{"annotation_id":"c89254a2-3112-4edc-8cd0-0df5c20519a8","file_hash":"684af3cf9f05e91bd02bc97fc037db6dfbe6a96726f277f755c6e8bc99641bfe","schema_id":"open/document-extraction","schema_version":"0.5.0","record":{"extraction_type":"boxes","producer":"pdf-extractor-v0.5.0","blocks":[{"id":"484c67c3-337a-4863-97a1-487cf96ee8cb","block_type":"box","text":"STATEMENT OF ADDITIONAL INFORMATION","page_number":1,"box":{"x":271,"y":83,"width":435,"height":11}},{"id":"e76e0039-7318-4900-b9e7-09e94f3426a1","block_type":"box","text":"BLACKROCK LARGE CAP SERIES FUNDS, INC.","page_number":1,"box":{"x":192,"y":120,"width":595,"height":17}},{"id":"a1ef749e-6dae-4e77-bb59-9abc95d05c38","block_type":"box","text":"BLACKROCK ADVANTAGE LARGE CAP VALUE FUND","page_number":1,"box":{"x":302,"y":149,"width":374,"height":9}},{"id":"39250f33-3397-4731-a2a7-ff5a468694d1","block_type":"box","text":"100 Bellevue Parkway, Wilmington, DE 19809 • Phone No. (800) 441-7762","page_number":1,"box":{"x":147,"y":176,"width":684,"height":14}},{"id":"fde2f3b7-f153-4b2d-a950-9b14ac7a0336","block_type":"box","text":"This Statement of Additional Information of BlackRock Advantage Large Cap Value Fund (the “Fund”), a","page_number":1,"box":{"x":101,"y":229,"width":789,"height":12}},{"id":"f548723a-0a6e-4317-90d8-998d3c4dad2f","block_type":"box","text":"series of BlackRock Large Cap Series Funds, Inc. (the “Corporation”), is not a prospectus and should be read in","page_number":1,"box":{"x":69,"y":242,"width":839,"height":12}},{"id":"c640e6de-27af-4b95-989d-8b97e9b7beaf","block_type":"box","text":"conjunction with the Prospectuses of the Fund, each dated September 28, 2026, as they may be amended or","page_number":1,"box":{"x":69,"y":255,"width":827,"height":12}},{"id":"9536c6c2-3445-4253-b4aa-10f19ecdc360","block_type":"box","text":"supplemented from time to time (the “Prospectuses”), which have been filed with the Securities and Exchange","page_number":1,"box":{"x":69,"y":268,"width":839,"height":12}},{"id":"e096e4d0-818d-4e68-b8be-cfdf6d5df616","block_type":"box","text":"Commission (the “Commission” or the “SEC”) and can be obtained, without charge, by calling (800) 441-7762","page_number":1,"box":{"x":70,"y":281,"width":836,"height":12}},{"id":"dd8447ca-afcb-4df0-b8bf-86e6404714b5","block_type":"box","text":"or by writing to the Fund at the above address. Part I of this Statement of Additional Information and the","page_number":1,"box":{"x":69,"y":294,"width":792,"height":12}},{"id":"63bea419-35fd-4464-b0ab-3ff6bfa9a03e","block_type":"box","text":"portions of Part II of this Statement of Additional Information that relate to the Fund have been incorporated","page_number":1,"box":{"x":70,"y":307,"width":824,"height":11}},{"id":"3880ac4c-ca0d-49ef-af51-a43575687f9c","block_type":"box","text":"by reference into the Fund’s Prospectuses. 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The audited financial statements of the Fund are incorporated into this Statement of Additional","page_number":1,"box":{"x":69,"y":358,"width":803,"height":12}},{"id":"d7be9875-0d0e-4d2e-9b39-c5c4487374af","block_type":"box","text":"Information by reference to the Fund’s Annual Financial Statements and Additional Information for the fiscal","page_number":1,"box":{"x":70,"y":371,"width":827,"height":12}},{"id":"60bd7d59-d115-4523-a33d-e24365d94672","block_type":"box","text":"year ended May 31, 2026, as filed with the SEC on Form N-CSR (the “2026 Annual Financial Statements”).","page_number":1,"box":{"x":68,"y":384,"width":809,"height":12}},{"id":"d3caad7d-c8c3-41df-9ce9-2826968578c5","block_type":"box","text":"You may request a copy of the 2026 Annual Financial Statements at no charge by calling (800) 441-7762","page_number":1,"box":{"x":68,"y":397,"width":804,"height":11}},{"id":"e34f8131-a440-4a9e-bad5-a157bc7064cb","block_type":"box","text":"between 8:00 a.m. and 6:00 p.m. Eastern time, on any business day.","page_number":1,"box":{"x":70,"y":410,"width":512,"height":11}},{"id":"7c8123e1-6b85-4f27-8b08-05d8cf479702","block_type":"box","text":"References to the Investment Company Act of 1940, as amended (the “Investment Company Act”), or","page_number":1,"box":{"x":103,"y":426,"width":767,"height":12}},{"id":"2637a84d-2965-4c6f-aa81-566eb5e3ff10","block_type":"box","text":"other applicable law, will include any rules promulgated thereunder and any guidance, interpretations or","page_number":1,"box":{"x":69,"y":439,"width":796,"height":12}},{"id":"7b3afe79-92aa-4266-a3d0-29f9511557a5","block_type":"box","text":"modifications by the Commission, Commission staff or other authority with appropriate jurisdiction, including","page_number":1,"box":{"x":70,"y":452,"width":837,"height":12}},{"id":"08378da2-3888-4a34-9dd6-92becf937575","block_type":"box","text":"court interpretations, and exemptive, no-action or other relief or permission from the Commission,","page_number":1,"box":{"x":69,"y":465,"width":749,"height":11}},{"id":"cd862e08-9a2f-4fad-9e6c-bdc12f8678c7","block_type":"box","text":"Commission staff or other authority.","page_number":1,"box":{"x":70,"y":478,"width":274,"height":11}},{"id":"c0dc88f3-d189-4662-b48c-08d9ab22e05f","block_type":"box","text":"Class","page_number":1,"box":{"x":69,"y":504,"width":31,"height":7}},{"id":"2483cb80-8fd9-4074-94fa-16f69af6e692","block_type":"box","text":"Ticker Symbol","page_number":1,"box":{"x":827,"y":504,"width":82,"height":9}},{"id":"0f17d08d-cfd4-4697-9b26-431bc9a5c05a","block_type":"box","text":"Investor A Shares","page_number":1,"box":{"x":70,"y":522,"width":124,"height":8}},{"id":"a1782eab-d0a2-4bfd-a01b-2c175827dd86","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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MALVX","page_number":1,"box":{"x":216,"y":552,"width":676,"height":9}},{"id":"82d3c6e5-020c-4a79-b92a-ebd07526861e","block_type":"box","text":"Class R Shares","page_number":1,"box":{"x":69,"y":567,"width":109,"height":9}},{"id":"ecfa3cc8-7517-49a7-875b-ded3e1295963","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MRLVX","page_number":1,"box":{"x":183,"y":567,"width":710,"height":9}},{"id":"d47341e2-f93a-4db6-b17b-1b9dcd1d2eeb","block_type":"box","text":"Class K Shares","page_number":1,"box":{"x":69,"y":582,"width":109,"height":9}},{"id":"8f506e75-a5fd-4bcd-8773-7e671563c020","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MLVKX","page_number":1,"box":{"x":183,"y":582,"width":710,"height":9}},{"id":"8101d5ff-8f20-4564-bc50-6a6c37739bc1","block_type":"box","text":"BlackRock Advisors, LLC — Manager","page_number":1,"box":{"x":260,"y":637,"width":460,"height":19}},{"id":"f979712b-13aa-4ab4-8ff3-6bbea4156dc1","block_type":"box","text":"BlackRock Investments, LLC — Distributor","page_number":1,"box":{"x":222,"y":659,"width":536,"height":18}},{"id":"7de359fe-a44b-4a87-bd64-82cb5f8e3ab8","block_type":"box","text":"The date of this Statement of Additional Information is September 28, 2026.","page_number":1,"box":{"x":199,"y":719,"width":579,"height":11}},{"id":"c4874ebb-79a0-4df3-8fe2-f035edb027a2","block_type":"box","text":"NM1026U-5979889-1/232","page_number":1,"box":{"x":764,"y":970,"width":141,"height":7}},{"id":"f316f4b0-91ad-46ae-a14d-af16a4909abd","block_type":"box","text":"TABLE OF CONTENTS","page_number":2,"box":{"x":411,"y":45,"width":155,"height":9}},{"id":"bf5bbb04-23ec-4ebf-8eb5-f76a0da72330","block_type":"box","text":"Page","page_number":2,"box":{"x":869,"y":73,"width":28,"height":9}},{"id":"be419bd7-ac1c-44fb-af5a-4547405bb390","block_type":"box","text":"PART I","page_number":2,"box":{"x":69,"y":92,"width":47,"height":9}},{"id":"58641f2f-99f7-4bcb-904a-e28c4e110d3c","block_type":"box","text":"Investment Objective and Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1","page_number":2,"box":{"x":70,"y":108,"width":839,"height":11}},{"id":"bf7bafdd-72d4-4559-b9b1-8222ffc70c5d","block_type":"box","text":"Investment Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-5","page_number":2,"box":{"x":70,"y":125,"width":839,"height":9}},{"id":"ba1f36ba-19ac-4b85-a1b6-376f800819da","block_type":"box","text":"Information on Directors and Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-7","page_number":2,"box":{"x":70,"y":141,"width":838,"height":9}},{"id":"e7ab9f11-b4a7-493c-a260-642086f7cd3a","block_type":"box","text":"Management, Advisory and Other Service Arrangements. . . . . . . . .","page_number":2,"box":{"x":70,"y":158,"width":469,"height":11}},{"id":"85b86d16-eceb-4c24-968d-f8a6adb1b1ba","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-18","page_number":2,"box":{"x":545,"y":158,"width":364,"height":8}},{"id":"6c58b03c-722c-4d27-a059-b19c4970a198","block_type":"box","text":"Information on Sales Charges and Distribution Related Expenses .","page_number":2,"box":{"x":70,"y":174,"width":469,"height":11}},{"id":"2f2b00c0-345d-41d5-9a42-076b8f2f7c90","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-23","page_number":2,"box":{"x":545,"y":174,"width":364,"height":9}},{"id":"d8721cf7-53e3-4cd7-8ce0-0848777f8e67","block_type":"box","text":"Computation of Offering Price Per Share . . . . . . . . . . . . . . . . . . . .","page_number":2,"box":{"x":69,"y":190,"width":446,"height":11}},{"id":"54d71fda-f3cf-43ad-8fb6-70d042d777b8","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-23","page_number":2,"box":{"x":521,"y":190,"width":388,"height":9}},{"id":"3ae68500-7437-4624-b4aa-b36892edd8b8","block_type":"box","text":"Portfolio Transactions and Brokerage . .","page_number":2,"box":{"x":69,"y":206,"width":283,"height":12}},{"id":"836a9281-17c5-4caf-8091-3c06beb16274","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-24","page_number":2,"box":{"x":358,"y":207,"width":551,"height":8}},{"id":"a1769079-7f36-4195-9fee-0868f1e9d77a","block_type":"box","text":"Additional Information. . . . . . . . . . . . . . . . . . .","page_number":2,"box":{"x":68,"y":223,"width":308,"height":9}},{"id":"fcf348e1-49d5-4ae9-920d-d5f996775d67","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-26","page_number":2,"box":{"x":382,"y":223,"width":527,"height":9}},{"id":"eeace995-ad69-44ba-b77d-13cbe720cf6d","block_type":"box","text":"Financial Statements","page_number":2,"box":{"x":70,"y":239,"width":148,"height":9}},{"id":"ef356b24-f5e1-4062-ab1a-9c367e28eb44","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-28","page_number":2,"box":{"x":227,"y":239,"width":682,"height":9}},{"id":"c12dfdb1-6e38-445f-aa69-1db9f2342eed","block_type":"box","text":"PART II","page_number":2,"box":{"x":69,"y":271,"width":52,"height":9}},{"id":"6568ed98-5c15-4956-898c-28a21819edfc","block_type":"box","text":"Investment Risks and Considerations . . . . . . . .","page_number":2,"box":{"x":70,"y":287,"width":330,"height":9}},{"id":"21045a82-1dc8-44ad-b28a-88b43283b5cf","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1","page_number":2,"box":{"x":407,"y":287,"width":502,"height":9}},{"id":"7863a182-eb99-4778-b6a8-04c6dfc3cbea","block_type":"box","text":"Management and Other Service Arrangements . . . . . . . . . . . . . . . .","page_number":2,"box":{"x":70,"y":304,"width":461,"height":11}},{"id":"80cf29fd-258e-4a8a-9b69-f9a11a6d7f02","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-82","page_number":2,"box":{"x":537,"y":304,"width":372,"height":9}},{"id":"6bec01d0-02e4-4295-a695-bf3e50a84bd1","block_type":"box","text":"Selective Disclosure of Portfolio Holdings. . . . . . . . . . . . . . . . . . .","page_number":2,"box":{"x":69,"y":320,"width":446,"height":11}},{"id":"5f6fd36c-8fa4-4671-9aba-ff0d007af272","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-84","page_number":2,"box":{"x":521,"y":320,"width":388,"height":9}},{"id":"df1eeb6d-2ff7-4c58-8351-cdbec4d30f0b","block_type":"box","text":"Purchase of Shares","page_number":2,"box":{"x":69,"y":336,"width":139,"height":9}},{"id":"dc9b074b-6e39-4279-b7d7-33c42a9161d4","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-97","page_number":2,"box":{"x":211,"y":336,"width":697,"height":9}},{"id":"4f8df24f-52f0-406c-9aae-f5ed3d4abbac","block_type":"box","text":"Redemption of Shares . .","page_number":2,"box":{"x":70,"y":353,"width":176,"height":11}},{"id":"128349b7-a6a0-4327-a5d5-20e1f4b3ebb9","block_type":"box","text":"........................................................................... I","page_number":2,"box":{"x":252,"y":353,"width":619,"height":9}},{"id":"607871e9-b767-4fbe-872c-12b89bcd591d","block_type":"box","text":"I-114","page_number":2,"box":{"x":874,"y":353,"width":35,"height":9}},{"id":"88af578d-f673-4946-8fed-5fa1a965caf4","block_type":"box","text":"Shareholder Services . .","page_number":2,"box":{"x":69,"y":369,"width":168,"height":9}},{"id":"875c9230-b890-43b2-876b-1488f4a4243f","block_type":"box","text":"............................................................................ 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I","page_number":2,"box":{"x":195,"y":386,"width":676,"height":8}},{"id":"eb1d7cac-1640-423b-a3ea-c5c970c05fe2","block_type":"box","text":"I-122","page_number":2,"box":{"x":874,"y":386,"width":35,"height":8}},{"id":"84a15e8f-4232-4c7a-8aa1-6d63e176798d","block_type":"box","text":"Portfolio Transactions and Brokerage . .","page_number":2,"box":{"x":69,"y":402,"width":283,"height":11}},{"id":"fe1151c7-ed2d-4633-95a4-597b9c6c2705","block_type":"box","text":".............................................................. I","page_number":2,"box":{"x":358,"y":402,"width":513,"height":9}},{"id":"03633c6c-da22-4d17-ab3f-1051bc9d4495","block_type":"box","text":"I-124","page_number":2,"box":{"x":874,"y":402,"width":35,"height":9}},{"id":"0b3b64b0-1ab0-41e8-ad92-ac30fde69a29","block_type":"box","text":"Dividends and Taxes . .","page_number":2,"box":{"x":70,"y":418,"width":159,"height":9}},{"id":"06b589a8-7980-48af-950f-e2b2c01c2f6f","block_type":"box","text":"............................................................................. 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I","page_number":2,"box":{"x":203,"y":435,"width":668,"height":8}},{"id":"13f198b7-c732-4a5a-b96d-10d33cfdb68a","block_type":"box","text":"I-137","page_number":2,"box":{"x":874,"y":435,"width":34,"height":9}},{"id":"75fbc191-687d-45d8-a2e1-c5166e77394b","block_type":"box","text":"Proxy Voting Policies and Procedures. . . . . . . . . . . . . . . . . . . . . .","page_number":2,"box":{"x":69,"y":451,"width":437,"height":11}},{"id":"4598365d-f140-4b63-a7de-15fea2db1934","block_type":"box","text":"........................................... I","page_number":2,"box":{"x":513,"y":451,"width":358,"height":9}},{"id":"13ce869f-40bd-44b8-8d37-1297dbd5ba11","block_type":"box","text":"I-139","page_number":2,"box":{"x":874,"y":451,"width":35,"height":9}},{"id":"d902ae06-e640-4478-bf78-6bd9b5628de4","block_type":"box","text":"General Information","page_number":2,"box":{"x":69,"y":467,"width":140,"height":9}},{"id":"39ab6cdb-eed5-4bff-a625-3e24fed1b434","block_type":"box","text":"............................................................................... 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Certain of the restrictions are fundamental policies of the Fund and may not be changed","page_number":7,"box":{"x":69,"y":877,"width":809,"height":12}},{"id":"ddf8554e-ecb4-4015-b02e-d97b390f3a4b","block_type":"box","text":"without the approval of the holders of a majority of the Fund’s outstanding voting securities (which for this purpose","page_number":7,"box":{"x":68,"y":892,"width":818,"height":12}},{"id":"15cfa3db-0f5b-45e3-b1f9-19854154e0f3","block_type":"box","text":"and under the Investment Company Act, means the lesser of (i) 67% of the shares represented at a meeting at which","page_number":7,"box":{"x":69,"y":908,"width":836,"height":11}},{"id":"08e34464-7285-4299-8dc1-e9857e93732f","block_type":"box","text":"I-5","page_number":7,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"d3fc392f-c8a1-4d8f-949d-7c5ec5cfb50b","block_type":"box","text":"NM1026U-5979889-7/232","page_number":7,"box":{"x":764,"y":970,"width":141,"height":7}},{"id":"4c73ae8c-cbb8-428d-b97a-64f3b3a157cf","block_type":"box","text":"more than 50% of the outstanding shares are represented or (ii) more than 50% of the outstanding shares). The","page_number":8,"box":{"x":69,"y":45,"width":799,"height":11}},{"id":"7cc0e8b2-adfa-4bf7-8b99-2ddd9bccb45f","block_type":"box","text":"Corporation, on behalf of the Fund, has also adopted certain non-fundamental investment restrictions, which may be","page_number":8,"box":{"x":69,"y":60,"width":830,"height":11}},{"id":"254c84cc-7e33-47fd-9230-3093e27ac6ad","block_type":"box","text":"changed by the Board without shareholder approval. None of the following fundamental or non-fundamental","page_number":8,"box":{"x":69,"y":75,"width":761,"height":11}},{"id":"ed4d9d6f-964b-475e-b947-1e4f06dab37b","block_type":"box","text":"investment restrictions shall prevent the Fund from investing all of its assets in shares of another registered","page_number":8,"box":{"x":70,"y":90,"width":772,"height":11}},{"id":"a5aead59-fc1e-41df-9734-fa1dbadd539a","block_type":"box","text":"investment company with the same investment objective and fundamental policies (in a master/feeder structure).","page_number":8,"box":{"x":70,"y":105,"width":809,"height":11}},{"id":"22a9316d-8ce2-4e86-b5e9-b6295a248604","block_type":"box","text":"Set forth below are the Fund’s fundamental and non-fundamental investment restrictions. Unless otherwise","page_number":8,"box":{"x":102,"y":128,"width":767,"height":9}},{"id":"fa9357ac-5c5a-4be1-aa8b-08d0737bc445","block_type":"box","text":"provided, all references below to the assets of the Fund are in terms of current market value.","page_number":8,"box":{"x":70,"y":143,"width":664,"height":11}},{"id":"185fd031-d642-4c1e-a088-07053dbf9042","block_type":"box","text":"Under its fundamental investment restrictions, the Fund may not:","page_number":8,"box":{"x":102,"y":166,"width":463,"height":11}},{"id":"beb9a740-9c3e-44e0-a282-b00bf11112b4","block_type":"box","text":"(1) Make any investment inconsistent with the Fund’s classification as a diversified company under the","page_number":8,"box":{"x":102,"y":188,"width":733,"height":11}},{"id":"a07e86c1-dac2-426c-b828-47e023823932","block_type":"box","text":"Investment Company Act.","page_number":8,"box":{"x":70,"y":203,"width":178,"height":12}},{"id":"21e74db6-8641-4a7c-9d96-cb94456ddec7","block_type":"box","text":"(2) Invest more than 25% of its assets, taken at market value, in the securities of issuers in any particular","page_number":8,"box":{"x":102,"y":226,"width":759,"height":11}},{"id":"f7be0d6b-49e0-4409-8a04-dcd987e79afd","block_type":"box","text":"industry (excluding the U.S. Government and its agencies and instrumentalities).","page_number":8,"box":{"x":70,"y":241,"width":573,"height":11}},{"id":"f7a4189e-3f66-4d61-8a03-95ffe28736b3","block_type":"box","text":"(3) Make investments for the purpose of exercising control or management. Investments by the Fund in wholly","page_number":8,"box":{"x":102,"y":264,"width":784,"height":11}},{"id":"76a6db03-2cb2-4c24-a158-929ff34fcff1","block_type":"box","text":"owned investment entities created under the laws of certain countries will not be deemed the making of investments","page_number":8,"box":{"x":69,"y":279,"width":833,"height":11}},{"id":"501087c6-d2eb-4595-9a95-7684346fd9d1","block_type":"box","text":"for the purpose of exercising control or management.","page_number":8,"box":{"x":68,"y":294,"width":378,"height":11}},{"id":"c57b0d77-0699-4166-af9c-064a84a28710","block_type":"box","text":"(4) Purchase or sell real estate, except that, to the extent permitted by applicable law, the Fund may invest in","page_number":8,"box":{"x":102,"y":317,"width":778,"height":11}},{"id":"f511f0ae-382e-4ccb-9110-66ebd75b2008","block_type":"box","text":"securities directly or indirectly secured by real estate or interests therein or issued by companies that invest in real","page_number":8,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"0e8e7ad2-385a-47c1-a674-2ec100365028","block_type":"box","text":"estate or interests therein.","page_number":8,"box":{"x":69,"y":347,"width":190,"height":9}},{"id":"0754c217-8480-494c-b2c3-70d5de5fcd36","block_type":"box","text":"(5) Make loans to other persons, except that the acquisition of bonds, debentures or other corporate debt","page_number":8,"box":{"x":102,"y":370,"width":755,"height":11}},{"id":"7dd48a8e-befc-48f1-abd5-a582dad36805","block_type":"box","text":"securities and investment in governmental obligations, commercial paper, pass-through instruments, certificates of","page_number":8,"box":{"x":69,"y":385,"width":823,"height":11}},{"id":"794a33fd-b419-42cc-b4f5-1e4604e4f497","block_type":"box","text":"deposit, bankers’ acceptances, repurchase agreements or any similar instruments shall not be deemed to be the","page_number":8,"box":{"x":69,"y":400,"width":809,"height":11}},{"id":"f360b5d0-c449-4917-82f1-07c0fcde4b67","block_type":"box","text":"making of a loan, and except further that the Fund may lend its portfolio securities, provided that the lending of","page_number":8,"box":{"x":69,"y":415,"width":795,"height":11}},{"id":"3ffcc437-bbf2-4bbb-84c7-e08807ef8bdb","block_type":"box","text":"portfolio securities may be made only in accordance with applicable law and the guidelines set forth in the Fund’s","page_number":8,"box":{"x":70,"y":430,"width":810,"height":11}},{"id":"8cd0bc7a-6362-451f-930f-b83d89906dea","block_type":"box","text":"Prospectuses and SAI, as they may be amended from time to time.","page_number":8,"box":{"x":69,"y":445,"width":477,"height":11}},{"id":"535427fa-83e8-46fc-b19c-313a20a1481b","block_type":"box","text":"(6) Issue senior securities to the extent such issuance would violate applicable law.","page_number":8,"box":{"x":102,"y":468,"width":594,"height":11}},{"id":"13498bc8-b276-4409-915a-0ad5f7e7abf8","block_type":"box","text":"(7) Borrow money, except that (i) the Fund may borrow from banks (as defined in the Investment Company Act) in","page_number":8,"box":{"x":102,"y":491,"width":804,"height":11}},{"id":"f0d7d1d0-6c05-4719-8c19-b04c9505bbec","block_type":"box","text":"amounts up to 33","page_number":8,"box":{"x":69,"y":506,"width":127,"height":11}},{"id":"d114c66f-3514-47c9-ae96-8f645542a316","block_type":"box","text":"1⁄","page_number":8,"box":{"x":197,"y":506,"width":6,"height":5}},{"id":"88bd31bc-809e-4c2d-9fcc-7410afbd71fc","block_type":"box","text":"1⁄3","page_number":8,"box":{"x":201,"y":506,"width":8,"height":9}},{"id":"627e01bf-88cf-4cc3-94bd-cf8a9ce0f7ea","block_type":"box","text":"⁄3","page_number":8,"box":{"x":206,"y":509,"width":6,"height":6}},{"id":"a7a65136-7154-475f-b588-6055393266d8","block_type":"box","text":"% of its total assets (including the amount borrowed), (ii) the Fund may borrow up to an","page_number":8,"box":{"x":213,"y":506,"width":621,"height":11}},{"id":"b6f67193-e4c8-4914-9d62-d51b26249058","block_type":"box","text":"additional 5% of its total assets for temporary purposes, (iii) the Fund may obtain such short term credit as may be","page_number":8,"box":{"x":69,"y":521,"width":822,"height":11}},{"id":"ca8ee32e-a00f-4426-a25a-5d1c241a41f6","block_type":"box","text":"necessary for the clearance of purchases and sales of portfolio securities and (iv) the Fund may purchase securities","page_number":8,"box":{"x":69,"y":536,"width":830,"height":11}},{"id":"b6451b4d-5717-4521-929c-ea0577ce0c96","block_type":"box","text":"on margin to the extent permitted by applicable law. The Fund may not pledge its assets other than to secure such","page_number":8,"box":{"x":69,"y":551,"width":817,"height":11}},{"id":"a4137b38-0ee7-4c87-a035-76d88002fea2","block_type":"box","text":"borrowings or, to the extent permitted by the Fund’s investment policies as set forth in the Fund’s Prospectuses and","page_number":8,"box":{"x":69,"y":566,"width":832,"height":11}},{"id":"ca88df37-272a-41f0-8069-b5da4388b093","block_type":"box","text":"SAI, as they may be amended from time to time, in connection with hedging transactions, short sales, when issued","page_number":8,"box":{"x":69,"y":581,"width":822,"height":12}},{"id":"d918bdd9-8ce2-4c9b-8d86-0ea6ddcb063f","block_type":"box","text":"and forward commitment transactions and similar investment strategies.","page_number":8,"box":{"x":69,"y":596,"width":518,"height":12}},{"id":"3c3f03bd-253e-4085-846a-77db4767819d","block_type":"box","text":"(8) Underwrite securities of other issuers except insofar as the Fund technically may be deemed an underwriter","page_number":8,"box":{"x":102,"y":619,"width":794,"height":11}},{"id":"d7c244ca-7a57-4693-a2e7-95f21bb43e80","block_type":"box","text":"under the Securities Act of 1933, as amended (the “Securities Act”), in selling portfolio securities.","page_number":8,"box":{"x":69,"y":634,"width":703,"height":12}},{"id":"3ea673cd-13d6-4aa2-93a9-22bba7107141","block_type":"box","text":"(9) Purchase or sell commodities or contracts on commodities, except to the extent that the Fund may do so in","page_number":8,"box":{"x":102,"y":657,"width":790,"height":11}},{"id":"500227f2-e2e0-4b1b-a92b-593e45f86705","block_type":"box","text":"accordance with applicable law and the Fund’s Prospectuses and SAI, as they may be amended from time to time,","page_number":8,"box":{"x":69,"y":672,"width":815,"height":11}},{"id":"e0e9b71c-3d35-4716-9b22-b55909d805ea","block_type":"box","text":"and without registering as a commodity pool operator under the CEA.","page_number":8,"box":{"x":69,"y":687,"width":489,"height":11}},{"id":"76c9c70a-4300-4b46-9003-b7dae5aa28b8","block_type":"box","text":"Under its non-fundamental investment restrictions, which may be changed by the Board without shareholder","page_number":8,"box":{"x":102,"y":710,"width":768,"height":11}},{"id":"e925885c-b4da-4de7-bb3a-c407241aee1d","block_type":"box","text":"approval, the Fund may not:","page_number":8,"box":{"x":69,"y":725,"width":197,"height":11}},{"id":"8c5af264-3bb1-4553-af08-a7badede2add","block_type":"box","text":"(a) Purchase securities of other investment companies, except to the extent permitted by the Investment","page_number":8,"box":{"x":102,"y":748,"width":747,"height":11}},{"id":"7773bf4b-9fee-4689-8406-cb9e226ab408","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":8,"box":{"x":69,"y":763,"width":759,"height":11}},{"id":"10d63d01-9e69-4312-b8b9-17cf3cf4f9a7","block_type":"box","text":"investment company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the “fund of funds”","page_number":8,"box":{"x":70,"y":778,"width":829,"height":11}},{"id":"ff9fca5f-94af-48c0-97f2-513391cef021","block_type":"box","text":"provisions) of the Investment Company Act, at any time the Fund has knowledge that its shares are purchased by","page_number":8,"box":{"x":70,"y":793,"width":808,"height":11}},{"id":"e79d34d1-0b95-4ec2-975c-73fba7139c51","block_type":"box","text":"another investment company in reliance on the provisions of subparagraph (G) of Section 12(d)(1).","page_number":8,"box":{"x":69,"y":808,"width":701,"height":11}},{"id":"12229433-3089-41d0-b312-860b24f02962","block_type":"box","text":"(b) Make short sales of securities or maintain a short position, except to the extent permitted by the Fund’s","page_number":8,"box":{"x":102,"y":831,"width":770,"height":11}},{"id":"b2b48519-8a5a-4636-b347-b6099debc467","block_type":"box","text":"Prospectuses and SAI, as amended from time to time, and applicable law.","page_number":8,"box":{"x":69,"y":846,"width":527,"height":11}},{"id":"869d744c-ae8c-4fa8-9086-a32092458f45","block_type":"box","text":"Except with respect to fundamental investment restriction (7) or with respect to policies adopted pursuant to","page_number":8,"box":{"x":102,"y":869,"width":773,"height":11}},{"id":"62337a5a-6f3d-4ab7-8d82-b75c407dab6b","block_type":"box","text":"Rule 35d-1 of the Investment Company Act, all limitations under the Fund’s fundamental or non-fundamental","page_number":8,"box":{"x":70,"y":884,"width":771,"height":11}},{"id":"38e7e405-f26c-491f-aa40-2a67a07d4226","block_type":"box","text":"investment restrictions apply only at the time that a transaction is undertaken. Any change in the percentage of the","page_number":8,"box":{"x":70,"y":899,"width":821,"height":11}},{"id":"8433122b-3e80-40f6-80ab-9044436a053a","block_type":"box","text":"I-6","page_number":8,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"3e9f9c51-18e0-4712-94f1-c4489ae9e024","block_type":"box","text":"NM1026U-5979889-8/232","page_number":8,"box":{"x":764,"y":970,"width":141,"height":7}},{"id":"2515e341-d7c8-4cf0-a8ce-a2af489c02c6","block_type":"box","text":"Fund’s assets invested in certain securities or other instruments resulting from market fluctuations or other changes","page_number":9,"box":{"x":70,"y":45,"width":833,"height":11}},{"id":"7327bd4a-7a3a-4c7c-a644-f7c51f922c9c","block_type":"box","text":"in the Fund’s total assets will not require the Fund to dispose of an investment until BlackRock determines that it is","page_number":9,"box":{"x":70,"y":60,"width":826,"height":11}},{"id":"17727058-e27c-4c3f-9fbf-a98b9a855f2a","block_type":"box","text":"practicable to sell or close out the investment without undue market or tax consequences.","page_number":9,"box":{"x":70,"y":75,"width":642,"height":11}},{"id":"47de97aa-82df-4450-a5a5-157ec4a92ae5","block_type":"box","text":"For purposes of fundamental investment restriction (2) above, with respect to the Fund’s industry classifications,","page_number":9,"box":{"x":102,"y":98,"width":805,"height":11}},{"id":"e6bbd86d-9c9a-4c0a-a19b-cfd2add4a621","block_type":"box","text":"the Fund currently utilizes any one or more of the industry sub-classifications used by one or more widely recognized","page_number":9,"box":{"x":68,"y":113,"width":829,"height":11}},{"id":"9cabcc3d-1b13-41c7-b468-746b74024835","block_type":"box","text":"market indexes or rating group indexes, and/or as defined by Fund management. The policy also will be interpreted to","page_number":9,"box":{"x":69,"y":128,"width":839,"height":11}},{"id":"242a9cdd-42b8-4155-814b-a2079bb1479c","block_type":"box","text":"give broad authority to the Fund as to how to classify issuers within or among industries.","page_number":9,"box":{"x":68,"y":143,"width":631,"height":11}},{"id":"eeec3e40-0ada-42d5-a807-3e9029a2ed9e","block_type":"box","text":"In addition, as a non-fundamental policy that may be changed by the Directors (as defined below) and to the","page_number":9,"box":{"x":102,"y":166,"width":768,"height":11}},{"id":"5ab445d7-fc08-496d-8011-0c8cb55b33ea","block_type":"box","text":"extent required by the Commission or its staff, the Fund will, for purposes of fundamental investment restriction (1),","page_number":9,"box":{"x":69,"y":181,"width":827,"height":11}},{"id":"781823c2-af92-403f-aaa6-5813cf07d409","block_type":"box","text":"treat securities issued or guaranteed by the government of any one foreign country as the obligations of a single","page_number":9,"box":{"x":68,"y":196,"width":803,"height":11}},{"id":"64bec0ac-09db-4467-8517-09d876e5c2ef","block_type":"box","text":"issuer.","page_number":9,"box":{"x":70,"y":211,"width":45,"height":9}},{"id":"cbda9675-2bbe-4a43-9516-24430cb9d00a","block_type":"box","text":"III. Information on Directors and Officers","page_number":9,"box":{"x":69,"y":241,"width":294,"height":9}},{"id":"6cee1283-e061-4174-9458-e7c48ded6eca","block_type":"box","text":"The Board consists of fifteen individuals (each, a “Director”), thirteen of whom are not “interested persons” of","page_number":9,"box":{"x":101,"y":264,"width":790,"height":11}},{"id":"5527011b-2518-4ab1-8d46-13568fec6c68","block_type":"box","text":"the Corporation as defined in the Investment Company Act (the “Independent Directors”). The registered investment","page_number":9,"box":{"x":68,"y":279,"width":828,"height":11}},{"id":"f9b71bb2-b13f-44eb-a4df-7499989ec34f","block_type":"box","text":"companies advised by the Manager or its affiliates (the “BlackRock-advised Funds”) are organized into the BlackRock","page_number":9,"box":{"x":69,"y":294,"width":837,"height":11}},{"id":"b05d4745-fc64-4724-9913-f6c623da1bab","block_type":"box","text":"Multi-Asset Complex, the BlackRock Fixed-Income Complex, and the iShares Complex (each, a “BlackRock Fund","page_number":9,"box":{"x":70,"y":309,"width":793,"height":11}},{"id":"261a2bda-7ed2-4a42-850c-420673bc4e45","block_type":"box","text":"Complex”). The Corporation is included in the BlackRock Fund Complex referred to as the BlackRock Multi-Asset","page_number":9,"box":{"x":69,"y":324,"width":799,"height":11}},{"id":"15727a41-f9ca-458f-b65e-069fea010179","block_type":"box","text":"Complex. The Directors also oversee as board members the operations of the other open-end registered investment","page_number":9,"box":{"x":69,"y":339,"width":827,"height":12}},{"id":"a5dc8196-a991-498a-be09-b80281647931","block_type":"box","text":"companies included in the BlackRock Multi-Asset Complex.","page_number":9,"box":{"x":69,"y":355,"width":418,"height":11}},{"id":"cc4225f3-bfb5-413f-9626-45097a98a9f8","block_type":"box","text":"The Board has overall responsibility for the oversight of the Corporation and the Fund. The Chair of the Board is","page_number":9,"box":{"x":101,"y":377,"width":794,"height":12}},{"id":"7d5acf05-531d-4049-a38c-83e14030034c","block_type":"box","text":"an Independent Director, and the Chair of each Board committee (each, a “Committee”) is an Independent Director.","page_number":9,"box":{"x":69,"y":392,"width":823,"height":11}},{"id":"7d473dca-a102-4fea-9fae-6e35157d7234","block_type":"box","text":"The Board has five standing Committees: an Audit Committee, a Governance and Nominating Committee, a","page_number":9,"box":{"x":68,"y":407,"width":766,"height":12}},{"id":"60e13257-f8bf-4150-a79f-55edbe90de61","block_type":"box","text":"Compliance Committee, a Performance Oversight Committee and an Ad Hoc Topics Committee. The role of the Chair","page_number":9,"box":{"x":69,"y":423,"width":831,"height":11}},{"id":"39893976-3362-4d49-b465-3ec544e54e84","block_type":"box","text":"of the Board is to preside at all meetings of the Board and to act as a liaison with service providers, officers,","page_number":9,"box":{"x":69,"y":438,"width":778,"height":11}},{"id":"11c8c7cd-e4d2-4440-b03e-f40250436975","block_type":"box","text":"attorneys and other Directors generally between meetings. The Chair of each Committee performs a similar role with","page_number":9,"box":{"x":69,"y":453,"width":830,"height":11}},{"id":"a1fc7344-a116-495c-a85f-17fd92230f78","block_type":"box","text":"respect to the Committee. The Chair of the Board or the Chair of a Committee may also perform such other functions","page_number":9,"box":{"x":69,"y":468,"width":836,"height":11}},{"id":"f043d650-88b9-4e5e-8b97-9c6edad950a0","block_type":"box","text":"as may be delegated by the Board or the Committee from time to time. The Independent Directors meet regularly","page_number":9,"box":{"x":69,"y":483,"width":805,"height":11}},{"id":"e496182b-aa57-4a9f-9946-409892659d8b","block_type":"box","text":"outside the presence of Fund management, in executive session or with other service providers to the Fund. The","page_number":9,"box":{"x":69,"y":498,"width":802,"height":11}},{"id":"4ff500e8-3dd6-4a19-8b5a-33d1f7f699b9","block_type":"box","text":"Board has regular meetings five times a year, and may hold special meetings if required before its next regular","page_number":9,"box":{"x":70,"y":513,"width":788,"height":12}},{"id":"b3714a66-d604-4f91-93b9-8cf111fef126","block_type":"box","text":"meeting. Each Committee meets regularly to conduct the oversight functions delegated to that Committee by the","page_number":9,"box":{"x":69,"y":528,"width":802,"height":12}},{"id":"f4cc953a-42c8-48f5-9a35-ed590d5e9d23","block_type":"box","text":"Board and reports its findings to the Board. The Board and each standing Committee conduct annual assessments","page_number":9,"box":{"x":70,"y":543,"width":821,"height":12}},{"id":"434301f7-1f47-42b1-b1a3-fef79ff3e662","block_type":"box","text":"of their oversight function and structure. The Board has determined that the Board’s leadership structure is","page_number":9,"box":{"x":69,"y":559,"width":767,"height":11}},{"id":"f615ec52-982a-492b-8108-b37524a04405","block_type":"box","text":"appropriate because it allows the Board to exercise independent judgment over management and to allocate areas of","page_number":9,"box":{"x":69,"y":574,"width":839,"height":11}},{"id":"5a009921-1915-46e9-9948-bb332030b202","block_type":"box","text":"responsibility among Committees and the full Board to enhance effective oversight.","page_number":9,"box":{"x":69,"y":589,"width":593,"height":11}},{"id":"c9333e99-b2fa-4c3d-9ab2-3ee69f03d7c1","block_type":"box","text":"The Board has engaged the Manager to manage the Fund on a day-to-day basis. The Board is responsible for","page_number":9,"box":{"x":101,"y":612,"width":777,"height":11}},{"id":"c99a1821-c0e3-4efd-b7a5-569231f8a303","block_type":"box","text":"overseeing the Manager, other service providers, the operations of the Fund and associated risks in accordance with","page_number":9,"box":{"x":69,"y":627,"width":832,"height":11}},{"id":"5b964556-c336-4276-b24e-0b83f43c0a0f","block_type":"box","text":"the provisions of the Investment Company Act, state law, other applicable laws, the Corporation’s charter, and the","page_number":9,"box":{"x":68,"y":642,"width":815,"height":11}},{"id":"27c40e80-5e59-4126-b5b5-46297683ba98","block_type":"box","text":"Fund’s investment objective and strategies. The Board reviews, on an ongoing basis, the Fund’s performance,","page_number":9,"box":{"x":70,"y":657,"width":784,"height":11}},{"id":"b6fc1ad9-2fc5-46eb-9548-24342b98b2f8","block_type":"box","text":"operations and investment strategies and techniques. The Board also conducts reviews of the Manager and its role","page_number":9,"box":{"x":69,"y":672,"width":823,"height":11}},{"id":"07f9a4ae-6bb4-4ec8-aef7-a6b336629e81","block_type":"box","text":"in running the operations of the Fund.","page_number":9,"box":{"x":70,"y":687,"width":266,"height":11}},{"id":"09c460ad-6c04-43a3-9e27-cd62f1531246","block_type":"box","text":"Day-to-day risk management with respect to the Fund is the responsibility of the Manager or of sub-advisers or","page_number":9,"box":{"x":102,"y":710,"width":785,"height":11}},{"id":"a3450280-626b-41e1-a6b5-b4ef842a0edd","block_type":"box","text":"other service providers (depending on the nature of the risk), subject to the supervision of the Manager. The Fund is","page_number":9,"box":{"x":69,"y":725,"width":828,"height":11}},{"id":"b5d5eaae-3b60-4476-97c5-e46e7fff0fbd","block_type":"box","text":"subject to a number of risks, including investment, compliance, operational and valuation risks, among others. While","page_number":9,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"fa21177c-b7cb-463e-99e7-1986094a3bc3","block_type":"box","text":"there are a number of risk management functions performed by the Manager and the sub-advisers or other service","page_number":9,"box":{"x":68,"y":755,"width":820,"height":11}},{"id":"88027fa1-db90-48fc-b475-e9216d4548ba","block_type":"box","text":"providers, as applicable, it is not possible to eliminate all of the risks applicable to the Fund. Risk oversight forms","page_number":9,"box":{"x":70,"y":770,"width":811,"height":12}},{"id":"21759c12-f172-4409-923a-c48beede0c81","block_type":"box","text":"part of the Board’s general oversight of the Fund and is addressed as part of various Board and Committee","page_number":9,"box":{"x":70,"y":785,"width":767,"height":12}},{"id":"38e4bf80-e931-469b-99b6-d7e600b6c35f","block_type":"box","text":"activities. The Board, directly or through a Committee, also reviews reports from, among others, management, the","page_number":9,"box":{"x":69,"y":801,"width":815,"height":11}},{"id":"75810518-6e3d-42db-90c3-7e3e577cd986","block_type":"box","text":"independent registered public accounting firm for the Fund, sub-advisers and internal auditors for the investment","page_number":9,"box":{"x":70,"y":816,"width":803,"height":11}},{"id":"3c2ff130-02b1-4edf-9ba5-6f2c6fc574a3","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":9,"box":{"x":69,"y":831,"width":840,"height":11}},{"id":"19fff7f1-801c-4c81-ac53-43135480e6fa","block_type":"box","text":"risk functions. The Committee system facilitates the timely and efficient consideration of matters by the Directors,","page_number":9,"box":{"x":69,"y":846,"width":814,"height":11}},{"id":"9b3d9c2b-4e33-4a74-a33b-d9c9970d9b88","block_type":"box","text":"and facilitates effective oversight of compliance with legal and regulatory requirements and of the Fund’s activities","page_number":9,"box":{"x":69,"y":861,"width":817,"height":11}},{"id":"ac48264f-d107-4ff3-8c29-3e914c7db8b3","block_type":"box","text":"and associated risks. The Board has appointed a Chief Compliance Officer, who oversees the implementation and","page_number":9,"box":{"x":69,"y":876,"width":812,"height":11}},{"id":"60bba8af-632f-4c0c-a847-65633af7045d","block_type":"box","text":"testing of the Corporation’s compliance program and reports to the Board regarding compliance matters for the Fund","page_number":9,"box":{"x":68,"y":891,"width":834,"height":12}},{"id":"c23fb3e4-0330-4051-9efa-a13164aa68b9","block_type":"box","text":"I-7","page_number":9,"box":{"x":481,"y":943,"width":16,"height":9}},{"id":"a9b9816c-8515-4b79-aec0-cab9eafeaaea","block_type":"box","text":"NM1026U-5979889-9/232","page_number":9,"box":{"x":764,"y":970,"width":141,"height":7}},{"id":"57d887f6-7955-4691-9a81-7e2e4b8763db","block_type":"box","text":"and its service providers. The Independent Directors have engaged independent legal counsel to assist them in","page_number":10,"box":{"x":69,"y":45,"width":794,"height":11}},{"id":"b6707204-8310-4af5-a9c1-7b323fe30d85","block_type":"box","text":"performing their oversight responsibilities.","page_number":10,"box":{"x":70,"y":60,"width":299,"height":11}},{"id":"def3c3ad-e9c6-4ac6-bf9e-7b4614c0676e","block_type":"box","text":"Audit Committee.","page_number":10,"box":{"x":101,"y":83,"width":122,"height":8}},{"id":"52afc98f-88b2-48aa-89ce-f332d19b4062","block_type":"box","text":"The members of the Audit Committee (the “Audit Committee”) are Henry R. Keizer (Chair), Neil","page_number":10,"box":{"x":229,"y":82,"width":673,"height":12}},{"id":"5df11fad-dd3c-4c24-8a8a-8eb568b1d5fd","block_type":"box","text":"A. Cotty, Jeffrey Jarczyk, Lori Richards, Kenneth L. Urish and Claire A. Walton, all of whom are Independent Directors.","page_number":10,"box":{"x":68,"y":98,"width":834,"height":11}},{"id":"1dce11b8-4caf-43f3-88e3-9b588bd64916","block_type":"box","text":"The principal responsibilities of the Audit Committee are to approve, and recommend to the full Board for approval,","page_number":10,"box":{"x":68,"y":113,"width":820,"height":11}},{"id":"c345dde4-d594-45d7-8402-18b3b43d06b5","block_type":"box","text":"the selection, retention, termination and compensation of the Fund’s independent registered public accounting firm","page_number":10,"box":{"x":68,"y":128,"width":823,"height":11}},{"id":"ee831c01-799f-490f-a5b2-aa5395ed018b","block_type":"box","text":"(the “Independent Registered Public Accounting Firm”) and to oversee the Independent Registered Public Accounting","page_number":10,"box":{"x":69,"y":143,"width":830,"height":11}},{"id":"55962ee2-7e56-41e3-80d6-2bd297a8964d","block_type":"box","text":"Firm’s work. The Audit Committee’s responsibilities include, without limitation, to (1) evaluate the qualifications and","page_number":10,"box":{"x":70,"y":158,"width":825,"height":11}},{"id":"61d918e7-471f-4eb8-be18-96118ebfe670","block_type":"box","text":"independence of the Independent Registered Public Accounting Firm; (2) approve all audit engagement terms and","page_number":10,"box":{"x":70,"y":173,"width":807,"height":11}},{"id":"fc1629b6-3a19-4815-9b91-278a8b8fd7a1","block_type":"box","text":"fees for the Fund; (3) review the conduct and results of each independent audit of the Fund’s annual financial","page_number":10,"box":{"x":68,"y":188,"width":781,"height":11}},{"id":"20466961-f392-4e96-b281-fed201eadc51","block_type":"box","text":"statements; (4) review any issues raised by the Independent Registered Public Accounting Firm or Fund management","page_number":10,"box":{"x":69,"y":204,"width":834,"height":11}},{"id":"3880372f-d74f-4f4e-a6df-0c8a36ff5d8f","block_type":"box","text":"regarding the accounting or financial reporting policies and practices of the Fund and the internal controls of the Fund","page_number":10,"box":{"x":69,"y":218,"width":838,"height":12}},{"id":"ed75bca5-27af-4975-aea3-35c664edd88d","block_type":"box","text":"and certain service providers; (5) oversee the performance of the Fund’s Independent Registered Public Accounting","page_number":10,"box":{"x":69,"y":234,"width":825,"height":11}},{"id":"d60dd610-90ad-485d-b717-21532a35ab6d","block_type":"box","text":"Firm; (6) review and discuss with management and the Fund’s Independent Registered Public Accounting Firm the","page_number":10,"box":{"x":70,"y":249,"width":809,"height":11}},{"id":"1f51285a-ff6c-4812-bc0c-fb11f5e4a54c","block_type":"box","text":"performance and findings of the Fund’s internal auditors; (7) discuss with Fund management its policies regarding","page_number":10,"box":{"x":70,"y":264,"width":815,"height":11}},{"id":"bf2751fe-6b91-4169-a88f-80477f3d427f","block_type":"box","text":"risk assessment and risk management as such matters relate to the Fund’s financial reporting and controls;","page_number":10,"box":{"x":69,"y":279,"width":774,"height":11}},{"id":"69079de5-384b-4960-8ca5-dc184b388ccd","block_type":"box","text":"(8) resolve any disagreements between Fund management and the Independent Registered Public Accounting Firm","page_number":10,"box":{"x":69,"y":294,"width":815,"height":11}},{"id":"045f31a3-31c5-4d3a-ae3f-fcfdecc15739","block_type":"box","text":"regarding financial reporting; and (9) undertake such other duties and responsibilities as may from time to time be","page_number":10,"box":{"x":69,"y":309,"width":819,"height":11}},{"id":"c9249da3-4ae6-4009-b11e-b94c2dadaa89","block_type":"box","text":"delegated by the Board to the Audit Committee. The Board has adopted a written charter for the Audit Committee.","page_number":10,"box":{"x":69,"y":324,"width":812,"height":12}},{"id":"fc8dccfd-a45f-4a56-8b53-e09a213d48d8","block_type":"box","text":"During the fiscal year ended May 31, 2026, the Audit Committee met four times.","page_number":10,"box":{"x":70,"y":339,"width":574,"height":12}},{"id":"36cef3bb-ba8b-4220-8903-c29a512dcfd1","block_type":"box","text":"Governance and Nominating Committee.","page_number":10,"box":{"x":102,"y":362,"width":286,"height":11}},{"id":"c861942c-438f-4bbc-808a-1d0869c80d64","block_type":"box","text":"The members of the Governance and Nominating Committee (the","page_number":10,"box":{"x":394,"y":362,"width":464,"height":11}},{"id":"5ce0f18e-2051-4063-b934-87524252d82e","block_type":"box","text":"“Governance Committee”) are Cynthia A. Montgomery (Chair), Christopher J. Ailman, Susan J. Carter, Collette Chilton,","page_number":10,"box":{"x":70,"y":377,"width":838,"height":12}},{"id":"15c10ad1-3ddd-40b7-b4a4-23ba80fb3016","block_type":"box","text":"Henry R. Keizer and Marc D. Stern, all of whom are Independent Directors. The principal responsibilities of the","page_number":10,"box":{"x":70,"y":392,"width":786,"height":12}},{"id":"e7b0b8f0-d459-4119-a406-f6bae5b24b7b","block_type":"box","text":"Governance Committee are to (1) identify individuals qualified to serve as Independent Directors of the Corporation","page_number":10,"box":{"x":69,"y":407,"width":821,"height":12}},{"id":"d84295a1-7fe0-4df8-8b8f-a759e2ca3c5a","block_type":"box","text":"and recommend Independent Director nominees for election by shareholders or appointment by the Board; (2) advise","page_number":10,"box":{"x":69,"y":423,"width":835,"height":11}},{"id":"870b99aa-65b2-492a-a829-45f531b300b4","block_type":"box","text":"the Board with respect to Board composition, procedures and committees (other than the Audit Committee);","page_number":10,"box":{"x":68,"y":438,"width":772,"height":11}},{"id":"7b77585e-4efc-4235-92b8-4dff9c9d7f17","block_type":"box","text":"(3) oversee periodic self-assessments of the Board and committees of the Board (other than the Audit Committee);","page_number":10,"box":{"x":69,"y":453,"width":820,"height":11}},{"id":"b40c7061-dd98-43e8-b0c6-da8e02408f69","block_type":"box","text":"(4) review and make recommendations regarding Independent Director compensation; (5) monitor corporate","page_number":10,"box":{"x":69,"y":468,"width":768,"height":11}},{"id":"092789ea-0d08-4afe-9541-0a77ab75a2b2","block_type":"box","text":"governance matters and develop appropriate recommendations to the Board; (6) act as the administrative committee","page_number":10,"box":{"x":68,"y":483,"width":837,"height":11}},{"id":"148cf828-c351-493b-8b1d-82e0028bd1f1","block_type":"box","text":"with respect to Board policies and procedures, committee policies and procedures (other than the Audit Committee)","page_number":10,"box":{"x":68,"y":498,"width":827,"height":11}},{"id":"b3a4347f-c7a0-420e-a6d5-c09d7a375da8","block_type":"box","text":"and codes of ethics as they relate to Independent Directors; and (7) undertake such other duties and responsibilities","page_number":10,"box":{"x":69,"y":513,"width":836,"height":11}},{"id":"fc1d21e8-99cf-4a52-adf5-5d31c7df0729","block_type":"box","text":"as may from time to time be delegated by the Board to the Governance Committee. The Governance Committee may","page_number":10,"box":{"x":69,"y":528,"width":831,"height":12}},{"id":"1bf2d858-240c-44fd-b3fa-8371a0488072","block_type":"box","text":"consider nominations for Directors made by the Fund’s shareholders as it deems appropriate. Under the","page_number":10,"box":{"x":69,"y":543,"width":744,"height":12}},{"id":"8b620090-8f28-4fb0-86f5-8f50128499e4","block_type":"box","text":"Corporation’s Amended and Restated Bylaws (“Bylaws”), shareholders must follow certain procedures to nominate a","page_number":10,"box":{"x":69,"y":559,"width":832,"height":11}},{"id":"94bec366-2970-43cb-a3d9-f29ae57297cb","block_type":"box","text":"person for election as a Director at a shareholder meeting at which Directors are to be elected. Under these advance","page_number":10,"box":{"x":70,"y":574,"width":833,"height":11}},{"id":"496da120-34c9-4a41-a10c-9a124550e8fa","block_type":"box","text":"notice procedures, notice of the proposed nominee to the Secretary of the Corporation must be delivered to or","page_number":10,"box":{"x":69,"y":589,"width":789,"height":11}},{"id":"6be835e5-0978-4966-aa5f-4cb976130a4f","block_type":"box","text":"mailed and received at the principal executive offices of the Corporation not later than the close of business on the","page_number":10,"box":{"x":69,"y":604,"width":822,"height":11}},{"id":"b3f839a6-8c2a-432e-8796-01889104c6ca","block_type":"box","text":"fifth day following the day on which notice of the date of the meeting was mailed or public disclosure of the date of","page_number":10,"box":{"x":68,"y":619,"width":819,"height":11}},{"id":"fdcd486a-df2f-4d33-b1cf-3370969a4dc9","block_type":"box","text":"the meeting was made, whichever first occurs. The Corporation’s Bylaws provide that notice of a proposed","page_number":10,"box":{"x":68,"y":634,"width":758,"height":12}},{"id":"fbc305a6-d1c9-4a20-85f6-e7ab01bdd3d0","block_type":"box","text":"nomination must include certain information about the shareholder and the nominee, as well as certain other","page_number":10,"box":{"x":69,"y":649,"width":782,"height":11}},{"id":"ac03f777-a0ce-4738-aecb-7141a2b6b2c0","block_type":"box","text":"information, including a written consent of the proposed nominee to serve if elected. Reference is made to the","page_number":10,"box":{"x":70,"y":664,"width":789,"height":12}},{"id":"9017103d-8202-49b0-bd55-d99b13d83d5d","block_type":"box","text":"Corporation’s Bylaws for more details. The Board has adopted a written charter for the Governance Committee.","page_number":10,"box":{"x":69,"y":680,"width":792,"height":11}},{"id":"0ea36a93-2a22-428d-80d0-9ef89534b475","block_type":"box","text":"During the fiscal year ended May 31, 2026, the Governance Committee met ten times.","page_number":10,"box":{"x":70,"y":695,"width":617,"height":11}},{"id":"7416e74a-c79b-417e-adf2-59c5b8aeb5cb","block_type":"box","text":"Compliance Committee.","page_number":10,"box":{"x":102,"y":718,"width":168,"height":10}},{"id":"1948ca2d-ecdf-49ec-91a1-a9b42ac7fc08","block_type":"box","text":"The members of the Compliance Committee (the “Compliance Committee”) are Claire A.","page_number":10,"box":{"x":276,"y":717,"width":629,"height":11}},{"id":"aea19444-ce7e-4258-bb14-c7ac86d16ff3","block_type":"box","text":"Walton (Chair), Jeffrey Jarczyk, Cynthia A. Montgomery, Donald C. Opatrny, Lori Richards and Kenneth L. Urish, all of","page_number":10,"box":{"x":68,"y":732,"width":828,"height":12}},{"id":"b68c2396-38bc-4bae-a756-79a03d4cf33c","block_type":"box","text":"whom are Independent Directors. The Compliance Committee’s purpose is to assist the Board in fulfilling its","page_number":10,"box":{"x":68,"y":748,"width":773,"height":11}},{"id":"740caf3d-859a-45e8-b7da-5535566b0776","block_type":"box","text":"responsibility to oversee regulatory and fiduciary compliance matters involving the Corporation, the fund-related","page_number":10,"box":{"x":69,"y":763,"width":794,"height":11}},{"id":"bef691bf-4efa-452d-9e4e-ed808915cf10","block_type":"box","text":"activities of BlackRock and any sub-adviser and the Corporation’s third-party service providers. The Compliance","page_number":10,"box":{"x":69,"y":778,"width":793,"height":11}},{"id":"ee04b409-2854-47a4-9962-7fb1e23e4a64","block_type":"box","text":"Committee’s responsibilities include, without limitation, to (1) oversee the compliance policies and procedures of the","page_number":10,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"f1661457-e5ab-442d-aeac-eef6b7bff052","block_type":"box","text":"Corporation and its service providers and recommend changes or additions to such policies and procedures;","page_number":10,"box":{"x":69,"y":808,"width":773,"height":11}},{"id":"b731af82-afab-4247-8987-a754cb9bf066","block_type":"box","text":"(2) review information on and, where appropriate, recommend policies concerning the Corporation’s compliance with","page_number":10,"box":{"x":69,"y":823,"width":829,"height":12}},{"id":"9f8e1756-1087-4f76-9c17-52fa01197115","block_type":"box","text":"applicable law; (3) review reports from, oversee the annual performance review of, and make certain","page_number":10,"box":{"x":69,"y":838,"width":719,"height":11}},{"id":"51a02f1d-c5b0-4b1e-babe-580e1d628be7","block_type":"box","text":"recommendations and determinations regarding the Corporation’s Chief Compliance Officer (the “CCO”), including","page_number":10,"box":{"x":69,"y":853,"width":814,"height":12}},{"id":"fc007f69-9de6-49f7-8599-2b43f22cb07c","block_type":"box","text":"determining the amount and structure of the CCO’s compensation and recommending such amount and structure to","page_number":10,"box":{"x":69,"y":869,"width":829,"height":11}},{"id":"7fbd1a2a-c3e7-4214-b40a-463014d186fc","block_type":"box","text":"the full Board for approval and ratification; and (4) undertake such other duties and responsibilities as may from time","page_number":10,"box":{"x":68,"y":884,"width":839,"height":11}},{"id":"5d43670a-9656-4988-a1ef-fa53abde4cd9","block_type":"box","text":"I-8","page_number":10,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"ccbbfb89-0703-4c81-a0c3-116c7eb5e962","block_type":"box","text":"NM1026U-5979889-10/232","page_number":10,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"0bafa8a8-9d61-414c-8ce2-83cff8b3b497","block_type":"box","text":"to time be delegated by the Board to the Compliance Committee. The Board has adopted a written charter for the","page_number":11,"box":{"x":68,"y":45,"width":810,"height":11}},{"id":"acd9a22d-62ae-4762-9c3b-fbb2a93cb9e8","block_type":"box","text":"Compliance Committee. During the fiscal year ended May 31, 2026, the Compliance Committee met four times.","page_number":11,"box":{"x":69,"y":60,"width":798,"height":11}},{"id":"4c73c047-bb01-428c-aea4-2d2b737dac33","block_type":"box","text":"Per formance Oversight Committee.","page_number":11,"box":{"x":102,"y":82,"width":248,"height":12}},{"id":"39da4dad-7564-4049-82ec-fd1b6668a1d8","block_type":"box","text":"The members of the Performance Oversight Committee (the “Performance","page_number":11,"box":{"x":356,"y":82,"width":531,"height":12}},{"id":"8945f181-4562-4bbb-9104-c877b167e520","block_type":"box","text":"Oversight Committee”) are Donald C. Opatrny (Chair), Christopher J. Ailman, Susan J. Carter, Collette Chilton, Neil A.","page_number":11,"box":{"x":69,"y":98,"width":829,"height":11}},{"id":"797dd99a-c873-4c94-aa41-a998e9caefc9","block_type":"box","text":"Cotty and Marc D. Stern, all of whom are Independent Directors. The Performance Oversight Committee’s purpose is","page_number":11,"box":{"x":69,"y":113,"width":832,"height":11}},{"id":"52da60ca-6471-43d6-be3e-da66c9cb81a4","block_type":"box","text":"to assist the Board in fulfilling its responsibility to oversee the Fund’s investment performance relative to its agreed","page_number":11,"box":{"x":68,"y":128,"width":832,"height":11}},{"id":"495f3278-1266-4efa-a8e4-67aad91ed399","block_type":"box","text":"upon performance objectives and to assist the Independent Directors in their consideration of investment advisory","page_number":11,"box":{"x":69,"y":143,"width":818,"height":11}},{"id":"fd24e4de-b3b2-4460-ac0f-68c4429403e2","block_type":"box","text":"agreements. The Performance Oversight Committee’s responsibilities include, without limitation, to (1) review","page_number":11,"box":{"x":69,"y":158,"width":782,"height":11}},{"id":"08a9ff78-f119-4a5c-a0bb-1660b8b66223","block_type":"box","text":"information on, and make recommendations to the full Board in respect of, the Fund’s investment objective, policies","page_number":11,"box":{"x":70,"y":173,"width":829,"height":11}},{"id":"c6d3317b-a4b0-4066-8d16-bf875de373f2","block_type":"box","text":"and practices; (2) review information on the Fund’s investment performance; (3) review information on appropriate","page_number":11,"box":{"x":69,"y":188,"width":816,"height":11}},{"id":"9979f5fc-efd9-4960-a538-8e45b6e3056d","block_type":"box","text":"benchmarks and competitive universes and unusual or exceptional investment matters; (4) review personnel and","page_number":11,"box":{"x":69,"y":204,"width":803,"height":10}},{"id":"fc92c6e9-aebd-4835-9868-c42b6ee64d65","block_type":"box","text":"other resources devoted to management of the Fund and evaluate the nature and quality of information furnished to","page_number":11,"box":{"x":69,"y":218,"width":827,"height":12}},{"id":"a00a09df-588c-4921-8b73-8d56a1aa11d4","block_type":"box","text":"the Performance Oversight Committee; (5) recommend any required action regarding changes in fundamental and","page_number":11,"box":{"x":68,"y":234,"width":811,"height":11}},{"id":"b6b51706-1635-4753-8397-3b240893a3e8","block_type":"box","text":"non-fundamental investment policies and restrictions, fund mergers or liquidations; (6) request and review","page_number":11,"box":{"x":69,"y":249,"width":757,"height":11}},{"id":"a6064233-b05c-437a-8405-3c4cf5b233df","block_type":"box","text":"information on the nature, extent and quality of services provided to the shareholders; (7) make recommendations to","page_number":11,"box":{"x":70,"y":264,"width":835,"height":11}},{"id":"dd98336b-cc1d-4aa4-9ad7-e2e89af7d2fb","block_type":"box","text":"the Board concerning the approval or renewal of investment advisory agreements; and (8) undertake such other","page_number":11,"box":{"x":68,"y":279,"width":800,"height":11}},{"id":"69130261-1a29-492d-8cf9-d2a1e71dc7d0","block_type":"box","text":"duties and responsibilities as may from time to time be delegated by the Board to the Performance Oversight","page_number":11,"box":{"x":69,"y":294,"width":780,"height":11}},{"id":"9bb82ae7-8fc0-4594-8b3c-e06c82a36227","block_type":"box","text":"Committee. The Board has adopted a written charter for the Performance Oversight Committee. During the fiscal year","page_number":11,"box":{"x":69,"y":309,"width":838,"height":11}},{"id":"416b8612-dcb7-4c67-a0f3-6d6270f6d517","block_type":"box","text":"ended May 31, 2026, the Performance Oversight Committee met five times.","page_number":11,"box":{"x":69,"y":324,"width":544,"height":12}},{"id":"7bbe28a1-163e-496a-b1e7-9c1f109ff9ca","block_type":"box","text":"Ad Hoc Topics Committee.","page_number":11,"box":{"x":101,"y":347,"width":186,"height":11}},{"id":"877631d9-07a5-4945-a249-beb5194cd242","block_type":"box","text":"The members of the Ad Hoc Topics Committee (the “Ad Hoc Topics Committee”) are","page_number":11,"box":{"x":293,"y":347,"width":598,"height":11}},{"id":"142f97b0-eeb9-40e8-bb3a-daed10e9d431","block_type":"box","text":"Mark Stalnecker (Chair) and Claire A. Walton, both of whom are Independent Directors, and John M. Perlowski, who","page_number":11,"box":{"x":70,"y":362,"width":819,"height":11}},{"id":"40a7ff0b-84d4-41b8-a8d8-0835be441c75","block_type":"box","text":"serves as an interested Director. The principal responsibilities of the Ad Hoc Topics Committee are to (1) act on","page_number":11,"box":{"x":69,"y":377,"width":796,"height":11}},{"id":"1c9abb4a-3341-4d72-8773-25a939689deb","block_type":"box","text":"routine matters between meetings of the Board; (2) act on such matters as may require urgent action between","page_number":11,"box":{"x":69,"y":392,"width":788,"height":12}},{"id":"80d50680-1a08-4f79-9b66-8baf97518a4e","block_type":"box","text":"meetings of the Board; and (3) exercise such other authority as may from time to time be delegated to the Ad Hoc","page_number":11,"box":{"x":69,"y":407,"width":813,"height":12}},{"id":"fa52b17d-663f-457f-89f5-8b507f0272a7","block_type":"box","text":"Topics Committee by the Board. The Board has adopted a written charter for the Ad Hoc Topics Committee. During","page_number":11,"box":{"x":68,"y":423,"width":816,"height":11}},{"id":"f7fb0fa5-6177-41fb-a398-bbbc2aa278eb","block_type":"box","text":"the fiscal year ended May 31, 2026, the Ad Hoc Topics Committee did not meet.","page_number":11,"box":{"x":68,"y":438,"width":575,"height":11}},{"id":"978f4545-0f90-481d-8b08-5d9208afdf0f","block_type":"box","text":"The Governance Committee has adopted a statement of policy that describes the experience, qualifications,","page_number":11,"box":{"x":101,"y":460,"width":771,"height":12}},{"id":"5232800c-c956-4244-b177-b55dee7076c8","block_type":"box","text":"skills and attributes that are necessary and desirable for potential Independent Director candidates (the “Statement","page_number":11,"box":{"x":69,"y":475,"width":830,"height":12}},{"id":"acf284e9-87b2-40c3-8443-b4bf196c0490","block_type":"box","text":"of Policy”). The Board believes that each Independent Director satisfied, at the time he or she was initially elected or","page_number":11,"box":{"x":69,"y":491,"width":833,"height":11}},{"id":"4ee42ffd-d74d-44b3-bb38-2170bdfe11cd","block_type":"box","text":"appointed a Director, and continues to satisfy, the standards contemplated by the Statement of Policy. Furthermore,","page_number":11,"box":{"x":69,"y":506,"width":827,"height":11}},{"id":"46711c49-72db-4d9a-8643-3d83b0d30bba","block_type":"box","text":"in determining that a particular Independent Director was and continues to be qualified to serve as a Director, the","page_number":11,"box":{"x":70,"y":521,"width":811,"height":11}},{"id":"26b55c70-2aa2-4dd8-86a5-b47a294966a2","block_type":"box","text":"Board has considered a variety of criteria, none of which, in isolation, was controlling. The Board believes that,","page_number":11,"box":{"x":70,"y":536,"width":787,"height":11}},{"id":"9a3858a9-e725-44dd-961e-87289e819119","block_type":"box","text":"collectively, the Independent Directors have balanced and diverse experience, skills, attributes and qualifications,","page_number":11,"box":{"x":69,"y":551,"width":807,"height":11}},{"id":"c73f417a-d6cf-4190-bfc7-895104a81d1d","block_type":"box","text":"which allow the Board to operate effectively in governing the Corporation and protecting the interests of shareholders.","page_number":11,"box":{"x":68,"y":566,"width":840,"height":11}},{"id":"3d62efc8-5fa5-4e24-8af1-18feb3cb1c61","block_type":"box","text":"Among the attributes common to all Independent Directors are their ability to review critically, evaluate, question and","page_number":11,"box":{"x":68,"y":582,"width":832,"height":11}},{"id":"d1625184-a813-48ea-a71f-4c33892d12fc","block_type":"box","text":"discuss information provided to them, to interact effectively with the Fund’s investment adviser, sub-advisers, other","page_number":11,"box":{"x":69,"y":596,"width":823,"height":12}},{"id":"dc947a28-fa6a-4e6d-83c8-c870f78991c8","block_type":"box","text":"service providers, counsel and the Independent Registered Public Accounting Firm, and to exercise effective","page_number":11,"box":{"x":69,"y":612,"width":771,"height":11}},{"id":"2cf1c5bb-b5d9-45b3-9c9b-addc00672871","block_type":"box","text":"business judgment in the performance of their duties as Directors.","page_number":11,"box":{"x":69,"y":627,"width":475,"height":11}},{"id":"eab6243f-746f-4b09-82d0-f43fc7620f0e","block_type":"box","text":"Each Director’s ability to perform his or her duties effectively is evidenced by his or her educational background","page_number":11,"box":{"x":102,"y":649,"width":794,"height":12}},{"id":"8eed246d-ab2f-4c7d-b109-7dc4e20c35c4","block_type":"box","text":"or professional training; business, consulting, public service or academic positions; experience from service as a","page_number":11,"box":{"x":69,"y":664,"width":807,"height":12}},{"id":"196aed9a-c40c-4ca3-b644-ed6da042ad4b","block_type":"box","text":"board member of the Corporation and the other funds in the BlackRock Fund Complexes (and any predecessor","page_number":11,"box":{"x":69,"y":680,"width":787,"height":11}},{"id":"bf4df119-5a53-4fd7-a3b4-1a2601c7de9a","block_type":"box","text":"funds), other investment funds, public companies, non-profit entities or other organizations; ongoing commitment to","page_number":11,"box":{"x":68,"y":695,"width":827,"height":11}},{"id":"cdc30169-ccd7-47a7-989d-bb25521f0276","block_type":"box","text":"and participation in Board and Committee meetings, as well as his or her leadership of standing and","page_number":11,"box":{"x":69,"y":710,"width":717,"height":11}},{"id":"758cb5b8-6884-40e3-859d-772fe08cd0c7","block_type":"box","text":"ad hoc","page_number":11,"box":{"x":793,"y":710,"width":47,"height":9}},{"id":"e409710e-f69e-4b9f-a66e-94be1cf4116b","block_type":"box","text":"committees throughout the years; or other relevant life experiences.","page_number":11,"box":{"x":69,"y":725,"width":483,"height":11}},{"id":"8f40e973-3c33-4743-aada-351cbd732546","block_type":"box","text":"I-9","page_number":11,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"29edd4e8-52f1-4311-b94a-c67c725fe53c","block_type":"box","text":"NM1026U-5979889-11/232","page_number":11,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"28dc1ad7-91aa-47fe-8a89-80e1d93029a4","block_type":"box","text":"The table below discusses some of the experiences, qualifications and skills of each of the Directors that","page_number":12,"box":{"x":101,"y":45,"width":754,"height":11}},{"id":"87b1c7c0-5ab0-4b59-a4d4-6e960297544c","block_type":"box","text":"support the conclusion that each Director should serve on the Board.","page_number":12,"box":{"x":69,"y":60,"width":494,"height":11}},{"id":"544475b6-2471-44d1-8174-10942c3deb7f","block_type":"box","text":"Directors Experience, Qualifications and Skills","page_number":12,"box":{"x":69,"y":88,"width":408,"height":9}},{"id":"b3c1941f-c3fd-4068-ba21-b22cf0b03fdf","block_type":"box","text":"Independent Directors","page_number":12,"box":{"x":70,"y":105,"width":156,"height":10}},{"id":"39619c63-f835-439d-85f3-51de26d47e34","block_type":"box","text":"Christopher J. Ailman Christopher Ailman has more than 30 years of experience in the financial services","page_number":12,"box":{"x":69,"y":120,"width":781,"height":11}},{"id":"d8a6ba35-c62f-48b4-92d3-1e0d981c50d0","block_type":"box","text":"industry, including most recently serving as Chief Investment Officer of the California","page_number":12,"box":{"x":265,"y":135,"width":604,"height":11}},{"id":"e4483fa5-c532-4f5b-b575-58ced89b653b","block_type":"box","text":"State Teachers Retirement System (CalSTRS) from 2000 to June 2024 where he led its","page_number":12,"box":{"x":265,"y":150,"width":623,"height":11}},{"id":"9d9ad091-4be3-4463-a565-af72a20c366c","block_type":"box","text":"investment program. Mr. Ailman currently is a principal at Ailman Advisers. In addition, he","page_number":12,"box":{"x":265,"y":165,"width":637,"height":11}},{"id":"40a0f4dd-066e-4254-870b-0a083b2f3bfd","block_type":"box","text":"has held various roles in the industry, including as member and chair of the asset owner","page_number":12,"box":{"x":265,"y":180,"width":631,"height":11}},{"id":"e594738d-1693-47e9-b8e5-dc1ff33f30e4","block_type":"box","text":"committee of the Kroner Center for Financial Research, chairman of the North American","page_number":12,"box":{"x":264,"y":195,"width":626,"height":11}},{"id":"f0e6e4ce-ed8b-45a9-b09e-70f1e2ea0e2b","block_type":"box","text":"Chapter of the 300 Club of Global CIOs, and co-chair of the Milken Global Capital Markets","page_number":12,"box":{"x":265,"y":210,"width":639,"height":11}},{"id":"b494d00f-0c15-4bc3-8d7e-f87cbafbe4b5","block_type":"box","text":"Advisory Council. These positions have provided Mr. Ailman with considerable investment","page_number":12,"box":{"x":264,"y":226,"width":637,"height":11}},{"id":"2ecb1fc8-9d6a-4571-895b-7a57e280f115","block_type":"box","text":"expertise across asset classes and strategies, and insight and perspective on the","page_number":12,"box":{"x":265,"y":241,"width":586,"height":11}},{"id":"d332db1a-24a2-43b9-88a7-857f15fa50b8","block_type":"box","text":"markets and the economy. In addition, Mr. Ailman serves as a member of the Governance","page_number":12,"box":{"x":265,"y":256,"width":640,"height":11}},{"id":"b4019d25-f686-41b8-b57f-ef28a93c791e","block_type":"box","text":"Committee and the Performance Oversight Committee.","page_number":12,"box":{"x":265,"y":271,"width":389,"height":11}},{"id":"5f6d5edd-da0e-49bf-8af6-fac361caf7b5","block_type":"box","text":"Susan J. Carter Susan J. Carter has over 35 years of experience in investment management. She has","page_number":12,"box":{"x":69,"y":293,"width":806,"height":12}},{"id":"74ff6fda-a003-4100-b12b-050da008375f","block_type":"box","text":"served as President & Chief Executive Officer of Commonfund Capital, Inc. (“CCI”), a","page_number":12,"box":{"x":265,"y":309,"width":604,"height":11}},{"id":"a0ca7cfb-a8cf-4d04-bdfb-83aef1d1f489","block_type":"box","text":"registered investment adviser focused on non-profit investors, from 1997 to 2013, Chief","page_number":12,"box":{"x":265,"y":324,"width":632,"height":11}},{"id":"4d23cf45-d177-4efe-924c-89cafda87164","block_type":"box","text":"Executive Officer of CCI from 2013 to 2014 and Senior Advisor to CCI in 2015.","page_number":12,"box":{"x":265,"y":339,"width":562,"height":9}},{"id":"e7034aa2-ce3a-48d8-a857-d028e63b15d5","block_type":"box","text":"Ms. Carter also served as director of the Pacific Pension Institute from 2014 to 2018,","page_number":12,"box":{"x":265,"y":354,"width":616,"height":10}},{"id":"db655695-e5f0-4777-9051-3a7df0f50225","block_type":"box","text":"trustee to the Financial Accounting Foundation from 2017 to 2021, Advisory Board","page_number":12,"box":{"x":264,"y":369,"width":591,"height":11}},{"id":"515a3445-af4b-4616-99bd-f37038733efc","block_type":"box","text":"Member for the Center for Private Equity and Entrepreneurship at Tuck School of Business","page_number":12,"box":{"x":265,"y":384,"width":641,"height":11}},{"id":"a59e1553-aaf2-4b24-a9ec-408e80900108","block_type":"box","text":"from 1997 to 2021, Advisory Board Member for Bridges Fund Management from 2016 to","page_number":12,"box":{"x":264,"y":399,"width":638,"height":12}},{"id":"7077b9a8-17a1-4800-97c0-be28ed7636d5","block_type":"box","text":"2018, Advisory Board Member for Girls Who Invest from 2015 to 2018 and Board","page_number":12,"box":{"x":265,"y":414,"width":584,"height":12}},{"id":"50dc012e-666b-4b23-919b-d01e230ce3c9","block_type":"box","text":"Member thereof from 2018 to 2022, and Practitioner Advisory Board Member for Private","page_number":12,"box":{"x":265,"y":429,"width":630,"height":12}},{"id":"2aceeda0-8cf2-4ccc-aa72-2539a27ef40b","block_type":"box","text":"Capital Research Institute (“PCRI”) from 2017 to 2024. She currently serves as Member","page_number":12,"box":{"x":265,"y":445,"width":634,"height":11}},{"id":"1d785c57-de23-4567-9e56-7157ec701c84","block_type":"box","text":"of the President’s Counsel for Commonfund. These positions have provided her with","page_number":12,"box":{"x":265,"y":460,"width":599,"height":11}},{"id":"51f966b8-a077-4171-8dd7-50659497a827","block_type":"box","text":"insight and perspective on the markets and the economy.","page_number":12,"box":{"x":265,"y":475,"width":407,"height":11}},{"id":"56559fd8-7c67-43d5-8d38-3061b42a90e5","block_type":"box","text":"Collette Chilton Collette Chilton has over 20 years of experience in investment management. She held the","page_number":12,"box":{"x":69,"y":498,"width":837,"height":11}},{"id":"b4e374ce-fb24-4350-924b-e97356bc2d4e","block_type":"box","text":"position of Chief Investment Officer of Williams College from October 2006 to June 2023.","page_number":12,"box":{"x":265,"y":513,"width":638,"height":11}},{"id":"0f5cd491-01c5-463b-98ca-363e3c9045ce","block_type":"box","text":"Prior to that she was President and Chief Investment Officer of Lucent Asset Management","page_number":12,"box":{"x":265,"y":528,"width":642,"height":11}},{"id":"4a6bc17b-0b92-4c46-acac-68c640627080","block_type":"box","text":"Corporation, where she oversaw approximately $40 billion in pension and retirement","page_number":12,"box":{"x":265,"y":542,"width":601,"height":12}},{"id":"23d6a869-b447-449f-affa-a64f4ecd3528","block_type":"box","text":"savings assets for the company. These positions have provided her with insight and","page_number":12,"box":{"x":265,"y":558,"width":595,"height":11}},{"id":"b574460b-9639-4580-aea3-0a4f82c47b82","block_type":"box","text":"perspective on the markets and the economy.","page_number":12,"box":{"x":265,"y":573,"width":323,"height":11}},{"id":"6aa22d3e-c39f-440c-abbc-adae79907273","block_type":"box","text":"Neil A. Cotty Neil A. Cotty has more than 30 years of experience in the financial services industry,","page_number":12,"box":{"x":70,"y":596,"width":798,"height":11}},{"id":"d5d49651-0949-4af1-a236-05ff32be86d0","block_type":"box","text":"including 19 years at Bank of America Corporation and its affiliates, where he served, at","page_number":12,"box":{"x":265,"y":611,"width":631,"height":11}},{"id":"0e570744-cd8e-45ba-a7bb-c83197852f14","block_type":"box","text":"different times, as the Chief Financial Officer of various businesses including Investment","page_number":12,"box":{"x":265,"y":626,"width":633,"height":11}},{"id":"be6ce3fa-c5d9-4afe-9fec-0d13262cd153","block_type":"box","text":"Banking, Global Markets, Wealth Management and Consumer and also served ten years","page_number":12,"box":{"x":265,"y":641,"width":628,"height":11}},{"id":"893f0c62-b0ce-47c2-a84d-e6027c6df55a","block_type":"box","text":"as the Chief Accounting Officer for Bank of America Corporation. 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Keizer Henry R. Keizer brings over 40 years of executive, financial, operational, strategic and","page_number":13,"box":{"x":70,"y":65,"width":806,"height":12}},{"id":"aec9dda3-b45f-4cdc-a43e-d10e0bef1915","block_type":"box","text":"global expertise gained through his 35 year career at KPMG, a global professional","page_number":13,"box":{"x":264,"y":81,"width":584,"height":11}},{"id":"8dc6cb27-79e8-4f1e-9cb9-1756b22bf80b","block_type":"box","text":"services organization and by his service as a director to both publicly and privately held","page_number":13,"box":{"x":265,"y":96,"width":622,"height":11}},{"id":"968c25cd-90f5-4930-b019-f5a3bbdc1be0","block_type":"box","text":"organizations. He has extensive experience with issues facing complex, global companies","page_number":13,"box":{"x":265,"y":111,"width":638,"height":11}},{"id":"8b6b7d08-2ea6-4de2-b994-34c3715b8e74","block_type":"box","text":"and expertise in financial reporting, accounting, auditing, risk management, and","page_number":13,"box":{"x":265,"y":126,"width":570,"height":11}},{"id":"646186f1-882d-4429-ad3d-ad5ac6e57b98","block_type":"box","text":"regulatory affairs for such companies. Mr. Keizer’s experience also includes service as an","page_number":13,"box":{"x":265,"y":141,"width":642,"height":11}},{"id":"b07a9cb8-4d98-4224-a3e4-c75d37894dc3","block_type":"box","text":"audit committee chair to both publicly and privately held organizations across numerous","page_number":13,"box":{"x":265,"y":156,"width":626,"height":11}},{"id":"dfadeed8-4f1e-4298-894a-c06fa52cbeb6","block_type":"box","text":"industries including professional services, property and casualty reinsurance, insurance,","page_number":13,"box":{"x":265,"y":171,"width":630,"height":12}},{"id":"44b793c4-d880-4a94-8b44-da6e4c2f8b27","block_type":"box","text":"diversified financial services, banking, direct to consumer, business to business and","page_number":13,"box":{"x":265,"y":186,"width":602,"height":12}},{"id":"dd09aed9-70dd-4dd9-a3de-30ee780eef2e","block_type":"box","text":"technology. Mr. Keizer is a certified public accountant and also served on the board of the","page_number":13,"box":{"x":264,"y":201,"width":643,"height":12}},{"id":"063e3007-d4f4-405d-8f10-62bea01af023","block_type":"box","text":"American Institute of Certified Public Accountants. Mr. Keizer has been determined by the","page_number":13,"box":{"x":264,"y":217,"width":639,"height":11}},{"id":"790e22d2-b8d0-4dcc-a697-eca4c50aa351","block_type":"box","text":"Audit Committee to be an audit committee financial expert, as such term is defined in the","page_number":13,"box":{"x":264,"y":232,"width":641,"height":11}},{"id":"fcbe1791-071f-461e-b01d-e5676df4b311","block_type":"box","text":"applicable Commission rules.","page_number":13,"box":{"x":265,"y":247,"width":208,"height":11}},{"id":"a5e6b840-253e-42a2-9bb7-cb3045e7284a","block_type":"box","text":"Cynthia A. Montgomery Cynthia A. Montgomery has served for over 20 years on the boards of registered","page_number":13,"box":{"x":69,"y":269,"width":769,"height":12}},{"id":"5ab34247-107d-4e82-8d42-357fe3b35ae8","block_type":"box","text":"investment companies, most recently as a member of the boards of certain BlackRock","page_number":13,"box":{"x":265,"y":285,"width":621,"height":11}},{"id":"55912937-2321-4621-8c7a-bab664e80b8a","block_type":"box","text":"advised Funds and predecessor funds, including the legacy Merrill Lynch Investment","page_number":13,"box":{"x":265,"y":300,"width":599,"height":11}},{"id":"d0c9e5c0-f9b4-44ba-8316-7668f344c45e","block_type":"box","text":"Managers, L.P. (“MLIM”) funds. The Board benefits from Ms. Montgomery’s more than 20","page_number":13,"box":{"x":265,"y":315,"width":641,"height":11}},{"id":"adee3f52-6892-4268-b1dc-2477fb7886bd","block_type":"box","text":"years of academic experience as a professor at Harvard Business School where she","page_number":13,"box":{"x":264,"y":330,"width":602,"height":11}},{"id":"f9ec5243-6d99-481f-a4d8-f06b292654bb","block_type":"box","text":"taught courses on corporate strategy and corporate governance. Ms. Montgomery also","page_number":13,"box":{"x":264,"y":345,"width":617,"height":11}},{"id":"ee0ee16a-b28b-4a54-b1c1-e78d1b399c75","block_type":"box","text":"has business management and corporate governance experience through her service on","page_number":13,"box":{"x":265,"y":360,"width":629,"height":12}},{"id":"5564b839-a2e3-445a-a2f9-d5a5faa809e5","block_type":"box","text":"the corporate boards of a variety of public companies. She has also authored numerous","page_number":13,"box":{"x":264,"y":375,"width":628,"height":11}},{"id":"76eb5cc7-f6a0-486e-8f62-5f70f99b40af","block_type":"box","text":"articles and books on these topics.","page_number":13,"box":{"x":265,"y":391,"width":251,"height":10}},{"id":"03e1c8d9-162c-49cf-a525-bbcebe1379a4","block_type":"box","text":"Donald C. Opatrny Donald C. Opatrny has more than 40 years of business, oversight and executive","page_number":13,"box":{"x":70,"y":413,"width":764,"height":11}},{"id":"3874d036-4833-48c4-a7e4-242c7df86d5a","block_type":"box","text":"experience, including through his service as president, director and investment committee","page_number":13,"box":{"x":265,"y":428,"width":642,"height":12}},{"id":"f792a542-34c5-4252-8944-5f7e2adbb0f8","block_type":"box","text":"chair for academic and not-for-profit organizations, and his experience as a partner,","page_number":13,"box":{"x":264,"y":443,"width":593,"height":12}},{"id":"2249167e-750e-47ec-8715-9f7c0d4d897b","block_type":"box","text":"managing director and advisory director at Goldman Sachs for 32 years. He also has","page_number":13,"box":{"x":265,"y":458,"width":603,"height":12}},{"id":"a7a8f300-ac01-4e02-be54-b2a5abbb4ff9","block_type":"box","text":"investment management experience as a board member of Athena Capital Advisors LLC.","page_number":13,"box":{"x":265,"y":474,"width":629,"height":11}},{"id":"eafccbf9-2986-4162-a334-a54d96d46c0b","block_type":"box","text":"Lori Richards Lori Richards has more than 30 years of experience in the financial services industry,","page_number":13,"box":{"x":70,"y":496,"width":804,"height":11}},{"id":"612d0bd2-58fc-4454-b660-808fad287478","block_type":"box","text":"most notably as the first Director of the Office of Compliance Inspections and","page_number":13,"box":{"x":265,"y":511,"width":552,"height":12}},{"id":"bce68a18-5caa-4b41-b18b-e5b2b7c531a2","block_type":"box","text":"Examinations (“OCIE”) of the Securities and Exchange Commission (“SEC”) from 1995 to","page_number":13,"box":{"x":265,"y":526,"width":636,"height":12}},{"id":"36ca04d8-dab7-44eb-87dd-af2495751682","block_type":"box","text":"2009. During 14 years as the Director of OCIE, she led the SEC’s nationwide examination","page_number":13,"box":{"x":265,"y":542,"width":639,"height":11}},{"id":"27737652-6aa0-4b6d-9d55-7321e7d6d318","block_type":"box","text":"oversight program for advisers, mutual funds, hedge funds, broker-dealers, stock","page_number":13,"box":{"x":265,"y":557,"width":576,"height":11}},{"id":"e9a30d52-c81c-4480-bb74-e79a170ec50f","block_type":"box","text":"exchanges, and other industry firms. Prior to that, from 1985 to 1995, she held various","page_number":13,"box":{"x":265,"y":572,"width":626,"height":11}},{"id":"0a40cefb-d481-4e1e-9030-bcd143c38fbd","block_type":"box","text":"roles at the SEC, including Associate Director for Enforcement for the SEC’s Pacific","page_number":13,"box":{"x":265,"y":587,"width":592,"height":11}},{"id":"7412040b-07ca-4ad2-abc8-6d48cfb8c449","block_type":"box","text":"Regional Office and executive assistant and senior advisor to then SEC Chairman Arthur","page_number":13,"box":{"x":265,"y":602,"width":629,"height":11}},{"id":"778c7767-e0ac-4463-9d89-10d875046b2b","block_type":"box","text":"Levitt. More recently, Ms. Richards served as Chief Compliance Officer of the Asset and","page_number":13,"box":{"x":265,"y":617,"width":626,"height":11}},{"id":"7b0e6c5b-7944-43de-81df-e574f46270fe","block_type":"box","text":"Wealth Management global lines of business at JPMorgan Chase & Co. from 2013 to","page_number":13,"box":{"x":264,"y":632,"width":608,"height":12}},{"id":"ac1ceaf1-0688-4764-b0c1-92a20542f8a7","block_type":"box","text":"2018 where she led its global compliance program, advised business leaders on","page_number":13,"box":{"x":265,"y":648,"width":575,"height":11}},{"id":"95c26194-5831-4a85-bc91-72946ae5b219","block_type":"box","text":"compliance issues, oversaw risk assessment, monitoring, testing and training, and","page_number":13,"box":{"x":264,"y":663,"width":591,"height":11}},{"id":"42460fac-8696-46d4-a965-6e8e8fb7d705","block_type":"box","text":"maintained relationships with regulators. In addition, Ms. Richards served as a member","page_number":13,"box":{"x":265,"y":678,"width":627,"height":11}},{"id":"1b1c82e6-20bc-4f6e-b6e5-581f10579ffb","block_type":"box","text":"of the National Adjudicatory Council of the Financial Industry Regulatory Authority","page_number":13,"box":{"x":265,"y":693,"width":578,"height":11}},{"id":"681bc539-af8a-4c82-8052-7e7caeab63a8","block_type":"box","text":"(FINRA) from 2019 to 2022 and held the chair and vice chair posts during her tenure.","page_number":13,"box":{"x":265,"y":708,"width":607,"height":11}},{"id":"3c20e33e-12ec-4670-a1e5-b921ae00c61a","block_type":"box","text":"Prior thereto, from 2010 to 2013, she was a Principal at PricewaterhouseCoopers LLP","page_number":13,"box":{"x":265,"y":723,"width":615,"height":11}},{"id":"20366b13-9ac6-462a-bd4d-29ffc9573fcf","block_type":"box","text":"(“PwC”) and co-leader of its Asset Management Regulatory group. At PwC, she assisted a","page_number":13,"box":{"x":265,"y":738,"width":638,"height":11}},{"id":"474bf0e3-a4b7-45bb-bded-c9afaed48210","block_type":"box","text":"broad range of financial services clients in designing and implementing risk management","page_number":13,"box":{"x":265,"y":753,"width":635,"height":12}},{"id":"cb43d36b-52ee-4138-b388-0ba0b190d9f6","block_type":"box","text":"and compliance programs, and preparing for new regulatory expectations. These positions","page_number":13,"box":{"x":265,"y":768,"width":642,"height":12}},{"id":"2e0406aa-ca74-4e0b-9357-44c602027c4a","block_type":"box","text":"have provided her with insight and perspective on the markets and the economy, as well","page_number":13,"box":{"x":265,"y":784,"width":627,"height":11}},{"id":"4b7b0cdf-7a5c-4318-a2cd-5dddf9b8f944","block_type":"box","text":"as asset management regulation and compliance. In addition, Ms. Richards serves as a","page_number":13,"box":{"x":265,"y":799,"width":628,"height":11}},{"id":"316e4f7d-7f05-4e26-8089-c22a12aff842","block_type":"box","text":"member of the Audit Committee and the Compliance Committee.","page_number":13,"box":{"x":265,"y":814,"width":460,"height":11}},{"id":"8a1d2cd7-4358-4c62-9ed9-129c7f25d06f","block_type":"box","text":"I-11","page_number":13,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"a209f120-f0a7-48a9-b02e-6a90708fc41d","block_type":"box","text":"NM1026U-5979889-13/232","page_number":13,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d582f24b-e5c3-4fe9-869c-e006247f5449","block_type":"box","text":"Directors Experience, Qualifications and Skills","page_number":14,"box":{"x":69,"y":49,"width":408,"height":9}},{"id":"fc8bb2ce-239e-4aca-ab28-158e4fb0ea4b","block_type":"box","text":"Mark Stalnecker Mark Stalnecker has gained a wealth of experience in investing and asset management","page_number":14,"box":{"x":70,"y":65,"width":818,"height":12}},{"id":"d60e8950-0cdd-4f79-b5fd-4541ee69422a","block_type":"box","text":"from his over 13 years of service as the Chief Investment Officer of the University of","page_number":14,"box":{"x":264,"y":81,"width":603,"height":11}},{"id":"799da00f-79bb-40fc-ada5-47117a88f9d7","block_type":"box","text":"Delaware as well as from his various positions with First Union Corporation, including","page_number":14,"box":{"x":265,"y":96,"width":606,"height":11}},{"id":"4433eee7-c4ee-414f-bc07-5dff7d7f7b6d","block_type":"box","text":"Senior Vice President and State Investment Director of First Investment Advisors. The","page_number":14,"box":{"x":265,"y":111,"width":608,"height":9}},{"id":"93cbb224-18f5-43db-a422-747bd6e8eb14","block_type":"box","text":"Board benefits from his experience and perspective as the Chief Investment Officer of a","page_number":14,"box":{"x":265,"y":126,"width":626,"height":11}},{"id":"88cc7ef1-c18d-434b-bbc7-6a0498ef65e2","block_type":"box","text":"university endowment and from the oversight experience he gained from service on","page_number":14,"box":{"x":265,"y":141,"width":591,"height":11}},{"id":"e2697ea5-f576-4e02-8022-0101b3e109c3","block_type":"box","text":"various private and non-profit boards.","page_number":14,"box":{"x":264,"y":156,"width":265,"height":11}},{"id":"cb6ce408-ba9a-4e7a-9129-d227daa415d8","block_type":"box","text":"Marc D. Stern Marc D. Stern has more than 30 years of experience in investing and asset management.","page_number":14,"box":{"x":70,"y":179,"width":833,"height":11}},{"id":"954ea285-6f32-49db-9d3f-b09fe954a99b","block_type":"box","text":"Mr. Stern served as the Chief Executive Officer at Bessemer Trust, a wealth management","page_number":14,"box":{"x":265,"y":194,"width":638,"height":11}},{"id":"d32bac24-1aef-47ee-9991-af8fc740966d","block_type":"box","text":"business, for 13 years. During his tenure at Bessemer Trust, Mr. Stern served on the","page_number":14,"box":{"x":265,"y":209,"width":608,"height":11}},{"id":"a34d2929-0734-42b3-a164-b3fec5554b6d","block_type":"box","text":"firm’s board of directors, chaired the board’s trust and investment committee, and led the","page_number":14,"box":{"x":264,"y":224,"width":645,"height":11}},{"id":"c49d7f0a-7c6f-4df3-8963-f8d2552c039c","block_type":"box","text":"firm’s executive committee. He also served as Bessemer’s Chief Investment Officer for 8","page_number":14,"box":{"x":264,"y":239,"width":639,"height":9}},{"id":"e06a8803-069a-493f-9765-908a0018df3e","block_type":"box","text":"years, where he was Chair of the Investment Policy and Strategy Committee with","page_number":14,"box":{"x":264,"y":254,"width":573,"height":12}},{"id":"8fca486b-77e4-49c9-bb99-7659a86f01bf","block_type":"box","text":"responsibility for overall asset allocation and investment strategy. Mr. Stern also served","page_number":14,"box":{"x":265,"y":269,"width":625,"height":12}},{"id":"6cd1af9f-7d32-4d60-a0a5-91dc364ca810","block_type":"box","text":"as Chair of the Private Clients Investment group at AllianceBernstein. These positions","page_number":14,"box":{"x":265,"y":285,"width":610,"height":11}},{"id":"a63f373b-78a6-4f1a-8575-f2a135762366","block_type":"box","text":"provide Mr. Stern with insight and perspective into investment management, the economy,","page_number":14,"box":{"x":265,"y":300,"width":642,"height":11}},{"id":"f4dff939-4bff-4581-9f99-428755ffae99","block_type":"box","text":"and fiduciary governance. Mr. Stern also served as consultant to the Independent","page_number":14,"box":{"x":265,"y":315,"width":583,"height":11}},{"id":"edbe18ed-8004-4eb8-8678-9a9e55bd592a","block_type":"box","text":"Directors prior to becoming an Independent Director.","page_number":14,"box":{"x":265,"y":330,"width":372,"height":11}},{"id":"1f41efe2-dc92-43cd-ba6f-532566f4c3bc","block_type":"box","text":"Kenneth L. Urish Kenneth L. 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Walton. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":19,"box":{"x":79,"y":754,"width":550,"height":9}},{"id":"fce8f4b0-75dc-4f37-a2a2-9a13bbec4a49","block_type":"box","text":"None Over $100,000","page_number":19,"box":{"x":698,"y":753,"width":211,"height":11}},{"id":"9b2faa49-83d5-436d-a30f-76f229b49e54","block_type":"box","text":"Interested Directors","page_number":19,"box":{"x":70,"y":769,"width":140,"height":9}},{"id":"b93cef15-260c-492a-be41-d534182afeed","block_type":"box","text":"Robert Fairbairn. . .","page_number":19,"box":{"x":79,"y":784,"width":134,"height":9}},{"id":"387ff065-df25-4d1f-a04a-fd8a4b774618","block_type":"box","text":"...................................................","page_number":19,"box":{"x":220,"y":792,"width":409,"height":1}},{"id":"9468a7ba-589e-4a27-b554-6d43f6afef42","block_type":"box","text":"None Over $100,000","page_number":19,"box":{"x":698,"y":784,"width":211,"height":11}},{"id":"2b33c4d9-68fc-40c0-b2f4-e40e93f7f65d","block_type":"box","text":"John M. 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As of","page_number":19,"box":{"x":69,"y":860,"width":754,"height":11}},{"id":"cb581297-78c7-4f29-b1ab-fb7062b72965","block_type":"box","text":"December 31, 2025 (and, with respect to Mr. Jarczyk and Mr. Stern, as of April 1, 2026) none of the Independent","page_number":19,"box":{"x":70,"y":875,"width":811,"height":11}},{"id":"beb023b8-32e1-4864-807b-8c466c1f85b4","block_type":"box","text":"Directors of the Corporation or their immediate family members owned beneficially or of record any securities of the","page_number":19,"box":{"x":70,"y":890,"width":822,"height":11}},{"id":"8c9b2c92-58e8-41f9-9a68-0e3f54018d43","block_type":"box","text":"I-17","page_number":19,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"7e5e2f9a-22a5-44a9-b562-115217990a11","block_type":"box","text":"NM1026U-5979889-19/232","page_number":19,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"7f2bf363-6bc9-4e6b-9ebd-b02fab035ff3","block_type":"box","text":"Fund’s investment adviser, principal underwriter, or any person directly or indirectly controlling, controlled by, or under","page_number":20,"box":{"x":70,"y":45,"width":837,"height":11}},{"id":"773bbefe-baca-4da9-88b6-639f4632072a","block_type":"box","text":"common control with such entities.","page_number":20,"box":{"x":69,"y":60,"width":248,"height":9}},{"id":"da77cb80-6471-4c44-9386-87897838cb3b","block_type":"box","text":"Compensation of Directors","page_number":20,"box":{"x":69,"y":90,"width":194,"height":11}},{"id":"7444b430-729b-420b-921d-d4d48c8147f8","block_type":"box","text":"Each Director who is an Independent Director is paid as compensation an annual retainer of $375,000 per year","page_number":20,"box":{"x":102,"y":112,"width":796,"height":12}},{"id":"3e009391-6e35-4a17-9865-654a00ddd91a","block_type":"box","text":"for his or her services as a board member of the BlackRock-advised Funds in the BlackRock Multi-Asset Complex,","page_number":20,"box":{"x":68,"y":128,"width":810,"height":11}},{"id":"ed47e305-f72c-447c-856b-3407d79e737c","block_type":"box","text":"including the Corporation, and a $20,000 board meeting fee to be paid for each in-person board meeting attended","page_number":20,"box":{"x":70,"y":142,"width":814,"height":12}},{"id":"ea759042-843d-4651-92ee-d4bc9aef3c37","block_type":"box","text":"(and may receive a board meeting fee for telephonic attendance at board meetings), for up to five board meetings","page_number":20,"box":{"x":69,"y":158,"width":811,"height":11}},{"id":"6f0b51d4-3fc8-4520-b1f7-6036051b948c","block_type":"box","text":"held in a calendar year (compensation for meetings in excess of this number to be determined on a case-by-case","page_number":20,"box":{"x":69,"y":173,"width":805,"height":11}},{"id":"b8782ed2-a747-4917-be51-66d684e2ee7b","block_type":"box","text":"basis), together with out-of-pocket expenses in accordance with a board policy on travel and other business expenses","page_number":20,"box":{"x":69,"y":188,"width":838,"height":12}},{"id":"72c4069e-551a-4221-ad7a-de37884800a1","block_type":"box","text":"relating to attendance at meetings. 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In addition, the Manager may delegate certain of","page_number":21,"box":{"x":68,"y":271,"width":825,"height":12}},{"id":"74c5b9ef-9137-490a-b97d-7ddc2bf2fad4","block_type":"box","text":"its management functions under the Management Agreement to one or more of its affiliates to the extent permitted","page_number":21,"box":{"x":70,"y":286,"width":824,"height":12}},{"id":"3d376ad2-3fbe-40cd-b2ce-6284a2b1ae04","block_type":"box","text":"by applicable law. The Manager may terminate any or all sub-advisers or such delegation arrangements in its sole","page_number":21,"box":{"x":69,"y":302,"width":808,"height":11}},{"id":"841d5d26-2c8a-40ef-888a-5c3a34c5dd05","block_type":"box","text":"discretion at any time to the extent permitted by applicable law.","page_number":21,"box":{"x":69,"y":317,"width":451,"height":11}},{"id":"0f52a606-0bfd-4253-a928-c63883029484","block_type":"box","text":"The table below sets forth information about the management fees paid by the Corporation, on behalf of the","page_number":21,"box":{"x":101,"y":339,"width":773,"height":12}},{"id":"4aa4bf37-0091-428e-a0ab-a6732bac2da9","block_type":"box","text":"Fund, to the Manager, and the amounts waived and/or reimbursed, for the periods shown.","page_number":21,"box":{"x":70,"y":355,"width":642,"height":11}},{"id":"0ca813dd-586b-4c25-8256-f77994320ff3","block_type":"box","text":"Fees 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$829,653 $279,039","page_number":21,"box":{"x":70,"y":410,"width":825,"height":12}},{"id":"12710c38-c035-4793-801d-886f51845562","block_type":"box","text":"Fiscal Year Ended May 31, 2025. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,133,340 $701,717 $220,272","page_number":21,"box":{"x":70,"y":425,"width":825,"height":12}},{"id":"4f975c6f-0eee-4bee-b438-6e3cc6ff994f","block_type":"box","text":"Fiscal Year Ended May 31, 2024. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,862,991 $603,011 $271,997","page_number":21,"box":{"x":70,"y":440,"width":825,"height":12}},{"id":"ec260426-056a-49b8-ad65-19a2a6674429","block_type":"box","text":"Information Regarding the Portfolio Managers","page_number":21,"box":{"x":69,"y":472,"width":335,"height":11}},{"id":"5bab6980-29b7-4bd2-8d29-f51e97c564f3","block_type":"box","text":"Raffaele Savi, Travis Cooke, CFA, and Richard Mathieson are the portfolio managers and are jointly and 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Pooled","page_number":21,"box":{"x":720,"y":639,"width":75,"height":7}},{"id":"9a03c549-d13d-443c-8a73-d9f33ba1b27f","block_type":"box","text":"Investment","page_number":21,"box":{"x":726,"y":649,"width":64,"height":7}},{"id":"9d112361-4f4c-4609-b8b2-6901bf26006d","block_type":"box","text":"Vehicles","page_number":21,"box":{"x":734,"y":659,"width":48,"height":8}},{"id":"e86726df-6d9c-44d7-8a45-28ec175d86ac","block_type":"box","text":"Other","page_number":21,"box":{"x":843,"y":649,"width":32,"height":7}},{"id":"66260caf-9eae-49dc-8239-b8c58bbb5f5f","block_type":"box","text":"Accounts","page_number":21,"box":{"x":832,"y":660,"width":54,"height":7}},{"id":"04c2d87d-422d-41e1-85bd-82a751b47f78","block_type":"box","text":"Travis Cooke, CFA 30 129 20 0 4 6","page_number":21,"box":{"x":73,"y":673,"width":789,"height":9}},{"id":"ab91138b-bd55-4f69-8732-81b0294ab29d","block_type":"box","text":"$31.43 Billion $32.31 Billion $20.01 Billion $0 $8.44 Billion $6.67 Billion","page_number":21,"box":{"x":329,"y":685,"width":566,"height":9}},{"id":"de355e33-cefc-42f8-8e93-046947e34db8","block_type":"box","text":"Richard Mathieson 35 423 46 0 5 9","page_number":21,"box":{"x":74,"y":698,"width":788,"height":8}},{"id":"01132b33-a8c1-4354-bcbf-64ee4145d08e","block_type":"box","text":"$44.15 Billion $51.33 Billion $81.28 Billion $0 $3.46 Billion $15.63 Billion","page_number":21,"box":{"x":329,"y":710,"width":570,"height":9}},{"id":"ac2af4f0-61e7-479a-99e6-9ab5a9071ed3","block_type":"box","text":"Raffaele Savi 38 67 19 0 12 3","page_number":21,"box":{"x":74,"y":724,"width":788,"height":7}},{"id":"83bffc24-0ef6-4938-ba4e-c39776906f96","block_type":"box","text":"$55.25 Billion $58.02 Billion $42.55 Billion $0 $22.75 Billion $4.93 Billion","page_number":21,"box":{"x":329,"y":736,"width":566,"height":8}},{"id":"6fc434be-b142-4607-89c4-d0fd43dab4e8","block_type":"box","text":"Por tfolio Manager Compensation Overview","page_number":21,"box":{"x":69,"y":774,"width":304,"height":11}},{"id":"b1fe8d00-7dd2-4aec-8d5d-4ee49ad8b0ee","block_type":"box","text":"The discussion below describes the portfolio managers’ compensation as of May 31, 2026.","page_number":21,"box":{"x":101,"y":797,"width":656,"height":11}},{"id":"ebbb0184-7ec4-45dc-adbe-2b6d5a82949d","block_type":"box","text":"BlackRock’s financial arrangements with its portfolio managers, its competitive compensation and its career","page_number":21,"box":{"x":102,"y":819,"width":774,"height":12}},{"id":"40fd6491-6bc6-488d-9dd1-c8e2f1fbced3","block_type":"box","text":"path emphasis at all levels reflect the value senior management places on key resources. Compensation may include","page_number":21,"box":{"x":70,"y":835,"width":837,"height":11}},{"id":"3eac6606-c7f2-43d5-a75d-c9074c172f07","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":21,"box":{"x":69,"y":850,"width":823,"height":11}},{"id":"8c844f7c-c29e-44b8-95e5-c65859edd625","block_type":"box","text":"compensation include a base salary, a performance-based discretionary bonus, participation in various benefits","page_number":21,"box":{"x":69,"y":865,"width":799,"height":11}},{"id":"3e70119c-7180-4374-bff5-822608eb04a1","block_type":"box","text":"programs and one or more of the incentive compensation programs established by BlackRock.","page_number":21,"box":{"x":70,"y":880,"width":670,"height":11}},{"id":"48381128-36aa-4b26-b2be-7a6981ab23c0","block_type":"box","text":"I-19","page_number":21,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"9caa3d1d-f9ce-494c-9b60-83d27b8cf3bb","block_type":"box","text":"NM1026U-5979889-21/232","page_number":21,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"63887dd4-07e6-4c58-be5c-035180ddc102","block_type":"box","text":"Base Compensation.","page_number":22,"box":{"x":102,"y":45,"width":148,"height":11}},{"id":"b89b329f-caee-4d27-b96b-9a4f8a9825b6","block_type":"box","text":"Generally, portfolio managers receive base compensation based on their position with the","page_number":22,"box":{"x":257,"y":45,"width":640,"height":11}},{"id":"b5bb6e78-b23a-473c-9ba5-e59397f5e526","block_type":"box","text":"firm.","page_number":22,"box":{"x":68,"y":60,"width":32,"height":9}},{"id":"0c9186fc-88e8-477f-949a-1e2573270a4e","block_type":"box","text":"Discretionary Incentive Compensation","page_number":22,"box":{"x":102,"y":90,"width":277,"height":11}},{"id":"adb61fb6-1e86-49e0-a077-da133c372a6d","block_type":"box","text":"Discretionary incentive compensation is a function of several components: the performance of BlackRock, Inc.,","page_number":22,"box":{"x":102,"y":113,"width":792,"height":11}},{"id":"760ec823-3f75-4f50-9b4b-656ee385528d","block_type":"box","text":"the performance of the portfolio manager’s group within BlackRock, the investment performance, including risk","page_number":22,"box":{"x":68,"y":128,"width":800,"height":11}},{"id":"551eaf3d-20b7-4844-ae05-1817c1c8f0be","block_type":"box","text":"adjusted returns, of the firm’s assets under management or supervision by that portfolio manager relative to","page_number":22,"box":{"x":69,"y":143,"width":777,"height":11}},{"id":"3ee9e3e7-5d04-4d0d-8372-55922b3cef0b","block_type":"box","text":"predetermined benchmarks, and the individual’s performance and contribution to the overall performance of these","page_number":22,"box":{"x":70,"y":158,"width":817,"height":11}},{"id":"37fc98d3-f404-4b1b-bb3a-e2fda416fbf3","block_type":"box","text":"portfolios and BlackRock. Among other things, BlackRock’s Chief Investment Officers make a subjective","page_number":22,"box":{"x":70,"y":173,"width":741,"height":11}},{"id":"aa074713-21b0-4843-81b0-82e609269375","block_type":"box","text":"determination with respect to each portfolio manager’s compensation based on the performance of the Fund and","page_number":22,"box":{"x":69,"y":188,"width":809,"height":12}},{"id":"d9c68144-dcb2-4a0b-a377-f86769734472","block_type":"box","text":"other accounts managed by each portfolio manager relative to the various benchmarks. Performance is generally","page_number":22,"box":{"x":69,"y":203,"width":806,"height":12}},{"id":"cb96f755-77b0-41fa-bdf6-afa246ba474c","block_type":"box","text":"assessed over trailing 1-, 3-, and 5-year periods relative to applicable benchmarks. The performance of Messrs. Savi,","page_number":22,"box":{"x":69,"y":218,"width":836,"height":12}},{"id":"e6afeb8a-4e5a-450e-a1d4-fe4f6204e305","block_type":"box","text":"Cooke and Mathieson is not measured against a specific benchmark.","page_number":22,"box":{"x":69,"y":234,"width":493,"height":11}},{"id":"ec5494c8-1f6b-4baa-99b1-c33bd58bdd1c","block_type":"box","text":"Distribution of Discretionary Incentive Compensation.","page_number":22,"box":{"x":102,"y":256,"width":389,"height":11}},{"id":"21afd5ba-94f5-4841-9b22-a32aca0a07ff","block_type":"box","text":"Discretionary incentive compensation is distributed to","page_number":22,"box":{"x":499,"y":257,"width":383,"height":10}},{"id":"f255271b-db31-4975-be6e-05d8d76e9a7b","block_type":"box","text":"portfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/or deferred cash awards","page_number":22,"box":{"x":70,"y":271,"width":815,"height":12}},{"id":"a414b175-704a-443c-971b-26b22c07b5b7","block_type":"box","text":"that notionally track the return of certain BlackRock investment products.","page_number":22,"box":{"x":68,"y":286,"width":522,"height":12}},{"id":"9688e645-4744-4814-8dfc-0670c2389bfb","block_type":"box","text":"Portfolio managers receive their annual discretionary incentive compensation in the form of cash. Portfolio","page_number":22,"box":{"x":102,"y":309,"width":760,"height":11}},{"id":"ae2ce1f2-7d0a-4fd4-ab22-962a1b2f2121","block_type":"box","text":"managers whose total compensation is above a specified threshold also receive deferred BlackRock, Inc. stock","page_number":22,"box":{"x":69,"y":324,"width":795,"height":12}},{"id":"d23bf85d-0083-4abd-9e18-6e7445deb4e6","block_type":"box","text":"awards annually as part of their discretionary incentive compensation. Paying a portion of discretionary incentive","page_number":22,"box":{"x":69,"y":339,"width":805,"height":12}},{"id":"e96f2f98-a420-4db7-ae91-05b72d62ad86","block_type":"box","text":"compensation in the form of deferred BlackRock, Inc. stock puts compensation earned by a portfolio manager for a","page_number":22,"box":{"x":69,"y":355,"width":822,"height":11}},{"id":"0ec980e3-8d09-49f2-8674-5cb0c1f65572","block_type":"box","text":"given year “at risk” based on BlackRock’s ability to sustain and improve its performance over future periods. In some","page_number":22,"box":{"x":68,"y":370,"width":839,"height":11}},{"id":"96666b5c-352f-485d-af8d-4832e4327b94","block_type":"box","text":"cases, additional deferred BlackRock, Inc. stock may be granted to certain key employees as part of a long-term","page_number":22,"box":{"x":69,"y":385,"width":802,"height":11}},{"id":"ba8bcd4b-95b7-4147-8517-5bd72c9a4f38","block_type":"box","text":"incentive award to aid in retention, align interests with long-term shareholders and motivate performance. Deferred","page_number":22,"box":{"x":70,"y":400,"width":820,"height":11}},{"id":"1caf122e-ff58-456e-91ad-0d4476035a61","block_type":"box","text":"BlackRock, Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest","page_number":22,"box":{"x":70,"y":415,"width":801,"height":11}},{"id":"27cd0c44-2e33-47bc-b032-855a730cb707","block_type":"box","text":"pursuant to the terms of the applicable plan and, once vested, settle in BlackRock, Inc. common stock. The portfolio","page_number":22,"box":{"x":70,"y":430,"width":831,"height":11}},{"id":"ca0e91e4-4de8-4702-9c4a-cf81815f22b0","block_type":"box","text":"managers of this Fund have deferred BlackRock, Inc. stock awards.","page_number":22,"box":{"x":69,"y":445,"width":479,"height":12}},{"id":"42a5c947-b3cb-4d45-8c1b-5865f7f32171","block_type":"box","text":"For certain portfolio managers, a portion of the discretionary incentive compensation is also distributed in the","page_number":22,"box":{"x":102,"y":468,"width":785,"height":11}},{"id":"cc7ae648-cebd-47e4-90cf-022ae8099b71","block_type":"box","text":"form of deferred cash awards that notionally track the returns of select BlackRock investment products they manage,","page_number":22,"box":{"x":68,"y":483,"width":836,"height":11}},{"id":"f1516da7-7d45-4b8a-b0ec-f30e2d778c70","block_type":"box","text":"which provides direct alignment of portfolio manager discretionary incentive compensation with investment product","page_number":22,"box":{"x":68,"y":498,"width":821,"height":11}},{"id":"60fdd668-a99f-4766-965a-fa0c4d4dfcdb","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":22,"box":{"x":69,"y":513,"width":829,"height":11}},{"id":"1e57e6ad-1dfd-4c7b-be78-d58fdfa4c76c","block_type":"box","text":"portfolio managers who manage specified products and whose total compensation is above a specified threshold are","page_number":22,"box":{"x":70,"y":528,"width":835,"height":12}},{"id":"4eb95da0-c332-465e-8c39-f5751c99a28d","block_type":"box","text":"eligible to participate in the deferred cash award program.","page_number":22,"box":{"x":69,"y":543,"width":414,"height":12}},{"id":"a797f61b-678c-43fa-b616-f2e35704cb54","block_type":"box","text":"Other Compensation Benefits.","page_number":22,"box":{"x":101,"y":566,"width":218,"height":11}},{"id":"3552fedd-2b59-41a9-9b0e-25f09bf27dd3","block_type":"box","text":"In addition to base salary and discretionary incentive compensation, portfolio","page_number":22,"box":{"x":327,"y":566,"width":552,"height":11}},{"id":"955a4f7f-e9ef-4fa4-8150-6eac1f2d3815","block_type":"box","text":"managers may be eligible to receive or participate in one or more of the following:","page_number":22,"box":{"x":69,"y":581,"width":582,"height":12}},{"id":"31755b05-6174-4955-bf29-33ab4ea54e73","block_type":"box","text":"Incentive Savings Plans","page_number":22,"box":{"x":102,"y":604,"width":167,"height":11}},{"id":"9089fd81-f088-4c83-afdc-05c0ed067ede","block_type":"box","text":"— BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock","page_number":22,"box":{"x":274,"y":604,"width":614,"height":11}},{"id":"3cfb0f14-1092-494c-9642-9e5bfe6b7911","block_type":"box","text":"employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the","page_number":22,"box":{"x":69,"y":619,"width":831,"height":11}},{"id":"6025466e-33bd-43cb-936d-2523e2ae79f0","block_type":"box","text":"BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a","page_number":22,"box":{"x":70,"y":634,"width":785,"height":11}},{"id":"11109716-64d0-4026-aa0d-865d72dff1c0","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":22,"box":{"x":69,"y":649,"width":830,"height":12}},{"id":"30989c62-4da6-4d7f-93a1-44d17f599b94","block_type":"box","text":"company retirement contribution equal to 3-5% of eligible compensation up to the Internal Revenue Service limit","page_number":22,"box":{"x":69,"y":664,"width":799,"height":12}},{"id":"662c64db-2824-436f-957d-f0a3a84fbe0a","block_type":"box","text":"($360,000 for 2026). The RSP offers a range of investment options, including registered investment companies and","page_number":22,"box":{"x":69,"y":679,"width":831,"height":12}},{"id":"70029dd9-729d-44e7-bb28-09c6b0dae8e2","block_type":"box","text":"collective investment funds managed by the firm. BlackRock contributions follow the investment direction set by","page_number":22,"box":{"x":69,"y":695,"width":798,"height":11}},{"id":"cf75a6ca-a5f0-44f3-aadf-eba484015798","block_type":"box","text":"participants for their own contributions or, absent participant investment direction, are invested into a target date","page_number":22,"box":{"x":70,"y":710,"width":809,"height":11}},{"id":"460a1576-cc7b-4962-8c48-2dc18a85bca9","block_type":"box","text":"fund that corresponds to, or is closest to, the year in which the participant attains age 65. The ESPP allows for","page_number":22,"box":{"x":68,"y":725,"width":793,"height":11}},{"id":"121b3bce-4723-4abc-9735-43b19b26de67","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":22,"box":{"x":70,"y":740,"width":832,"height":11}},{"id":"126cb6ef-50d4-406c-8cc9-6e1efe3c1433","block_type":"box","text":"Annual participation in the ESPP is limited to the purchase of 1,000 shares of common stock or a dollar value of","page_number":22,"box":{"x":68,"y":755,"width":805,"height":11}},{"id":"5aa26509-e0e5-425d-8b4b-48e4028e8ee4","block_type":"box","text":"$25,000 based on its fair market value on the purchase date. All of the eligible portfolio managers are eligible to","page_number":22,"box":{"x":69,"y":770,"width":808,"height":12}},{"id":"4bd89667-36be-4c50-9d8b-1516df9a825f","block_type":"box","text":"participate in these plans.","page_number":22,"box":{"x":70,"y":786,"width":185,"height":10}},{"id":"5879e072-47bd-4fa9-8f3a-fe0266cdcf63","block_type":"box","text":"I-20","page_number":22,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"b16fb36d-aa0a-449d-9d3b-0182912d3058","block_type":"box","text":"NM1026U-5979889-22/232","page_number":22,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"b3f157f3-5167-4b1a-92bc-812b933569a4","block_type":"box","text":"Por tfolio Manager Beneficial Holdings","page_number":23,"box":{"x":69,"y":45,"width":268,"height":11}},{"id":"91918058-1f9a-4c71-9ffd-ba1456f6d673","block_type":"box","text":"As of May 31, 2026, the Fund’s most recently completed fiscal year end, the dollar range of securities","page_number":23,"box":{"x":101,"y":67,"width":731,"height":12}},{"id":"0e65baf4-504b-41a9-83e9-990a4d2fd09b","block_type":"box","text":"beneficially owned by the portfolio managers in the Fund is shown below:","page_number":23,"box":{"x":69,"y":82,"width":519,"height":12}},{"id":"8ae2961c-5e92-4778-9f10-fff45548693d","block_type":"box","text":"Portfolio Manager","page_number":23,"box":{"x":69,"y":121,"width":105,"height":9}},{"id":"32a695f8-e891-41ae-be7b-9f92f48276c9","block_type":"box","text":"Dollar Range of Equity","page_number":23,"box":{"x":759,"y":111,"width":129,"height":9}},{"id":"9102ffdd-b4e2-49b6-923a-e2bf1879d48f","block_type":"box","text":"Securities Beneficially Owned","page_number":23,"box":{"x":736,"y":121,"width":173,"height":9}},{"id":"f6afc766-9f34-4a2b-ac92-a32c1b55a6ad","block_type":"box","text":"Raffaele Savi. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None","page_number":23,"box":{"x":70,"y":138,"width":771,"height":9}},{"id":"2f09eaf7-92d0-42ee-b44e-4cf245fca7ee","block_type":"box","text":"Travis Cooke, CFA. . .","page_number":23,"box":{"x":68,"y":154,"width":148,"height":10}},{"id":"c0dc29d2-be04-45cf-8176-42b019c646e1","block_type":"box","text":"............................................................","page_number":23,"box":{"x":223,"y":161,"width":482,"height":1}},{"id":"ab99db38-3927-4b48-a940-c6776ba63d90","block_type":"box","text":"$100,001 - $500,000","page_number":23,"box":{"x":744,"y":153,"width":158,"height":11}},{"id":"8444bbf6-a3d8-4ae1-903c-3ff5f6793c02","block_type":"box","text":"Richard Mathieson .","page_number":23,"box":{"x":70,"y":169,"width":138,"height":9}},{"id":"8585df7c-f125-4477-acae-eaacfe9b97f1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1 -","page_number":23,"box":{"x":214,"y":168,"width":589,"height":11}},{"id":"e654ae4b-c990-4414-8d01-6d68dda1c37b","block_type":"box","text":"$10,000","page_number":23,"box":{"x":808,"y":168,"width":62,"height":11}},{"id":"38459b2f-245a-41d3-aa59-d3c13ed31b87","block_type":"box","text":"Por tfolio Manager Potential Material Conflicts of Interest","page_number":23,"box":{"x":69,"y":200,"width":403,"height":12}},{"id":"584c2d23-5f4f-4bf5-8895-d67c17ed48a7","block_type":"box","text":"BlackRock has built a professional working environment, firm-wide compliance culture and compliance","page_number":23,"box":{"x":102,"y":223,"width":727,"height":11}},{"id":"0243e0d6-6780-4ae2-b0c0-7654263774a6","block_type":"box","text":"procedures and systems designed to protect against potential incentives that may favor one account over another.","page_number":23,"box":{"x":70,"y":238,"width":814,"height":11}},{"id":"f48c66fa-1000-4bbd-a89b-f6e09713449a","block_type":"box","text":"BlackRock has adopted policies and procedures that address the allocation of investment opportunities, execution of","page_number":23,"box":{"x":70,"y":253,"width":837,"height":11}},{"id":"edf161cd-2863-4b69-9759-3eaf49248340","block_type":"box","text":"portfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to","page_number":23,"box":{"x":70,"y":268,"width":810,"height":12}},{"id":"0d62e868-59c1-447e-a177-8cb6801e4646","block_type":"box","text":"ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes investment","page_number":23,"box":{"x":69,"y":283,"width":782,"height":12}},{"id":"7fda7424-ae24-4b60-90b8-0bc7394ac9e5","block_type":"box","text":"management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with","page_number":23,"box":{"x":69,"y":299,"width":830,"height":11}},{"id":"08249125-6bc6-4c3e-8142-cf3324a07392","block_type":"box","text":"applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge","page_number":23,"box":{"x":69,"y":314,"width":828,"height":11}},{"id":"bae372d2-5d2e-4a74-8d3e-14981eff6a65","block_type":"box","text":"funds or have performance or higher fees paid to BlackRock, or in which portfolio managers have a personal interest","page_number":23,"box":{"x":68,"y":329,"width":834,"height":11}},{"id":"afa6856b-4f42-4ae7-8d4e-d84b1e734d2f","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":23,"box":{"x":70,"y":344,"width":777,"height":11}},{"id":"a3836b8d-0efb-4b3f-acc5-e46b9ed87876","block_type":"box","text":"BlackRock, its affiliates and significant shareholders and any officer, director, shareholder or employee may or may","page_number":23,"box":{"x":70,"y":359,"width":821,"height":11}},{"id":"19afdb89-a5d7-4bfa-b077-4aa3b879b0bb","block_type":"box","text":"not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund. BlackRock, or","page_number":23,"box":{"x":69,"y":374,"width":819,"height":11}},{"id":"9b0da76d-96de-4e11-a2f0-ed99875598f5","block_type":"box","text":"any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their","page_number":23,"box":{"x":69,"y":389,"width":832,"height":11}},{"id":"160d9bab-382b-43c1-9af6-eff3ec3956c5","block_type":"box","text":"families may take different actions than those recommended to the Fund by BlackRock with respect to the same","page_number":23,"box":{"x":68,"y":404,"width":804,"height":11}},{"id":"ca786083-b1b0-42e0-812d-142b4fecd9a7","block_type":"box","text":"securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of","page_number":23,"box":{"x":69,"y":419,"width":760,"height":12}},{"id":"18ba366a-5e96-42c1-8762-b12e800d7710","block_type":"box","text":"companies of which any of BlackRock’s (or its affiliates’ or significant shareholders’) officers, directors or employees","page_number":23,"box":{"x":69,"y":435,"width":834,"height":11}},{"id":"7c81e88c-6412-4a9f-83a5-fde1fe88a6bf","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":23,"box":{"x":69,"y":450,"width":836,"height":11}},{"id":"1b691436-6794-4aff-85cc-f14a035efb7c","block_type":"box","text":"officers, directors and employees of any of them has any substantial economic interest or possesses material non","page_number":23,"box":{"x":69,"y":465,"width":822,"height":11}},{"id":"55a0664b-e5b3-4a00-a1a5-bb094e78c9af","block_type":"box","text":"public information. Certain portfolio managers also may manage accounts whose investment strategies may at times","page_number":23,"box":{"x":70,"y":480,"width":835,"height":11}},{"id":"e330c09c-0095-419a-b7bf-58a8f4e3c001","block_type":"box","text":"be opposed to the strategy utilized for the Fund. It should also be noted that Messrs. Cooke, Mathieson and Savi","page_number":23,"box":{"x":69,"y":495,"width":806,"height":11}},{"id":"06f80331-fa28-4fe4-a052-f992571916d8","block_type":"box","text":"may be managing hedge fund and/or long only accounts, or may be part of a team managing hedge fund and/or long","page_number":23,"box":{"x":69,"y":510,"width":834,"height":11}},{"id":"5d6ea11d-cc4b-44c9-b60f-bc22c5fb8a00","block_type":"box","text":"only accounts, subject to incentive fees. Messrs. Cooke, Mathieson and Savi may therefore be entitled to receive a","page_number":23,"box":{"x":69,"y":525,"width":822,"height":11}},{"id":"290ce7ed-f2b8-4ba5-b342-1fc9eab10485","block_type":"box","text":"portion of any incentive fees earned on such accounts.","page_number":23,"box":{"x":70,"y":540,"width":390,"height":12}},{"id":"dedd59bc-6c28-4e20-ac8a-579cdee35b60","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":23,"box":{"x":101,"y":563,"width":788,"height":11}},{"id":"4e1ca287-62f1-46b0-a08f-88c417459037","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":23,"box":{"x":70,"y":578,"width":839,"height":11}},{"id":"f430e146-bcd4-4099-bc0d-7ea147437975","block_type":"box","text":"fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner among client accounts,","page_number":23,"box":{"x":68,"y":593,"width":823,"height":12}},{"id":"dd8a462c-e3f8-4d39-a813-064fb32a0162","block_type":"box","text":"with no account receiving preferential treatment. To this end, BlackRock has adopted policies that are intended to","page_number":23,"box":{"x":68,"y":608,"width":812,"height":12}},{"id":"38ad0060-0599-4a02-b2fb-9361a3d64079","block_type":"box","text":"ensure reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate","page_number":23,"box":{"x":69,"y":623,"width":777,"height":12}},{"id":"d52cd9c1-ad4f-4e74-8a9b-fca4307f6714","block_type":"box","text":"investments in a manner that is consistent with the particular investment discipline and client base, as appropriate.","page_number":23,"box":{"x":70,"y":639,"width":826,"height":11}},{"id":"ada5f69a-e4d4-4700-a0d7-2e42b9edc20d","block_type":"box","text":"Administration Agreement","page_number":23,"box":{"x":68,"y":669,"width":191,"height":11}},{"id":"f067b89e-1c43-4671-931a-fdb6c3fb586b","block_type":"box","text":"BlackRock serves as the Fund’s administrator (in such capacity, the “Administrator”) pursuant to an","page_number":23,"box":{"x":102,"y":692,"width":711,"height":11}},{"id":"61be605d-48c0-4421-965e-a78bf2bc9ef8","block_type":"box","text":"administration agreement (the “Administration Agreement”). The Administrator has agreed to maintain office facilities","page_number":23,"box":{"x":69,"y":707,"width":838,"height":11}},{"id":"fa24e25f-4b15-4104-8e93-1f2ebbd7eea6","block_type":"box","text":"for the Fund; furnish the Fund with clerical, bookkeeping and administrative services; oversee the determination and","page_number":23,"box":{"x":68,"y":722,"width":830,"height":11}},{"id":"a5d3a140-d56b-49cf-a060-4b7aaa595aaf","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":23,"box":{"x":70,"y":737,"width":813,"height":11}},{"id":"3a32c060-7cfa-4ece-931c-2316c74cfc50","block_type":"box","text":"returns; prepare certain reports required by regulatory authorities; calculate various contractual expenses; determine","page_number":23,"box":{"x":69,"y":752,"width":837,"height":11}},{"id":"181ccb0c-5ed2-46a6-995a-085c9c559448","block_type":"box","text":"the amount of dividends and distributions available for payment by the Fund to its shareholders; prepare and arrange","page_number":23,"box":{"x":68,"y":767,"width":836,"height":11}},{"id":"6d65502f-0a0d-40ab-b8a4-83791a2443e7","block_type":"box","text":"for the printing of dividend notices to shareholders; provide Fund service providers with such information as is","page_number":23,"box":{"x":68,"y":782,"width":785,"height":12}},{"id":"c506f599-6e4f-455d-bbea-62501fd8f7c7","block_type":"box","text":"required to effect the payment of dividends and distributions; and serve as liaison with the Corporation’s officers,","page_number":23,"box":{"x":69,"y":797,"width":811,"height":12}},{"id":"9e3d048b-6e8e-4c9c-8b16-5056d78bde95","block_type":"box","text":"independent accountants, legal counsel, custodian, accounting agent and transfer and dividend disbursing agent in","page_number":23,"box":{"x":70,"y":812,"width":819,"height":12}},{"id":"1344f9ad-0809-4e90-9d0f-983c85176102","block_type":"box","text":"establishing the accounting policies of the Fund and monitoring financial and shareholder accounting services. The","page_number":23,"box":{"x":69,"y":828,"width":818,"height":11}},{"id":"9182b77d-8be0-4ecd-91b4-c598a551ed73","block_type":"box","text":"Administrator may from time to time voluntarily waive administration fees with respect to the Fund and may voluntarily","page_number":23,"box":{"x":68,"y":843,"width":840,"height":11}},{"id":"ac380494-4bf7-4b5d-bc7e-ac950cbbe3cf","block_type":"box","text":"reimburse the Fund for expenses.","page_number":23,"box":{"x":69,"y":858,"width":238,"height":11}},{"id":"e250ecba-1dd1-4938-a8dd-089716847a6e","block_type":"box","text":"Under the Administration Agreement, the Corporation, on behalf of the Fund, pays to the Administrator a fee,","page_number":23,"box":{"x":102,"y":881,"width":773,"height":11}},{"id":"3c68cd51-8b88-4bc2-bb6a-3f6fe5b5c838","block_type":"box","text":"computed daily and payable monthly, at an aggregate annual rate of (i) 0.0425% of the first $500 million of the","page_number":23,"box":{"x":69,"y":895,"width":792,"height":12}},{"id":"e6484fc4-0d3a-409a-ae4f-4fda9f1802e1","block_type":"box","text":"Fund’s average daily net assets, 0.040% of the next $500 million of the Fund’s average daily net assets, 0.0375% of","page_number":23,"box":{"x":70,"y":910,"width":838,"height":12}},{"id":"3ba27aca-bb5d-485d-b5ce-68b48df6a16e","block_type":"box","text":"I-21","page_number":23,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"da5eb3d8-88dd-49b2-ba92-a8cca6a82f67","block_type":"box","text":"NM1026U-5979889-23/232","page_number":23,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"eb5d07f4-b424-4d28-bebd-a025192c2dda","block_type":"box","text":"the next $1 billion of the Fund’s average daily net assets, 0.035% of the next $2 billion of the Fund’s average daily","page_number":24,"box":{"x":68,"y":44,"width":821,"height":12}},{"id":"61f3dbf2-e25b-4b59-9428-718932ba0884","block_type":"box","text":"net assets, 0.0325% of the next $9 billion of the Fund’s average daily net assets and 0.030% of the average daily","page_number":24,"box":{"x":69,"y":59,"width":816,"height":12}},{"id":"53765567-d868-4b35-9230-2ecb6b14db7f","block_type":"box","text":"net 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":24,"box":{"x":69,"y":74,"width":833,"height":12}},{"id":"0e28a1c5-bbc5-4450-8859-051a4f882b54","block_type":"box","text":"shares of the Fund.","page_number":24,"box":{"x":69,"y":90,"width":137,"height":9}},{"id":"083e7169-29fe-45d0-a3fe-3051de1276f3","block_type":"box","text":"The table below sets forth information about the total administration fees paid by the Corporation, on behalf of","page_number":24,"box":{"x":101,"y":113,"width":792,"height":11}},{"id":"153c64c9-44ce-4ff3-9b59-2669c1e4fcdb","block_type":"box","text":"the Fund, to the Administrator (and waived and/or reimbursed by the Administrator) for the periods shown.","page_number":24,"box":{"x":68,"y":128,"width":758,"height":11}},{"id":"127ee5ee-c0aa-4a60-a917-a4de9a56c70a","block_type":"box","text":"Fees Paid to","page_number":24,"box":{"x":674,"y":166,"width":72,"height":7}},{"id":"51c061ce-7d54-4a6e-b68c-685f776fe283","block_type":"box","text":"the Administrator","page_number":24,"box":{"x":659,"y":176,"width":102,"height":7}},{"id":"491d2a0c-54aa-4333-9065-71c1d6397d5b","block_type":"box","text":"Fees Waived","page_number":24,"box":{"x":814,"y":156,"width":72,"height":7}},{"id":"99ff8c95-535e-472c-9329-933585a2c627","block_type":"box","text":"and/or Reimbursed","page_number":24,"box":{"x":794,"y":166,"width":112,"height":9}},{"id":"50b8c00e-2f8e-4c11-b222-5ac1d2cbb915","block_type":"box","text":"by the Administrator","page_number":24,"box":{"x":791,"y":176,"width":118,"height":9}},{"id":"d74c3780-4c7d-42bf-ae07-a49e8e343183","block_type":"box","text":"Fiscal Year Ended May 31, 2026 . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":194,"width":330,"height":11}},{"id":"1e1bef1c-d5f6-43f5-ad62-de8043a64b64","block_type":"box","text":"............................","page_number":24,"box":{"x":406,"y":201,"width":222,"height":2}},{"id":"f7b89eab-5b36-4241-ac31-40778d8ba86b","block_type":"box","text":"$438,575 $142,030","page_number":24,"box":{"x":674,"y":193,"width":212,"height":11}},{"id":"28d03aae-be5d-400a-9d31-4fea8acc3999","block_type":"box","text":"Fiscal Year Ended May 31, 2025 . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":209,"width":330,"height":11}},{"id":"4bd8f267-d39d-43cf-8eef-a63a1015194b","block_type":"box","text":"............................","page_number":24,"box":{"x":406,"y":217,"width":222,"height":1}},{"id":"7d1cc24b-7f9e-48a3-9349-acf220f66292","block_type":"box","text":"$396,196 $127,947","page_number":24,"box":{"x":674,"y":208,"width":211,"height":12}},{"id":"81fca759-aceb-4a14-908f-bcd1cacaa3f3","block_type":"box","text":"Fiscal Year Ended May 31, 2024 . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":224,"width":330,"height":11}},{"id":"cbed65ba-e02a-4c23-81f9-a8aa11c97c84","block_type":"box","text":"............................","page_number":24,"box":{"x":406,"y":232,"width":222,"height":1}},{"id":"2394b293-ec27-410e-934b-9f1a916413cf","block_type":"box","text":"$363,119 $116,905","page_number":24,"box":{"x":674,"y":224,"width":212,"height":11}},{"id":"c805e7d1-5c11-406b-a885-116810307781","block_type":"box","text":"Accounting Services","page_number":24,"box":{"x":68,"y":256,"width":150,"height":11}},{"id":"1201b2f9-6445-4518-938a-0de6e1563246","block_type":"box","text":"The Bank of New York Mellon (“BNY Mellon”), which has its principal place of business at 240 Greenwich Street,","page_number":24,"box":{"x":101,"y":278,"width":803,"height":11}},{"id":"d26c40c1-dd78-441b-b1d3-d1440d508d5e","block_type":"box","text":"New York, New York 10286, serves as the accounting services provider for the Fund. BNY Mellon records investment,","page_number":24,"box":{"x":70,"y":293,"width":837,"height":12}},{"id":"d369f6e8-3591-41bc-9055-f9b470951641","block_type":"box","text":"capital share and income and expense activities; verifies and transmits trade tickets; maintains accounting ledgers","page_number":24,"box":{"x":69,"y":309,"width":820,"height":11}},{"id":"306e38ed-07a2-4e27-9d67-37a015b733a5","block_type":"box","text":"for investment securities; maintains tax lots; reconciles cash with the Fund’s custodian; reports cash balances to the","page_number":24,"box":{"x":68,"y":324,"width":839,"height":11}},{"id":"9dcf215c-43ac-476d-a10c-b56c73584ed6","block_type":"box","text":"Manager; prepares certain financial statements; calculates expenses, gains, losses and income; controls","page_number":24,"box":{"x":70,"y":339,"width":753,"height":11}},{"id":"9ea78733-1c3c-4973-9b97-387c0a5bbe5e","block_type":"box","text":"disbursements; works with independent pricing sources; and computes and reports net asset value. In connection","page_number":24,"box":{"x":69,"y":354,"width":815,"height":11}},{"id":"130cd9ff-9ccd-4477-b2b8-3659cff1c80e","block_type":"box","text":"with its accounting services, BNY Mellon also provides certain administration services.","page_number":24,"box":{"x":68,"y":369,"width":621,"height":11}},{"id":"a76680c3-5fc8-4ee3-8c5a-0d4a74cf2279","block_type":"box","text":"The table below shows the amounts paid by the Fund to BNY Mellon for accounting services for the periods","page_number":24,"box":{"x":101,"y":392,"width":765,"height":11}},{"id":"4b20bae6-1b72-4d5d-84f1-70085ad24df1","block_type":"box","text":"indicated below.","page_number":24,"box":{"x":70,"y":407,"width":111,"height":9}},{"id":"f2050951-1ce2-4504-a3aa-2edb8c17684f","block_type":"box","text":"Fees Paid","page_number":24,"box":{"x":810,"y":435,"width":56,"height":7}},{"id":"bb0b88e6-795e-450d-9655-860a73d29de0","block_type":"box","text":"to BNY Mellon","page_number":24,"box":{"x":796,"y":445,"width":84,"height":7}},{"id":"506b4e0f-4dd7-4153-81e6-2144483e2eca","block_type":"box","text":"Fiscal Year Ended May 31, 2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":463,"width":459,"height":11}},{"id":"4ec7a203-49ae-4064-90b6-92a430c914b0","block_type":"box","text":".............................","page_number":24,"box":{"x":535,"y":470,"width":230,"height":2}},{"id":"d5f406c3-6ad7-4e34-83ea-e9d2ce936ad3","block_type":"box","text":"$74,647","page_number":24,"box":{"x":807,"y":462,"width":62,"height":11}},{"id":"4e87249f-3f7e-4717-8c55-94ecb3d4b545","block_type":"box","text":"Fiscal Year Ended May 31, 2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":478,"width":459,"height":11}},{"id":"a2fb4f66-9b60-4af0-9f98-2f73b7c6826b","block_type":"box","text":".............................","page_number":24,"box":{"x":535,"y":485,"width":230,"height":2}},{"id":"7780696d-3a7e-4a07-ae22-4f49ad9d80a9","block_type":"box","text":"$71,503","page_number":24,"box":{"x":807,"y":477,"width":62,"height":12}},{"id":"b5b425cd-a487-4548-b5a6-9d7bf0f2d6bf","block_type":"box","text":"Fiscal Year Ended May 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":493,"width":459,"height":11}},{"id":"3aa98555-0b73-4bfc-a2ba-9f354f088e43","block_type":"box","text":".............................","page_number":24,"box":{"x":535,"y":501,"width":230,"height":1}},{"id":"1028f99c-4843-42df-9a56-8550f6c3c81a","block_type":"box","text":"$68,104","page_number":24,"box":{"x":807,"y":492,"width":62,"height":12}},{"id":"61cdb732-e097-424e-8c20-58e9c931f8bd","block_type":"box","text":"Custodian","page_number":24,"box":{"x":69,"y":525,"width":72,"height":9}},{"id":"5fb85f15-9bd4-4c68-8155-ff6b36fe3f5c","block_type":"box","text":"BNY Mellon, which has its principal offices at 240 Greenwich Street, New York, New York 10286, serves as the","page_number":24,"box":{"x":102,"y":547,"width":794,"height":11}},{"id":"292f050c-4afc-4d71-ae00-e639ea9f29fb","block_type":"box","text":"custodian for the Fund (the “Custodian”). The Custodian, among other responsibilities, maintains a custody account","page_number":24,"box":{"x":69,"y":562,"width":828,"height":12}},{"id":"a1c28405-1b04-40a2-8d93-bf6f36543186","block_type":"box","text":"or accounts in the name of the Fund, receives and delivers all assets for the Fund upon purchase and upon sale or","page_number":24,"box":{"x":69,"y":578,"width":820,"height":11}},{"id":"0dd94cea-f721-4994-966c-31b70bb47b5a","block_type":"box","text":"maturity, and collects and receives all income and other payments and distributions on account of the assets of the","page_number":24,"box":{"x":69,"y":593,"width":825,"height":11}},{"id":"b3dab13c-a702-48ba-9a61-4e68ca7bf0d3","block_type":"box","text":"Fund.","page_number":24,"box":{"x":70,"y":608,"width":36,"height":9}},{"id":"b6d31440-6381-479a-aa86-74d85df0a21c","block_type":"box","text":"Transfer Agency and Shareholders’ Administrative Services","page_number":24,"box":{"x":68,"y":638,"width":432,"height":11}},{"id":"33cb9110-696b-4afc-9c1d-950ded200bd7","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc. serves as the transfer agent and dividend disbursement agent for the","page_number":24,"box":{"x":102,"y":661,"width":803,"height":11}},{"id":"c09c3b03-67ec-418e-8cf6-c9cf5a4dfb4b","block_type":"box","text":"Fund.","page_number":24,"box":{"x":70,"y":676,"width":36,"height":9}},{"id":"deabddc6-98b3-42d2-a880-6d4bfde99cab","block_type":"box","text":"Pursuant to a Shareholders’ Administrative Services Agreement, BlackRock provides certain shareholder liaison","page_number":24,"box":{"x":102,"y":699,"width":797,"height":11}},{"id":"518b8973-701e-4e41-908d-fd2520f5abd1","block_type":"box","text":"services in connection with the Corporation’s investor service center. The Corporation, on behalf of the Fund,","page_number":24,"box":{"x":69,"y":714,"width":776,"height":11}},{"id":"0912fff8-06ff-46ee-82b8-3692eaff3e73","block_type":"box","text":"reimburses BlackRock for its costs in maintaining the service center, which costs include, among other things,","page_number":24,"box":{"x":69,"y":729,"width":787,"height":11}},{"id":"3868d984-6c52-47b9-8e0c-1d92c71d0980","block_type":"box","text":"employee salaries, leasehold expenses, and other out-of-pocket expenses.","page_number":24,"box":{"x":69,"y":744,"width":531,"height":11}},{"id":"bb4ae29f-2e8f-480b-b891-0d6ee5b405c0","block_type":"box","text":"For the periods shown, the Corporation, on behalf of the Fund, reimbursed to BlackRock fees for shareholder","page_number":24,"box":{"x":102,"y":766,"width":775,"height":11}},{"id":"5eaf2b2e-47af-4e3e-be93-5a3b99ad461c","block_type":"box","text":"liaison services pursuant to such agreement as follows.","page_number":24,"box":{"x":70,"y":782,"width":397,"height":11}},{"id":"ff8fc9e0-71e6-4b39-86a4-9861e6871bfb","block_type":"box","text":"Fees Paid","page_number":24,"box":{"x":732,"y":810,"width":56,"height":7}},{"id":"4c030055-b457-4392-b05c-650893e90997","block_type":"box","text":"to BlackRock","page_number":24,"box":{"x":720,"y":820,"width":80,"height":7}},{"id":"e9b689a3-7741-4cbf-9ce5-18db5471be8f","block_type":"box","text":"Fees Waived","page_number":24,"box":{"x":833,"y":810,"width":72,"height":7}},{"id":"afc6f9c0-1db5-4ebd-849c-00fd2c3a8688","block_type":"box","text":"by BlackRock","page_number":24,"box":{"x":830,"y":820,"width":80,"height":9}},{"id":"d66f397e-411b-4a33-bf38-63023565a1d1","block_type":"box","text":"Fiscal Year Ended May 31, 2026. . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":838,"width":457,"height":11}},{"id":"c900a476-2737-4f2b-9d57-f19cf9b40ce4","block_type":"box","text":"....................","page_number":24,"box":{"x":533,"y":845,"width":157,"height":2}},{"id":"87052ae5-5b89-49b1-a476-b3c4de510fca","block_type":"box","text":"$41,136 $41,136","page_number":24,"box":{"x":729,"y":837,"width":171,"height":11}},{"id":"42b2e393-a51e-442d-a823-19bb44a2c9f9","block_type":"box","text":"Fiscal Year Ended May 31, 2025. . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":853,"width":457,"height":11}},{"id":"7e0e0f2a-b129-44d4-8597-a1dbdfc90a5e","block_type":"box","text":"....................","page_number":24,"box":{"x":533,"y":860,"width":157,"height":2}},{"id":"d93f3ec6-72a5-4e77-8c6d-9c6153470de2","block_type":"box","text":"$27,015 $27,015","page_number":24,"box":{"x":729,"y":852,"width":171,"height":11}},{"id":"387f6ffc-a319-4ea9-9448-24b3c628915b","block_type":"box","text":"Fiscal Year Ended May 31, 2024. . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":868,"width":457,"height":11}},{"id":"fc164620-219c-4505-8521-916d9caa814c","block_type":"box","text":"....................","page_number":24,"box":{"x":533,"y":875,"width":157,"height":2}},{"id":"43a37c06-d894-4612-964d-bfc9157dd3b8","block_type":"box","text":"$36,805 $36,805","page_number":24,"box":{"x":729,"y":867,"width":171,"height":11}},{"id":"2ff158c4-d6cc-45b4-a5ed-0a8d1e5c9634","block_type":"box","text":"I-22","page_number":24,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"187bdf19-ee4f-4117-83fb-9d5f28b56e69","block_type":"box","text":"NM1026U-5979889-24/232","page_number":24,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"a9d98ba0-a140-4369-bc34-9c81ed96f04f","block_type":"box","text":"Credit Agreement","page_number":25,"box":{"x":69,"y":45,"width":129,"height":11}},{"id":"ed66e513-970c-4840-ad2d-2c3a826ea831","block_type":"box","text":"The Corporation, on behalf of the Fund, along with certain other funds managed by the Manager and its affiliates","page_number":25,"box":{"x":101,"y":67,"width":804,"height":12}},{"id":"61821d4b-2171-4d52-9892-bb43a49ac6bb","block_type":"box","text":"(“Participating Funds”), is a party to a 364-day, $2.4 billion credit agreement with a group of lenders, which facility","page_number":25,"box":{"x":69,"y":82,"width":817,"height":12}},{"id":"7ad41d70-7a68-4ba7-b61f-391fb3ae4b29","block_type":"box","text":"terminates on April 8, 2027, unless otherwise extended or renewed (the “Credit Agreement”). Excluding","page_number":25,"box":{"x":68,"y":98,"width":743,"height":11}},{"id":"ebcec6fb-55be-4162-80fe-88534ecc6c5f","block_type":"box","text":"commitments designated for certain Participating Funds, the Participating Funds, including the Fund, can borrow up","page_number":25,"box":{"x":69,"y":113,"width":825,"height":11}},{"id":"5f4851aa-249e-4aa1-9fbb-e20501b7930b","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":25,"box":{"x":68,"y":127,"width":818,"height":12}},{"id":"b462a27e-e652-4a71-aef2-2d8b34c551e3","block_type":"box","text":"limitations as specified in the Credit Agreement. The Fund may borrow under the Credit Agreement to meet","page_number":25,"box":{"x":70,"y":143,"width":761,"height":11}},{"id":"e9e195fd-9aa8-48e6-a440-9e12aead023c","block_type":"box","text":"shareholder redemptions and for other lawful purposes. However, the Fund may not borrow under the Credit","page_number":25,"box":{"x":69,"y":158,"width":768,"height":11}},{"id":"73a00365-e61b-4171-aefb-2172d5733b3d","block_type":"box","text":"Agreement for leverage. The Fund may borrow up to the maximum amount allowable under its current Prospectuses","page_number":25,"box":{"x":68,"y":173,"width":825,"height":11}},{"id":"1df8200c-708c-4ae2-9f1e-1c05bbd64f87","block_type":"box","text":"and SAI, subject to various other legal, regulatory or contractual limits. Borrowing results in interest expense and","page_number":25,"box":{"x":69,"y":188,"width":805,"height":12}},{"id":"fe3667ad-b1d5-4a3e-8c5a-2e4264698acd","block_type":"box","text":"other fees and expenses for the Fund which may impact the Fund’s net expenses. The costs of borrowing may reduce","page_number":25,"box":{"x":69,"y":203,"width":838,"height":12}},{"id":"a298b5d3-387f-4a38-b9ae-5c9ddb12ea5f","block_type":"box","text":"the Fund’s return. The Fund is charged its pro rata share of upfront fees and commitment fees on the aggregate","page_number":25,"box":{"x":68,"y":218,"width":801,"height":12}},{"id":"34ceca6c-44eb-49b6-9a72-ec0b37dfdf5e","block_type":"box","text":"commitment amount based on its net assets. If the Fund borrows pursuant to the Credit Agreement, the Fund will be","page_number":25,"box":{"x":69,"y":234,"width":833,"height":11}},{"id":"743338b6-6f2c-4e12-9168-474cb7033e1e","block_type":"box","text":"charged interest at a variable rate.","page_number":25,"box":{"x":69,"y":249,"width":245,"height":11}},{"id":"85e5f972-3e3a-4450-8236-65cf3376cc02","block_type":"box","text":"V. Information on Sales Charges and Distribution Related Expenses","page_number":25,"box":{"x":68,"y":279,"width":491,"height":11}},{"id":"cfdd7d13-8054-4354-83b2-f0ec3e96953b","block_type":"box","text":"Set forth below is information on sales charges (including any contingent deferred sales charges (“CDSCs”))","page_number":25,"box":{"x":102,"y":302,"width":773,"height":11}},{"id":"ff0acb1c-b113-446d-b2bc-a10317d067ca","block_type":"box","text":"received by the Fund, including the amounts paid to affiliates of BlackRock (“affiliates”) for the periods indicated.","page_number":25,"box":{"x":69,"y":317,"width":808,"height":11}},{"id":"ee045039-74e5-48bf-b664-f9f0b4065087","block_type":"box","text":"BlackRock Investments, LLC (“BRIL” or the “Distributor”), an affiliate of BlackRock, acts as the distributor to the","page_number":25,"box":{"x":70,"y":332,"width":801,"height":11}},{"id":"e07436d1-dabe-486c-a804-16d43ddc94d8","block_type":"box","text":"Fund.","page_number":25,"box":{"x":70,"y":347,"width":36,"height":9}},{"id":"b9a7ec0b-f36e-4e61-9c74-4f4d0494e5c8","block_type":"box","text":"Investor A Shares","page_number":25,"box":{"x":636,"y":375,"width":102,"height":7}},{"id":"fa9f00b5-44a8-43be-bab3-d4bd98cdbf2f","block_type":"box","text":"Gross Sales","page_number":25,"box":{"x":466,"y":391,"width":69,"height":7}},{"id":"07b30589-226c-486c-beca-1d616d503914","block_type":"box","text":"Charges","page_number":25,"box":{"x":477,"y":401,"width":47,"height":9}},{"id":"71313afc-e370-40e3-9ec0-e2195af22c87","block_type":"box","text":"Collected","page_number":25,"box":{"x":473,"y":411,"width":55,"height":7}},{"id":"25c4e534-e7c0-4fed-8c33-7a01adece92e","block_type":"box","text":"Sales Charges","page_number":25,"box":{"x":567,"y":391,"width":83,"height":9}},{"id":"36dfcbb2-fb8f-44df-bd2a-fbf97561c13d","block_type":"box","text":"Retained","page_number":25,"box":{"x":583,"y":401,"width":51,"height":7}},{"id":"3fbdd869-defb-49f6-8a0c-71f4230fb133","block_type":"box","text":"by BRIL","page_number":25,"box":{"x":587,"y":411,"width":44,"height":9}},{"id":"1100d8cb-1f35-4d30-831a-b839e8bd95b2","block_type":"box","text":"Sales Charges","page_number":25,"box":{"x":680,"y":391,"width":83,"height":9}},{"id":"29d71068-7986-4e38-beca-7cd31e339d71","block_type":"box","text":"Paid to","page_number":25,"box":{"x":702,"y":401,"width":40,"height":7}},{"id":"c9e6709b-1495-4d87-81fb-204c58263b18","block_type":"box","text":"Affiliates","page_number":25,"box":{"x":696,"y":411,"width":52,"height":7}},{"id":"cfd515bc-e99e-4762-99e6-0f906f1af9a4","block_type":"box","text":"CDSCs Received on","page_number":25,"box":{"x":794,"y":391,"width":115,"height":7}},{"id":"dc65b7f3-4e95-415e-aa4a-b4d3832df21d","block_type":"box","text":"Redemption of Load","page_number":25,"box":{"x":794,"y":401,"width":115,"height":9}},{"id":"46ffaec1-474d-4e53-8af9-849fa814dba2","block_type":"box","text":"Waived Shares","page_number":25,"box":{"x":808,"y":411,"width":86,"height":7}},{"id":"914cd39c-0caf-433c-ad4c-5f7457707be7","block_type":"box","text":"Fiscal Year Ended May 31, 2026 . . . .","page_number":25,"box":{"x":70,"y":429,"width":265,"height":11}},{"id":"ceccbdb6-0926-4366-8168-5b5158348cf3","block_type":"box","text":". . . . . . . . . . . . $ 85,521 $6,741 $6,741","page_number":25,"box":{"x":342,"y":428,"width":406,"height":11}},{"id":"d217a382-14d1-4427-8c08-c61a2402c7a5","block_type":"box","text":"$245","page_number":25,"box":{"x":833,"y":428,"width":37,"height":11}},{"id":"c5a1028b-cf65-4658-b940-5aa3d5133bf0","block_type":"box","text":"Fiscal Year Ended May 31, 2025 . . . .","page_number":25,"box":{"x":70,"y":444,"width":265,"height":11}},{"id":"671a8747-54d2-4227-9732-fe872fe21341","block_type":"box","text":"............","page_number":25,"box":{"x":342,"y":451,"width":91,"height":2}},{"id":"bdc47e43-4288-4ea6-95ba-13969088131a","block_type":"box","text":"$103,882 $8,603 $8,603 $479","page_number":25,"box":{"x":465,"y":443,"width":405,"height":11}},{"id":"c69fd31d-d3f0-4625-af79-58044c96186f","block_type":"box","text":"Fiscal Year Ended May 31, 2024 . . . .","page_number":25,"box":{"x":70,"y":459,"width":265,"height":11}},{"id":"005789a9-0b1d-4c1b-9aa6-6b2b232dc37f","block_type":"box","text":". . . . . . . . . . . . $ 65,587 $5,151 $5,151","page_number":25,"box":{"x":342,"y":458,"width":406,"height":12}},{"id":"f066bfd3-9077-4529-bf45-35dd892992f8","block_type":"box","text":"$461","page_number":25,"box":{"x":833,"y":458,"width":37,"height":11}},{"id":"bbf5eb53-3506-4ea5-acec-658b94f1ecbc","block_type":"box","text":"Investor C Shares","page_number":25,"box":{"x":700,"y":489,"width":102,"height":7}},{"id":"3614315d-3cb3-46cc-9e46-2be0d0f3c07c","block_type":"box","text":"CDSCs Received by BRIL CDSCs Paid to Affiliates","page_number":25,"box":{"x":592,"y":504,"width":317,"height":9}},{"id":"f8baf49b-4c8c-4e99-bec0-bd94b123ad86","block_type":"box","text":"Fiscal Year Ended May 31, 2026 .","page_number":25,"box":{"x":70,"y":522,"width":239,"height":11}},{"id":"289e1d57-40ba-4d68-a760-7a0a422d062a","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 161 $ 161","page_number":25,"box":{"x":315,"y":521,"width":550,"height":11}},{"id":"ca33b7cd-dcd3-4992-8d8a-5dad6ebbda87","block_type":"box","text":"Fiscal Year Ended May 31, 2025 .","page_number":25,"box":{"x":70,"y":537,"width":239,"height":11}},{"id":"08384f39-dec2-476d-9347-d9dfdd56fc7f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,770 $3,770","page_number":25,"box":{"x":315,"y":537,"width":550,"height":11}},{"id":"2e6c3bed-b6d8-4d45-a9db-bf02e7dac8bb","block_type":"box","text":"Fiscal Year Ended May 31, 2024 .","page_number":25,"box":{"x":70,"y":552,"width":239,"height":12}},{"id":"f26dac3b-d1ef-4ed9-89e7-accae70d6fea","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 891 $ 891","page_number":25,"box":{"x":315,"y":552,"width":550,"height":10}},{"id":"2a9d6c6f-31cd-4332-aa99-75c4815d6be8","block_type":"box","text":"The table below sets forth the 12b-1 fees that were paid by the Fund for the fiscal year ended May 31, 2026","page_number":25,"box":{"x":101,"y":576,"width":776,"height":11}},{"id":"13c63ace-d825-4381-8984-0381d29877c3","block_type":"box","text":"pursuant to the Fund’s 12b-1 plan. A portion of the fees collected by BRIL was paid to affiliates for providing","page_number":25,"box":{"x":70,"y":591,"width":773,"height":12}},{"id":"054e94e9-8350-445f-98ae-b54c34f4611f","block_type":"box","text":"shareholder servicing activities for Investor A Shares and for providing shareholder servicing and distribution related","page_number":25,"box":{"x":69,"y":606,"width":827,"height":12}},{"id":"b65ed94b-6fd4-4b5b-9a99-07b850d15f7b","block_type":"box","text":"activities and services for Investor C and Class R Shares.","page_number":25,"box":{"x":69,"y":622,"width":409,"height":9}},{"id":"9e882683-6e15-465a-8cff-44937b5bddc3","block_type":"box","text":"Class Name","page_number":25,"box":{"x":69,"y":650,"width":68,"height":7}},{"id":"08008d1c-ac9d-451a-ab96-b53d10beafbe","block_type":"box","text":"Fees Paid to BRIL","page_number":25,"box":{"x":806,"y":650,"width":103,"height":7}},{"id":"c1f6e56a-bbbf-4b05-baa0-e8bf10034896","block_type":"box","text":"Investor A Shares .","page_number":25,"box":{"x":70,"y":668,"width":134,"height":9}},{"id":"96d6d34c-ed56-4b6b-a9f9-da8fc6c635e3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,","page_number":25,"box":{"x":210,"y":667,"width":626,"height":11}},{"id":"3b3ccd22-d9a6-4751-8933-1bcb60fab45e","block_type":"box","text":"045,660","page_number":25,"box":{"x":838,"y":668,"width":63,"height":10}},{"id":"9fa9d94d-b7f7-4f7d-a431-218aa02f514f","block_type":"box","text":"Investor C Shares . . .","page_number":25,"box":{"x":70,"y":683,"width":150,"height":9}},{"id":"3e5b3379-bba0-4ebe-af35-4ac77a827979","block_type":"box","text":".................................................................... $","page_number":25,"box":{"x":226,"y":682,"width":596,"height":11}},{"id":"d0757cd8-e463-4161-9383-d8809fdaabcd","block_type":"box","text":"137,601","page_number":25,"box":{"x":839,"y":683,"width":62,"height":10}},{"id":"5991b4a9-17f1-48f0-91f4-7ad2cd389aea","block_type":"box","text":"Class R Shares","page_number":25,"box":{"x":69,"y":698,"width":109,"height":9}},{"id":"4a27b777-5628-4eea-afcf-72744adb651c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 29,820","page_number":25,"box":{"x":185,"y":697,"width":716,"height":11}},{"id":"54102466-90ae-47e5-b64d-894bb5725ba0","block_type":"box","text":"VI. Computation of Offering Price Per Share","page_number":25,"box":{"x":68,"y":729,"width":318,"height":11}},{"id":"e006fb70-dfa3-4064-8e51-b45785f27635","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":25,"box":{"x":101,"y":752,"width":790,"height":11}},{"id":"d424bbae-3984-4e98-80a1-35d38ec48d7a","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":25,"box":{"x":68,"y":767,"width":731,"height":11}},{"id":"40984ed7-937c-400a-9d2a-4dc003167087","block_type":"box","text":"May 31, 2026, is set forth below.","page_number":25,"box":{"x":70,"y":782,"width":238,"height":11}},{"id":"7462b3c2-38f2-48ad-ad58-3928e1c49cb2","block_type":"box","text":"Investor A Shares","page_number":25,"box":{"x":805,"y":811,"width":102,"height":7}},{"id":"a7bd43bf-5dbe-4c56-92fc-578e8a793fc1","block_type":"box","text":"Net Assets","page_number":25,"box":{"x":70,"y":828,"width":76,"height":9}},{"id":"e2f7bbeb-e19c-4971-a208-31115c83e131","block_type":"box","text":".............................................................................","page_number":25,"box":{"x":150,"y":836,"width":621,"height":1}},{"id":"367f751d-c53f-42b9-9421-ad5abe3bc17c","block_type":"box","text":"$464,094,596","page_number":25,"box":{"x":803,"y":828,"width":106,"height":11}},{"id":"bcc9c7c4-3485-42ef-96c9-05660f3283b4","block_type":"box","text":"Number of Shares Outstanding . . .","page_number":25,"box":{"x":70,"y":843,"width":245,"height":12}},{"id":"1814e92c-635f-48c7-9a83-dacb83a9c594","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,","page_number":25,"box":{"x":321,"y":843,"width":524,"height":11}},{"id":"78aef171-47fc-442e-99b9-387d448692d7","block_type":"box","text":"877,368","page_number":25,"box":{"x":847,"y":843,"width":62,"height":11}},{"id":"f6495472-f162-484d-8660-ac74100d99c0","block_type":"box","text":"Net Asset Value Per Share (net assets divided by number of shares outstanding)","page_number":25,"box":{"x":70,"y":858,"width":571,"height":12}},{"id":"0f8549ca-7cc6-4bed-ad8f-a285b31a6280","block_type":"box","text":"................","page_number":25,"box":{"x":647,"y":866,"width":124,"height":1}},{"id":"5ada1af1-aeb5-44f0-b70d-2b99f343973a","block_type":"box","text":"$36.04","page_number":25,"box":{"x":857,"y":858,"width":52,"height":10}},{"id":"430c3184-6701-43df-8cca-7e9788e1ce0c","block_type":"box","text":"Sales Charge (5.25% of offering price; 5.54% of net asset value per share)","page_number":25,"box":{"x":69,"y":874,"width":534,"height":11}},{"id":"41ba16f5-ed3b-48ea-b3e1-40e6637fd3ab","block_type":"box","text":"1","page_number":25,"box":{"x":604,"y":874,"width":4,"height":4}},{"id":"a3c1f276-3e98-4290-9451-2c1e0f401096","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . $2.00","page_number":25,"box":{"x":615,"y":873,"width":294,"height":10}},{"id":"e3818689-6fd7-463c-8cdb-371f2916c63e","block_type":"box","text":"Offering Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":25,"box":{"x":69,"y":893,"width":702,"height":11}},{"id":"3953e62c-fe7d-4251-8079-340e7aeef6bc","block_type":"box","text":"$38.04","page_number":25,"box":{"x":857,"y":892,"width":52,"height":11}},{"id":"c2a81066-5904-4787-beb5-ce3356aae697","block_type":"box","text":"I-23","page_number":25,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"66adea0b-b2c3-494b-9251-663da041b341","block_type":"box","text":"NM1026U-5979889-25/232","page_number":25,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4d5d38f5-c816-4345-9c31-3fa95d1b4c91","block_type":"box","text":"1","page_number":26,"box":{"x":69,"y":58,"width":3,"height":3}},{"id":"74c407b9-5c49-4e97-a325-a7d52d593bed","block_type":"box","text":"Rounded to the nearest one-hundredth percent; assumes maximum sales charge is applicable.","page_number":26,"box":{"x":94,"y":58,"width":541,"height":9}},{"id":"c649d87d-8aa1-4bfa-a5e8-044889e9299a","block_type":"box","text":"The offering price for the other share classes of the Fund is equal to the share class’s net asset value computed","page_number":26,"box":{"x":101,"y":79,"width":806,"height":11}},{"id":"32d5309b-88ba-4118-bd88-7509eccb0eb3","block_type":"box","text":"as set forth above for Investor A Shares. Though not subject to a sales charge, certain share classes may be subject","page_number":26,"box":{"x":69,"y":94,"width":837,"height":11}},{"id":"df0232fb-7838-465a-9bf7-5a4763b326c7","block_type":"box","text":"to a CDSC on redemption. For more information on the purchasing and valuation of shares, please see “Purchase of","page_number":26,"box":{"x":68,"y":109,"width":833,"height":11}},{"id":"6062477c-b2ff-4d0b-8287-295c75eebd97","block_type":"box","text":"Shares” and “Pricing of Shares” in Part II of this SAI.","page_number":26,"box":{"x":69,"y":124,"width":377,"height":11}},{"id":"ebd763ba-22ef-41e4-b944-5c933b2cd7ad","block_type":"box","text":"VII. Portfolio Transactions and Brokerage","page_number":26,"box":{"x":68,"y":154,"width":302,"height":11}},{"id":"d6e0f51e-6634-4dbd-9a62-7bf7bae4d383","block_type":"box","text":"See “Portfolio Transactions and Brokerage” in Part II of this SAI for more information.","page_number":26,"box":{"x":102,"y":177,"width":609,"height":11}},{"id":"8a93a26a-e3e0-44e2-b5e8-28c77dd77d86","block_type":"box","text":"Information about the brokerage commissions paid by the Fund, including commissions paid to affiliates, for the","page_number":26,"box":{"x":102,"y":200,"width":800,"height":11}},{"id":"ff8b388c-e856-403a-a2c8-3ee2209af114","block_type":"box","text":"periods shown is set forth below.","page_number":26,"box":{"x":70,"y":215,"width":234,"height":11}},{"id":"df48d82d-1ccb-4465-9aea-c725a1a1668e","block_type":"box","text":"Aggregate Brokerage","page_number":26,"box":{"x":613,"y":243,"width":125,"height":9}},{"id":"4574b442-62a4-4688-a2fd-b325a10eabfe","block_type":"box","text":"Commissions Paid","page_number":26,"box":{"x":623,"y":253,"width":106,"height":7}},{"id":"41b7b075-4d27-4c7d-86b9-4f27a8610efb","block_type":"box","text":"Brokerage Commissions","page_number":26,"box":{"x":769,"y":243,"width":140,"height":9}},{"id":"bcc9d4d7-4352-49bf-ae75-186609012c95","block_type":"box","text":"Paid to Affiliates","page_number":26,"box":{"x":791,"y":253,"width":96,"height":7}},{"id":"efb4b808-ad78-4ba1-b1a3-e9b7597a94b2","block_type":"box","text":"Fiscal Year Ended May 31, 2026. . . . . . . .","page_number":26,"box":{"x":70,"y":271,"width":292,"height":11}},{"id":"fb4ff6b2-32d1-42c8-ace1-71567f6d04a5","block_type":"box","text":"...........................","page_number":26,"box":{"x":369,"y":278,"width":213,"height":2}},{"id":"2b3afecd-2925-4bd6-940a-780373a61e66","block_type":"box","text":"$125,640 $0","page_number":26,"box":{"x":640,"y":270,"width":208,"height":11}},{"id":"5c6f6bdb-df45-4d87-99e7-429f82efeb0d","block_type":"box","text":"Fiscal Year Ended May 31, 2025. . . . . . . .","page_number":26,"box":{"x":70,"y":286,"width":292,"height":11}},{"id":"b171fe38-4ac4-47e5-9c13-6671e706018f","block_type":"box","text":"...........................","page_number":26,"box":{"x":369,"y":293,"width":213,"height":2}},{"id":"e563e774-b4e9-486c-8b60-9dc67be2e01c","block_type":"box","text":"$144,171 $0","page_number":26,"box":{"x":640,"y":285,"width":208,"height":11}},{"id":"ead871da-63ea-4dff-85ac-f746f0f3a22a","block_type":"box","text":"Fiscal Year Ended May 31, 2024. . . . . . . .","page_number":26,"box":{"x":70,"y":301,"width":292,"height":11}},{"id":"ca508173-33e8-406d-b398-ad7752a1b89e","block_type":"box","text":"...........................","page_number":26,"box":{"x":369,"y":308,"width":213,"height":2}},{"id":"c103a7c0-956f-49d2-95c7-8f7f7f6ef69f","block_type":"box","text":"$192,456 $0","page_number":26,"box":{"x":640,"y":300,"width":208,"height":12}},{"id":"33dfcf9c-f1a9-49a2-a2a8-40ec29491a7f","block_type":"box","text":"The following table shows the dollar amount of brokerage commissions paid to brokers for providing Section","page_number":26,"box":{"x":101,"y":325,"width":770,"height":11}},{"id":"4a4ae6b8-6431-4e73-afad-d5d003721d4b","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":26,"box":{"x":69,"y":340,"width":814,"height":11}},{"id":"ab102663-ef08-46d1-b627-ec7f14a1ea98","block_type":"box","text":"the approximate dollar amount of the transactions involved for the fiscal year ended May 31, 2026. The provision of","page_number":26,"box":{"x":68,"y":355,"width":829,"height":11}},{"id":"a4ebca55-5d77-47aa-ad71-ed20c5f24b23","block_type":"box","text":"Section 28(e) research/brokerage services was not necessarily a factor in the placement of all brokerage business","page_number":26,"box":{"x":69,"y":370,"width":822,"height":12}},{"id":"6a82e2c8-e0a3-451b-b2b4-23adfdb0eed6","block_type":"box","text":"with such brokers.","page_number":26,"box":{"x":68,"y":386,"width":130,"height":8}},{"id":"c52403c4-1a96-45b2-a510-76618d8b0177","block_type":"box","text":"Amount of Commissions","page_number":26,"box":{"x":355,"y":414,"width":141,"height":7}},{"id":"2384d737-0c1f-43ff-8114-08dc4121790e","block_type":"box","text":"Paid to Brokers for Providing","page_number":26,"box":{"x":342,"y":424,"width":168,"height":9}},{"id":"1cd82bee-d045-4f98-8054-a626b439066e","block_type":"box","text":"28(e) Eligible Research Services","page_number":26,"box":{"x":330,"y":434,"width":191,"height":9}},{"id":"e968a162-f4f1-4ecb-bebb-1957de2fb3db","block_type":"box","text":"Amount of Brokerage","page_number":26,"box":{"x":588,"y":424,"width":124,"height":9}},{"id":"da8c7bfe-3f75-4f45-8755-85263d9b6c52","block_type":"box","text":"Transactions Involved","page_number":26,"box":{"x":587,"y":434,"width":126,"height":7}},{"id":"fdc833c0-7966-4f07-86cf-3ce415a4d26d","block_type":"box","text":"$66,131 $417,414,591","page_number":26,"box":{"x":395,"y":451,"width":309,"height":11}},{"id":"af6054e1-4880-4758-9efb-54b168e7d652","block_type":"box","text":"The value of the Fund’s aggregate holdings of the securities of its regular brokers or dealers (as defined in Rule","page_number":26,"box":{"x":101,"y":475,"width":796,"height":12}},{"id":"3a8de3ac-7ed1-411d-bf37-f69210db6a90","block_type":"box","text":"10b-1 under the Investment Company Act) or their parents as of May 31, 2026 if any portion of such holdings were","page_number":26,"box":{"x":70,"y":491,"width":821,"height":11}},{"id":"545dd006-5553-48e8-8a3f-d75473ced625","block_type":"box","text":"purchased during the fiscal year ended May 31, 2026, is as follows:","page_number":26,"box":{"x":70,"y":506,"width":485,"height":11}},{"id":"2de08f2d-7acf-4f95-be7e-2fa7d8102bcf","block_type":"box","text":"Regular Broker/Dealer Debt (D)/Equity (E) Aggregate Holdings (000’s)","page_number":26,"box":{"x":69,"y":534,"width":840,"height":9}},{"id":"1018cf09-bbf3-492a-aede-65e81cd03504","block_type":"box","text":"J.P. Morgan Securities LLC . .","page_number":26,"box":{"x":69,"y":552,"width":209,"height":11}},{"id":"8ec284a5-01fa-43d6-ba4a-0067585c2be8","block_type":"box","text":".................................... E","page_number":26,"box":{"x":284,"y":552,"width":380,"height":9}},{"id":"9c4dd2af-ead4-47ef-b706-18b0e6b55a2c","block_type":"box","text":"$19,754","page_number":26,"box":{"x":797,"y":551,"width":62,"height":11}},{"id":"7a0466e8-6bb4-406a-afb2-41a350e2e018","block_type":"box","text":"BofA Securities, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E","page_number":26,"box":{"x":70,"y":567,"width":594,"height":10}},{"id":"69a62bf7-4d5d-4325-bc96-77ef98471925","block_type":"box","text":"$13,466","page_number":26,"box":{"x":797,"y":566,"width":62,"height":11}},{"id":"0c8e8290-5f17-4015-a8ac-8476101ba253","block_type":"box","text":"Morgan Stanley & Co. LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E","page_number":26,"box":{"x":70,"y":582,"width":594,"height":11}},{"id":"59eadbf0-6cc0-4e61-9b25-f7c0629d9e8e","block_type":"box","text":"$13,095","page_number":26,"box":{"x":797,"y":581,"width":62,"height":11}},{"id":"eb914cde-099e-4778-a6f3-883f790e7b0b","block_type":"box","text":"Citigroup Global Markets Inc. .","page_number":26,"box":{"x":69,"y":597,"width":217,"height":11}},{"id":"a4131c80-439d-42b6-92dd-b65d0d335e69","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E $ 7,837","page_number":26,"box":{"x":292,"y":596,"width":567,"height":12}},{"id":"fee50b18-00a9-4261-9e33-d53de88a2d22","block_type":"box","text":"Goldman Sachs & Co. LLC.","page_number":26,"box":{"x":69,"y":612,"width":192,"height":9}},{"id":"fd7e05c0-050b-482f-a47a-72fca2476e17","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E $ 7,545","page_number":26,"box":{"x":268,"y":612,"width":591,"height":11}},{"id":"e9b0b344-b0aa-435f-8915-2eab47efdb96","block_type":"box","text":"Securities Lending","page_number":26,"box":{"x":68,"y":644,"width":135,"height":11}},{"id":"7978a20f-6558-446c-9c48-75ee4a6dbaf2","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":26,"box":{"x":101,"y":667,"width":807,"height":11}},{"id":"b7d1c09e-5834-4977-ad67-a1665b8da6d0","block_type":"box","text":"exemptive order from the Commission permitting it to lend portfolio securities to borrowers affiliated with the Fund","page_number":26,"box":{"x":69,"y":681,"width":817,"height":12}},{"id":"dfdf572a-571f-4c73-b3b8-20168c2829ea","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":26,"box":{"x":69,"y":697,"width":813,"height":11}},{"id":"edf660de-d55a-4031-96d0-18e2b329dc72","block_type":"box","text":"lending, BlackRock Investment Management, LLC (“BIM”) acts as securities lending agent for the Fund, subject to the","page_number":26,"box":{"x":70,"y":712,"width":838,"height":11}},{"id":"e69c7a5e-cbbb-40f9-a8d4-e32cca6745ed","block_type":"box","text":"overall supervision of the Manager, pursuant to a written agreement (the “Securities Lending Agency Agreement”).","page_number":26,"box":{"x":69,"y":727,"width":813,"height":11}},{"id":"653822ed-0715-426b-bc41-f6aab793f793","block_type":"box","text":"BIM administers the lending program in accordance with guidelines approved by the Board of Directors.","page_number":26,"box":{"x":70,"y":742,"width":734,"height":11}},{"id":"b9ad2121-b486-4f23-8292-2ebee4821dda","block_type":"box","text":"The Fund retains a portion of the securities lending income and remits the remaining portion to BIM as","page_number":26,"box":{"x":101,"y":765,"width":735,"height":11}},{"id":"2d2ed60e-0c08-43d2-810a-58f334cdd42d","block_type":"box","text":"compensation for its services as securities lending agent. Securities lending income is generally equal to the total of","page_number":26,"box":{"x":69,"y":780,"width":834,"height":11}},{"id":"d9f9f4b9-5bcb-4d06-96de-44c6ce13a4ad","block_type":"box","text":"income earned from the reinvestment of cash collateral (and excludes collateral investment fees as defined below),","page_number":26,"box":{"x":70,"y":795,"width":822,"height":11}},{"id":"03ac04fd-2ce9-442c-a248-11f9c804b7d8","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":26,"box":{"x":69,"y":810,"width":787,"height":11}},{"id":"675d9355-f8dd-4e36-b136-dfed78f488c3","block_type":"box","text":"operational costs directly related to securities lending. The Fund is responsible for fees in connection with the","page_number":26,"box":{"x":69,"y":825,"width":783,"height":11}},{"id":"8b526432-5345-40f9-a635-137a5817042e","block_type":"box","text":"investment of cash collateral received for securities on loan in a money market fund managed by the Manager (the","page_number":26,"box":{"x":70,"y":840,"width":816,"height":12}},{"id":"5f4dd73f-e48b-41c4-8ee6-4175741084ac","block_type":"box","text":"“collateral investment fees”); however, the securities lending agent has agreed to reduce the amount of securities","page_number":26,"box":{"x":70,"y":855,"width":813,"height":12}},{"id":"d7656c14-8dc0-4898-ac63-246f55aa8c61","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":26,"box":{"x":70,"y":870,"width":830,"height":12}},{"id":"f12796b5-85f6-4cb8-be8b-71c84a0098da","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":26,"box":{"x":69,"y":886,"width":773,"height":11}},{"id":"a9092701-dbad-4b7a-b1e1-53b4f262c0fd","block_type":"box","text":"I-24","page_number":26,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"0f9efe41-0401-4c90-bb12-95fb09284389","block_type":"box","text":"NM1026U-5979889-26/232","page_number":26,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"15bbcb61-78a2-4a04-b38b-ef95b2d8eee9","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":27,"box":{"x":101,"y":45,"width":776,"height":11}},{"id":"b9afcc7c-a922-4aeb-9657-36a3160475e4","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":27,"box":{"x":69,"y":60,"width":831,"height":11}},{"id":"2e3556d9-55c1-43b1-b1a0-b0d7759fc8ec","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":27,"box":{"x":68,"y":75,"width":812,"height":11}},{"id":"2f8c7b9f-5479-44d6-ae7a-6d670b6d35e0","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":27,"box":{"x":69,"y":90,"width":799,"height":11}},{"id":"f080b52a-0dd1-4cdb-ae52-7a80f4191f98","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":27,"box":{"x":68,"y":105,"width":835,"height":11}},{"id":"4031db94-eb20-4dd6-921b-eb8370d13555","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":27,"box":{"x":69,"y":120,"width":818,"height":12}},{"id":"1bee701b-389f-4df2-9f07-901d7f72ead7","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":27,"box":{"x":68,"y":135,"width":789,"height":11}},{"id":"0326f7ff-7c29-4d90-bdcb-b526c7040e6c","block_type":"box","text":"making a good faith estimate of certain costs the money market fund would incur if it were to sell a pro rata amount","page_number":27,"box":{"x":69,"y":150,"width":829,"height":12}},{"id":"741a506b-480b-49d0-8eed-36705eb35696","block_type":"box","text":"of each security in the portfolio to satisfy the amount of net redemptions on that day. There is no limit to the size of a","page_number":27,"box":{"x":69,"y":166,"width":839,"height":11}},{"id":"2ceab22f-a80d-45f0-a3c1-57eb73a6be9c","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":27,"box":{"x":69,"y":181,"width":802,"height":11}},{"id":"310d48cf-8763-4249-b2c1-a567d6e15718","block_type":"box","text":"portfolio security in good faith and supported by data, it is required to apply a default liquidity fee of 1% on the value","page_number":27,"box":{"x":70,"y":196,"width":830,"height":11}},{"id":"60fafe31-7ddd-4cc0-9b83-63e624135954","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":27,"box":{"x":69,"y":211,"width":838,"height":11}},{"id":"bae82e54-913b-4a46-85c6-f1da211f177c","block_type":"box","text":"Fund’s returns on securities lending.","page_number":27,"box":{"x":70,"y":226,"width":258,"height":11}},{"id":"05024c0a-1778-4ba2-9337-562b641d312b","block_type":"box","text":"Under the securities lending program, the Fund is categorized into one of several specific asset classes. The","page_number":27,"box":{"x":102,"y":249,"width":774,"height":11}},{"id":"a3ce215a-b812-4236-9a87-a9958c41f55c","block_type":"box","text":"determination of the Fund’s asset class category (fixed-income, domestic equity, international equity, or fund of","page_number":27,"box":{"x":69,"y":264,"width":794,"height":11}},{"id":"89f43faa-245b-4642-943b-b368f52fa9fd","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":27,"box":{"x":68,"y":279,"width":809,"height":11}},{"id":"ef72c198-651c-4b3e-8274-cc9af971c307","block_type":"box","text":"Corporation and BIM.","page_number":27,"box":{"x":69,"y":294,"width":149,"height":11}},{"id":"55dbb9b9-9ed2-43e3-846f-6c5a37a89ed4","block_type":"box","text":"Pursuant to the securities lending agreement effective January 1, 2026: (i) the Fund retains 81% of securities","page_number":27,"box":{"x":102,"y":317,"width":783,"height":11}},{"id":"44d3fd30-8162-44a2-81ea-3082bb2269f1","block_type":"box","text":"lending income (which excludes collateral investment fees); and (ii) this amount can never be less than 70% of the","page_number":27,"box":{"x":70,"y":332,"width":815,"height":11}},{"id":"be1534ab-0bc8-419f-bb38-5d42e961fd0e","block_type":"box","text":"sum of securities lending income plus collateral investment fees.","page_number":27,"box":{"x":69,"y":347,"width":463,"height":11}},{"id":"f7f5c34c-4e98-4e7d-bd51-03f6f70ae09d","block_type":"box","text":"In addition, commencing the business day following the date that the aggregate securities lending income","page_number":27,"box":{"x":102,"y":370,"width":753,"height":11}},{"id":"43a683e9-7d4e-448c-8528-c23babd44840","block_type":"box","text":"earned across the BlackRock Multi-Asset Complex in a calendar year exceeds specified thresholds, the Fund,","page_number":27,"box":{"x":69,"y":385,"width":778,"height":11}},{"id":"6d278065-5efc-4805-a540-7f33204315f8","block_type":"box","text":"pursuant to the current securities lending agreement, will receive for the remainder of that calendar year securities","page_number":27,"box":{"x":70,"y":400,"width":817,"height":11}},{"id":"d56cb366-62ec-4612-a803-81aff7327ecd","block_type":"box","text":"lending income as follows: (i) 84% of securities lending income (which excludes collateral investment fees); and","page_number":27,"box":{"x":70,"y":415,"width":794,"height":11}},{"id":"73a11caa-d17b-4818-abb1-7e9f22d7a17e","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":27,"box":{"x":69,"y":430,"width":825,"height":11}},{"id":"1c83df9f-c85d-4817-8a61-ebc1fa458df9","block_type":"box","text":"Prior to January 1, 2026, the Fund was subject to the same securities lending fee arrangement.","page_number":27,"box":{"x":102,"y":453,"width":683,"height":11}},{"id":"6adc36a4-6ac5-4930-b0d6-6120c2519e0d","block_type":"box","text":"The services provided to the Fund by BIM, in the most recent fiscal year ended May 31, 2026, primarily included","page_number":27,"box":{"x":101,"y":475,"width":803,"height":12}},{"id":"da41a49a-af36-4ec2-bccd-be31f59c55bd","block_type":"box","text":"the following:","page_number":27,"box":{"x":68,"y":491,"width":93,"height":11}},{"id":"76855b72-0d39-4d43-bbc6-2c8a9470998e","block_type":"box","text":"(1) selecting borrowers from an approved list of borrowers and executing a securities lending agreement as agent","page_number":27,"box":{"x":69,"y":511,"width":818,"height":11}},{"id":"dabd0156-deab-4a4f-8ff3-76ac4e7f1758","block_type":"box","text":"on behalf of the Fund with each such borrower;","page_number":27,"box":{"x":102,"y":526,"width":333,"height":10}},{"id":"50cc3970-e77d-4140-a4a5-1ebdccb78c06","block_type":"box","text":"(2) negotiating the terms of securities loans, including the amount of fees;","page_number":27,"box":{"x":69,"y":546,"width":538,"height":11}},{"id":"6906e255-fd07-438c-973e-5b8f330a846f","block_type":"box","text":"(3) directing the delivery of loaned securities;","page_number":27,"box":{"x":69,"y":566,"width":330,"height":11}},{"id":"73b65ce2-ef96-4d92-84ad-4590484fedf6","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":27,"box":{"x":69,"y":586,"width":834,"height":12}},{"id":"47266def-8a51-48bd-813d-0e7c4cb2e236","block_type":"box","text":"of excess collateral, as necessary;","page_number":27,"box":{"x":102,"y":601,"width":246,"height":12}},{"id":"d60053af-0ba6-4cc3-a12b-cddb5a72b7dc","block_type":"box","text":"(5) investing cash collateral received in connection with any loaned securities;","page_number":27,"box":{"x":69,"y":622,"width":562,"height":11}},{"id":"8105bfbe-9534-4749-925e-c978f88df342","block_type":"box","text":"(6) monitoring distributions on loaned securities (for example, interest and dividend activity);","page_number":27,"box":{"x":69,"y":642,"width":665,"height":11}},{"id":"cd11043e-473a-41d1-aa69-f75e2dd4bd5d","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":27,"box":{"x":69,"y":662,"width":822,"height":11}},{"id":"27e17e88-40c6-4568-8f3a-41a6dab6ea5e","block_type":"box","text":"the liquidation of collateral to purchase replacement securities of the same issue, type, class and series as that","page_number":27,"box":{"x":101,"y":677,"width":803,"height":11}},{"id":"d7502445-3eb3-4862-84d0-a9b22b8e5ad4","block_type":"box","text":"of the loaned securities; and","page_number":27,"box":{"x":102,"y":692,"width":203,"height":11}},{"id":"b78a8113-bea1-4e1a-b6c6-274b7144bf1d","block_type":"box","text":"(8) terminating securities loans and arranging for the return of loaned securities to the Fund at loan termination.","page_number":27,"box":{"x":69,"y":712,"width":808,"height":12}},{"id":"6569c619-49bc-4ead-945b-30942a25b7c0","block_type":"box","text":"I-25","page_number":27,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"dc8b9516-e570-45fb-a299-8944c723e328","block_type":"box","text":"NM1026U-5979889-27/232","page_number":27,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"54434f37-6522-42f2-8282-4c897e8caad1","block_type":"box","text":"The following table shows the dollar amounts of income and fees/compensation related to the securities lending","page_number":28,"box":{"x":101,"y":45,"width":805,"height":11}},{"id":"b538af39-5b23-45fa-b231-9db298f3fb28","block_type":"box","text":"activities of the Fund during its most recent fiscal year ended May 31, 2026.","page_number":28,"box":{"x":69,"y":60,"width":546,"height":11}},{"id":"2ff28ae5-c2b9-49c6-ad2d-ed68fb0d6cab","block_type":"box","text":"Gross income from securities lending activities","page_number":28,"box":{"x":69,"y":88,"width":343,"height":11}},{"id":"6956d055-90fb-480e-b8e8-53f85738873f","block_type":"box","text":"...................................................","page_number":28,"box":{"x":416,"y":95,"width":409,"height":1}},{"id":"05fc770a-f6bd-4fe6-82da-a97a9c4e5a35","block_type":"box","text":"$34,100","page_number":28,"box":{"x":847,"y":87,"width":62,"height":11}},{"id":"b6434e6e-4823-4954-8c4a-5f2d40502c08","block_type":"box","text":"Fees and/or compensation for securities lending activities and related services","page_number":28,"box":{"x":70,"y":107,"width":565,"height":11}},{"id":"f90f7ed9-ae61-46f3-a517-6bf378a30eb4","block_type":"box","text":"Securities lending income paid to BIM for services as securities lending agent . . . . .","page_number":28,"box":{"x":79,"y":122,"width":599,"height":11}},{"id":"2e6f44a0-3218-42c6-a56d-43e4d5432863","block_type":"box","text":". . . . . . . . . . . . . . . . . . $ 2,341","page_number":28,"box":{"x":685,"y":121,"width":224,"height":12}},{"id":"a6d9ef25-81ac-4f83-8d7b-4a0b98443c19","block_type":"box","text":"Cash collateral management expenses not included in securities lending income paid to BIM. .","page_number":28,"box":{"x":79,"y":137,"width":673,"height":12}},{"id":"188e00a4-c65c-4a06-851d-2eedcf320fbd","block_type":"box","text":". . . . . . . . . $ 294","page_number":28,"box":{"x":758,"y":137,"width":151,"height":10}},{"id":"fc9cf12d-b234-494d-b4e9-6cf3a69ef4cb","block_type":"box","text":"Administrative fees not included in securities lending income paid to BIM . . . .","page_number":28,"box":{"x":78,"y":152,"width":551,"height":12}},{"id":"2b2caec9-e471-4dea-8a5b-462b363465f0","block_type":"box","text":"........................ $ 0","page_number":28,"box":{"x":636,"y":152,"width":273,"height":10}},{"id":"151eb5a9-ff0c-4fa5-8801-e30dd03ef37a","block_type":"box","text":"Indemnification fees not included in securities lending income paid to BIM . . . . .","page_number":28,"box":{"x":79,"y":167,"width":567,"height":12}},{"id":"ced63c02-2558-41fd-bbbf-889bf22751d4","block_type":"box","text":"...................... $ 0","page_number":28,"box":{"x":652,"y":167,"width":257,"height":10}},{"id":"ef79c475-2bc2-49d0-b6ed-81760159d2b2","block_type":"box","text":"Rebates (paid to borrowers) . . . . . . . . . . .","page_number":28,"box":{"x":79,"y":183,"width":289,"height":11}},{"id":"b7ebef0f-90a9-4753-9e05-1928dbdfbf53","block_type":"box","text":"........................................................","page_number":28,"box":{"x":375,"y":190,"width":450,"height":1}},{"id":"758b9bbc-0014-44e8-af33-972b5299f49b","block_type":"box","text":"$21,400","page_number":28,"box":{"x":847,"y":182,"width":62,"height":11}},{"id":"3f6df379-9fba-4497-a3b0-4b2a185526be","block_type":"box","text":"Other fees not included in securities lending income paid to BIM. . . . . . . . . . .","page_number":28,"box":{"x":79,"y":198,"width":542,"height":11}},{"id":"a00ff74c-6dfd-4f5e-8fdc-2ed95fc2f8f4","block_type":"box","text":"......................... $ 0","page_number":28,"box":{"x":628,"y":197,"width":281,"height":11}},{"id":"d2a73813-d623-4ed5-96e9-905a4d029ea1","block_type":"box","text":"Aggregate fees/compensation for securities lending activities","page_number":28,"box":{"x":68,"y":213,"width":455,"height":11}},{"id":"85003504-9171-4d8b-a4d3-d6f4acf5dfc8","block_type":"box","text":".....................................","page_number":28,"box":{"x":530,"y":220,"width":295,"height":2}},{"id":"a1e546a6-9cce-4bd0-a279-00e1c1799284","block_type":"box","text":"$24,035","page_number":28,"box":{"x":847,"y":212,"width":62,"height":12}},{"id":"9c3abce4-a760-448d-810b-bc04919e1aea","block_type":"box","text":"Net income from securities lending activities","page_number":28,"box":{"x":69,"y":232,"width":327,"height":11}},{"id":"9ef9b2b1-e8b1-43c6-bc9e-856959609dd9","block_type":"box","text":".....................................................","page_number":28,"box":{"x":399,"y":240,"width":426,"height":1}},{"id":"421455d4-bec9-4501-80fb-888b70574b0c","block_type":"box","text":"$10,065","page_number":28,"box":{"x":847,"y":232,"width":62,"height":11}},{"id":"c2457330-36b1-40e6-91a9-67f98a4d1f10","block_type":"box","text":"VIII. Additional Information","page_number":28,"box":{"x":68,"y":268,"width":195,"height":9}},{"id":"0e3f89a6-29fb-4e81-86e7-fd338192cb49","block_type":"box","text":"Independent Registered Public Accounting Firm.","page_number":28,"box":{"x":102,"y":291,"width":352,"height":11}},{"id":"ee562fc7-0d15-44fb-a3b1-d78a2f06b3b6","block_type":"box","text":"Deloitte & Touche LLP, with offices located at 115 Federal","page_number":28,"box":{"x":461,"y":291,"width":412,"height":10}},{"id":"ca71fdba-5812-42ae-9755-14ccede0091a","block_type":"box","text":"Street, Boston, Massachusetts 02110, serves as the Fund’s independent registered public accounting firm.","page_number":28,"box":{"x":69,"y":306,"width":772,"height":11}},{"id":"ef66e721-0397-46cb-8437-0d7dc2282fbd","block_type":"box","text":"Counsel.","page_number":28,"box":{"x":101,"y":329,"width":62,"height":9}},{"id":"4f2e041e-9a02-4dd5-b829-76bcbe736d31","block_type":"box","text":"Ropes & Gray LLP, with offices at 1211 Avenue of the Americas, New York, New York 10036, serves as","page_number":28,"box":{"x":170,"y":329,"width":736,"height":11}},{"id":"fe07b2c3-ba0f-41a3-84a8-7f7a36151f45","block_type":"box","text":"the Fund’s counsel.","page_number":28,"box":{"x":68,"y":344,"width":139,"height":9}},{"id":"cd974b54-1dbe-4273-99c1-8c3bc891afd3","block_type":"box","text":"Description of Shares","page_number":28,"box":{"x":69,"y":374,"width":156,"height":11}},{"id":"c7d298cf-af96-4809-98e8-1ccc7a953487","block_type":"box","text":"The Corporation is a Maryland corporation incorporated on October 20, 1999 as Merrill Lynch Large Cap Series","page_number":28,"box":{"x":101,"y":397,"width":794,"height":11}},{"id":"d19cac81-6842-4862-9484-289e76955a89","block_type":"box","text":"Funds, Inc. and is registered under the Investment Company Act as an open-end management investment company.","page_number":28,"box":{"x":70,"y":412,"width":823,"height":11}},{"id":"b4255c59-7b64-4118-bca9-310331178bf5","block_type":"box","text":"The Fund is diversified. Effective September 29, 2006, the Corporation changed its name to BlackRock Large Cap","page_number":28,"box":{"x":68,"y":427,"width":814,"height":11}},{"id":"423cb6d3-474f-47cc-bf98-0c831a0159ef","block_type":"box","text":"Series Funds, Inc. Currently, the Corporation is comprised of three series: BlackRock Advantage Large Cap Value","page_number":28,"box":{"x":69,"y":442,"width":802,"height":11}},{"id":"57f892c0-2559-4d09-8bd7-da289dd6813d","block_type":"box","text":"Fund, BlackRock Advantage Large Cap Core Fund and BlackRock Event Driven Equity Fund. The Corporation has an","page_number":28,"box":{"x":70,"y":457,"width":814,"height":12}},{"id":"1cd8de1b-80d4-4a90-ab40-748af14325b8","block_type":"box","text":"authorized capital of 11,650,000,000 shares of Common Stock, par value $0.10 per share. 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For simplicity, this SAI uses the term “Fund” to include both a Feeder Fund and its Master Portfolio.","page_number":31,"box":{"x":68,"y":385,"width":830,"height":11}},{"id":"8f4c39b2-554b-4f13-9c5d-4a11dfef6ac0","block_type":"box","text":"In addition to containing information about the Funds, Part II of this SAI contains general information about all","page_number":31,"box":{"x":102,"y":407,"width":783,"height":12}},{"id":"8554799d-f080-47f0-beed-11610adb4f30","block_type":"box","text":"funds in the BlackRock-advised fund complex. Certain information contained herein may not be relevant to a","page_number":31,"box":{"x":68,"y":423,"width":772,"height":11}},{"id":"f11d7315-6325-4d67-8b4e-cc445ab3d7c2","block_type":"box","text":"particular Fund.","page_number":31,"box":{"x":70,"y":438,"width":109,"height":11}},{"id":"d21c3001-2e31-4c54-8a0d-27b215fa41b4","block_type":"box","text":"INVESTMENT RISKS AND CONSIDERATIONS","page_number":31,"box":{"x":314,"y":467,"width":351,"height":10}},{"id":"94b9ffb5-9a36-49ac-ad62-f8fed3837a2d","block_type":"box","text":"Set forth below are descriptions of some of the types of investments and investment strategies that one or more","page_number":31,"box":{"x":102,"y":490,"width":805,"height":11}},{"id":"36bad929-7b62-44af-b5f2-3681c6076407","block_type":"box","text":"of the Funds may use, and the risks and considerations associated with those investments and investment","page_number":31,"box":{"x":69,"y":505,"width":765,"height":11}},{"id":"0b9aa2ea-77c3-4461-b09c-4b253c1b6715","block_type":"box","text":"strategies. Please see each Fund’s prospectuses (the “Prospectus”) and the “Investment Objective and Policies,”","page_number":31,"box":{"x":69,"y":520,"width":811,"height":12}},{"id":"07ea48d5-9e48-4444-8f0a-7dcf974a56d5","block_type":"box","text":"“Investment Objectives and Policies” or “Investment Strategies and Risks of the Fund” section, as applicable, of Part","page_number":31,"box":{"x":70,"y":535,"width":837,"height":12}},{"id":"3952308c-ef03-4833-8791-d778cdce0d00","block_type":"box","text":"I of this SAI for further information on each Fund’s investment policies and risks. Information contained in this","page_number":31,"box":{"x":70,"y":550,"width":785,"height":11}},{"id":"487c9228-ac49-4d87-b3e7-d5b8b10e3ac5","block_type":"box","text":"section about the risks and considerations associated with a Fund’s investments and/or investment strategies","page_number":31,"box":{"x":69,"y":566,"width":791,"height":11}},{"id":"4bd939c5-b372-45ae-a6c4-402bbd45509c","block_type":"box","text":"applies only to those Funds specifically identified in Part I of this SAI as making each type of investment or using","page_number":31,"box":{"x":69,"y":581,"width":805,"height":11}},{"id":"03a0862a-d22c-4336-9a25-4c6b235a1ebe","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":31,"box":{"x":69,"y":596,"width":835,"height":11}},{"id":"0f9f8058-3d47-4d4b-8878-13d52f32fc73","block_type":"box","text":"a part of that Covered Fund’s SAI and should not be relied on by investors in that Covered Fund. Only information that","page_number":31,"box":{"x":69,"y":611,"width":840,"height":11}},{"id":"4acfcd7d-73bb-4981-ba68-3fd99c59b9ad","block_type":"box","text":"is clearly identified as applicable to a Covered Fund is considered to form a part of that Covered Fund’s SAI.","page_number":31,"box":{"x":70,"y":626,"width":770,"height":11}},{"id":"acf2db9e-ac0f-4cfd-b660-05134227e435","block_type":"box","text":"Asset-Backed Securities.","page_number":31,"box":{"x":101,"y":649,"width":183,"height":9}},{"id":"5b0330d0-94a9-469c-a51a-cbc36e4b8545","block_type":"box","text":"Asset-backed securities are securities backed by home equity loans, installment sale","page_number":31,"box":{"x":290,"y":649,"width":607,"height":11}},{"id":"49fb1319-6e6f-462d-bae5-2fb4e67ec9c5","block_type":"box","text":"contracts, credit card receivables or other assets. Asset-backed securities are “pass-through” securities, meaning","page_number":31,"box":{"x":69,"y":664,"width":814,"height":11}},{"id":"42914c6b-d1b0-4260-891c-9481ea6c926f","block_type":"box","text":"that principal and interest payments — net of expenses — made by the borrower on the underlying assets (such as","page_number":31,"box":{"x":68,"y":679,"width":825,"height":11}},{"id":"81a9595d-6a58-4594-978a-cc673a4927a6","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":31,"box":{"x":69,"y":694,"width":813,"height":11}},{"id":"8be7cc3b-69da-40e0-bd7e-0eba0d4bef93","block_type":"box","text":"fixed-income securities, typically increases when interest rates fall and decreases when interest rates rise. However,","page_number":31,"box":{"x":68,"y":709,"width":830,"height":11}},{"id":"342b56ed-4062-4173-98a7-45dc5a130db6","block_type":"box","text":"asset-backed securities differ from traditional fixed-income securities because of their potential for prepayment. The","page_number":31,"box":{"x":69,"y":724,"width":827,"height":11}},{"id":"145b0a04-5cbf-4f4f-98cf-09cb705dc0b7","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":31,"box":{"x":70,"y":739,"width":813,"height":12}},{"id":"f1102d63-72c8-4434-9510-f4573920fe64","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":31,"box":{"x":68,"y":755,"width":818,"height":11}},{"id":"af6f4baf-6fc0-4a32-adef-19ac75331e9f","block_type":"box","text":"the underlying assets. In a period of declining interest rates, borrowers may prepay the underlying assets more","page_number":31,"box":{"x":68,"y":770,"width":792,"height":11}},{"id":"7aa757ee-0548-4058-97f3-b6987b6d2951","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the asset-backed securities.","page_number":31,"box":{"x":69,"y":785,"width":811,"height":11}},{"id":"ab5bedf9-7df5-4b09-a87c-a83d2b0dc659","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":31,"box":{"x":70,"y":800,"width":832,"height":11}},{"id":"a84920dd-3a5d-45cc-950b-3d961c286aa3","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":31,"box":{"x":70,"y":815,"width":792,"height":11}},{"id":"e422bd5a-30e8-478b-a103-506383986e9e","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":31,"box":{"x":69,"y":830,"width":825,"height":11}},{"id":"b9290648-c3f1-4bb5-b988-37a4c0e7234c","block_type":"box","text":"such securities at a discount, both scheduled payments and unscheduled prepayments will increase current and total","page_number":31,"box":{"x":69,"y":846,"width":838,"height":10}},{"id":"db4e30ae-0790-4907-9433-0fee74373756","block_type":"box","text":"returns and unscheduled prepayments will also accelerate the recognition of income which, when distributed to","page_number":31,"box":{"x":69,"y":860,"width":793,"height":12}},{"id":"4856fb1e-318a-411f-8455-ecb795403463","block_type":"box","text":"shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of the underlying","page_number":31,"box":{"x":69,"y":875,"width":819,"height":12}},{"id":"1347ee29-ade9-4c8e-bf21-ace078230c32","block_type":"box","text":"assets may occur at a slower than expected rate, creating maturity extension risk. This particular risk may effectively","page_number":31,"box":{"x":69,"y":891,"width":834,"height":11}},{"id":"44b48640-ca9b-4455-a8e0-c44039619605","block_type":"box","text":"change a security that was considered short- or intermediate-term at the time of purchase into a longer term security.","page_number":31,"box":{"x":69,"y":906,"width":837,"height":11}},{"id":"93c498e1-c2f0-490d-8baa-59b2321e7f36","block_type":"box","text":"II-1","page_number":31,"box":{"x":478,"y":943,"width":23,"height":9}},{"id":"6bbedde0-4707-4c8f-8888-d84666261d2e","block_type":"box","text":"NM1026U-5979889-31/232","page_number":31,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"6d523827-b667-4a0d-b09f-fd4a05063be2","block_type":"box","text":"Since the value of longer-term securities generally fluctuates more widely in response to changes in interest rates","page_number":32,"box":{"x":69,"y":45,"width":810,"height":11}},{"id":"7506c4e0-e74a-472c-9633-ed1866afcc51","block_type":"box","text":"than does the value of shorter-term securities, maturity extension risk could increase the volatility of the Fund. When","page_number":32,"box":{"x":68,"y":60,"width":833,"height":11}},{"id":"aa813e16-17ed-4049-8e1d-726ca4509406","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":32,"box":{"x":70,"y":75,"width":827,"height":11}},{"id":"6e1c8dc6-bd1e-4313-b404-1712b38397c0","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":32,"box":{"x":68,"y":90,"width":805,"height":11}},{"id":"503df885-27d3-490f-bb08-1d00d703d59a","block_type":"box","text":"retard prepayments and thus affect maturities.","page_number":32,"box":{"x":69,"y":105,"width":333,"height":11}},{"id":"409ccb73-825b-48a6-a2a8-36d2ffb4691f","block_type":"box","text":"Asset-Based Securities.","page_number":32,"box":{"x":101,"y":128,"width":173,"height":9}},{"id":"73311126-56a4-4074-90ea-a68cb0550d38","block_type":"box","text":"Certain Funds may invest in debt, preferred or convertible securities, the principal","page_number":32,"box":{"x":281,"y":128,"width":582,"height":11}},{"id":"a2334ac6-a7c7-478a-a074-f3076d8e50e3","block_type":"box","text":"amount, redemption terms or conversion terms of which are related to the market price of some natural resource","page_number":32,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"14e341fc-5dab-46cc-85aa-0ff2f46a5309","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":32,"box":{"x":69,"y":158,"width":815,"height":11}},{"id":"8e096200-be7f-4c5a-bab6-80604f7def96","block_type":"box","text":"asset-based securities that are rated, or are issued by issuers that have outstanding debt obligations rated,","page_number":32,"box":{"x":69,"y":173,"width":769,"height":11}},{"id":"018ac1fc-6605-4ae1-b8ea-81669729d78d","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":32,"box":{"x":70,"y":188,"width":833,"height":12}},{"id":"553965cd-52bb-45b9-b792-44fc10091df7","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":32,"box":{"x":70,"y":203,"width":795,"height":12}},{"id":"8023a001-dfb1-492d-a682-c8c92ec0df10","block_type":"box","text":"issuers that the Manager has determined to be of similar creditworthiness. Obligations ranked in the fourth highest","page_number":32,"box":{"x":70,"y":218,"width":824,"height":12}},{"id":"70eb4139-0271-46f9-864d-715f446cb1a0","block_type":"box","text":"rating category, while considered “investment grade,” may have certain speculative characteristics and may be more","page_number":32,"box":{"x":69,"y":234,"width":832,"height":11}},{"id":"73f2324b-cba1-427c-831a-b781fb30f7a9","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":32,"box":{"x":70,"y":249,"width":797,"height":11}},{"id":"cf933498-2172-44c5-a0a3-d73f8a13e2a6","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":32,"box":{"x":69,"y":264,"width":768,"height":11}},{"id":"e6c4bda1-fa50-4cb3-b1e6-911eb62e2a5b","block_type":"box","text":"determining the creditworthiness of the issuer. While the market prices for an asset-based security and the related","page_number":32,"box":{"x":69,"y":279,"width":819,"height":11}},{"id":"96458997-29f9-4c27-9fb7-7e4ca00c29da","block_type":"box","text":"natural resource asset generally are expected to move in the same direction, there may not be perfect correlation in","page_number":32,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"c41ee4fb-5718-46e2-9056-2d219c235b40","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":32,"box":{"x":68,"y":309,"width":780,"height":11}},{"id":"a9198e5f-e5ab-4c26-ae15-8236b04a6f2b","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":32,"box":{"x":69,"y":325,"width":815,"height":11}},{"id":"5f9fb97a-6e7e-4a1a-949b-bdb6bc9d32f4","block_type":"box","text":"preferred dividends at below market (or even relatively nominal) rates. Certain asset-based securities may be payable","page_number":32,"box":{"x":70,"y":339,"width":837,"height":12}},{"id":"2c67ceb3-e582-4376-a9ad-4f59a8776076","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":32,"box":{"x":69,"y":355,"width":812,"height":11}},{"id":"3edd707d-e466-4924-9e23-36af84b8d978","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":32,"box":{"x":69,"y":370,"width":836,"height":11}},{"id":"6f714c30-0617-4a55-98d5-d8784b5586d7","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":32,"box":{"x":69,"y":385,"width":778,"height":11}},{"id":"d606761c-d18b-4783-b1d9-e052e898a728","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":32,"box":{"x":69,"y":400,"width":819,"height":11}},{"id":"38d58289-da76-40c1-869d-177490ac80cf","block_type":"box","text":"appreciation in the underlying asset.","page_number":32,"box":{"x":69,"y":415,"width":258,"height":11}},{"id":"e81942da-1906-40df-8969-5bde8c01d3e1","block_type":"box","text":"Precious Metal-Related Securities.","page_number":32,"box":{"x":102,"y":438,"width":243,"height":9}},{"id":"3b10bbe9-5b5c-44b0-84e3-45ccb4a323c5","block_type":"box","text":"A Fund may invest in the equity and other securities of companies that","page_number":32,"box":{"x":351,"y":438,"width":503,"height":11}},{"id":"e3e4962c-26de-4431-9bb6-189a8915800c","block_type":"box","text":"explore for, extract, process or deal in precious metals (","page_number":32,"box":{"x":69,"y":453,"width":398,"height":11}},{"id":"3e2b3f69-bd2a-4c69-8fe4-8cf88b99df78","block_type":"box","text":"e.g.","page_number":32,"box":{"x":469,"y":454,"width":25,"height":10}},{"id":"72333e5e-296d-45bd-975d-05b8f3c7e72a","block_type":"box","text":", gold, silver and platinum), and in asset-based securities","page_number":32,"box":{"x":497,"y":453,"width":407,"height":11}},{"id":"91a93e1d-452f-4dfe-b7d3-f1152b106e5c","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":32,"box":{"x":70,"y":468,"width":801,"height":11}},{"id":"e45039e8-431e-448e-ac59-f9fc3df83592","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":32,"box":{"x":70,"y":483,"width":815,"height":11}},{"id":"2656e30a-7ec4-4f3f-ade0-bd24ccf73b52","block_type":"box","text":"are expected to benefit from inflationary pressure or other economic, political or financial uncertainty or instability.","page_number":32,"box":{"x":69,"y":498,"width":815,"height":11}},{"id":"905117fe-6261-483b-902e-9ff550cf2511","block_type":"box","text":"Based on historical experience, during periods of economic or financial instability the securities of companies","page_number":32,"box":{"x":70,"y":513,"width":779,"height":12}},{"id":"f6b9cc1c-67bf-443d-b799-cd809731777c","block_type":"box","text":"involved in precious metals may be subject to extreme price fluctuations, reflecting the high volatility of precious","page_number":32,"box":{"x":70,"y":528,"width":799,"height":12}},{"id":"296091b5-c674-4ff6-9e06-ccc8fed1cd8f","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":32,"box":{"x":69,"y":543,"width":838,"height":12}},{"id":"246a8d74-a16a-46a1-8b0f-5631c234d4ee","block_type":"box","text":"precious metal-related companies, which may, in turn, adversely affect the financial condition of such companies. The","page_number":32,"box":{"x":70,"y":559,"width":838,"height":11}},{"id":"943199be-2019-4fad-9857-aaee3911d0f3","block_type":"box","text":"major producers of gold include the Republic of South Africa, Russia, Canada, the United States, Brazil and Australia.","page_number":32,"box":{"x":69,"y":574,"width":835,"height":11}},{"id":"2bdc8d4f-d904-4936-b807-23d794dbfc8f","block_type":"box","text":"Sales of gold by Russia are largely unpredictable and often relate to political and economic considerations rather","page_number":32,"box":{"x":69,"y":589,"width":806,"height":11}},{"id":"699a3d67-4011-420a-8d19-0cef05aea97b","block_type":"box","text":"than to market forces. Economic, financial, social and political factors within South Africa may significantly affect","page_number":32,"box":{"x":68,"y":604,"width":805,"height":11}},{"id":"98d87f25-5f56-41cf-bae4-771f1a6c3b1e","block_type":"box","text":"South African gold production.","page_number":32,"box":{"x":69,"y":619,"width":213,"height":11}},{"id":"c7b651d7-d5b4-4ce4-9b35-a7f875eec65c","block_type":"box","text":"Borrowing and Leverage.","page_number":32,"box":{"x":102,"y":642,"width":179,"height":11}},{"id":"22dde480-cc21-460d-9038-8c7253caac83","block_type":"box","text":"Each Fund may borrow as a temporary measure for extraordinary or emergency","page_number":32,"box":{"x":288,"y":642,"width":563,"height":11}},{"id":"6d0204c0-e3af-4c73-807d-e51f834b52f7","block_type":"box","text":"purposes, including to meet redemptions or to settle securities transactions. Certain Funds will not purchase","page_number":32,"box":{"x":70,"y":657,"width":777,"height":11}},{"id":"5f22f119-418d-4729-8030-224dafcef20e","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":32,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"9eedf964-9a1b-47d3-97bf-e0255a561d2c","block_type":"box","text":"(b) to exercise subscription rights when outstanding borrowings have been obtained exclusively for settlements of","page_number":32,"box":{"x":69,"y":687,"width":810,"height":11}},{"id":"d2a931be-beee-4c10-bf2b-e1929c511850","block_type":"box","text":"other securities transactions.","page_number":32,"box":{"x":69,"y":703,"width":207,"height":8}},{"id":"e71c540e-e25f-4ae3-a118-ba74d8d03890","block_type":"box","text":"Certain Funds may also borrow in order to make investments, to the extent disclosed in such Fund’s Prospectus.","page_number":32,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"45f9fad6-f4b9-4614-a56b-c8b55e19785b","block_type":"box","text":"The purchase of securities while borrowings are outstanding will have the effect of leveraging the Fund. Such","page_number":32,"box":{"x":68,"y":740,"width":776,"height":11}},{"id":"8b3fa02a-a99d-4d51-8306-8de114108ad7","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":32,"box":{"x":70,"y":755,"width":813,"height":11}},{"id":"d4fec260-f0b2-4559-b655-c92fb5a13325","block_type":"box","text":"reduce net income. The use of leverage by a Fund creates an opportunity for greater total return, but, at the same","page_number":32,"box":{"x":69,"y":770,"width":813,"height":12}},{"id":"511abc79-5596-4d95-812a-0f3362e38302","block_type":"box","text":"time, creates special risks. For example, leveraging may exaggerate changes in the net asset value (“NAV”) of Fund","page_number":32,"box":{"x":68,"y":785,"width":823,"height":12}},{"id":"e7ccdac0-9e39-494d-b683-0ffed0fd2817","block_type":"box","text":"shares and in the yield on the Fund’s portfolio. Although the principal of such borrowings will be fixed, the Fund’s","page_number":32,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"0e99fb3c-2912-4c17-b592-c84daf5002bf","block_type":"box","text":"assets may change in value during the time the borrowings are outstanding. Borrowings will create interest expenses","page_number":32,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"55f61a08-f4e2-46a0-b11d-83d7cd694c2a","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":32,"box":{"x":68,"y":831,"width":835,"height":11}},{"id":"99084c1d-5b5f-4d12-a317-c5d1894d1eae","block_type":"box","text":"capital appreciation derived from securities purchased with borrowed funds exceeds the interest the Fund will have to","page_number":32,"box":{"x":69,"y":846,"width":838,"height":11}},{"id":"cf6e5e86-80b7-44ac-ae76-2b76679fa9f6","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":32,"box":{"x":70,"y":861,"width":835,"height":11}},{"id":"3cd13df1-fcdf-46bf-9ab2-e36ee8d63ae7","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":32,"box":{"x":69,"y":876,"width":825,"height":11}},{"id":"4248e53d-563d-4963-9141-17faf4dee52c","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":32,"box":{"x":69,"y":891,"width":837,"height":12}},{"id":"c1264f1c-461b-475f-a6bd-4b85c2ff0f7d","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":32,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"327dfdfb-86ae-4bfe-b892-4a86ff775028","block_type":"box","text":"II-2","page_number":32,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"0c1215ae-f688-41a0-b56e-9a952a0c6526","block_type":"box","text":"NM1026U-5979889-32/232","page_number":32,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"420787fb-b246-4ebc-ac2e-85d966b69a92","block_type":"box","text":"nevertheless may determine to maintain the Fund’s leveraged position if it expects that the benefits to the Fund’s","page_number":33,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"4191e8c8-68e8-497a-bb73-8998a425a2f2","block_type":"box","text":"shareholders of maintaining the leveraged position will outweigh the current reduced return.","page_number":33,"box":{"x":69,"y":60,"width":653,"height":11}},{"id":"13495ce2-40b9-496b-97b8-2e323f77961f","block_type":"box","text":"Certain types of borrowings by a Fund may result in the Fund being subject to covenants in credit agreements","page_number":33,"box":{"x":102,"y":82,"width":780,"height":12}},{"id":"0a2c9be3-186d-4cbd-9945-91206e56c3f8","block_type":"box","text":"relating to asset coverage, portfolio composition requirements and other matters. It is not anticipated that","page_number":33,"box":{"x":69,"y":98,"width":759,"height":11}},{"id":"777d9dc8-0be6-441c-a63e-0596ac3bbcea","block_type":"box","text":"observance of such covenants would impede the Manager from managing a Fund’s portfolio in accordance with the","page_number":33,"box":{"x":69,"y":113,"width":822,"height":11}},{"id":"5237fe28-c84a-4679-8a96-30f532a3de2a","block_type":"box","text":"Fund’s investment objectives and policies. However, a breach of any such covenants not cured within the specified","page_number":33,"box":{"x":70,"y":128,"width":816,"height":11}},{"id":"fcdc472f-26a4-4860-bbfc-8cbb08e27d79","block_type":"box","text":"cure period may result in acceleration of outstanding indebtedness and require the Fund to dispose of portfolio","page_number":33,"box":{"x":69,"y":143,"width":792,"height":11}},{"id":"29a75add-102a-40f8-9ba7-5e1c4d3a38cf","block_type":"box","text":"investments at a time when it may be disadvantageous to do so.","page_number":33,"box":{"x":70,"y":158,"width":459,"height":11}},{"id":"50d25a1f-a226-40af-ae0c-a042f3de62f1","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":33,"box":{"x":102,"y":181,"width":786,"height":11}},{"id":"85c27987-565d-45f4-ac54-cc70838fccda","block_type":"box","text":"no less favorable than those available from comparable sources of funds in the marketplace.","page_number":33,"box":{"x":69,"y":196,"width":663,"height":11}},{"id":"209f74ca-6b0a-4260-a521-832fba60aaa9","block_type":"box","text":"Cash Management.","page_number":33,"box":{"x":102,"y":219,"width":140,"height":11}},{"id":"6c38faf2-8a12-40ea-81a6-280a6f44266b","block_type":"box","text":"Generally, the Manager will employ futures and options on futures to provide liquidity","page_number":33,"box":{"x":249,"y":218,"width":603,"height":12}},{"id":"04f1dc39-5a56-4a0c-9c33-0440bcbd0520","block_type":"box","text":"necessary to meet anticipated redemptions or for day-to-day operating purposes. However, if considered appropriate","page_number":33,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"6990b8c7-792e-45de-9654-b1b09a46771a","block_type":"box","text":"in the opinion of the Manager, a portion of a Fund’s assets may be invested in certain types of instruments with","page_number":33,"box":{"x":70,"y":249,"width":799,"height":11}},{"id":"b0a6508a-e50a-44d9-b753-0688c476df4b","block_type":"box","text":"remaining maturities of 397 days or less for liquidity purposes. Such instruments would consist of: (i) obligations of","page_number":33,"box":{"x":69,"y":264,"width":826,"height":11}},{"id":"45023a9c-e129-4109-b686-af95a4dafc99","block_type":"box","text":"the U.S. Government, its agencies, instrumentalities, authorities or political subdivisions (“U.S. Government","page_number":33,"box":{"x":68,"y":279,"width":772,"height":11}},{"id":"85531ef3-0989-4615-9edd-70b768e9868b","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":33,"box":{"x":69,"y":294,"width":823,"height":11}},{"id":"07391e86-4dc7-4bd4-9ac2-aaad484229e7","block_type":"box","text":"comparable quality in the opinion of the Manager; (iii) commercial paper; (iv) bank obligations, including negotiable","page_number":33,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"ac0a7a23-8f27-41da-b250-d3d8a2164f3b","block_type":"box","text":"certificates of deposit, time deposits and bankers’ acceptances; and (v) repurchase agreements. At the time the","page_number":33,"box":{"x":69,"y":324,"width":804,"height":12}},{"id":"94c224e0-c625-4e86-9df7-ad431097fc74","block_type":"box","text":"Fund invests in commercial paper, bank obligations or repurchase agreements, the issuer or the issuer’s parent must","page_number":33,"box":{"x":70,"y":340,"width":839,"height":11}},{"id":"8d87befc-bfd5-4806-9550-c520acf229e7","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":33,"box":{"x":69,"y":355,"width":824,"height":11}},{"id":"b847ddf1-28d6-4e95-8ba4-6b588961dfbd","block_type":"box","text":"obligations or other short-term obligations rated Prime-1 by Moody’s or A-1 by S&P; or, if no such ratings are","page_number":33,"box":{"x":69,"y":370,"width":771,"height":11}},{"id":"b829917b-6437-42e5-9887-399f651eac35","block_type":"box","text":"available, the instrument must be of comparable quality in the opinion of the Manager. For more information on","page_number":33,"box":{"x":69,"y":385,"width":793,"height":11}},{"id":"a328945d-1290-40e8-91ce-7f47b796d56e","block_type":"box","text":"money market instruments, see “Money Market Securities” below.","page_number":33,"box":{"x":69,"y":400,"width":472,"height":11}},{"id":"dfe9b240-8275-4e58-83a6-d68d66fc74dd","block_type":"box","text":"Collateralized Debt Obligations.","page_number":33,"box":{"x":102,"y":423,"width":229,"height":11}},{"id":"015ba1bb-9265-4ed7-975f-5ebf66a50738","block_type":"box","text":"Certain Funds may invest in collateralized debt obligations (“CDOs”), which","page_number":33,"box":{"x":337,"y":423,"width":534,"height":11}},{"id":"01b97fb3-34e6-4178-96b8-9c341a757ada","block_type":"box","text":"include collateralized bond obligations (“CBOs”), collateralized loan obligations (“CLOs”) and other similarly","page_number":33,"box":{"x":70,"y":438,"width":764,"height":11}},{"id":"036d0320-0e4c-4b51-9b6f-c1fa9f607a49","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":33,"box":{"x":69,"y":453,"width":787,"height":11}},{"id":"77dab1db-7354-4b39-b3ba-a923f77295c5","block_type":"box","text":"special purpose entity (“SPE”) and is typically backed by a diversified pool of fixed-income securities (which may","page_number":33,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"ef0ee46a-ea5d-4b65-bc9d-ece0f22b40a8","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":33,"box":{"x":70,"y":483,"width":798,"height":11}},{"id":"9eaf41fa-2c8a-44b7-810c-0d10c0063ff8","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":33,"box":{"x":69,"y":498,"width":827,"height":11}},{"id":"df0c24d7-8a4a-404d-9d70-cb5d8c04d515","block_type":"box","text":"senior secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be rated","page_number":33,"box":{"x":69,"y":514,"width":814,"height":11}},{"id":"2899a8c5-3ee1-403a-9f86-021c6c1febaa","block_type":"box","text":"below investment grade or equivalent unrated loans, held by such issuer. Investments in a CLO organized outside of","page_number":33,"box":{"x":69,"y":528,"width":828,"height":12}},{"id":"f4bb0103-14bd-4626-9b40-6400b966abd1","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":33,"box":{"x":68,"y":543,"width":782,"height":12}},{"id":"3835f61a-f404-45e6-97aa-dde2833e5faa","block_type":"box","text":"substantial portion of which are U.S. loans. Although certain CDOs may benefit from credit enhancement in the form","page_number":33,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"d3aa825e-0e9b-4127-b006-3432c6fe832a","block_type":"box","text":"of a senior-subordinate structure, over-collateralization or bond insurance, such enhancement may not always be","page_number":33,"box":{"x":69,"y":574,"width":803,"height":11}},{"id":"96619d67-0c99-4f2c-aade-eca3e86502fc","block_type":"box","text":"present, and may fail to protect a Fund against the risk of loss on default of the collateral. Certain CDO issuers may","page_number":33,"box":{"x":70,"y":589,"width":827,"height":11}},{"id":"8b665171-0ae5-4209-ad4f-3a414bbf0ecd","block_type":"box","text":"use derivatives contracts to create “synthetic” exposure to assets rather than holding such assets directly, which","page_number":33,"box":{"x":69,"y":604,"width":807,"height":11}},{"id":"e4d06347-b8b2-4705-a965-17a1ef4f13ca","block_type":"box","text":"entails the risks of derivative instruments described elsewhere in this SAI. CDOs may charge management fees and","page_number":33,"box":{"x":69,"y":619,"width":826,"height":11}},{"id":"045b0f7f-97d5-41a7-a149-38a3a87b842b","block_type":"box","text":"administrative expenses, which are in addition to those of a Fund.","page_number":33,"box":{"x":69,"y":634,"width":469,"height":11}},{"id":"3d558d3f-f733-4728-a05c-b7f8b3210264","block_type":"box","text":"For both CBOs and CLOs, the cash flows from the SPE are split into two or more portions, called tranches,","page_number":33,"box":{"x":102,"y":657,"width":758,"height":11}},{"id":"15a62835-4bfd-4703-84d6-fff4fddcb60e","block_type":"box","text":"varying in risk and yield. The riskiest portion is the “equity” tranche, which bears the first loss from defaults from the","page_number":33,"box":{"x":68,"y":672,"width":836,"height":11}},{"id":"37d864e7-b09e-4993-9765-cc34d6efef20","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":33,"box":{"x":69,"y":687,"width":838,"height":11}},{"id":"70dff2f0-aff2-4b35-8edf-5b50bbc0f262","block_type":"box","text":"is not complete). Since it is partially protected from defaults, a senior tranche from a CBO or CLO typically has higher","page_number":33,"box":{"x":70,"y":702,"width":835,"height":12}},{"id":"ac0c5abb-e9d1-4fa9-921c-d0037f19c581","block_type":"box","text":"ratings and lower yields than its underlying securities, and may be rated investment grade. Despite the protection","page_number":33,"box":{"x":69,"y":718,"width":808,"height":11}},{"id":"23d9a6a0-a619-4cbd-94a9-23887309bbc0","block_type":"box","text":"from the equity tranche, CBO or CLO tranches can experience substantial losses due to actual defaults, downgrades","page_number":33,"box":{"x":68,"y":732,"width":830,"height":12}},{"id":"af17eeeb-9406-479e-9a38-0ee79cb7541c","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":33,"box":{"x":69,"y":748,"width":806,"height":11}},{"id":"ac20c022-c188-4be7-8136-4201eef796b7","block_type":"box","text":"tests, increased sensitivity to defaults due to collateral default and disappearance of protecting tranches, market","page_number":33,"box":{"x":68,"y":763,"width":809,"height":11}},{"id":"f389ae4d-66e4-41a4-8ce5-515480e1c233","block_type":"box","text":"anticipation of defaults as well as investor aversion to CBO or CLO securities as a class. Interest on certain tranches","page_number":33,"box":{"x":69,"y":778,"width":835,"height":11}},{"id":"8a4de135-d08d-49b1-a5ab-dd90c3f38cc2","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":33,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"3d6410ae-7ac8-4d1b-91bd-6e8b4b5a0d3d","block_type":"box","text":"cash), which involves continued exposure to default risk with respect to such payments.","page_number":33,"box":{"x":69,"y":808,"width":625,"height":11}},{"id":"2f903024-ecc5-4ddc-b29f-344f9ee63249","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":33,"box":{"x":101,"y":831,"width":789,"height":11}},{"id":"adeb9d48-7bb6-4c7c-a4e1-95bf3633a128","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":33,"box":{"x":69,"y":846,"width":830,"height":11}},{"id":"a9f43389-c042-4827-89f1-4f122404fcdb","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":33,"box":{"x":69,"y":861,"width":830,"height":11}},{"id":"2bf1be65-a3a4-4bfe-a5ba-51d846539932","block_type":"box","text":"for Rule 144A transactions. In addition to the normal risks associated with fixed-income securities and asset-backed","page_number":33,"box":{"x":68,"y":876,"width":831,"height":9}},{"id":"67fec34d-cc0f-4dc3-8b99-718e46710019","block_type":"box","text":"securities generally discussed elsewhere in this SAI, CDOs carry additional risks including, but not limited to: (i) the","page_number":33,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"fdb20cef-3a71-4ca3-b151-307bc0f5b162","block_type":"box","text":"possibility that distributions from collateral securities will not be adequate to make interest or other payments; (ii) the","page_number":33,"box":{"x":70,"y":906,"width":838,"height":12}},{"id":"46508a08-5394-47b0-986a-582afbedc243","block_type":"box","text":"II-3","page_number":33,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"d0398a51-68a7-437d-9465-dfc1da31bbbf","block_type":"box","text":"NM1026U-5979889-33/232","page_number":33,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"5af4ece5-596e-4320-a1a1-1763b40f8114","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":34,"box":{"x":69,"y":45,"width":832,"height":11}},{"id":"09de5320-6318-47bf-ad52-8ffa6dc36ab1","block_type":"box","text":"rating organization (“NRSRO”); (iii) a Fund may invest in tranches of CDOs that are subordinate to other tranches;","page_number":34,"box":{"x":69,"y":60,"width":807,"height":11}},{"id":"46a723b3-da1c-41d2-b1c8-fd94bc19ece0","block_type":"box","text":"(iv) the structure and complexity of the transaction and the legal documents could lead to disputes among investors","page_number":34,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"ee0d4c2a-a900-48ee-9508-8a84f97d6e67","block_type":"box","text":"regarding the characterization of proceeds; (v) the investment return achieved by the Fund could be significantly","page_number":34,"box":{"x":69,"y":90,"width":795,"height":11}},{"id":"8e766b5d-ad01-4877-b61d-79ff2ba54ea0","block_type":"box","text":"different than those predicted by financial models; (vi) the lack of a readily available secondary market for CDOs;","page_number":34,"box":{"x":69,"y":105,"width":804,"height":11}},{"id":"0a6c0728-8eee-4c5e-9ab8-1e6db5ffe5bc","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":34,"box":{"x":69,"y":120,"width":805,"height":12}},{"id":"701061fd-5f47-4fac-a5f8-3eea8a974b2e","block_type":"box","text":"CDO’s manager may perform poorly.","page_number":34,"box":{"x":69,"y":135,"width":257,"height":12}},{"id":"c28c9d96-1f39-4048-9b9f-f1676a37cb2c","block_type":"box","text":"Commercial Paper.","page_number":34,"box":{"x":102,"y":158,"width":136,"height":11}},{"id":"eb5f4782-86b6-40da-b5cd-cdcc7d3e6e69","block_type":"box","text":"Certain Funds may purchase commercial paper. Commercial paper purchasable by each","page_number":34,"box":{"x":244,"y":158,"width":626,"height":11}},{"id":"96dfdb8b-e7fc-4c50-a174-5a3159ebe565","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":34,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"ebcd0334-9264-4766-a529-434afac9df21","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":34,"box":{"x":70,"y":188,"width":806,"height":12}},{"id":"e067d8d9-3ace-403a-aa25-aae4bc8f5481","block_type":"box","text":"restricted as to disposition under the Federal securities laws, and is frequently sold (and resold) to institutional","page_number":34,"box":{"x":69,"y":203,"width":792,"height":12}},{"id":"c88641d6-b488-4c10-b714-46f6072cdd5d","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":34,"box":{"x":70,"y":218,"width":820,"height":12}},{"id":"153d66ae-38fb-49af-b93d-4144d3435528","block_type":"box","text":"4(a)(2) paper, thereby providing liquidity. Certain transactions in Section 4(a)(2) paper may qualify for the registration","page_number":34,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"fde95578-a4e5-45ee-857c-26d78edaaf0c","block_type":"box","text":"exemption provided in Rule 144A under the Securities Act. Most Funds can purchase commercial paper rated (at the","page_number":34,"box":{"x":69,"y":249,"width":831,"height":11}},{"id":"e38d5ea4-57f1-4e06-bb13-7e1c5e46f7ee","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":34,"box":{"x":68,"y":264,"width":805,"height":11}},{"id":"ca460592-5ba7-48f9-847b-4cb2dc8093ba","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":34,"box":{"x":69,"y":279,"width":707,"height":11}},{"id":"ba5a4c92-8ebc-45d3-b1fb-77c14105c8d6","block_type":"box","text":"Commercial paper is generally considered to be short-term unsecured debt of corporations. Like all fixed income","page_number":34,"box":{"x":102,"y":302,"width":801,"height":11}},{"id":"2cbf14a1-5898-4513-ad78-2c55dd0982ac","block_type":"box","text":"securities, commercial paper prices are susceptible to fluctuations in interest rates. If interest rates rise, commercial","page_number":34,"box":{"x":69,"y":317,"width":836,"height":11}},{"id":"fb992a26-822d-4bdb-a56e-d32d957ec514","block_type":"box","text":"paper prices will decline and vice versa. However, the short-term nature of a commercial paper investment generally","page_number":34,"box":{"x":70,"y":332,"width":826,"height":11}},{"id":"9686bfd4-7746-4a05-a4c2-43b0e14e5684","block_type":"box","text":"makes it less susceptible to volatility than many other fixed income securities because interest rate risk typically","page_number":34,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"95f49e8a-e825-409f-b70c-8151bfa5dd9d","block_type":"box","text":"increases as maturity lengths increase. Commercial paper tends to yield smaller returns than longer-term corporate","page_number":34,"box":{"x":70,"y":362,"width":822,"height":11}},{"id":"d035655b-3966-48e5-aaac-8315d6535fe9","block_type":"box","text":"debt because securities with shorter maturities typically have lower effective yields than those with longer maturities.","page_number":34,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"cd40378f-5d8c-4e33-9738-659fe3b8d1ca","block_type":"box","text":"Commodity-Linked Derivative Instruments and Hybrid Instruments.","page_number":34,"box":{"x":102,"y":400,"width":483,"height":11}},{"id":"006e32da-0e3a-4528-a170-e6a3cfc7faa7","block_type":"box","text":"Certain Funds seek to gain exposure to the","page_number":34,"box":{"x":591,"y":400,"width":308,"height":11}},{"id":"6e3626f0-b3a9-4681-9c03-78fce76e3d0d","block_type":"box","text":"commodities markets primarily through investments in hybrid instruments. Hybrid instruments are either equity or","page_number":34,"box":{"x":69,"y":415,"width":809,"height":11}},{"id":"c3915c12-a68e-4021-9286-cb9a4e52c468","block_type":"box","text":"debt derivative securities with one or more commodity-dependent components that have payment features similar to","page_number":34,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"d0237eb9-3884-455d-b300-ebdd8bb42fa7","block_type":"box","text":"a commodity futures contract, a commodity option contract, or a combination of both. Therefore, these instruments","page_number":34,"box":{"x":69,"y":445,"width":822,"height":11}},{"id":"6ef956f2-3f24-4fbe-bb77-613639537eb7","block_type":"box","text":"are “commodity-linked.” They are considered “hybrid” instruments because they have both commodity-like and","page_number":34,"box":{"x":69,"y":461,"width":787,"height":11}},{"id":"12321428-4550-4fc9-ae63-303aa95b1683","block_type":"box","text":"security-like characteristics. Hybrid instruments are derivative instruments because at least part of their value is","page_number":34,"box":{"x":69,"y":475,"width":801,"height":12}},{"id":"735e9d84-b5fd-4bcd-b777-3dbb1a8b4a42","block_type":"box","text":"derived from the value of an underlying commodity, futures contract, index or other readily measurable economic","page_number":34,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"09cc0440-cdfe-401a-b9de-4ce5d1c38298","block_type":"box","text":"variable.","page_number":34,"box":{"x":68,"y":506,"width":59,"height":9}},{"id":"16d11ce4-19aa-4e09-934f-b1bdc70dd4a0","block_type":"box","text":"The prices of commodity-linked derivative instruments may move in different directions than investments in","page_number":34,"box":{"x":101,"y":528,"width":763,"height":12}},{"id":"ca538f85-1a70-4d59-b99a-d0744544ad3d","block_type":"box","text":"traditional equity and debt securities when the value of those traditional securities is declining due to adverse","page_number":34,"box":{"x":68,"y":543,"width":783,"height":12}},{"id":"7dab6853-806c-49e0-be0b-d4fc59bce4c6","block_type":"box","text":"economic conditions. As an example, during periods of rising inflation, debt securities have historically tended to","page_number":34,"box":{"x":69,"y":559,"width":802,"height":11}},{"id":"8517330a-570c-4c75-9b36-aa6d095bde66","block_type":"box","text":"decline in value due to the general increase in prevailing interest rates. Conversely, during those same periods of","page_number":34,"box":{"x":69,"y":574,"width":808,"height":11}},{"id":"19b8d3b8-02d3-4bd0-83dc-33ad46c9af3e","block_type":"box","text":"rising inflation, the prices of certain commodities, such as oil and metals, have historically tended to increase. Of","page_number":34,"box":{"x":69,"y":589,"width":811,"height":11}},{"id":"86b873f5-5212-4be2-885f-66e39bddf641","block_type":"box","text":"course, there cannot be any guarantee that these investments will perform in that manner in the future, and at","page_number":34,"box":{"x":69,"y":604,"width":791,"height":11}},{"id":"981c4a3b-b964-4f9c-9b8f-03bff2104e90","block_type":"box","text":"certain times the price movements of commodity-linked instruments have been parallel to those of debt and equity","page_number":34,"box":{"x":69,"y":619,"width":819,"height":11}},{"id":"c21151e8-993e-4f08-8c7b-c85eeae5975f","block_type":"box","text":"securities. Commodities have historically tended to increase and decrease in value during different parts of the","page_number":34,"box":{"x":69,"y":634,"width":795,"height":12}},{"id":"8cade740-79b4-496a-9c03-c9c773e1f76a","block_type":"box","text":"business cycle than financial assets. Nevertheless, at various times, commodities prices may move in tandem with","page_number":34,"box":{"x":69,"y":649,"width":822,"height":12}},{"id":"626e0f33-ca8d-48d8-8e60-f341f899587e","block_type":"box","text":"the prices of financial assets and thus may not provide overall portfolio diversification benefits. Under favorable","page_number":34,"box":{"x":68,"y":664,"width":797,"height":12}},{"id":"29619bfc-27f2-4501-b1c7-4aad1a98d644","block_type":"box","text":"economic conditions, the Fund’s investments may be expected to under-perform an investment in traditional","page_number":34,"box":{"x":69,"y":680,"width":772,"height":11}},{"id":"9698391a-7570-4868-b52c-a85d2c04df3c","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":34,"box":{"x":69,"y":695,"width":773,"height":11}},{"id":"316f419c-bd86-40e5-aaff-4c98fbefa5be","block_type":"box","text":"correlation with stocks and bonds.","page_number":34,"box":{"x":69,"y":710,"width":244,"height":9}},{"id":"23fa9f52-7c7a-49aa-9b52-aaf32a91b6b1","block_type":"box","text":"Qualifying Hybrid Instruments.","page_number":34,"box":{"x":102,"y":732,"width":212,"height":12}},{"id":"e34aef3a-69e7-4709-ba89-d6019354faf1","block_type":"box","text":"Certain Funds may invest in hybrid instruments that qualify for exclusion from","page_number":34,"box":{"x":320,"y":732,"width":552,"height":12}},{"id":"99ec910f-b445-4204-8179-ff7e7445b135","block_type":"box","text":"regulation under the Commodity Exchange Act and the regulations adopted thereunder. A hybrid instrument that","page_number":34,"box":{"x":69,"y":748,"width":795,"height":11}},{"id":"d8dd8872-c5c2-475c-916e-6e05b21e0436","block_type":"box","text":"qualifies for this exclusion from regulation must be “predominantly a security.” A hybrid instrument is considered to","page_number":34,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"0986e596-5e51-4d88-ace7-3ba0a588fe99","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":34,"box":{"x":69,"y":778,"width":834,"height":11}},{"id":"441f1055-e266-4fd2-b5ec-cac1a4f29f0f","block_type":"box","text":"the hybrid instrument, substantially contemporaneously with delivery of the hybrid instrument; (b) the purchaser or","page_number":34,"box":{"x":68,"y":793,"width":816,"height":11}},{"id":"fbfab8ef-d097-493b-970b-895cf0b70134","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":34,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"f73b5288-17d1-4588-ad91-530542548075","block_type":"box","text":"paid under subparagraph (a), whether as margin, settlement payment, or otherwise, during the life of the hybrid","page_number":34,"box":{"x":70,"y":823,"width":793,"height":12}},{"id":"c16c6d08-868d-46ab-9b90-74baa1ee761d","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":34,"box":{"x":70,"y":838,"width":798,"height":11}},{"id":"c2727d95-3fb0-4e88-b9e6-3221279db3d8","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":34,"box":{"x":69,"y":853,"width":797,"height":12}},{"id":"7b5d142b-9051-411f-9a4c-b809983b50c2","block_type":"box","text":"commodity for future delivery (or option on such a contract) subject to applicable provisions of the Commodity","page_number":34,"box":{"x":69,"y":869,"width":783,"height":11}},{"id":"22b0535c-6a1f-408b-9949-7b785e8d8ec6","block_type":"box","text":"Exchange Act. Hybrid instruments may be principal protected, partially protected, or offer no principal protection. A","page_number":34,"box":{"x":70,"y":884,"width":816,"height":11}},{"id":"05a03d68-bbc4-43b6-b606-260d6f86f2a9","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":34,"box":{"x":70,"y":899,"width":791,"height":11}},{"id":"1686730a-1ff6-40a3-937c-57a86a8439aa","block_type":"box","text":"II-4","page_number":34,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"774ab149-d9dc-4c7f-9167-27f7dc3ec509","block_type":"box","text":"NM1026U-5979889-34/232","page_number":34,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d14247e2-a881-4e79-922d-e7ee304770e0","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":35,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"4fc2b670-1d01-42a4-b18f-f00ca16ec4ce","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":35,"box":{"x":68,"y":60,"width":837,"height":11}},{"id":"95f8f0a9-b171-4ea6-b9f5-74a08af16ebd","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":35,"box":{"x":70,"y":75,"width":772,"height":11}},{"id":"305d7e13-e6a6-462a-864f-a3376cf2045e","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":35,"box":{"x":69,"y":90,"width":839,"height":11}},{"id":"3cdbecf9-a08d-4b93-8e1d-df64542f8655","block_type":"box","text":"level of the underlying commodity. The Manager’s decision whether to use principal protection depends in part on the","page_number":35,"box":{"x":70,"y":105,"width":835,"height":11}},{"id":"e4e3c89a-a185-4e65-afc8-4b85b5d8e814","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":35,"box":{"x":69,"y":120,"width":833,"height":12}},{"id":"144b228d-553b-495d-86b7-5bb1251b953d","block_type":"box","text":"to buy back the security, and, therefore, depends on the creditworthiness of the issuer. With full principal protection,","page_number":35,"box":{"x":68,"y":135,"width":831,"height":11}},{"id":"452e0f8f-707c-4faa-b7aa-b7fd3cf380ac","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":35,"box":{"x":68,"y":150,"width":795,"height":12}},{"id":"0d9d8a08-b5db-40c9-935b-273712c1ebe7","block_type":"box","text":"potentially, an amount greater than the stated par value if the underlying commodity, index, futures contract or","page_number":35,"box":{"x":70,"y":166,"width":784,"height":11}},{"id":"da84d69f-344e-4020-88da-b9dd9e98f37d","block_type":"box","text":"economic variable to which the hybrid instrument is linked has increased in value. Partially protected hybrid","page_number":35,"box":{"x":69,"y":181,"width":765,"height":11}},{"id":"38a0cbff-e3b6-488d-b8c0-95dbfab343b5","block_type":"box","text":"instruments may suffer some loss of principal if the underlying commodity, index, futures contract or economic","page_number":35,"box":{"x":70,"y":196,"width":788,"height":11}},{"id":"43745236-49b8-4d01-852f-da80b0d9b677","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":35,"box":{"x":68,"y":211,"width":828,"height":11}},{"id":"208d90f3-e763-498d-882e-2a0aef5b8316","block_type":"box","text":"partially protected hybrid instruments have a specified limit as to the amount of principal that they may lose.","page_number":35,"box":{"x":70,"y":226,"width":773,"height":11}},{"id":"67b68f0d-9982-40a0-8485-1b25d599c8a0","block_type":"box","text":"Hybrid Instruments Without Principal Protection.","page_number":35,"box":{"x":102,"y":249,"width":339,"height":11}},{"id":"8ad2e7c7-850e-46a2-abdc-cc2806de138e","block_type":"box","text":"Certain Funds may invest in hybrid instruments that offer no","page_number":35,"box":{"x":448,"y":249,"width":429,"height":11}},{"id":"a5b1342d-c0db-4088-b319-eaa78b2418e2","block_type":"box","text":"principal protection. At maturity, there is a risk that the underlying commodity price, futures contract, index or other","page_number":35,"box":{"x":70,"y":264,"width":818,"height":11}},{"id":"c9b6e6eb-37bc-4b27-9980-99a0508d50ca","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":35,"box":{"x":69,"y":279,"width":780,"height":11}},{"id":"338784f6-f5ca-484a-8944-66678fba332c","block_type":"box","text":"instrument might not be returned. The Manager, at its discretion, may invest in a partially protected principal","page_number":35,"box":{"x":70,"y":294,"width":773,"height":11}},{"id":"ddca8ac1-0f28-4bd2-87ce-b942d370c03d","block_type":"box","text":"structured note or a note without principal protection. In deciding to purchase a note without principal protection, the","page_number":35,"box":{"x":69,"y":309,"width":832,"height":11}},{"id":"fb22a806-dd32-45a4-b7d5-1857c64453c0","block_type":"box","text":"Manager may consider, among other things, the expected performance of the underlying commodity futures contract,","page_number":35,"box":{"x":70,"y":324,"width":831,"height":12}},{"id":"20d826b6-d214-47c0-b7c9-27b7e2955d07","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":35,"box":{"x":70,"y":339,"width":831,"height":12}},{"id":"e9f829b3-1039-4da4-90f5-2f40579d57f4","block_type":"box","text":"the Manager believes are relevant.","page_number":35,"box":{"x":68,"y":355,"width":247,"height":11}},{"id":"1f8d6db4-4c36-44f2-ac1b-d89d4fc1d34f","block_type":"box","text":"Limitations on Leverage.","page_number":35,"box":{"x":102,"y":377,"width":173,"height":12}},{"id":"ec7c9855-c7df-443b-a5b7-d12b030b473d","block_type":"box","text":"Some of the hybrid instruments in which a Fund may invest may involve leverage. To","page_number":35,"box":{"x":281,"y":377,"width":598,"height":12}},{"id":"32ec006d-8700-4d4d-836e-c587960532b6","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":35,"box":{"x":69,"y":392,"width":840,"height":12}},{"id":"33bcc5a1-cb4b-446c-aa0d-5dde8aa92f9a","block_type":"box","text":"one hybrid instrument that it buys and the leverage of the Fund’s overall portfolio. A Fund will not invest in a hybrid","page_number":35,"box":{"x":69,"y":407,"width":816,"height":12}},{"id":"e99df8b3-0a0e-4105-b3e3-910d46abd189","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":35,"box":{"x":70,"y":423,"width":812,"height":11}},{"id":"a18198ee-0f44-4a01-9d68-eeb370b51048","block_type":"box","text":"the underlying commodity, futures contract, index or other economic variable or (ii) the Fund’s “portfolio leverage","page_number":35,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"346f2b0a-6334-48c2-a09f-3db62b15e48b","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":35,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"61b764fb-c8f7-4659-9ab1-3d74d63a90e0","block_type":"box","text":"hybrid instrument, assuming a one percent price increase in the underlying commodity, futures contract, index or","page_number":35,"box":{"x":69,"y":468,"width":803,"height":11}},{"id":"0267e720-005c-4ecf-bc75-01cf63943c3e","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":35,"box":{"x":69,"y":483,"width":783,"height":11}},{"id":"d1bb5a7f-d491-4763-a15c-e8951d67e4fb","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":35,"box":{"x":69,"y":498,"width":758,"height":11}},{"id":"2ddf275c-d8bd-4f34-a1f4-9367da85cecd","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":35,"box":{"x":69,"y":513,"width":818,"height":12}},{"id":"0a1d6be6-f2b6-4f26-9359-6fd8bce1fce7","block_type":"box","text":"variable lost 1% of its value. “Portfolio leverage ratio” is defined as the average (mean) leverage ratio of all","page_number":35,"box":{"x":68,"y":528,"width":763,"height":12}},{"id":"a21bdf26-52f9-47e3-a7ac-a776c28ae7a7","block_type":"box","text":"instruments in a Fund’s portfolio, weighted by the market values of such instruments or, in the case of futures","page_number":35,"box":{"x":70,"y":543,"width":787,"height":12}},{"id":"aa75f6fc-150f-4aad-8855-046e8af79b2d","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":35,"box":{"x":69,"y":559,"width":757,"height":11}},{"id":"a5289e6e-2453-4728-ab7d-5e1ba6cc5022","block_type":"box","text":"investments or use less leverage than may otherwise be allowable.","page_number":35,"box":{"x":70,"y":574,"width":477,"height":11}},{"id":"d3ab638d-670b-4d63-b255-07ae618d91d0","block_type":"box","text":"Counterpar ty Risk.","page_number":35,"box":{"x":102,"y":597,"width":130,"height":11}},{"id":"4b0bcb24-b648-4b8e-a8cc-c1b8c749a7ca","block_type":"box","text":"A significant risk of hybrid instruments is counterparty risk. Unlike exchange-traded futures","page_number":35,"box":{"x":238,"y":596,"width":646,"height":12}},{"id":"fc610bb3-0f7a-4abd-a7d9-bec619e4c2a7","block_type":"box","text":"and options, which are standard contracts, hybrid instruments are customized securities, tailor-made by a specific","page_number":35,"box":{"x":69,"y":612,"width":813,"height":11}},{"id":"517174c5-f744-48c9-8775-548c5b702294","block_type":"box","text":"issuer. With a listed futures or options contract, an investor’s counterparty is the exchange clearinghouse. Exchange","page_number":35,"box":{"x":70,"y":627,"width":829,"height":11}},{"id":"a32b3e83-254f-4a46-9684-6b5159791c6d","block_type":"box","text":"clearinghouses are capitalized by the exchange members and typically have high investment grade ratings (","page_number":35,"box":{"x":69,"y":642,"width":763,"height":11}},{"id":"a0b1de0c-93ca-4c12-97b0-bc7e4e6dfa66","block_type":"box","text":"e.g.","page_number":35,"box":{"x":834,"y":643,"width":25,"height":10}},{"id":"6c4a1b77-7365-47aa-b4aa-af87dff23a2b","block_type":"box","text":",","page_number":35,"box":{"x":861,"y":649,"width":2,"height":3}},{"id":"8e07b96a-ccee-4711-a5f6-c3cebc192837","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":35,"box":{"x":69,"y":657,"width":836,"height":11}},{"id":"3d661c9c-893a-4528-ac1a-636aae86ff02","block_type":"box","text":"obligations at maturity. However, with a hybrid instrument, a Fund will take on the counterparty credit risk of the","page_number":35,"box":{"x":69,"y":672,"width":795,"height":11}},{"id":"c002e484-0444-45bd-ab99-28a1450ce3b3","block_type":"box","text":"issuer. That is, at maturity of the hybrid instrument, there is a risk that the issuer may be unable to perform its","page_number":35,"box":{"x":70,"y":687,"width":791,"height":11}},{"id":"b17e8d35-4d37-48db-9bde-83b2da8b2e77","block_type":"box","text":"obligations under the structured note.","page_number":35,"box":{"x":69,"y":703,"width":268,"height":11}},{"id":"523d000c-64ed-441a-bbe5-2de64fb20b50","block_type":"box","text":"Convertible Securities.","page_number":35,"box":{"x":102,"y":725,"width":165,"height":9}},{"id":"43dcbe37-ca27-4dfb-8984-3833827c8920","block_type":"box","text":"A convertible security is a bond, debenture, note, preferred stock or other security that","page_number":35,"box":{"x":273,"y":725,"width":619,"height":11}},{"id":"c5d54bfb-7a8d-4f2b-b7d8-fe1ce0c295ba","block_type":"box","text":"may be converted into or exchanged for a prescribed amount of common stock or other equity security of the same or","page_number":35,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"70682d94-70d6-46ad-9a7a-743ae634c7c8","block_type":"box","text":"a different issuer within a particular period of time at a specified price or formula. A convertible security entitles the","page_number":35,"box":{"x":69,"y":755,"width":826,"height":11}},{"id":"d2ccf94b-b7f4-48af-9d83-ae76c92315e9","block_type":"box","text":"holder to receive interest paid or accrued on debt or the dividend paid on preferred stock until the convertible","page_number":35,"box":{"x":69,"y":770,"width":781,"height":11}},{"id":"c0044b35-a274-4fa2-ac9b-c30005a7c372","block_type":"box","text":"security matures or is redeemed, converted or exchanged. Before conversion, convertible securities have","page_number":35,"box":{"x":69,"y":785,"width":750,"height":12}},{"id":"d03c23f6-2c72-4bf1-901b-62cf0100f1db","block_type":"box","text":"characteristics similar to nonconvertible income securities in that they ordinarily provide a stable stream of income","page_number":35,"box":{"x":69,"y":801,"width":819,"height":11}},{"id":"e465983e-813d-47ea-8c87-36d5a5eecfce","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":35,"box":{"x":68,"y":816,"width":784,"height":11}},{"id":"a65f9006-03f1-440c-896f-74c5238a53a1","block_type":"box","text":"comparable nonconvertible securities. The value of a convertible security is influenced by changes in interest rates,","page_number":35,"box":{"x":69,"y":831,"width":823,"height":11}},{"id":"3c5c4855-2406-40b6-936c-2a0c254eea5d","block_type":"box","text":"with investment value declining as interest rates increase and increasing as interest rates decline. The credit","page_number":35,"box":{"x":68,"y":846,"width":780,"height":11}},{"id":"8f9f0e64-1c01-42d4-a473-669ed24d18a5","block_type":"box","text":"standing of the issuer and other factors also may have an effect on the convertible security’s investment value.","page_number":35,"box":{"x":69,"y":861,"width":795,"height":11}},{"id":"d1a94aa9-76c4-4e43-931a-a959167312cf","block_type":"box","text":"Convertible securities rank senior to common stock in a corporation’s capital structure but are usually subordinated","page_number":35,"box":{"x":69,"y":876,"width":826,"height":11}},{"id":"995214af-7e53-490e-b990-421c5413b03c","block_type":"box","text":"to comparable nonconvertible securities. Convertible securities may be subject to redemption at the option of the","page_number":35,"box":{"x":68,"y":891,"width":811,"height":11}},{"id":"0af42233-f17d-4d65-9608-bb1bd0e7874c","block_type":"box","text":"issuer at a price established in the convertible security’s governing instrument.","page_number":35,"box":{"x":70,"y":907,"width":563,"height":11}},{"id":"758147f0-7b88-4052-b369-a17dede0ef27","block_type":"box","text":"II-5","page_number":35,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"c2278666-e436-4bef-80b9-6fe3e7e3f987","block_type":"box","text":"NM1026U-5979889-35/232","page_number":35,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"cd3cc727-4b6d-4a7d-87ae-24b1f1531e0f","block_type":"box","text":"The characteristics of convertible securities make them potentially attractive investments for an investment","page_number":36,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"651b641e-56d6-4ecd-91ba-50af4cc0af67","block_type":"box","text":"company seeking a high total return from capital appreciation and investment income. These characteristics include","page_number":36,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"acbfaacd-7464-4894-89a1-1c76be5c344f","block_type":"box","text":"the potential for capital appreciation as the value of the underlying common stock increases, the relatively high yield","page_number":36,"box":{"x":68,"y":75,"width":829,"height":11}},{"id":"a26472cb-aef4-48a2-92b7-4c9243fc9655","block_type":"box","text":"received from dividend or interest payments as compared to common stock dividends and decreased risks of decline","page_number":36,"box":{"x":69,"y":90,"width":834,"height":11}},{"id":"f7e4f25a-ba7c-456a-a302-960206d92cdd","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":36,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"6a208743-aefe-47c2-ba4f-703274544b0f","block_type":"box","text":"feature, however, the interest rate or dividend preference on a convertible security is generally less than would be the","page_number":36,"box":{"x":68,"y":120,"width":839,"height":12}},{"id":"3f611a67-4c93-4433-a922-ee53795364f6","block_type":"box","text":"case if the securities were issued in nonconvertible form.","page_number":36,"box":{"x":69,"y":135,"width":409,"height":9}},{"id":"a01c17b3-0a56-4825-ad05-42d54747ddb0","block_type":"box","text":"In analyzing convertible securities, the Manager will consider both the yield on the convertible security relative to","page_number":36,"box":{"x":102,"y":158,"width":802,"height":11}},{"id":"3ac041c2-1c48-46d7-a590-1104d3d985da","block_type":"box","text":"its credit quality and the potential capital appreciation that is offered by the underlying common stock, among other","page_number":36,"box":{"x":70,"y":173,"width":824,"height":11}},{"id":"bba3d783-23c0-4b0b-b69d-c6673704792c","block_type":"box","text":"things.","page_number":36,"box":{"x":68,"y":188,"width":47,"height":12}},{"id":"5d1af894-9ec7-41fb-916c-5548b4b687da","block_type":"box","text":"Convertible securities are issued and traded in a number of securities markets. Even in cases where a","page_number":36,"box":{"x":102,"y":211,"width":731,"height":9}},{"id":"403bd847-a027-4e2a-89ca-59affb50013e","block_type":"box","text":"substantial portion of the convertible securities held by a Fund are denominated in U.S. dollars, the underlying equity","page_number":36,"box":{"x":69,"y":226,"width":836,"height":11}},{"id":"538dd5b9-73d3-4b73-a561-5779f4c29bd9","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":36,"box":{"x":69,"y":241,"width":832,"height":11}},{"id":"f86804ec-e294-43af-8239-082350dc4b93","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":36,"box":{"x":69,"y":257,"width":818,"height":11}},{"id":"bc693449-498e-46fe-bb5a-583723aca90f","block_type":"box","text":"price is quoted will affect the value of the convertible security. With respect to convertible securities denominated in","page_number":36,"box":{"x":70,"y":271,"width":828,"height":12}},{"id":"2a62d640-e996-4ada-872d-ad3da98e8bf0","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":36,"box":{"x":69,"y":286,"width":786,"height":12}},{"id":"c89b7408-11ed-47ae-85f9-fe87122eaba9","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":36,"box":{"x":69,"y":302,"width":800,"height":11}},{"id":"4af5170b-3866-4a97-a01f-be537a70e0df","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":36,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"978bfcab-ba38-4f53-a645-ddfa8b00a4cd","block_type":"box","text":"reduce the effect of exchange rate fluctuations.","page_number":36,"box":{"x":69,"y":332,"width":337,"height":11}},{"id":"1e36632d-047f-4391-bda3-bf0bf0ff15b3","block_type":"box","text":"Apart from currency considerations, the value of convertible securities is influenced by both the yield on","page_number":36,"box":{"x":101,"y":355,"width":741,"height":11}},{"id":"906759f2-2bd4-4a4c-94b9-c2aac0b677d9","block_type":"box","text":"nonconvertible securities of comparable issuers and by the value of the underlying common stock. The value of a","page_number":36,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"cbfb478f-df23-4b7e-8c1f-5002f1549737","block_type":"box","text":"convertible security viewed without regard to its conversion feature (","page_number":36,"box":{"x":69,"y":385,"width":485,"height":11}},{"id":"11c19d6f-e67e-4eb9-8883-28bed9e82644","block_type":"box","text":"i.e.","page_number":36,"box":{"x":557,"y":385,"width":20,"height":9}},{"id":"b3600d1a-6215-4609-9c11-da53a8b98a6f","block_type":"box","text":", strictly on the basis of its yield) is","page_number":36,"box":{"x":579,"y":385,"width":248,"height":11}},{"id":"0a8bc373-e454-48e8-9920-948650cc9858","block_type":"box","text":"sometimes referred to as its “investment value.” To the extent interest rates change, the investment value of the","page_number":36,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"04bd3309-74f9-470a-9e72-c10849fb3b8f","block_type":"box","text":"convertible security typically will fluctuate. At the same time, however, the value of the convertible security will be","page_number":36,"box":{"x":69,"y":415,"width":807,"height":11}},{"id":"1487e55c-5519-4179-9c0c-687c788b0f07","block_type":"box","text":"influenced by its “conversion value,” which is the market value of the underlying common stock that would be","page_number":36,"box":{"x":70,"y":430,"width":778,"height":11}},{"id":"ff251c28-fb8b-40be-b11b-0538221a4ec3","block_type":"box","text":"obtained if the convertible security were converted. Conversion value fluctuates directly with the price of the","page_number":36,"box":{"x":69,"y":445,"width":769,"height":11}},{"id":"685f331c-5587-490e-b202-4ff79715c3a6","block_type":"box","text":"underlying common stock. If the conversion value of a convertible security is substantially below its investment value,","page_number":36,"box":{"x":69,"y":460,"width":837,"height":12}},{"id":"10d683fb-3395-4dac-9800-e953f4d860c0","block_type":"box","text":"the price of the convertible security is governed principally by its investment value. To the extent the conversion value","page_number":36,"box":{"x":68,"y":475,"width":837,"height":12}},{"id":"9fbf09bb-1188-4327-9475-1a87d95beaab","block_type":"box","text":"of a convertible security increases to a point that approximates or exceeds its investment value, the price of the","page_number":36,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"14a6ba94-68cf-4020-b8dd-1e8e1f9e4364","block_type":"box","text":"convertible security will be influenced principally by its conversion value. A convertible security will sell at a premium","page_number":36,"box":{"x":69,"y":506,"width":828,"height":11}},{"id":"194aefce-47b8-4f59-8e06-4f4e4d53cddf","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":36,"box":{"x":69,"y":521,"width":808,"height":11}},{"id":"49527cd4-e91c-41d6-a1fb-c96d25f5c917","block_type":"box","text":"while holding a fixed-income security. The yield and conversion premium of convertible securities issued in Japan and","page_number":36,"box":{"x":68,"y":536,"width":835,"height":11}},{"id":"e2d84489-311b-45c0-8b31-96c1a0407f3f","block_type":"box","text":"the Euromarket are frequently determined at levels that cause the conversion value to affect their market value more","page_number":36,"box":{"x":68,"y":551,"width":836,"height":11}},{"id":"dfe52c5c-baa4-420f-b0a0-5f63b5431a26","block_type":"box","text":"than the securities’ investment value.","page_number":36,"box":{"x":68,"y":566,"width":268,"height":9}},{"id":"2f87dc13-d936-4783-948f-b9f91c222d46","block_type":"box","text":"Holders of convertible securities generally have a claim on the assets of the issuer prior to the common","page_number":36,"box":{"x":102,"y":589,"width":740,"height":11}},{"id":"bde76a16-3c3c-4c4b-9bca-d3b07136042c","block_type":"box","text":"stockholders but may be subordinated to other debt securities of the same issuer. A convertible security may be","page_number":36,"box":{"x":69,"y":604,"width":801,"height":11}},{"id":"3c389bec-e46d-45b1-b0b7-c4fca456c710","block_type":"box","text":"subject to redemption at the option of the issuer at a price established in a charter provision, indenture or other","page_number":36,"box":{"x":69,"y":619,"width":800,"height":11}},{"id":"b0c292e8-f949-4879-a7a3-340d3b56d816","block_type":"box","text":"governing instrument pursuant to which the convertible security was issued. If a convertible security held by a Fund is","page_number":36,"box":{"x":68,"y":634,"width":840,"height":12}},{"id":"96f82feb-57a8-4548-9603-6235b6966ab9","block_type":"box","text":"called for redemption, the Fund will be required to redeem the security, convert it into the underlying common stock","page_number":36,"box":{"x":69,"y":649,"width":823,"height":12}},{"id":"13c993da-67e0-4059-ae3f-44e9e8f713c6","block_type":"box","text":"or sell it to a third party. Certain convertible debt securities may provide a put option to the holder, which entitles the","page_number":36,"box":{"x":69,"y":665,"width":835,"height":11}},{"id":"13a2e8d9-bf53-4d66-816d-daef6ea7fc47","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":36,"box":{"x":69,"y":680,"width":832,"height":11}},{"id":"5014e266-d607-4319-9b36-3f10b3ca9b26","block_type":"box","text":"security under certain circumstances.","page_number":36,"box":{"x":69,"y":695,"width":267,"height":11}},{"id":"f4effdea-518a-4243-ab17-fdc45930dcb7","block_type":"box","text":"A Fund may also invest in synthetic convertible securities. Synthetic convertible securities may include either","page_number":36,"box":{"x":101,"y":718,"width":777,"height":11}},{"id":"a58cd19a-bf15-4453-a5a2-406108f7a7d4","block_type":"box","text":"Cash-Settled Convertibles or Manufactured Convertibles. “Cash-Settled Convertibles” are instruments that are","page_number":36,"box":{"x":69,"y":732,"width":789,"height":10}},{"id":"6227c039-496a-479f-b71b-965c297662e5","block_type":"box","text":"created by the issuer and have the economic characteristics of traditional convertible securities but may not actually","page_number":36,"box":{"x":69,"y":748,"width":831,"height":11}},{"id":"0f7ef9c0-20eb-426d-ba22-4aa3723d1ed1","block_type":"box","text":"permit conversion into the underlying equity securities in all circumstances. As an example, a private company may","page_number":36,"box":{"x":70,"y":763,"width":819,"height":11}},{"id":"132cdd19-634b-4b20-b37e-ac241079b2a2","block_type":"box","text":"issue a Cash-Settled Convertible that is convertible into common stock only if the company successfully completes a","page_number":36,"box":{"x":70,"y":778,"width":833,"height":11}},{"id":"fe3cccfa-0e4d-47d9-8b6f-f8f6098f06af","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":36,"box":{"x":70,"y":793,"width":769,"height":11}},{"id":"14627c63-344c-4ff0-9b54-d3fa7997b9b0","block_type":"box","text":"appreciation. “Manufactured Convertibles” are created by the Manager or another party by combining separate","page_number":36,"box":{"x":69,"y":808,"width":791,"height":11}},{"id":"b018c560-1216-4627-b6a4-4922018c1a74","block_type":"box","text":"securities that possess one of the two principal characteristics of a convertible security,","page_number":36,"box":{"x":69,"y":823,"width":627,"height":11}},{"id":"9925d781-1626-48fe-9fa3-ce2874ad1e2b","block_type":"box","text":"i.e.","page_number":36,"box":{"x":703,"y":823,"width":20,"height":9}},{"id":"2a27e5c6-3314-4f56-a14c-b80e6559df20","block_type":"box","text":", fixed-income (“fixed","page_number":36,"box":{"x":726,"y":823,"width":151,"height":11}},{"id":"9d661c05-1ae9-44ae-bf8a-91fb3cad9e6a","block_type":"box","text":"income component”) or a right to acquire equity securities (“convertibility component”). The fixed-income component","page_number":36,"box":{"x":70,"y":838,"width":830,"height":12}},{"id":"a3d8b362-21e6-4d75-b7a4-486686b81d2b","block_type":"box","text":"is achieved by investing in nonconvertible fixed-income securities, such as nonconvertible bonds, preferred stocks","page_number":36,"box":{"x":70,"y":853,"width":814,"height":12}},{"id":"1b5e7435-ce5d-45e6-8c79-5f4117790f15","block_type":"box","text":"and money market instruments. The convertibility component is achieved by investing in call options, warrants, or","page_number":36,"box":{"x":69,"y":869,"width":811,"height":11}},{"id":"9e3be51b-c7f8-4c7f-a57f-81424177d039","block_type":"box","text":"other securities with equity conversion features (“equity features”) granting the holder the right to purchase a","page_number":36,"box":{"x":69,"y":884,"width":779,"height":11}},{"id":"8a4b8a5c-6851-4a25-be69-6940a47fc153","block_type":"box","text":"II-6","page_number":36,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"718c83b4-f8a7-4ef1-892f-7eca347ea36b","block_type":"box","text":"NM1026U-5979889-36/232","page_number":36,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"3972573f-d375-49a9-a39b-c7096a40c8a9","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":37,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"3d4d3d90-fe83-464a-94af-0885cff95567","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":37,"box":{"x":69,"y":60,"width":744,"height":11}},{"id":"8bc0db48-ece0-4f6a-b1f3-1c82089f0366","block_type":"box","text":"A Manufactured Convertible differs from traditional convertible securities in several respects. Unlike a traditional","page_number":37,"box":{"x":101,"y":82,"width":804,"height":11}},{"id":"75e752c5-3f24-447e-b1a0-3a71f6dc1563","block_type":"box","text":"convertible security, which is a single security that has a unitary market value, a Manufactured Convertible is","page_number":37,"box":{"x":69,"y":98,"width":777,"height":11}},{"id":"ec2a6c4f-764e-4e84-bf54-889e3d3fc626","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":37,"box":{"x":69,"y":113,"width":832,"height":11}},{"id":"47729265-7a2a-4d85-b64d-e572c3328621","block_type":"box","text":"such a Manufactured Convertible is the sum of the values of its fixed-income component and its convertibility","page_number":37,"box":{"x":69,"y":128,"width":781,"height":11}},{"id":"d86110b6-c0f1-4128-aeac-e85f67ee1471","block_type":"box","text":"component.","page_number":37,"box":{"x":69,"y":144,"width":82,"height":10}},{"id":"8d083222-b7c9-4ee5-8dc7-2db8e868617d","block_type":"box","text":"More flexibility is possible in the creation of a Manufactured Convertible than in the purchase of a traditional","page_number":37,"box":{"x":102,"y":166,"width":773,"height":11}},{"id":"4538dd33-013c-4e49-8697-e95e9a755ff7","block_type":"box","text":"convertible security. Because many corporations have not issued convertible securities, the Manager may combine a","page_number":37,"box":{"x":69,"y":181,"width":833,"height":11}},{"id":"f43a6872-6e84-4a51-8eca-db836ca4505d","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":37,"box":{"x":68,"y":196,"width":826,"height":11}},{"id":"96d1d8a9-5903-49c3-b2c0-a70749e22dc3","block_type":"box","text":"to create a synthetic convertible security otherwise unavailable in the market. The Manager may also combine a","page_number":37,"box":{"x":68,"y":211,"width":800,"height":11}},{"id":"a350dc89-5115-42c7-8021-a0fe3e1c28a9","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":37,"box":{"x":68,"y":226,"width":817,"height":11}},{"id":"dcc12a66-ab97-4936-862b-fbf274ff9bd2","block_type":"box","text":"Manager believes such a Manufactured Convertible would better promote a Fund’s objective than alternative","page_number":37,"box":{"x":70,"y":241,"width":772,"height":11}},{"id":"497a8b3b-2852-46a4-8179-59e2e37da513","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":37,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"171c4670-855c-42c3-b758-157f5ec3fc88","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":37,"box":{"x":70,"y":271,"width":790,"height":12}},{"id":"ff64c7ae-b0cd-43cc-82a7-6d5141b99e8b","block_type":"box","text":"Treasury instrument to create a Manufactured Convertible with a higher credit profile than a traditional convertible","page_number":37,"box":{"x":68,"y":286,"width":815,"height":12}},{"id":"e972c721-9030-4174-bdae-e0672f0372c8","block_type":"box","text":"security issued by that issuer. A Manufactured Convertible also is a more flexible investment in that its two","page_number":37,"box":{"x":69,"y":302,"width":764,"height":11}},{"id":"857ba3f3-b0b8-4c99-9bf5-1f661b017f56","block_type":"box","text":"components may be purchased separately and, upon purchasing the separate securities, “combined” to create a","page_number":37,"box":{"x":69,"y":317,"width":806,"height":11}},{"id":"5a62ce10-e2a1-48c6-91cd-c42c636ca2dd","block_type":"box","text":"Manufactured Convertible. For example, the Fund may purchase a warrant for eventual inclusion in a Manufactured","page_number":37,"box":{"x":70,"y":332,"width":818,"height":11}},{"id":"99e3d626-942f-4094-a0b6-e3d2906b3af4","block_type":"box","text":"Convertible while postponing the purchase of a suitable bond to pair with the warrant pending development of more","page_number":37,"box":{"x":69,"y":347,"width":824,"height":11}},{"id":"bb6f0c44-9d26-4366-9a4a-c704d1957da3","block_type":"box","text":"favorable market conditions.","page_number":37,"box":{"x":68,"y":362,"width":202,"height":9}},{"id":"a58321ff-3bb5-4949-bcc1-36ab00444033","block_type":"box","text":"The value of a Manufactured Convertible may respond to certain market fluctuations differently from a traditional","page_number":37,"box":{"x":101,"y":385,"width":805,"height":11}},{"id":"0054a028-6be6-449b-a6c5-891c22bbfee8","block_type":"box","text":"convertible security with similar characteristics. For example, in the event a Fund created a Manufactured Convertible","page_number":37,"box":{"x":69,"y":400,"width":837,"height":11}},{"id":"167a8973-d609-48f3-a0bd-af5ea518c834","block_type":"box","text":"by combining a short-term U.S. Treasury instrument and a call option on a stock, the Manufactured Convertible would","page_number":37,"box":{"x":69,"y":415,"width":839,"height":11}},{"id":"0d79c043-066e-4628-922b-9d774e47cf93","block_type":"box","text":"be expected to outperform a traditional convertible of similar maturity that is convertible into that stock during","page_number":37,"box":{"x":69,"y":430,"width":787,"height":11}},{"id":"432675f5-f7b9-4349-8c6d-5c453888f5a0","block_type":"box","text":"periods when Treasury instruments outperform corporate fixed-income securities and underperform during periods","page_number":37,"box":{"x":70,"y":445,"width":815,"height":12}},{"id":"83d92be2-586f-4e2c-b691-06104cf6a3be","block_type":"box","text":"when corporate fixed-income securities outperform Treasury instruments.","page_number":37,"box":{"x":68,"y":460,"width":523,"height":12}},{"id":"59eded5b-ef05-4730-803e-ad23882b16c4","block_type":"box","text":"Corporate Loans.","page_number":37,"box":{"x":102,"y":483,"width":123,"height":11}},{"id":"9d31f141-581e-489a-8dd2-b85a0a0a01b2","block_type":"box","text":"Certain Funds may invest in corporate loans. Corporate loans are generally non-investment","page_number":37,"box":{"x":231,"y":483,"width":647,"height":11}},{"id":"da97e79d-dfcd-446a-8a54-9c8c41f17584","block_type":"box","text":"grade floating rate instruments. Usually, they are freely callable at the issuer’s option. Certain Funds may invest in","page_number":37,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"3c64e6a3-44b4-4c65-a367-344f253f3fc4","block_type":"box","text":"fixed and floating rate loans (“Loans”) arranged through private negotiations between a corporate borrower or a","page_number":37,"box":{"x":68,"y":513,"width":794,"height":12}},{"id":"04f8b14a-23ff-4125-8e2e-b598cf78e3a5","block_type":"box","text":"foreign sovereign entity and one or more financial institutions or institutional investors (“Lenders”). A Fund may invest","page_number":37,"box":{"x":68,"y":528,"width":841,"height":12}},{"id":"7319afae-7098-4e0f-8e61-6362e8b164e6","block_type":"box","text":"in such Loans in the form of participations in Loans (“Participations”) and assignments of all or a portion of Loans","page_number":37,"box":{"x":70,"y":543,"width":818,"height":12}},{"id":"34d003cc-6a99-4cb1-a7f6-4c03000cb518","block_type":"box","text":"from third parties (“Assignments”). A Fund considers these investments to be investments in debt securities for","page_number":37,"box":{"x":68,"y":559,"width":801,"height":11}},{"id":"88226f3e-d17c-482e-afe7-fc46fc24a18b","block_type":"box","text":"purposes of its investment policies. Participations typically will result in the Fund having a contractual relationship","page_number":37,"box":{"x":70,"y":574,"width":811,"height":11}},{"id":"2183743f-5b7d-4605-9b21-9b1c800a99af","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":37,"box":{"x":69,"y":589,"width":833,"height":11}},{"id":"bbcb187a-4cb6-4b94-8d10-8edf87934d8d","block_type":"box","text":"any fees to which it is entitled only from the Lender selling the Participation and only upon receipt by the Lender of","page_number":37,"box":{"x":69,"y":604,"width":817,"height":11}},{"id":"3be36fb4-617c-42c6-9634-5c35e6cbd87f","block_type":"box","text":"the payments from the borrower. In connection with purchasing Participations, the Fund generally will have no right to","page_number":37,"box":{"x":68,"y":619,"width":836,"height":11}},{"id":"fe947100-e466-4a80-8c26-d4b795bbb9bd","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":37,"box":{"x":69,"y":634,"width":833,"height":12}},{"id":"2a4aecda-1f81-4159-af92-bc1828686968","block_type":"box","text":"off against the borrower, and the Fund may not benefit directly from any collateral supporting the Loan in which it has","page_number":37,"box":{"x":69,"y":649,"width":837,"height":12}},{"id":"26a12e44-c3f9-4a54-8fb3-3759e711ecbd","block_type":"box","text":"purchased the Participation. As a result, the Fund will assume the credit risk of both the borrower and the Lender","page_number":37,"box":{"x":70,"y":664,"width":809,"height":11}},{"id":"4351beca-7832-418f-b1de-51d9a0b06372","block_type":"box","text":"that is selling the Participation. In the event of the insolvency of the Lender selling the Participation, the Fund may be","page_number":37,"box":{"x":68,"y":680,"width":838,"height":11}},{"id":"635aa943-aa7c-4415-825c-ae8be1d16639","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":37,"box":{"x":68,"y":695,"width":772,"height":11}},{"id":"5e54fa41-bdd1-4a14-acbd-182aa7041823","block_type":"box","text":"borrower. The Fund will acquire Participations only if the Lender interpositioned between the Fund and the borrower is","page_number":37,"box":{"x":69,"y":710,"width":837,"height":11}},{"id":"76845dc5-822a-4fca-98c6-724cc37cc7bf","block_type":"box","text":"determined by the Fund’s manager to be creditworthy. When the Fund purchases Assignments from Lenders, the","page_number":37,"box":{"x":69,"y":725,"width":804,"height":11}},{"id":"5995ca76-d5ca-41d9-992e-e8d94f1903a4","block_type":"box","text":"Fund will acquire direct rights against the borrower on the Loan, and will not have exposure to a counterparty’s credit","page_number":37,"box":{"x":70,"y":740,"width":834,"height":11}},{"id":"0635cec6-2160-442b-b948-c26f6843fb2c","block_type":"box","text":"risk. The Funds may enter into Participations and Assignments on a forward commitment or “when-issued” basis,","page_number":37,"box":{"x":69,"y":755,"width":809,"height":11}},{"id":"2e388156-5d7c-49c2-bc2b-e884860e6bed","block_type":"box","text":"whereby a Fund would agree to purchase a Participation or Assignment at set terms in the future. For more","page_number":37,"box":{"x":68,"y":770,"width":764,"height":12}},{"id":"93684b1a-e063-436e-b1c5-048a77444204","block_type":"box","text":"information on forward commitments and when-issued securities, see “When-Issued Securities, Delayed Delivery","page_number":37,"box":{"x":70,"y":785,"width":805,"height":12}},{"id":"70c1b34b-05a7-4c0a-a9cf-3186a4b5ab9e","block_type":"box","text":"Securities and Forward Commitments” below.","page_number":37,"box":{"x":69,"y":801,"width":324,"height":9}},{"id":"ebcb95b0-9f24-402a-9c7d-b538a04a97b0","block_type":"box","text":"A Fund may have difficulty disposing of Assignments and Participations. In certain cases, the market for such","page_number":37,"box":{"x":101,"y":823,"width":782,"height":12}},{"id":"dd7a9bec-b4f0-4099-b335-55a102326ab2","block_type":"box","text":"instruments may lack sufficient liquidity, and therefore the Fund anticipates that in such cases such instruments","page_number":37,"box":{"x":70,"y":838,"width":803,"height":11}},{"id":"041eda5a-6c74-43df-b9bc-e6210618e591","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":37,"box":{"x":69,"y":853,"width":809,"height":12}},{"id":"0b0bcaa1-8958-4fa5-83e0-9a2c5bd9c972","block_type":"box","text":"may have an adverse impact on the value of such instruments and on the Fund’s ability to dispose of particular","page_number":37,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"d8acc965-a784-4964-89ef-db4d5ebe347c","block_type":"box","text":"Assignments or Participations in response to a specific economic event, such as deterioration in the creditworthiness","page_number":37,"box":{"x":68,"y":884,"width":841,"height":11}},{"id":"1e5f76ab-0251-4dd4-a640-9d3d9f6b5923","block_type":"box","text":"of the borrower.","page_number":37,"box":{"x":69,"y":899,"width":111,"height":9}},{"id":"74948ae7-e787-490c-b3d0-7837a7d8458b","block_type":"box","text":"II-7","page_number":37,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"d9701c0c-6f1b-4ba3-812a-a6cb613ce9a0","block_type":"box","text":"NM1026U-5979889-37/232","page_number":37,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"713cc874-79b7-4e97-9d55-5ad404282ce3","block_type":"box","text":"Leading financial institutions often act as agent for a broader group of Lenders, generally referred to as a","page_number":38,"box":{"x":102,"y":45,"width":750,"height":11}},{"id":"89b24265-26bb-49c1-b76e-827aec7507f6","block_type":"box","text":"syndicate. The syndicate’s agent arranges the loans, holds collateral and accepts payments of principal and interest.","page_number":38,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"25ea6a5f-ab49-492b-b26f-b711ca0f781e","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":38,"box":{"x":70,"y":75,"width":816,"height":11}},{"id":"689b48b4-2945-4bbf-a004-af088ab8ce18","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":38,"box":{"x":101,"y":98,"width":740,"height":11}},{"id":"11cd755e-d3be-4b73-935d-796d711295fb","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":38,"box":{"x":69,"y":113,"width":827,"height":11}},{"id":"3d28e403-ad9c-4f6c-a4c1-8af86f4da19b","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":38,"box":{"x":70,"y":128,"width":802,"height":11}},{"id":"89e954f8-7180-4e06-9802-f242b4861f50","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":38,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"e8b4975a-353b-40a5-bd06-a5c847b01338","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":38,"box":{"x":70,"y":158,"width":827,"height":11}},{"id":"c03b834e-d652-4762-8808-86d0bcc3ac17","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":38,"box":{"x":69,"y":173,"width":777,"height":11}},{"id":"90e1abc6-86bc-452e-8c24-6d77489a4267","block_type":"box","text":"investment and may not receive interest during the delay.","page_number":38,"box":{"x":70,"y":188,"width":406,"height":12}},{"id":"0f416e8f-1fbd-4390-b175-eb486682c41f","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":38,"box":{"x":101,"y":211,"width":752,"height":11}},{"id":"48116c22-fd97-4815-bd95-9729d5068f64","block_type":"box","text":"corporate loans may not be readily available to make additional investments or to meet a Fund’s redemption","page_number":38,"box":{"x":69,"y":226,"width":773,"height":11}},{"id":"8c05f294-d5df-4c31-bb65-9ebc6d239bc8","block_type":"box","text":"obligations. To the extent the extended settlement process gives rise to short-term liquidity needs, a Fund may hold","page_number":38,"box":{"x":69,"y":241,"width":824,"height":11}},{"id":"27f4addf-3150-4934-a2e7-96938081999d","block_type":"box","text":"additional cash, sell investments or temporarily borrow from banks and other lenders.","page_number":38,"box":{"x":69,"y":256,"width":610,"height":11}},{"id":"a2807fee-6937-45da-acc8-8ec128792a5d","block_type":"box","text":"In certain circumstances, Loans may not be deemed to be securities under certain federal securities laws.","page_number":38,"box":{"x":102,"y":279,"width":759,"height":11}},{"id":"dffc932b-fe6f-42c9-9a51-99f5ee65932f","block_type":"box","text":"Therefore, in the event of fraud or misrepresentation by a borrower or an arranger, Lenders and purchasers of","page_number":38,"box":{"x":68,"y":294,"width":784,"height":11}},{"id":"3f148818-a6a1-4650-bd99-5bdb68498b66","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":38,"box":{"x":70,"y":309,"width":772,"height":11}},{"id":"4a1603ad-826a-4b60-b2bc-f5096cc2387d","block_type":"box","text":"securities laws as would otherwise be available for bonds or stocks. Instead, in such cases, parties generally would","page_number":38,"box":{"x":69,"y":324,"width":827,"height":12}},{"id":"4041c646-ca04-419d-936c-721258466ac2","block_type":"box","text":"rely on the contractual provisions in the Loan agreement itself and common-law fraud protections under applicable","page_number":38,"box":{"x":69,"y":339,"width":815,"height":12}},{"id":"09d358ae-d445-4dbd-a148-20a1d855ba79","block_type":"box","text":"state law.","page_number":38,"box":{"x":69,"y":355,"width":67,"height":9}},{"id":"2de022a0-5333-4dc3-830d-8d8092b4814f","block_type":"box","text":"Direct Lending.","page_number":38,"box":{"x":102,"y":377,"width":105,"height":12}},{"id":"7f753639-194e-413c-8845-b81e6c17c7e3","block_type":"box","text":"The Fund may act as the originator for direct loans and engage in direct lending. Direct loans","page_number":38,"box":{"x":213,"y":377,"width":660,"height":12}},{"id":"589e7732-0876-4684-997c-f809ad039ab5","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":38,"box":{"x":69,"y":393,"width":817,"height":11}},{"id":"238bcc64-7f57-4fa1-a776-24b2e49f133d","block_type":"box","text":"financing to commercial borrowers directly or through companies acquired (or created) and owned by or otherwise","page_number":38,"box":{"x":68,"y":407,"width":811,"height":12}},{"id":"9419d5c2-39b9-444c-a1d5-0361194dc9f4","block_type":"box","text":"affiliated with the Fund. The terms of the direct loans are negotiated with borrowers in private transactions.","page_number":38,"box":{"x":69,"y":423,"width":764,"height":11}},{"id":"eecdb493-1980-424a-adfb-4a6b43bd4795","block_type":"box","text":"Furthermore, a direct loan may be secured or unsecured.","page_number":38,"box":{"x":70,"y":438,"width":405,"height":11}},{"id":"69b6fc93-bab2-485e-b0fd-e752771d3aa0","block_type":"box","text":"In determining whether to make a direct loan, the Fund will rely primarily upon the creditworthiness of the","page_number":38,"box":{"x":102,"y":460,"width":750,"height":12}},{"id":"f549c131-7749-4a3c-87ce-fb9e4482e018","block_type":"box","text":"borrower and/or any collateral for payment of interest and repayment of principal. The risks associated with direct","page_number":38,"box":{"x":69,"y":475,"width":813,"height":12}},{"id":"93faf324-d733-4467-a05b-f4cb09ac538c","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":38,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"8e2a0064-93a8-4f78-a8e5-823ebcf74cb8","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":38,"box":{"x":70,"y":506,"width":818,"height":11}},{"id":"d41ca0cc-67ff-42c4-a007-a70f8e128e3d","block_type":"box","text":"money on the loan. Furthermore, direct loans may subject the Fund to liquidity and interest rate risk and certain","page_number":38,"box":{"x":69,"y":521,"width":798,"height":11}},{"id":"43ca6f2f-a3d5-48a9-b4dd-b91bfa613ad7","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":38,"box":{"x":69,"y":536,"width":825,"height":11}},{"id":"2538a66e-112e-4192-85f1-5da28bc9bf0a","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":38,"box":{"x":70,"y":551,"width":807,"height":11}},{"id":"1ddea1ed-aea7-4fae-857c-311979715c31","block_type":"box","text":"direct loan and/or to value the direct loan.","page_number":38,"box":{"x":69,"y":566,"width":301,"height":11}},{"id":"5af9e533-5d1a-4da2-bfa1-1c6f55d12f56","block_type":"box","text":"When engaging in direct lending, the Fund’s performance may depend, in part, on the ability of the Fund to","page_number":38,"box":{"x":101,"y":589,"width":762,"height":11}},{"id":"84949e4f-6f97-4387-9c67-808536f952cd","block_type":"box","text":"originate loans on advantageous terms. In originating loans, the Fund will compete with a broad spectrum of lenders.","page_number":38,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"085a0b62-84fd-4892-abc1-74aac88f336d","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":38,"box":{"x":70,"y":619,"width":836,"height":11}},{"id":"de982826-4f3f-486b-b6a6-05e40e0e305b","block_type":"box","text":"such loans, which could reduce Fund performance.","page_number":38,"box":{"x":69,"y":634,"width":362,"height":11}},{"id":"03f3ae80-c74b-4270-9996-f284f33ba0ce","block_type":"box","text":"As part of its lending activities, the Fund may originate loans to companies that are experiencing significant","page_number":38,"box":{"x":101,"y":657,"width":767,"height":11}},{"id":"91c06b29-539c-4263-a229-f5e37d606689","block_type":"box","text":"financial or business difficulties, including companies involved in bankruptcy or other reorganization and liquidation","page_number":38,"box":{"x":68,"y":672,"width":821,"height":11}},{"id":"c75e1b42-052f-47b8-bf5c-78eacca196ab","block_type":"box","text":"proceedings. Although the terms of such financing may result in significant financial returns to the Fund, they involve","page_number":38,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"a59fbe84-5419-4aab-9c88-6e6f58da7873","block_type":"box","text":"a substantial degree of risk. The level of analytical sophistication, both financial and legal, necessary for successful","page_number":38,"box":{"x":69,"y":702,"width":826,"height":12}},{"id":"67b2f9bc-b3f7-44f4-af9a-24b50cfb1f8f","block_type":"box","text":"financing to companies experiencing significant business and financial difficulties is unusually high.","page_number":38,"box":{"x":68,"y":717,"width":709,"height":12}},{"id":"c0962fba-d790-4275-bf4c-0eb39588ba35","block_type":"box","text":"Credit Linked Securities.","page_number":38,"box":{"x":102,"y":740,"width":179,"height":9}},{"id":"2bab97a6-0022-4fc8-990c-8de3236ee0cc","block_type":"box","text":"Among the income producing securities in which a Fund may invest are credit linked","page_number":38,"box":{"x":287,"y":740,"width":596,"height":11}},{"id":"0e5b2583-de93-4920-8077-a7827fe3fd76","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":38,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"fc27b84f-ed53-41b7-8e4c-78e9f74e99b2","block_type":"box","text":"or basket of derivative instruments, such as credit default swaps, interest rate swaps and other securities, in order","page_number":38,"box":{"x":69,"y":770,"width":823,"height":11}},{"id":"e9b6e75b-8f06-4a65-a3fa-d6dc669788fb","block_type":"box","text":"to provide exposure to certain fixed-income markets. For instance, a Fund may invest in credit linked securities as a","page_number":38,"box":{"x":68,"y":785,"width":827,"height":12}},{"id":"d64b6786-451d-471a-8e5d-2e593389f296","block_type":"box","text":"cash management tool in order to gain exposure to a certain market and/or to remain fully invested when more","page_number":38,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"37c0319f-42e1-41ea-9830-83644d2a880e","block_type":"box","text":"traditional income producing securities are not available.","page_number":38,"box":{"x":68,"y":816,"width":404,"height":11}},{"id":"565123fa-14bc-4751-bdaf-2a005bac075d","block_type":"box","text":"Like an investment in a bond, investments in these credit linked securities represent the right to receive periodic","page_number":38,"box":{"x":102,"y":839,"width":804,"height":11}},{"id":"6cdbd463-505d-4ab6-b63e-f1331eb28dec","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":38,"box":{"x":70,"y":853,"width":780,"height":12}},{"id":"3860a7e7-be26-41fd-bf4a-7dc73313e9b3","block_type":"box","text":"However, these payments are conditioned on the issuer’s receipt of payments from, and the issuer’s potential","page_number":38,"box":{"x":102,"y":876,"width":785,"height":11}},{"id":"1b4bb311-16d9-4264-8149-3bec2eb95943","block_type":"box","text":"obligations to, the counterparties to the derivative instruments and other securities in which the issuer invests. For","page_number":38,"box":{"x":69,"y":891,"width":821,"height":12}},{"id":"46931420-5081-42f6-a0b3-51c0d5d70f97","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":38,"box":{"x":70,"y":906,"width":806,"height":12}},{"id":"eefe8ac8-9c05-41cb-a0d5-badd4a18b510","block_type":"box","text":"II-8","page_number":38,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"ad480012-81b0-4591-a87d-126e7720e5f3","block_type":"box","text":"NM1026U-5979889-38/232","page_number":38,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"51240433-f2a0-46d2-873c-0834c2092d5a","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":39,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"688faf65-d751-47bd-888e-38f8ccfdd32f","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":39,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"fa36095d-dcd6-4802-807f-c51ff41b8ef5","block_type":"box","text":"the issuer would be obligated to pay the counterparty the par (or other agreed upon value) of the referenced debt","page_number":39,"box":{"x":68,"y":75,"width":807,"height":11}},{"id":"b3944945-1441-40e8-ba45-76f7c2252551","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":39,"box":{"x":69,"y":90,"width":783,"height":11}},{"id":"b4f8b63a-58da-403c-a729-210459473c18","block_type":"box","text":"investments in these instruments are indirectly subject to the risks associated with derivative instruments, including,","page_number":39,"box":{"x":70,"y":105,"width":833,"height":11}},{"id":"dbb03f86-9fe1-4764-b7b1-2459adf5f43d","block_type":"box","text":"among others, credit risk, default or similar event risk, counterparty risk, interest rate risk, leverage risk and","page_number":39,"box":{"x":69,"y":120,"width":771,"height":12}},{"id":"7d58916e-252b-4df0-98ed-b2cc11f15336","block_type":"box","text":"management risk. It is also expected that the securities will be exempt from registration under the Securities Act.","page_number":39,"box":{"x":69,"y":135,"width":808,"height":12}},{"id":"d21e6513-56b2-4932-8c86-a1edd1c9702f","block_type":"box","text":"Accordingly, there may be no established trading market for the securities and they may constitute illiquid","page_number":39,"box":{"x":68,"y":150,"width":752,"height":12}},{"id":"a7f23385-2450-4324-b7be-3734eee80e97","block_type":"box","text":"investments.","page_number":39,"box":{"x":70,"y":166,"width":89,"height":9}},{"id":"43d6fa76-4463-4de2-969b-1fcb1fac53c2","block_type":"box","text":"Debt Securities.","page_number":39,"box":{"x":102,"y":188,"width":116,"height":9}},{"id":"cc286af0-0764-4713-af88-523a092472a0","block_type":"box","text":"Debt securities, such as bonds, involve credit risk. This is the risk that the issuer will not make","page_number":39,"box":{"x":225,"y":188,"width":677,"height":11}},{"id":"a6d19af7-dd49-4518-a396-1a1f9782e202","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":39,"box":{"x":68,"y":203,"width":839,"height":12}},{"id":"947a9e99-281b-4452-b364-2abb1e875658","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":39,"box":{"x":68,"y":218,"width":787,"height":12}},{"id":"bfe8ac12-8197-412f-a9d6-8507f4558caf","block_type":"box","text":"creditworthiness may also affect the value of a Fund’s investment in that issuer. Credit risk is reduced to the extent","page_number":39,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"9f13a4db-5edd-46ed-a4d2-a583db22eb7c","block_type":"box","text":"a Fund limits its debt investments to U.S. Government Securities.","page_number":39,"box":{"x":69,"y":249,"width":466,"height":9}},{"id":"5bbfb364-24bf-4d66-bd0d-6ce504114757","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":39,"box":{"x":101,"y":271,"width":784,"height":12}},{"id":"ed9159db-a10d-4b72-86c8-2acdee543d56","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":39,"box":{"x":68,"y":286,"width":792,"height":12}},{"id":"b5def6db-3547-4905-808b-7212fe4b975a","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":39,"box":{"x":70,"y":302,"width":806,"height":11}},{"id":"cac35c4b-46ed-4c01-a1b9-7e17e3a1cdc1","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":39,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"548e6ea6-81c8-41ed-b506-8b1f00d6850c","block_type":"box","text":"rates than will the market price of shorter-term debt securities.","page_number":39,"box":{"x":69,"y":332,"width":448,"height":11}},{"id":"8631a9af-fd3c-4d6a-86bb-f30e622c6358","block_type":"box","text":"During periods of rising interest rates, the average life of certain fixed-income securities is extended because of","page_number":39,"box":{"x":102,"y":355,"width":798,"height":11}},{"id":"069180db-c8ce-4d27-b33d-a195e717b8ec","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":39,"box":{"x":69,"y":370,"width":813,"height":11}},{"id":"04d682b3-eb64-4f07-9743-f902f053d5b9","block_type":"box","text":"these fixed-income securities, especially mortgage-related securities, making them more sensitive to changes in","page_number":39,"box":{"x":68,"y":385,"width":801,"height":11}},{"id":"7b7cfe07-5c94-4de1-89e9-9686cee0074f","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":39,"box":{"x":70,"y":400,"width":806,"height":11}},{"id":"cb13d1f5-08c0-4407-9dfb-1e30bf959cb3","block_type":"box","text":"lose value. This is known as extension risk.","page_number":39,"box":{"x":70,"y":415,"width":307,"height":9}},{"id":"5dc3e98e-1214-460b-a6d8-cf4d47227633","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":39,"box":{"x":101,"y":438,"width":778,"height":11}},{"id":"404f93eb-e688-4e34-8dc2-e54468f76629","block_type":"box","text":"interest rates. Fixed-income securities with longer maturities, which tend to produce higher yields, are subject to","page_number":39,"box":{"x":70,"y":453,"width":798,"height":11}},{"id":"54447567-ccec-4c1c-86b6-3652b9789080","block_type":"box","text":"potentially greater capital appreciation and depreciation than securities with shorter maturities. The Funds are not","page_number":39,"box":{"x":70,"y":468,"width":812,"height":11}},{"id":"800b6768-cf0e-40da-8d26-7bc2c7f65e80","block_type":"box","text":"restricted to any maximum or minimum time to maturity in purchasing individual portfolio securities, and the average","page_number":39,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"a6edb33f-d8ec-4e35-bfe3-08bdba4937cc","block_type":"box","text":"maturity of a Fund’s assets will vary.","page_number":39,"box":{"x":69,"y":498,"width":259,"height":11}},{"id":"00a7bed1-2bac-45a7-86dc-0e4862772b40","block_type":"box","text":"Floating and Variable Rate Securities","page_number":39,"box":{"x":102,"y":521,"width":260,"height":11}},{"id":"f64d9012-e330-49ba-95de-afdec5280273","block_type":"box","text":". Certain Funds may invest in debt instruments that pay a variable coupon","page_number":39,"box":{"x":364,"y":521,"width":526,"height":11}},{"id":"986ada9a-9a9b-4b44-b9fd-436d0e027042","block_type":"box","text":"rate. Securities with floating or variable interest rates can be less sensitive to interest rate changes than securities","page_number":39,"box":{"x":69,"y":536,"width":821,"height":11}},{"id":"7b8deb7d-7029-4a5f-bf81-3e59e6564103","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":39,"box":{"x":68,"y":551,"width":834,"height":11}},{"id":"5e20fb5f-30df-4802-a39b-7fb1500d8742","block_type":"box","text":"rates in general. Conversely, floating rate securities will not generally increase in value if interest rates decline. The","page_number":39,"box":{"x":69,"y":566,"width":820,"height":11}},{"id":"18e4be0a-24d5-4c5a-879c-2d123b072f2f","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":39,"box":{"x":70,"y":581,"width":838,"height":12}},{"id":"efee07d7-5415-478a-9a8f-221cba4499b5","block_type":"box","text":"the investments. Benchmark interest rates used for floating and variable rate securities may not accurately track","page_number":39,"box":{"x":68,"y":596,"width":804,"height":12}},{"id":"05fb954b-be66-487f-b8d7-06b91a145262","block_type":"box","text":"market interest rates.","page_number":39,"box":{"x":69,"y":612,"width":153,"height":9}},{"id":"daa7f21e-7c5f-449b-bb8f-878eef961634","block_type":"box","text":"Inflation-Indexed Bonds.","page_number":39,"box":{"x":102,"y":634,"width":169,"height":9}},{"id":"f2844e04-9a70-446b-bbaf-99afdda19fc0","block_type":"box","text":"Certain Funds may invest in inflation-indexed bonds, which are fixed-income securities or","page_number":39,"box":{"x":278,"y":634,"width":632,"height":11}},{"id":"6c30dcf1-f442-4674-a5ce-34855a301964","block_type":"box","text":"other instruments whose principal value is periodically adjusted according to the rate of inflation. Two structures are","page_number":39,"box":{"x":69,"y":649,"width":828,"height":12}},{"id":"8e39faa6-d9d2-4486-a630-9712e4a7ece3","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":39,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"f9c7bcfc-c4f1-440d-8819-8bdf1ad1b088","block_type":"box","text":"the bond. Most other issuers pay out the Consumer Price Index (“CPI”) accruals as part of a semi-annual coupon.","page_number":39,"box":{"x":68,"y":680,"width":810,"height":11}},{"id":"24477bab-f736-4d74-a437-69d950ff9b26","block_type":"box","text":"Inflation-indexed securities issued by the U.S. Treasury have maturities of five, ten or thirty years, although it is","page_number":39,"box":{"x":102,"y":702,"width":792,"height":12}},{"id":"34c68bad-3926-4867-85a6-5ff4f134fdbc","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":39,"box":{"x":70,"y":717,"width":833,"height":12}},{"id":"9302035b-b413-4763-880e-fa47f85aac61","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":39,"box":{"x":69,"y":732,"width":810,"height":12}},{"id":"21478565-5d57-4ac9-87c0-2f39882b7714","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":39,"box":{"x":70,"y":747,"width":814,"height":12}},{"id":"a3fd400a-c0da-4f1b-a02e-1486a24ee417","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":39,"box":{"x":69,"y":762,"width":816,"height":12}},{"id":"8a513f6b-58a5-458b-b8c5-e81661779e13","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":39,"box":{"x":69,"y":777,"width":828,"height":12}},{"id":"37a222e5-f189-406c-8b3c-147a32e60b20","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":39,"box":{"x":69,"y":792,"width":828,"height":12}},{"id":"d81d7acc-2918-4f53-8c02-d381097971fc","block_type":"box","text":"and the second semi-annual interest payment would be $15.45 ($1,030 times 1.5%).","page_number":39,"box":{"x":69,"y":807,"width":610,"height":12}},{"id":"f2f564f3-10e3-4285-877c-517b047043ac","block_type":"box","text":"If the periodic adjustment rate measuring inflation falls, the principal value of inflation-indexed bonds will be","page_number":39,"box":{"x":102,"y":831,"width":767,"height":11}},{"id":"73a10bd3-4488-45d3-bd43-f9b2556878da","block_type":"box","text":"adjusted downward, and, consequently, the interest payable on these securities (calculated with respect to a smaller","page_number":39,"box":{"x":69,"y":846,"width":833,"height":11}},{"id":"58b94ef5-6c7d-4fb4-a019-474ca6185d6b","block_type":"box","text":"principal amount) will be reduced. Repayment of the original bond principal upon maturity (as adjusted for inflation) is","page_number":39,"box":{"x":70,"y":861,"width":834,"height":11}},{"id":"6d059380-b718-4f04-8651-065f9f0f9352","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":39,"box":{"x":68,"y":876,"width":795,"height":11}},{"id":"b415d966-6fd7-4158-b2e1-c89d45e322de","block_type":"box","text":"current market value of the bonds is not guaranteed, and will fluctuate. Certain Funds may also invest in other","page_number":39,"box":{"x":69,"y":891,"width":788,"height":12}},{"id":"f2a2a4f4-6f9b-4464-b13e-a1b2af9dbf22","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":39,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"74e7d237-6f2c-46f6-9a1a-e25f16256705","block_type":"box","text":"II-9","page_number":39,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"e78594a7-d10b-4eb7-8b30-54d6b9fc2b42","block_type":"box","text":"NM1026U-5979889-39/232","page_number":39,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"e4bc2d1a-c616-4ceb-adfa-a2a8b4f47d33","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":40,"box":{"x":68,"y":45,"width":821,"height":11}},{"id":"e974f2f2-189f-4acc-86fd-63f4f4d09b3c","block_type":"box","text":"Fund purchases inflation-indexed bonds offered by foreign issuers, the rate of inflation measured by the foreign","page_number":40,"box":{"x":70,"y":60,"width":792,"height":11}},{"id":"37eb6d4e-f6e4-493c-9d83-f11d853cba94","block_type":"box","text":"inflation index may not be correlated to the rate of inflation in the United States.","page_number":40,"box":{"x":70,"y":75,"width":570,"height":11}},{"id":"ac8af6fc-0f4b-4ee2-bf5b-9c6bd0600326","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":40,"box":{"x":101,"y":98,"width":780,"height":11}},{"id":"c6719478-a1a0-4780-a15e-5fc9ac5fc75b","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":40,"box":{"x":70,"y":113,"width":831,"height":11}},{"id":"b06471bd-40ab-49a5-8ac1-97b283bd24d9","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":40,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"161553c5-6ba2-4c0e-b4d3-bed682fb0c02","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":40,"box":{"x":70,"y":143,"width":796,"height":10}},{"id":"662c6794-2fbb-4faf-81bd-6d1d3e0c282a","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":40,"box":{"x":70,"y":158,"width":805,"height":11}},{"id":"7338e2b5-bcb3-41a3-96f9-0e8d9875986b","block_type":"box","text":"assurance, however, that the value of inflation-indexed bonds will be directly correlated to changes in interest rates.","page_number":40,"box":{"x":69,"y":173,"width":824,"height":11}},{"id":"f0086a3d-7a24-408f-b13e-d32f7dd7e9fe","block_type":"box","text":"While these securities are expected to be protected from long-term inflationary trends, short-term increases in","page_number":40,"box":{"x":101,"y":196,"width":788,"height":11}},{"id":"89263579-4c7d-4716-b256-cd2c8d068f3c","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":40,"box":{"x":70,"y":211,"width":825,"height":11}},{"id":"10ddcb38-be13-4931-82b9-cbc06c7f8095","block_type":"box","text":"changes in currency exchange rates), investors in these securities may not be protected to the extent that the","page_number":40,"box":{"x":69,"y":226,"width":784,"height":11}},{"id":"065ea883-f90b-4274-9c0a-8e87b70ea832","block_type":"box","text":"increase is not reflected in the bond’s inflation measure.","page_number":40,"box":{"x":70,"y":241,"width":403,"height":9}},{"id":"a5e0a347-b4be-4f0c-bff9-28b5a2390294","block_type":"box","text":"In general, the measure used to determine the periodic adjustment of U.S. inflation-indexed bonds is the","page_number":40,"box":{"x":102,"y":264,"width":746,"height":11}},{"id":"566add96-441f-40a7-a149-16ef5e92660f","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":40,"box":{"x":69,"y":279,"width":786,"height":11}},{"id":"26fd5299-e69e-447d-8274-49defcc58adb","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":40,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"f4b12cfa-acd2-45d7-8597-249393e5460f","block_type":"box","text":"food, transportation and energy. Inflation-indexed bonds issued by a foreign government are generally adjusted to","page_number":40,"box":{"x":68,"y":309,"width":809,"height":11}},{"id":"921eb0db-db59-4972-9ee8-7be4cb876cf5","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":40,"box":{"x":69,"y":324,"width":830,"height":12}},{"id":"bcf850b4-ea2b-4935-9858-af4540287e33","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":40,"box":{"x":68,"y":339,"width":833,"height":12}},{"id":"443c6132-b873-4e17-814b-b8b653624509","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":40,"box":{"x":68,"y":355,"width":840,"height":11}},{"id":"8d5a1a1f-34da-457b-9db5-ccdc690dc58a","block_type":"box","text":"United States.","page_number":40,"box":{"x":70,"y":370,"width":99,"height":9}},{"id":"d0ab5500-4881-470c-8ea9-9b61ff474a52","block_type":"box","text":"Any increase in the principal amount of an inflation-indexed bond will be considered taxable ordinary income,","page_number":40,"box":{"x":101,"y":392,"width":774,"height":12}},{"id":"aa4559a6-9c05-4482-a7ac-8e1142af2a83","block_type":"box","text":"even though investors do not receive their principal until maturity.","page_number":40,"box":{"x":69,"y":408,"width":464,"height":11}},{"id":"421d1c39-d500-4f41-8a53-494864364a57","block_type":"box","text":"Investment Grade Debt Obligations.","page_number":40,"box":{"x":102,"y":430,"width":252,"height":11}},{"id":"7047e36b-3b93-4303-a271-97b116cafdb3","block_type":"box","text":"Certain Funds may invest in “investment grade securities,” which are","page_number":40,"box":{"x":360,"y":430,"width":493,"height":11}},{"id":"55c367e0-2564-4cc9-a46f-9e74fceb783e","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":40,"box":{"x":69,"y":445,"width":823,"height":12}},{"id":"690b9c5a-bdc1-4434-9005-e0ad3b127760","block_type":"box","text":"Manager. Certain Funds may invest in debt securities rated Aaa by Moody’s or AAA by S&P. It should be noted that","page_number":40,"box":{"x":70,"y":460,"width":815,"height":12}},{"id":"faa7c3e3-aabe-43fa-a17e-05a102f5b580","block_type":"box","text":"debt obligations rated in the lowest of the top four ratings (","page_number":40,"box":{"x":69,"y":475,"width":420,"height":12}},{"id":"55a879da-e99a-4e33-8e96-3001ed7de521","block_type":"box","text":"i.e.","page_number":40,"box":{"x":492,"y":476,"width":20,"height":8}},{"id":"3cd36463-f506-47b5-acf5-ec4e29597186","block_type":"box","text":", “Baa” by Moody’s or “BBB” by S&P) are considered","page_number":40,"box":{"x":514,"y":476,"width":377,"height":11}},{"id":"e5cdffa5-2e0c-4ed7-b095-1bb4cf12a141","block_type":"box","text":"to have some speculative characteristics and are more sensitive to economic change than higher rated securities. If","page_number":40,"box":{"x":68,"y":491,"width":829,"height":11}},{"id":"00d930ae-aa38-4282-8b98-bed48442e9d4","block_type":"box","text":"an investment grade security of a Fund is subsequently downgraded below investment grade, the Fund’s Manager will","page_number":40,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"b3c036d1-bc94-40be-9a32-b5191252975c","block_type":"box","text":"consider such an event in determining whether the Fund should continue to hold the security. Subject to its","page_number":40,"box":{"x":69,"y":521,"width":763,"height":11}},{"id":"3038e037-3c12-4216-b101-8f2241648660","block_type":"box","text":"investment strategies, there is no limit on the amount of such downgraded securities a Fund may hold.","page_number":40,"box":{"x":70,"y":536,"width":731,"height":11}},{"id":"b40ef1d9-0659-4491-a719-473a4a1644ed","block_type":"box","text":"See Appendix A to this SAI for a description of applicable securities ratings.","page_number":40,"box":{"x":102,"y":559,"width":536,"height":11}},{"id":"00537046-fbd8-45c9-a7f0-36f60582af91","block_type":"box","text":"High Yield Investments (“Junk Bonds”).","page_number":40,"box":{"x":102,"y":582,"width":278,"height":11}},{"id":"2678b4b2-5e18-4d43-8d3e-28e1b600bbba","block_type":"box","text":"Non-investment grade or “high yield” fixed-income or convertible securities commonly known to investors as","page_number":40,"box":{"x":102,"y":604,"width":767,"height":11}},{"id":"ead1cfe8-901b-4c7e-9f62-1b377b5f75e2","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":40,"box":{"x":70,"y":619,"width":834,"height":11}},{"id":"ae1ee84a-64ac-4734-9917-e9115f67a657","block_type":"box","text":"that Fund management believes are of comparable quality. While generally providing greater income and opportunity","page_number":40,"box":{"x":68,"y":634,"width":828,"height":12}},{"id":"f344e961-9dc5-4de0-9c87-c4853a63b9e2","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":40,"box":{"x":68,"y":649,"width":841,"height":12}},{"id":"3201cf98-0132-45de-a98e-aed2b3f67d97","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":40,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"b361988f-c3ce-4b71-b609-ac71b80fa9c7","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":40,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"cf7f6008-a32d-40ca-a65e-11a4d9ffed43","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":40,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"af894d24-de4e-488b-8781-a24d3910bd70","block_type":"box","text":"ratings may from time to time change, positively or negatively, to reflect developments regarding the issuer’s financial","page_number":40,"box":{"x":69,"y":710,"width":838,"height":11}},{"id":"f357044d-fdd3-40d1-877b-4e9b6ee07b35","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":40,"box":{"x":69,"y":725,"width":817,"height":11}},{"id":"8df96965-087d-4456-8a0b-1dbbaa156bbb","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":40,"box":{"x":69,"y":740,"width":837,"height":11}},{"id":"8c02bc11-4df5-4799-81b1-64a1849a0a16","block_type":"box","text":"risk than higher rated securities.","page_number":40,"box":{"x":69,"y":755,"width":230,"height":11}},{"id":"d33e28cf-c04e-4436-b124-5f6037b089bb","block_type":"box","text":"The major risks in junk bond investments include the following:","page_number":40,"box":{"x":101,"y":778,"width":447,"height":11}},{"id":"59df9cbe-c6d5-4696-af40-bf2cdaaf3ff4","block_type":"box","text":"•","page_number":40,"box":{"x":69,"y":801,"width":6,"height":4}},{"id":"2c80dbad-2782-4e1b-8a23-2ccbe927509d","block_type":"box","text":"Junk bonds may be issued by less creditworthy companies. These securities are vulnerable to adverse changes","page_number":40,"box":{"x":101,"y":798,"width":796,"height":11}},{"id":"1283917d-553f-4046-8979-4c48519900e4","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":40,"box":{"x":102,"y":813,"width":792,"height":11}},{"id":"57b337e3-cdf8-483e-812f-4cefa39bb86e","block_type":"box","text":"interest or principal payment obligations because of an economic downturn, specific issuer developments or the","page_number":40,"box":{"x":102,"y":828,"width":799,"height":12}},{"id":"436265bf-453b-4c76-8bb6-783953073c17","block_type":"box","text":"unavailability of additional financing.","page_number":40,"box":{"x":102,"y":843,"width":256,"height":12}},{"id":"6dd7221f-943b-437d-9f62-c4716f04cd75","block_type":"box","text":"•","page_number":40,"box":{"x":69,"y":866,"width":6,"height":5}},{"id":"ef2fd6f9-d86b-453c-a845-760fb4d67843","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":40,"box":{"x":101,"y":863,"width":797,"height":12}},{"id":"c3a83c9e-a561-4d99-9f15-23a307ee1241","block_type":"box","text":"investment grade bonds. If the issuer experiences financial stress, it may be unable to meet its debt obligations.","page_number":40,"box":{"x":102,"y":879,"width":804,"height":11}},{"id":"e0822f10-b2b5-4eb2-969f-1efac3ed9a95","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":40,"box":{"x":101,"y":894,"width":769,"height":11}},{"id":"a694d7d7-7b5c-4647-9f47-f1770b9eb9b1","block_type":"box","text":"II-10","page_number":40,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3663967f-da97-417c-a1c1-542db9ed2fb7","block_type":"box","text":"NM1026U-5979889-40/232","page_number":40,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"c0ce741c-44b7-497c-a4f5-4572e7ae6053","block_type":"box","text":"unavailability of additional financing. Issuers of high yield securities are often in the growth stage of their","page_number":41,"box":{"x":102,"y":45,"width":746,"height":11}},{"id":"aff91005-39e4-42b5-aa31-469820fc8df9","block_type":"box","text":"development and/or involved in a reorganization or takeover.","page_number":41,"box":{"x":101,"y":60,"width":432,"height":11}},{"id":"e932f6c5-c4ff-4de7-86ef-3a3f55d50419","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"53636957-39a7-4aac-81a0-7dcd35e0200d","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":41,"box":{"x":101,"y":80,"width":808,"height":11}},{"id":"2d5002ec-5116-4352-9d94-b6bee94227d7","block_type":"box","text":"senior obligations are generally paid off before the junior obligations, which will potentially limit a Fund’s ability","page_number":41,"box":{"x":102,"y":95,"width":789,"height":11}},{"id":"6ceb8250-a620-4d2e-8bc9-133f0939fc47","block_type":"box","text":"to fully recover principal or to receive interest payments when senior securities are in default. Thus, investors in","page_number":41,"box":{"x":101,"y":110,"width":796,"height":11}},{"id":"a0cd383c-380d-4522-94f9-6c76b552cbd4","block_type":"box","text":"high yield securities have a lower degree of protection with respect to principal and interest payments than do","page_number":41,"box":{"x":102,"y":125,"width":782,"height":12}},{"id":"f1322d8e-8d13-4f0a-9a64-6976f35de210","block_type":"box","text":"investors in higher rated securities.","page_number":41,"box":{"x":102,"y":141,"width":249,"height":11}},{"id":"35fbaed6-400d-4822-811d-f10c341ab19a","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":163,"width":6,"height":5}},{"id":"ad5954e9-a33c-4e11-ad69-c6c332002ae4","block_type":"box","text":"Junk bonds frequently have redemption features that permit an issuer to repurchase the security from a Fund","page_number":41,"box":{"x":101,"y":161,"width":780,"height":11}},{"id":"b466b8bc-3647-4237-a8fd-018342dafa81","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":41,"box":{"x":102,"y":176,"width":784,"height":11}},{"id":"abdc735d-215e-403e-96b6-4f720317ce63","block_type":"box","text":"lower yields and may lose income.","page_number":41,"box":{"x":102,"y":191,"width":242,"height":11}},{"id":"dde27f92-70b3-4c83-8287-dbc721d26a2e","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":214,"width":6,"height":4}},{"id":"4598bfa6-f47a-4069-a791-765cbf7f59fe","block_type":"box","text":"Prices of junk bonds are subject to extreme price fluctuations. Negative economic developments may have a","page_number":41,"box":{"x":102,"y":211,"width":772,"height":11}},{"id":"7f274cf8-09f1-4bd8-a1bb-dce64d17a078","block_type":"box","text":"greater impact on the prices of junk bonds than on those of other higher rated fixed-income securities.","page_number":41,"box":{"x":101,"y":226,"width":729,"height":11}},{"id":"235633ec-3491-403c-b22d-5a83f6dc11b3","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":249,"width":6,"height":5}},{"id":"3f05a5f0-000d-406d-bac1-6e5dc8336c88","block_type":"box","text":"Junk bonds may be less liquid than higher rated fixed-income securities even under normal economic conditions.","page_number":41,"box":{"x":101,"y":246,"width":802,"height":11}},{"id":"3833d86a-1c8b-4132-b9fd-ac9663d03739","block_type":"box","text":"Under certain economic and/or market conditions, a Fund may have difficulty disposing of certain high yield","page_number":41,"box":{"x":102,"y":261,"width":768,"height":12}},{"id":"3cdb5231-bb8c-4847-82fd-7dc482b3ef5d","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":41,"box":{"x":102,"y":276,"width":805,"height":12}},{"id":"09b36237-3ec5-4ef4-af3a-46e1c96abe32","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":41,"box":{"x":102,"y":292,"width":781,"height":11}},{"id":"5854cf41-2246-434b-b290-f8b8772f72e6","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":41,"box":{"x":102,"y":307,"width":767,"height":11}},{"id":"d019635f-4a81-4e92-a1ae-55b0702d6d6a","block_type":"box","text":"liquid than higher rated bonds, judgment may play a greater role in valuing certain of a Fund’s portfolio securities","page_number":41,"box":{"x":102,"y":322,"width":806,"height":11}},{"id":"68c69a23-f89d-4d7b-bb52-531ed63378f7","block_type":"box","text":"than in the case of securities trading in a more liquid market.","page_number":41,"box":{"x":101,"y":337,"width":436,"height":11}},{"id":"a461eeb4-6486-4114-b182-d00179a7b4c9","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":360,"width":6,"height":5}},{"id":"c2590728-bd97-47a2-8fbb-bbc3a63b8808","block_type":"box","text":"The secondary markets for high yield securities are not as liquid as the secondary markets for higher rated","page_number":41,"box":{"x":101,"y":357,"width":763,"height":11}},{"id":"d38e5b87-97d8-431e-aa36-d15fdb94caeb","block_type":"box","text":"securities. The secondary markets for high yield securities are concentrated in relatively few market makers and","page_number":41,"box":{"x":102,"y":372,"width":798,"height":11}},{"id":"49c94c35-1f38-4d5a-82f9-9de24f295db5","block_type":"box","text":"participants in the markets are mostly institutional investors, including insurance companies, banks, other","page_number":41,"box":{"x":102,"y":388,"width":759,"height":11}},{"id":"7049c91d-620d-49de-8e3f-258e653bd2cc","block_type":"box","text":"financial institutions and mutual funds. In addition, the trading volume for high yield securities is generally lower","page_number":41,"box":{"x":101,"y":402,"width":798,"height":12}},{"id":"84fa19f3-9599-495f-8124-d6e8493bba2f","block_type":"box","text":"than that for higher rated securities and the secondary markets could contract under adverse market or","page_number":41,"box":{"x":101,"y":418,"width":739,"height":11}},{"id":"ceade9bf-4a3f-4570-b518-879b4f6ec815","block_type":"box","text":"economic conditions independent of any specific adverse changes in the condition of a particular issuer. Under","page_number":41,"box":{"x":101,"y":433,"width":792,"height":11}},{"id":"38299e14-8847-4f52-8f4b-217959932425","block_type":"box","text":"certain economic and/or market conditions, a Fund may have difficulty disposing of certain high yield securities","page_number":41,"box":{"x":101,"y":448,"width":797,"height":11}},{"id":"37f13a1c-dca7-425d-9829-6f3ba07d7596","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":41,"box":{"x":101,"y":463,"width":791,"height":11}},{"id":"2825bdd7-74e8-40ee-8fe8-580b67ff74b7","block_type":"box","text":"affect the market price of the high yield security, which may result in increased difficulty selling the particular","page_number":41,"box":{"x":102,"y":478,"width":777,"height":11}},{"id":"259928be-f658-4cbc-a485-c317dc2113a3","block_type":"box","text":"issue and obtaining accurate market quotations on the issue when valuing a Fund’s assets. Market quotations","page_number":41,"box":{"x":102,"y":493,"width":788,"height":11}},{"id":"f0054163-cb1b-4e69-b642-0b209ab20dcc","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":41,"box":{"x":102,"y":508,"width":797,"height":12}},{"id":"04c2dd96-6c09-4fca-b6ef-98311db01651","block_type":"box","text":"actual prices available for a purchase or sale. When the secondary market for high yield securities becomes","page_number":41,"box":{"x":102,"y":523,"width":769,"height":12}},{"id":"566c2b0f-635a-44ce-98d7-0379541d6849","block_type":"box","text":"more illiquid, or in the absence of readily available market quotations for such securities, the relative lack of","page_number":41,"box":{"x":102,"y":538,"width":772,"height":12}},{"id":"50de7d93-f059-425f-9bb9-8d351979b0be","block_type":"box","text":"reliable objective data makes it more difficult to value a Fund’s securities, and judgment plays a more important","page_number":41,"box":{"x":102,"y":554,"width":801,"height":11}},{"id":"4e0693f3-4610-4149-be59-01da27401ac7","block_type":"box","text":"role in determining such valuations.","page_number":41,"box":{"x":102,"y":569,"width":252,"height":11}},{"id":"41ccbde6-c050-410a-9e0d-1fe5b45a5f47","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":592,"width":6,"height":4}},{"id":"fd8d7dcd-7ce0-4408-97b1-36843505b7e8","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":41,"box":{"x":101,"y":589,"width":808,"height":11}},{"id":"f3c017a2-fadb-45b5-8f5d-b0e7999ef0a7","block_type":"box","text":"a defaulting issuer.","page_number":41,"box":{"x":102,"y":604,"width":134,"height":11}},{"id":"35c9264a-bb5b-4a5b-bb56-59e3dcdc7b96","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":627,"width":6,"height":5}},{"id":"55a627b1-d59d-400d-92d4-59c356477e2a","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":41,"box":{"x":101,"y":624,"width":800,"height":11}},{"id":"a9ec628d-d272-4e36-be63-81934add4e3a","block_type":"box","text":"or expectation of adverse news, whether or not it is based on fundamental analysis. Additionally, prices for high","page_number":41,"box":{"x":102,"y":639,"width":793,"height":12}},{"id":"3f3cd377-b39d-488c-a9f1-75417f463982","block_type":"box","text":"yield securities may be affected by legislative and regulatory developments. These developments could adversely","page_number":41,"box":{"x":101,"y":654,"width":808,"height":12}},{"id":"55be236c-c9e0-48fd-bc61-83a57dd304a5","block_type":"box","text":"affect a Fund’s NAV and investment practices, the secondary market for high yield securities, the financial","page_number":41,"box":{"x":102,"y":669,"width":756,"height":12}},{"id":"75fb6752-313f-43ff-b2f9-338d40cac9b6","block_type":"box","text":"condition of issuers of these securities and the value and liquidity of outstanding high yield securities, especially","page_number":41,"box":{"x":101,"y":685,"width":803,"height":11}},{"id":"070acf95-16ae-4afb-91d3-c25f7218f9af","block_type":"box","text":"in a thinly traded market. For example, federal legislation requiring the divestiture by federally insured savings","page_number":41,"box":{"x":102,"y":700,"width":781,"height":11}},{"id":"682ea9d4-c615-433d-9a3b-670be77f9f14","block_type":"box","text":"and loan associations of their investments in high yield bonds and limiting the deductibility of interest by certain","page_number":41,"box":{"x":102,"y":715,"width":798,"height":11}},{"id":"82b88304-ba86-458b-af04-c0855851af81","block_type":"box","text":"corporate issuers of high yield bonds adversely affected the market in the past.","page_number":41,"box":{"x":101,"y":730,"width":566,"height":11}},{"id":"343137aa-6e21-46dc-91a1-480c0bde3c10","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":753,"width":6,"height":5}},{"id":"7ea76ee4-1297-475a-8dc6-060a6411424a","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":41,"box":{"x":101,"y":750,"width":751,"height":11}},{"id":"cfc0d5a3-d4d3-45c7-83d3-3e00b0cf00b4","block_type":"box","text":"investment grade security’s principal and interest payments, but does not address market value risk. Because","page_number":41,"box":{"x":102,"y":766,"width":786,"height":11}},{"id":"bb16eec6-9c16-49d7-a6b3-6f3cafb34999","block_type":"box","text":"such ratings of the ratings agencies may not always reflect current conditions and events, in addition to using","page_number":41,"box":{"x":102,"y":780,"width":782,"height":12}},{"id":"91dcb1bf-23f7-4539-ad24-92dae546fc40","block_type":"box","text":"recognized rating agencies and other sources, the Manager or sub-adviser performs its own analysis of the","page_number":41,"box":{"x":102,"y":795,"width":762,"height":12}},{"id":"980b6d03-ad90-40bc-8bb7-30a274bf35e2","block_type":"box","text":"issuers whose non-investment grade securities a Fund holds. Because of this, the Fund’s performance may","page_number":41,"box":{"x":102,"y":811,"width":767,"height":11}},{"id":"99a789a8-f6ba-468a-824c-451de284f972","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":41,"box":{"x":101,"y":826,"width":806,"height":11}},{"id":"447af68d-f281-449a-bc30-b0cb15207925","block_type":"box","text":"higher-rated securities.","page_number":41,"box":{"x":102,"y":841,"width":161,"height":11}},{"id":"5c37a1e9-ae5d-426f-9b81-04d8bb60e70e","block_type":"box","text":"In selecting non-investment grade securities, the Manager or sub-adviser considers factors such as those","page_number":41,"box":{"x":102,"y":863,"width":751,"height":12}},{"id":"3c69039b-cf64-47ad-a608-d36e2c73fc80","block_type":"box","text":"relating to the creditworthiness of issuers, the ratings and performance of the securities, the protections afforded","page_number":41,"box":{"x":69,"y":879,"width":814,"height":11}},{"id":"c1470813-c838-4dc0-812b-2f95f75399ab","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":41,"box":{"x":68,"y":894,"width":812,"height":11}},{"id":"fcf103da-3b2e-44c4-ac4e-19c9f0a17298","block_type":"box","text":"investment grade securities held by the Fund for their ability to make required principal and interest payments, as","page_number":41,"box":{"x":70,"y":909,"width":808,"height":11}},{"id":"df1318e4-25dc-432a-a430-eeeb2eefaedb","block_type":"box","text":"II-11","page_number":41,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c8e64f80-90af-4717-8891-1d20f971bf2c","block_type":"box","text":"NM1026U-5979889-41/232","page_number":41,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"bc4dd9d7-668c-4c1f-8b32-302d57ac4f8d","block_type":"box","text":"well as in an effort to control the liquidity of the Fund so that it can meet redemption requests. If a security’s rating","page_number":42,"box":{"x":68,"y":45,"width":825,"height":11}},{"id":"a39de8da-d898-4340-a4aa-b10450de48d5","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":42,"box":{"x":70,"y":60,"width":779,"height":11}},{"id":"2cf5193c-fad5-434e-80ff-0d509192bbe7","block_type":"box","text":"consider whether the Fund should continue to hold the security.","page_number":42,"box":{"x":69,"y":75,"width":451,"height":11}},{"id":"080ace95-84ef-4a8b-8e56-d114ee03209b","block_type":"box","text":"In the event that a Fund investing in high yield securities experiences an unexpected level of net redemptions,","page_number":42,"box":{"x":102,"y":98,"width":782,"height":11}},{"id":"51a38da0-fe83-4de3-8e86-470a685bf77b","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":42,"box":{"x":68,"y":113,"width":825,"height":11}},{"id":"0ff5ae1c-3105-4079-bf2a-f311d19aea9b","block_type":"box","text":"upon which the Fund’s rate of return is based.","page_number":42,"box":{"x":69,"y":128,"width":328,"height":11}},{"id":"17ce62ea-e3f0-4829-b204-babd14e91342","block_type":"box","text":"The costs attributable to investing in the junk bond markets are usually higher for several reasons, such as","page_number":42,"box":{"x":101,"y":150,"width":764,"height":12}},{"id":"809d2621-d31f-432a-a673-dcfc0aed3d00","block_type":"box","text":"higher investment research costs and higher commission costs.","page_number":42,"box":{"x":69,"y":166,"width":455,"height":11}},{"id":"1fcb232b-6514-4c3d-92f9-d858e06368ab","block_type":"box","text":"Mezzanine Investments.","page_number":42,"box":{"x":102,"y":188,"width":170,"height":9}},{"id":"89b70690-fb8e-4016-86b1-801c3eba16da","block_type":"box","text":"Certain Funds, consistent with their restrictions on investing in securities of a specific","page_number":42,"box":{"x":279,"y":188,"width":612,"height":12}},{"id":"a7af48bb-34b8-4d30-a145-8e7ed4f028bb","block_type":"box","text":"credit quality, may invest in certain high yield securities known as mezzanine investments, which are subordinated","page_number":42,"box":{"x":69,"y":204,"width":813,"height":11}},{"id":"27106710-0054-4b49-9cce-43bbff0218d1","block_type":"box","text":"debt securities which are generally issued in private placements in connection with an equity security (","page_number":42,"box":{"x":69,"y":219,"width":729,"height":11}},{"id":"ba852bb6-2144-4bcf-bcdd-c84502c39cd1","block_type":"box","text":"e.g.","page_number":42,"box":{"x":800,"y":220,"width":24,"height":10}},{"id":"42e1629d-da3d-41fe-ba0d-8d82e78ecd27","block_type":"box","text":", with","page_number":42,"box":{"x":827,"y":219,"width":36,"height":10}},{"id":"1a8dc0e4-2eb5-41f1-8857-7d520f539b21","block_type":"box","text":"attached warrants). Such mezzanine investments may be issued with or without registration rights. Similar to other","page_number":42,"box":{"x":69,"y":234,"width":818,"height":11}},{"id":"9ac7bbcd-f489-44cb-bb30-dbc9681fe287","block_type":"box","text":"high yield securities, maturities of mezzanine investments are typically seven to ten years, but the expected average","page_number":42,"box":{"x":69,"y":249,"width":827,"height":11}},{"id":"7023e616-7371-475a-9a1c-bc9de323c5c7","block_type":"box","text":"life is significantly shorter at three to five years. Mezzanine investments are usually unsecured and subordinate to","page_number":42,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"2bbe4de3-420e-4534-8a58-69dbf46e288d","block_type":"box","text":"other obligations of the issuer.","page_number":42,"box":{"x":69,"y":279,"width":216,"height":11}},{"id":"68e9175d-e22f-4d3d-9702-3a2923fc4667","block_type":"box","text":"Pay-in-kind Bonds.","page_number":42,"box":{"x":102,"y":302,"width":127,"height":11}},{"id":"e742fae3-412b-46c9-8779-bee15d12c3c4","block_type":"box","text":"Certain Funds may invest in pay-in-kind, or PIK, bonds. PIK bonds are bonds which pay","page_number":42,"box":{"x":236,"y":302,"width":615,"height":11}},{"id":"1158763a-d3b2-4470-af17-18679223b67b","block_type":"box","text":"interest through the issuance of additional debt or equity securities. Similar to zero coupon obligations, pay-in-kind","page_number":42,"box":{"x":70,"y":317,"width":813,"height":11}},{"id":"b9a3ef9f-69a1-4c15-bc6f-8ba721821f5b","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":42,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"0d76281b-d512-4e9a-bc02-1c43a76c8f99","block_type":"box","text":"unless a portion of such securities is sold and, if the issuer defaults, a Fund may obtain no return at all on its","page_number":42,"box":{"x":69,"y":347,"width":784,"height":11}},{"id":"43bfc8ac-1cd8-42ea-9be9-4ae179bee780","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":42,"box":{"x":70,"y":362,"width":783,"height":11}},{"id":"9bea099d-f0bd-4b6d-a89a-b0560439cad6","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":42,"box":{"x":68,"y":377,"width":790,"height":11}},{"id":"2b6e04cb-7c36-4e62-b152-2788cd027c53","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":42,"box":{"x":68,"y":392,"width":831,"height":12}},{"id":"23b536d6-a761-4b45-89be-0e85dd854f76","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":42,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"2b81da63-edcf-4bb6-84d3-d2c392a8c27b","block_type":"box","text":"federal income and excise taxes, each Fund may be required to distribute income accrued with respect to these","page_number":42,"box":{"x":68,"y":423,"width":798,"height":11}},{"id":"b499c189-139e-4b2e-aa46-c2cf517bf954","block_type":"box","text":"securities and may have to dispose of portfolio securities under disadvantageous circumstances in order to generate","page_number":42,"box":{"x":69,"y":438,"width":835,"height":11}},{"id":"6e715576-587b-4b21-84cf-0fecdd317538","block_type":"box","text":"cash to satisfy these distribution requirements.","page_number":42,"box":{"x":69,"y":453,"width":336,"height":11}},{"id":"7718c15d-2875-4a44-8c33-d5fd6e96bb22","block_type":"box","text":"Supranational Entities.","page_number":42,"box":{"x":102,"y":476,"width":160,"height":10}},{"id":"2add019d-8a72-4415-acf3-b7d8db069c0a","block_type":"box","text":"A Fund may invest in debt securities of supranational entities. Examples of such entities","page_number":42,"box":{"x":268,"y":475,"width":629,"height":12}},{"id":"507fc1fb-b35c-4888-95b6-2f0778470b4f","block_type":"box","text":"include the International Bank for Reconstruction and Development (the World Bank), the European Steel and Coal","page_number":42,"box":{"x":70,"y":491,"width":814,"height":11}},{"id":"d04d430d-b8df-44f5-aec0-e4b0764de0b6","block_type":"box","text":"Community, the Asian Development Bank and the Inter-American Development Bank. The government members, or","page_number":42,"box":{"x":69,"y":506,"width":817,"height":11}},{"id":"64e35fff-d799-473f-b701-2e054d9d631d","block_type":"box","text":"“stockholders,” usually make initial capital contributions to the supranational entity and in many cases are","page_number":42,"box":{"x":70,"y":521,"width":759,"height":11}},{"id":"53da560c-16f6-4340-b24b-c2eb26df17b6","block_type":"box","text":"committed to make additional capital contributions if the supranational entity is unable to repay its borrowings. There","page_number":42,"box":{"x":69,"y":536,"width":836,"height":11}},{"id":"c37f997f-ebc3-4327-bac6-a34a2d8c768a","block_type":"box","text":"is no guarantee that one or more stockholders of a supranational entity will continue to make any necessary","page_number":42,"box":{"x":70,"y":551,"width":772,"height":11}},{"id":"9337e675-c1a0-44e7-8bb7-4a1d0fe25165","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":42,"box":{"x":69,"y":566,"width":830,"height":11}},{"id":"843d0a7d-8693-4a30-80fd-51b1ecf1bece","block_type":"box","text":"principal on its debt securities, and a Fund may lose money on such investments.","page_number":42,"box":{"x":70,"y":582,"width":580,"height":10}},{"id":"c2f30036-135a-482d-97da-2e1ee34d252f","block_type":"box","text":"Depositary Receipts (ADRs, EDRs and GDRs).","page_number":42,"box":{"x":102,"y":604,"width":334,"height":11}},{"id":"ae93f889-1191-4136-a649-bd042146d360","block_type":"box","text":"Certain Funds may invest in the securities of foreign issuers in","page_number":42,"box":{"x":442,"y":604,"width":446,"height":11}},{"id":"ace15d5f-1f09-4bed-bad8-0c011946d7e2","block_type":"box","text":"the form of Depositary Receipts or other securities convertible into securities of foreign issuers. Depositary Receipts","page_number":42,"box":{"x":68,"y":619,"width":835,"height":11}},{"id":"bf5042ae-34a2-451c-ba3b-60ff34e7d3a0","block_type":"box","text":"may not necessarily be denominated in the same currency as the underlying securities into which they may be","page_number":42,"box":{"x":69,"y":634,"width":784,"height":12}},{"id":"e0a6d50e-a593-4abc-aadd-61e1b56ed374","block_type":"box","text":"converted. The Fund may invest in both sponsored and unsponsored American Depositary Receipts (“ADRs”),","page_number":42,"box":{"x":69,"y":650,"width":781,"height":11}},{"id":"12889c7a-d674-46bb-9caa-53ece4163181","block_type":"box","text":"European Depositary Receipts (“EDRs”), Global Depositary Receipts (“GDRs”) and other similar global instruments.","page_number":42,"box":{"x":70,"y":665,"width":823,"height":11}},{"id":"f157e17a-eb8c-4056-825d-50006e7f1659","block_type":"box","text":"ADRs typically are issued by an American bank or trust company and evidence ownership of underlying securities","page_number":42,"box":{"x":68,"y":680,"width":804,"height":11}},{"id":"dfb5e638-1e97-403f-a209-48d232256271","block_type":"box","text":"issued by a foreign corporation. EDRs, which are sometimes referred to as Continental Depositary Receipts, are","page_number":42,"box":{"x":70,"y":695,"width":799,"height":11}},{"id":"a561bb08-1ceb-4cf1-ab91-0e32e3fc4b4d","block_type":"box","text":"receipts issued in Europe, typically by foreign banks and trust companies, that evidence ownership of either foreign","page_number":42,"box":{"x":69,"y":710,"width":821,"height":11}},{"id":"a060aeae-f1d5-4a11-a465-aeeb6dd391f3","block_type":"box","text":"or domestic underlying securities. GDRs are depositary receipts structured like global debt issues to facilitate trading","page_number":42,"box":{"x":69,"y":725,"width":837,"height":11}},{"id":"e1e5b92b-992e-4f9b-86ff-82fbb0934ab5","block_type":"box","text":"on an international basis. In addition to investment risks associated with the underlying issuer, Depositary Receipts","page_number":42,"box":{"x":69,"y":740,"width":825,"height":11}},{"id":"0775fc83-cf19-44a7-9f6c-3464b33ab574","block_type":"box","text":"expose a Fund to additional risks associated with the non-uniform terms that apply to Depositary Receipt programs,","page_number":42,"box":{"x":69,"y":755,"width":825,"height":11}},{"id":"3ff8b27c-4c68-4f88-88a8-b5391b6a61a2","block_type":"box","text":"credit exposure to the depository bank and to the sponsors and other parties with whom the depository bank","page_number":42,"box":{"x":69,"y":771,"width":780,"height":10}},{"id":"2567e8fa-7d19-467a-9ab6-519b90fb6bdd","block_type":"box","text":"establishes the programs, currency risk and the risk of an illiquid market for Depositary Receipts. Unsponsored ADR,","page_number":42,"box":{"x":69,"y":785,"width":833,"height":12}},{"id":"03dc051e-36db-486b-bc3e-1468d21f7690","block_type":"box","text":"EDR and GDR programs are organized independently and without the cooperation of the issuer of the underlying","page_number":42,"box":{"x":70,"y":801,"width":796,"height":11}},{"id":"b9c714ef-efd2-4936-a3c6-cfdef1e3877b","block_type":"box","text":"securities. Unsponsored programs generally expose investors to greater risks than sponsored programs and do not","page_number":42,"box":{"x":69,"y":816,"width":822,"height":11}},{"id":"0a4968f5-d325-4f75-bdd6-996ccf05e113","block_type":"box","text":"provide holders with many of the shareholder benefits that come from investing in a sponsored Depositary Receipt.","page_number":42,"box":{"x":70,"y":831,"width":820,"height":11}},{"id":"b3a2db4f-ac8a-4148-b136-c1d6f2c28905","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":42,"box":{"x":68,"y":846,"width":827,"height":11}},{"id":"0e0e985d-d1dc-4caa-8f60-804d2a127567","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":42,"box":{"x":70,"y":861,"width":825,"height":11}},{"id":"be7ef5e0-3fa1-44bd-82f6-0547ff214c0f","block_type":"box","text":"issuer. Depositary Receipts are generally subject to the same risks as the foreign securities that they evidence or","page_number":42,"box":{"x":70,"y":876,"width":810,"height":11}},{"id":"031840b1-9a1f-4fa3-88dc-2dc45187de74","block_type":"box","text":"into which they may be converted. Investments in ADRs, EDRs and GDRs present additional investment","page_number":42,"box":{"x":70,"y":891,"width":737,"height":11}},{"id":"ed2fcbab-2219-4497-8ef0-4590ddd1e857","block_type":"box","text":"considerations as described under “Foreign Investment Risks.”","page_number":42,"box":{"x":69,"y":907,"width":449,"height":11}},{"id":"d347751d-1bec-495b-ba85-098c23c34062","block_type":"box","text":"II-12","page_number":42,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"11ea7af4-3cdf-4891-8f2d-6bc2653e6664","block_type":"box","text":"NM1026U-5979889-42/232","page_number":42,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"bd1dc72b-0731-4019-a477-d5610e036cf5","block_type":"box","text":"Derivatives.","page_number":43,"box":{"x":102,"y":45,"width":84,"height":9}},{"id":"819be392-c007-4657-b957-0b3c41222b9d","block_type":"box","text":"General.","page_number":43,"box":{"x":102,"y":67,"width":58,"height":9}},{"id":"5c6c8c23-c399-431f-b69c-713340eed629","block_type":"box","text":"Each Fund may use instruments referred to as derivatives, which are financial instruments that derive","page_number":43,"box":{"x":167,"y":67,"width":725,"height":11}},{"id":"f80fd00b-5837-40f2-be91-54f363774454","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":43,"box":{"x":68,"y":82,"width":836,"height":12}},{"id":"7503bd0c-9299-4be8-9f16-b9dfac32450b","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":43,"box":{"x":70,"y":98,"width":829,"height":11}},{"id":"9f430e73-b8a8-42cd-aed4-a59919491e64","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":43,"box":{"x":70,"y":113,"width":830,"height":11}},{"id":"0592c869-7d4f-45e3-bb4a-a0a96e7de32e","block_type":"box","text":"efficiently than with other transactions. Certain Funds may use derivatives to maintain a portion of their long and","page_number":43,"box":{"x":69,"y":128,"width":804,"height":11}},{"id":"7b4fa0f6-9cc9-46e6-8fb6-f68b925c7e96","block_type":"box","text":"short positions. Unless otherwise permitted, no Fund may use derivatives to gain exposure to an asset or asset","page_number":43,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"30e7106c-4684-4917-90dd-1af759ee4f91","block_type":"box","text":"class it is prohibited by its investment restrictions from purchasing directly. As described below, derivatives can be","page_number":43,"box":{"x":69,"y":158,"width":816,"height":11}},{"id":"22f4f101-f48f-4005-a0f8-22fd576ee146","block_type":"box","text":"used for hedging or speculative purposes. Funds will engage in transaction-level payment netting,","page_number":43,"box":{"x":69,"y":173,"width":691,"height":11}},{"id":"c1c5d5cb-d6a2-4ab4-b262-c8de1ab757c0","block_type":"box","text":"i.e.","page_number":43,"box":{"x":768,"y":173,"width":20,"height":9}},{"id":"6b366871-e644-4e24-b129-2d564c688e3d","block_type":"box","text":", the payment","page_number":43,"box":{"x":791,"y":173,"width":96,"height":11}},{"id":"b6b0df78-6500-4b86-ad69-d22408d82df0","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":43,"box":{"x":69,"y":188,"width":839,"height":12}},{"id":"8afeca72-338d-4c65-b77b-e4f2c771aa84","block_type":"box","text":"be, only the net amount of the two payment streams.","page_number":43,"box":{"x":69,"y":203,"width":378,"height":12}},{"id":"1d98c249-05ae-45b7-9a30-4b79ee5b8ca8","block_type":"box","text":"Hedging.","page_number":43,"box":{"x":102,"y":226,"width":60,"height":11}},{"id":"d5eb6417-b815-430a-adfa-1794725806ce","block_type":"box","text":"Each Fund may use derivatives for hedging purposes, in which a derivative is used to offset the risks","page_number":43,"box":{"x":169,"y":226,"width":717,"height":11}},{"id":"557a0d2e-5077-4865-8486-5e43e06629c4","block_type":"box","text":"associated with other Fund holdings. Losses on other investments may be substantially reduced by gains on a","page_number":43,"box":{"x":69,"y":241,"width":786,"height":11}},{"id":"4ba16a18-a292-40d1-b4ac-d17f3df532bc","block_type":"box","text":"derivative that reacts in an opposite manner to market movements. Although hedging may reduce losses, it may also","page_number":43,"box":{"x":69,"y":257,"width":834,"height":11}},{"id":"5f669270-da8e-4f37-83cd-548c78348c7e","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":43,"box":{"x":69,"y":271,"width":834,"height":12}},{"id":"e92f26af-8934-4d12-8d7f-f84f0aa6a957","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":43,"box":{"x":70,"y":286,"width":797,"height":12}},{"id":"4554e9bd-7a6c-4bb4-859a-ed06f973015e","block_type":"box","text":"correlation risk,","page_number":43,"box":{"x":69,"y":302,"width":109,"height":10}},{"id":"527db784-c01b-4570-b715-6ea6c330fb67","block_type":"box","text":"i.e.","page_number":43,"box":{"x":186,"y":302,"width":20,"height":9}},{"id":"aa2c9c6d-99e6-4058-a9a5-39645ad32ca2","block_type":"box","text":", the risk that changes in the value of the derivative will not match those of the holdings being","page_number":43,"box":{"x":209,"y":302,"width":669,"height":11}},{"id":"4fa02498-83b5-45ec-b638-0eec8be8e3c9","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":43,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"96557696-5339-4c9f-a390-e05eb77eed65","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":43,"box":{"x":69,"y":332,"width":835,"height":11}},{"id":"4b2b6da8-bc54-459b-bafe-590490148bec","block_type":"box","text":"be effective. No Fund is required to use derivatives to hedge.","page_number":43,"box":{"x":69,"y":347,"width":434,"height":11}},{"id":"611eab26-0d38-4ab0-85a2-8c5e7a1ca3df","block_type":"box","text":"Speculation.","page_number":43,"box":{"x":102,"y":370,"width":86,"height":11}},{"id":"30646ee9-6e86-465e-9906-7269db36ad19","block_type":"box","text":"Certain Funds may also use derivatives for speculative purposes to seek to enhance returns. The","page_number":43,"box":{"x":195,"y":370,"width":694,"height":11}},{"id":"ee645601-cc8e-4655-8014-949d47e9e98e","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":43,"box":{"x":69,"y":385,"width":831,"height":11}},{"id":"f1480aa1-aca7-4e9b-9bfc-f98db45fada3","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":43,"box":{"x":70,"y":400,"width":824,"height":11}},{"id":"86befb9a-f385-4b7a-87a8-1dc292e60d2a","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":43,"box":{"x":69,"y":415,"width":831,"height":11}},{"id":"eccdc5b3-6479-43b3-b604-248efdaa46c0","block_type":"box","text":"in certain cases may be unlimited.","page_number":43,"box":{"x":70,"y":430,"width":243,"height":11}},{"id":"824959a5-997f-4062-95b3-cf494ff23806","block_type":"box","text":"Regulation of Derivatives.","page_number":43,"box":{"x":102,"y":453,"width":180,"height":11}},{"id":"50da5317-6089-481a-9389-40ca347f1996","block_type":"box","text":"Rule 18f-4 Under the Investment Company Act.","page_number":43,"box":{"x":102,"y":475,"width":333,"height":12}},{"id":"447d3bd6-356d-4818-8053-929a65b7bd73","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to","page_number":43,"box":{"x":442,"y":475,"width":458,"height":12}},{"id":"79235af4-e6ff-4b94-a44d-b89a54dceede","block_type":"box","text":"enter into Derivatives Transactions (as defined below) and certain other transactions notwithstanding the restrictions","page_number":43,"box":{"x":69,"y":491,"width":833,"height":11}},{"id":"a32061aa-34c5-42ba-97ae-ffc4a1aae537","block_type":"box","text":"on the issuance of “senior securities” under Section 18 of the Investment Company Act. Section 18 of the","page_number":43,"box":{"x":69,"y":506,"width":759,"height":11}},{"id":"fe93ed62-8ec5-4dc3-99fe-62b6188b49fe","block_type":"box","text":"Investment Company Act, among other things, prohibits open-end funds, including the Funds, from issuing or selling","page_number":43,"box":{"x":70,"y":521,"width":825,"height":11}},{"id":"521f8d61-0ede-4bd6-bcc3-7f69761caf06","block_type":"box","text":"any “senior security,” other than borrowing from a bank (subject to a requirement to maintain 300% “asset","page_number":43,"box":{"x":69,"y":536,"width":763,"height":11}},{"id":"cd20b87b-6f37-41c8-a0b8-499a5eb042a7","block_type":"box","text":"coverage”).","page_number":43,"box":{"x":69,"y":551,"width":79,"height":11}},{"id":"807fb343-123d-4ca2-9b37-14951d52433b","block_type":"box","text":"Under Rule 18f-4, “Derivatives Transactions” include the following: (1) any swap, security-based swap (including","page_number":43,"box":{"x":102,"y":574,"width":796,"height":11}},{"id":"80cc6038-2c65-4c20-b270-fbe61aca5f67","block_type":"box","text":"a contract for differences), futures contract, forward contract, option (excluding purchased options), any combination","page_number":43,"box":{"x":69,"y":589,"width":832,"height":11}},{"id":"d9888644-f3bd-489c-ba60-0f2aad0ca946","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":43,"box":{"x":69,"y":604,"width":840,"height":11}},{"id":"68793496-9925-4076-992f-6c71f60b8b52","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":43,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"31b280ec-1155-484a-ae67-b0ab89eb6d05","block_type":"box","text":"settlement payment or otherwise; (2) any short sale borrowing; (3) reverse repurchase agreements and similar","page_number":43,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"0c371379-a479-4b07-b0ef-ab7b626d9bac","block_type":"box","text":"financing transactions (","page_number":43,"box":{"x":68,"y":649,"width":166,"height":12}},{"id":"e6db0c80-ac55-4c9d-91e4-e51005c98eae","block_type":"box","text":"e.g.","page_number":43,"box":{"x":236,"y":651,"width":25,"height":10}},{"id":"abbcee58-54e4-42f7-a668-5fa55e14d091","block_type":"box","text":", recourse and non-recourse tender option bonds, and borrowed bonds), if a Fund elects to","page_number":43,"box":{"x":263,"y":649,"width":646,"height":11}},{"id":"c9178c96-5ce4-473c-be51-ca448a76e8ce","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":43,"box":{"x":68,"y":664,"width":825,"height":12}},{"id":"0158485b-56b5-4d30-a5c3-db0075ba1445","block_type":"box","text":"securities (","page_number":43,"box":{"x":69,"y":680,"width":78,"height":11}},{"id":"6c80b4a9-447e-4eaf-b254-c59797b1d371","block_type":"box","text":"e.g.","page_number":43,"box":{"x":148,"y":681,"width":25,"height":10}},{"id":"bf8f5ef6-d53e-4f36-b3f4-29c5894ac028","block_type":"box","text":", firm and standby commitments, including to-be-announced (“TBA”) commitments, and dollar rolls)","page_number":43,"box":{"x":176,"y":680,"width":704,"height":11}},{"id":"766fe945-a894-4940-b7c6-e77c058ee122","block_type":"box","text":"and non-standard settlement cycle securities, unless such transactions meet the Delayed-Settlement Securities","page_number":43,"box":{"x":69,"y":695,"width":796,"height":11}},{"id":"ea8e26e0-c121-4cdc-9089-6ede3a6675e9","block_type":"box","text":"Provision (as defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward","page_number":43,"box":{"x":69,"y":710,"width":732,"height":11}},{"id":"587f9311-53a5-4dbb-854e-25c2c3b9d423","block_type":"box","text":"Commitments”).","page_number":43,"box":{"x":69,"y":725,"width":115,"height":11}},{"id":"85de85c8-31b6-4991-95ff-a22fdd980074","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":43,"box":{"x":102,"y":748,"width":805,"height":11}},{"id":"824f2573-d846-458e-8b3e-a19772a55270","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":43,"box":{"x":70,"y":763,"width":832,"height":11}},{"id":"fdb401d3-2a96-4f66-838e-14be3b50b5b6","block_type":"box","text":"implement a comprehensive written derivatives risk management program (“DRMP”) and comply with a relative or","page_number":43,"box":{"x":70,"y":778,"width":808,"height":11}},{"id":"44ef4cf5-b6fa-491f-92ed-e9a26547210d","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":43,"box":{"x":69,"y":793,"width":780,"height":11}},{"id":"7f7a8a42-ed59-4b4d-b1a0-4444420296e2","block_type":"box","text":"“derivatives risk manager,” who is appointed by the Fund’s Board, including a majority of the independent Directors,","page_number":43,"box":{"x":70,"y":808,"width":824,"height":11}},{"id":"938cf3ea-86b6-4ca8-b97f-9d5de723a2a0","block_type":"box","text":"and periodically reviews the DRMP and reports to the Fund’s Board.","page_number":43,"box":{"x":69,"y":823,"width":482,"height":11}},{"id":"634b5326-2421-4343-83a1-b2236900218b","block_type":"box","text":"Rule 18f-4 provides an exception from the DRMP, VaR limit and certain other requirements if a Fund’s","page_number":43,"box":{"x":102,"y":846,"width":724,"height":11}},{"id":"01846ddd-1bfd-49ed-8ed6-002408e3a1a9","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":43,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"f3a7018a-afd1-44ab-a22f-891a187b1700","block_type":"box","text":"adopts and implements written policies and procedures reasonably designed to manage its derivatives risks (the","page_number":43,"box":{"x":69,"y":876,"width":803,"height":11}},{"id":"2618944e-e60b-43f7-9bbe-19fc34995bf4","block_type":"box","text":"“Limited Derivatives User Exception”).","page_number":43,"box":{"x":70,"y":891,"width":268,"height":11}},{"id":"db1608e9-b024-4e01-9438-ebe806080edf","block_type":"box","text":"II-13","page_number":43,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"59a802d4-6c89-40f7-82ef-9d88f2872c28","block_type":"box","text":"NM1026U-5979889-43/232","page_number":43,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"7b55f190-ac3b-44db-8923-196d1e9638a4","block_type":"box","text":"Dodd-Frank Regulations.","page_number":44,"box":{"x":102,"y":45,"width":171,"height":11}},{"id":"8613cff7-1b8a-4b1e-9b02-d484ea4bb3ba","block_type":"box","text":"The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”),","page_number":44,"box":{"x":279,"y":45,"width":575,"height":11}},{"id":"af513f21-1353-4909-91a3-80147204ef04","block_type":"box","text":"enacted in July 2010, includes provisions that comprehensively regulate the over-the-counter (“OTC”) derivatives","page_number":44,"box":{"x":69,"y":60,"width":800,"height":11}},{"id":"75072ee4-a063-4f79-bb64-bf31249955d1","block_type":"box","text":"markets for the first time. While the Commodity Futures Trading Commission (“CFTC”) and other U.S. regulators have","page_number":44,"box":{"x":69,"y":75,"width":834,"height":11}},{"id":"ac7ac24a-956b-43f7-89a0-9920b09c6ea6","block_type":"box","text":"adopted many of the required Dodd-Frank regulations, certain regulations have only recently become effective and","page_number":44,"box":{"x":69,"y":90,"width":813,"height":11}},{"id":"7513ed1f-7a1f-42b9-b829-c3605e11bd52","block_type":"box","text":"other regulations remain to be adopted. The full impact of Dodd-Frank on the Funds remains uncertain.","page_number":44,"box":{"x":69,"y":105,"width":733,"height":11}},{"id":"67cc2e7c-91fa-4b72-bbb9-6d82b2758341","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":44,"box":{"x":102,"y":128,"width":789,"height":11}},{"id":"b7577d13-c2ba-42b6-b1e9-71f565bf5084","block_type":"box","text":"“security-based swap dealers”. Registered swap dealers and security-based swap dealers are subject to various","page_number":44,"box":{"x":70,"y":143,"width":797,"height":11}},{"id":"884334e9-5ecf-4703-8225-64e04f09374d","block_type":"box","text":"regulatory requirements, including, but not limited to, margin, recordkeeping, reporting, transparency, position limits,","page_number":44,"box":{"x":69,"y":158,"width":833,"height":11}},{"id":"e29e9eeb-3cad-4096-a8ef-3cb0974bb717","block_type":"box","text":"limitations on conflicts of interest, business conduct standards, minimum capital requirements and other regulatory","page_number":44,"box":{"x":70,"y":173,"width":826,"height":11}},{"id":"3aeb6fe6-69f8-462b-bc82-9ce3f93486ca","block_type":"box","text":"requirements, which indirectly impact the Funds that enter into transactions with them.","page_number":44,"box":{"x":69,"y":188,"width":618,"height":11}},{"id":"6c6bd396-20bf-4830-8e05-8cb1be34927c","block_type":"box","text":"The CFTC requires that certain interest rate swaps and certain credit default swaps must be executed in","page_number":44,"box":{"x":101,"y":211,"width":745,"height":11}},{"id":"cfc470b4-ded1-4c8e-b299-1410477b211b","block_type":"box","text":"regulated markets and be submitted for clearing to regulated clearinghouses. The SEC is also expected to impose","page_number":44,"box":{"x":69,"y":226,"width":813,"height":11}},{"id":"2539df18-8e0d-43fc-afc3-03a9b74c98da","block_type":"box","text":"similar requirements on certain security-based derivatives in the future. OTC derivatives trades submitted for clearing","page_number":44,"box":{"x":69,"y":241,"width":835,"height":11}},{"id":"ded01ce6-2b15-4843-903a-d8a624b61831","block_type":"box","text":"are subject to minimum initial and variation margin requirements set by the relevant clearinghouse, as well as margin","page_number":44,"box":{"x":69,"y":257,"width":837,"height":11}},{"id":"7aa9314a-018e-4e6b-8992-869a888e4c53","block_type":"box","text":"requirements mandated by the CFTC, SEC and/or federal prudential regulators. In addition, futures commission","page_number":44,"box":{"x":69,"y":271,"width":794,"height":12}},{"id":"e72e2767-7dc0-4659-bab7-c16a671fa18f","block_type":"box","text":"merchants (“FCMs”), who act as clearing members on behalf of customers for cleared OTC derivatives and futures","page_number":44,"box":{"x":69,"y":286,"width":815,"height":12}},{"id":"f38367ac-3207-419c-a063-a20ec50cdeed","block_type":"box","text":"contracts, also have discretion to increase a Fund’s margin requirements for these transactions beyond any","page_number":44,"box":{"x":69,"y":302,"width":770,"height":11}},{"id":"577115f2-2906-4c3f-8bdd-502e2b0ea157","block_type":"box","text":"regulatory and clearinghouse minimums subject to any restrictions on such discretion in the documentation between","page_number":44,"box":{"x":69,"y":317,"width":831,"height":11}},{"id":"8f6ef1c6-2937-4a4d-9efd-a3ad638b41ac","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":44,"box":{"x":68,"y":332,"width":804,"height":11}},{"id":"a26fcefd-d5ec-43de-aff2-c404e41eb345","block_type":"box","text":"enter into highly tailored or customized transactions, potentially rendering certain investment strategies impossible or","page_number":44,"box":{"x":69,"y":347,"width":839,"height":11}},{"id":"d2d65b02-280d-4350-b4ae-5b4b057f92a7","block_type":"box","text":"not economically feasible. If a Fund decides to execute and clear cleared OTC derivatives and/or futures contracts","page_number":44,"box":{"x":69,"y":362,"width":814,"height":11}},{"id":"a9d136fa-abe8-4490-8870-178a060f3d04","block_type":"box","text":"through execution facilities, exchanges or clearinghouses, either indirectly through an executing broker, clearing","page_number":44,"box":{"x":68,"y":377,"width":796,"height":12}},{"id":"1a282998-77da-4974-a6df-95c9972d7a2b","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":44,"box":{"x":69,"y":392,"width":793,"height":12}},{"id":"e09c6973-4ef3-46b5-bb73-ea674081aa1c","block_type":"box","text":"exchange or clearinghouse and other applicable law.","page_number":44,"box":{"x":69,"y":408,"width":370,"height":11}},{"id":"cd3a08ef-f79f-4f7b-858a-8203c5d24ca7","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":44,"box":{"x":101,"y":430,"width":766,"height":11}},{"id":"2cf2b5f3-7f5a-429d-b227-c595297f6beb","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":44,"box":{"x":69,"y":445,"width":826,"height":12}},{"id":"3ac75bdf-07ad-41d6-885f-9996d4124715","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":44,"box":{"x":69,"y":460,"width":825,"height":12}},{"id":"9b7bb548-7e08-4365-be5a-8e42524e04a2","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":44,"box":{"x":70,"y":475,"width":791,"height":12}},{"id":"556fc594-1882-4c3f-a4ea-85fd3b14541c","block_type":"box","text":"obligations to the clearinghouse simultaneously with a customer’s failure to meet its obligations to the clearing","page_number":44,"box":{"x":69,"y":491,"width":793,"height":11}},{"id":"3d3000c4-bcd8-4900-b94b-85eb329729f3","block_type":"box","text":"member.","page_number":44,"box":{"x":69,"y":506,"width":60,"height":9}},{"id":"255cacb8-e25b-400c-a831-7d83c559d6a7","block_type":"box","text":"Clearing member FCMs are required to post initial margin to the clearinghouses through which they clear their","page_number":44,"box":{"x":102,"y":529,"width":782,"height":11}},{"id":"63b6ad9f-a18e-4de4-96bb-0072fe3c5984","block_type":"box","text":"customers’ cleared OTC derivatives and futures contracts, instead of using such initial margin in their businesses, as","page_number":44,"box":{"x":69,"y":543,"width":837,"height":12}},{"id":"5de2e8c1-b388-4860-8fb3-c7d894737728","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":44,"box":{"x":68,"y":559,"width":811,"height":11}},{"id":"3376cbea-6fe4-4ccb-b1b8-accd7f6cde4a","block_type":"box","text":"margin in excess of clearinghouse requirements, and certain clearinghouses may share a portion of their earnings on","page_number":44,"box":{"x":69,"y":574,"width":838,"height":11}},{"id":"7ff56bbe-707b-4e2d-865e-ad3cbef2e1fe","block_type":"box","text":"initial margin with their clearing members, some portion of the initial margin that is passed through to the","page_number":44,"box":{"x":70,"y":589,"width":754,"height":11}},{"id":"b709dcc1-8210-46bf-909e-9123ec36ff76","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":44,"box":{"x":69,"y":604,"width":815,"height":11}},{"id":"047ab758-60b4-46d2-9e0a-21cbc04f0a62","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":44,"box":{"x":70,"y":619,"width":817,"height":11}},{"id":"16375f50-e439-4f21-9f43-170734a38ba8","block_type":"box","text":"FCMs to charge higher fees, or provide less favorable pricing on cleared OTC derivatives than swap dealers will","page_number":44,"box":{"x":70,"y":634,"width":788,"height":12}},{"id":"3bf722a1-d91c-47d8-acf0-8bf1e9d41afb","block_type":"box","text":"provide for non-cleared OTC derivatives. Furthermore, customers, including the Funds, are subject to additional fees","page_number":44,"box":{"x":70,"y":649,"width":825,"height":12}},{"id":"26c7dabb-dba2-4c93-bf2b-a45a3d5c257b","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":44,"box":{"x":70,"y":664,"width":829,"height":12}},{"id":"9d5d2270-0410-4f9f-8e7f-d2345341726d","block_type":"box","text":"to trading non-cleared OTC derivatives bilaterally.","page_number":44,"box":{"x":68,"y":680,"width":346,"height":11}},{"id":"ce61ad81-8f3a-40f8-b085-a2fc3d5eee20","block_type":"box","text":"With respect to uncleared swaps, registered swap dealers and security-based swap dealers are required to","page_number":44,"box":{"x":101,"y":703,"width":762,"height":11}},{"id":"5eecb0b7-5176-4cbd-a284-bbd6ecbb75c3","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":44,"box":{"x":69,"y":718,"width":820,"height":11}},{"id":"8e8d6c86-d98b-4fec-87b0-809e0db133c3","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":44,"box":{"x":69,"y":732,"width":816,"height":12}},{"id":"b4f698c7-596c-4afe-b3b7-d5c9244b9535","block_type":"box","text":"subject to applicable regulatory haircuts and other restrictions. Shares of investment companies (other than certain","page_number":44,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"50859b45-031d-4c0c-ae3f-7f9dc35eeb47","block_type":"box","text":"money market funds) may not be posted as collateral under applicable regulations.","page_number":44,"box":{"x":69,"y":763,"width":590,"height":11}},{"id":"22e3802f-e7d8-4ce8-9e96-adda28768e35","block_type":"box","text":"The CFTC, certain foreign regulators, and many futures exchanges have established (and continue to evaluate","page_number":44,"box":{"x":101,"y":785,"width":783,"height":12}},{"id":"8fecf646-54b6-4210-acae-ff7cc8cd4608","block_type":"box","text":"and monitor) speculative position limits (“position limits”) on the maximum speculative position which any person, or","page_number":44,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"da5f6cfb-96f1-4c47-a9b2-6dd264d82e74","block_type":"box","text":"group of persons acting in concert, may hold or control in particular contracts. In addition, U.S. federal position limits","page_number":44,"box":{"x":68,"y":816,"width":837,"height":11}},{"id":"57ab2a93-fd2c-4a06-b533-aaa8da88bb16","block_type":"box","text":"apply to swaps that are economically equivalent to futures contracts on certain agricultural, metals and energy","page_number":44,"box":{"x":69,"y":831,"width":789,"height":11}},{"id":"2461e82c-d084-4ef1-a81f-b66da72d4e19","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":44,"box":{"x":69,"y":846,"width":818,"height":11}},{"id":"ebb90f4b-1ad6-4abd-bccb-1d4a0e46ee99","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":44,"box":{"x":69,"y":861,"width":801,"height":11}},{"id":"e3315d10-9996-463d-b3c3-caf6148f4aa7","block_type":"box","text":"applicable position limits, it is possible that different clients managed by the Manager and its affiliates may be","page_number":44,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"40e89d12-91bb-43ce-ae97-668ec13e4978","block_type":"box","text":"aggregated for this purpose. Therefore, the trading decisions of the Manager may have to be modified and positions","page_number":44,"box":{"x":69,"y":891,"width":827,"height":12}},{"id":"271afeeb-dbee-40b2-8bf0-6c4e6a91a692","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":44,"box":{"x":69,"y":906,"width":805,"height":12}},{"id":"af5e9199-6d7a-4555-96a2-641696ac911e","block_type":"box","text":"II-14","page_number":44,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9011bd91-e238-4a40-9aa0-370be4c01b89","block_type":"box","text":"NM1026U-5979889-44/232","page_number":44,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"e742df8a-3ba8-4711-9703-21deeeadd991","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":45,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"018973bd-3291-4ef6-b61e-931dc376093b","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":45,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"4e889353-917a-47ec-ba82-4fe373e70bb7","block_type":"box","text":"by other regimes, including those of the European Union and United Kingdom, and trading venues that impose","page_number":45,"box":{"x":69,"y":75,"width":785,"height":11}},{"id":"acf5e615-1053-4661-8a3c-4296fc147cc5","block_type":"box","text":"position limits on commodity derivative contracts.","page_number":45,"box":{"x":70,"y":90,"width":350,"height":11}},{"id":"938f5bfb-56b2-4338-bb47-aa6d83d89bc5","block_type":"box","text":"Additional Regulation of Derivatives.","page_number":45,"box":{"x":101,"y":113,"width":256,"height":11}},{"id":"26e6b82f-f670-45bd-a73f-c2f2dd12375d","block_type":"box","text":"Regulatory bodies outside the U.S. have also passed, proposed, or may","page_number":45,"box":{"x":364,"y":113,"width":513,"height":11}},{"id":"e50a68e3-54e7-4fec-ab69-3446240ff5f6","block_type":"box","text":"propose in the future, legislation similar to Dodd-Frank or other legislation that could increase the costs of","page_number":45,"box":{"x":70,"y":128,"width":757,"height":11}},{"id":"b7b3e9cb-bd57-4cad-89d5-03b97841e3b7","block_type":"box","text":"participating in, or otherwise adversely impact the liquidity of, participating in the commodities markets. For example,","page_number":45,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"82d43c1c-c0b8-4dda-8bf1-a96548c31f4e","block_type":"box","text":"the European Market Infrastructure Regulation (Regulation (EU) No 648/2012) (“EMIR”) introduced certain","page_number":45,"box":{"x":68,"y":158,"width":762,"height":11}},{"id":"28aa2e0e-82b7-4075-ad15-eb7d9395f0f6","block_type":"box","text":"requirements in respect of OTC derivatives including: (i) the mandatory clearing of OTC derivative contracts declared","page_number":45,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"1d017b2e-45ac-4d0f-bd62-07c645a4b8f5","block_type":"box","text":"subject to the clearing obligation; (ii) risk mitigation techniques in respect of uncleared OTC derivative contracts,","page_number":45,"box":{"x":69,"y":188,"width":798,"height":12}},{"id":"4ec40387-8cdc-403b-a79a-959955da788f","block_type":"box","text":"including the mandatory margining of uncleared OTC derivative contracts; and (iii) reporting and recordkeeping","page_number":45,"box":{"x":70,"y":203,"width":785,"height":12}},{"id":"9c838788-2bf0-4ae6-b801-f2aae5b24a67","block_type":"box","text":"requirements in respect of all derivatives contracts. By way of further example, the European Union Markets in","page_number":45,"box":{"x":69,"y":218,"width":787,"height":12}},{"id":"c4c96f06-dc97-482b-9651-fb611300c589","block_type":"box","text":"Financial Instruments Directive (Directive 2014/65/EU) and Markets in Financial Instruments Regulation (Regulation","page_number":45,"box":{"x":70,"y":234,"width":830,"height":11}},{"id":"f91a0523-683e-4d7e-8896-23cba2c55483","block_type":"box","text":"(EU) No 600/2014) (together “MiFID II”), which have applied since January 3, 2018, govern the provision of","page_number":45,"box":{"x":69,"y":249,"width":771,"height":11}},{"id":"4ad07510-9c86-48fe-812b-094baed4feb4","block_type":"box","text":"investment services and activities in relation to, as well as the organized trading of, financial instruments such as","page_number":45,"box":{"x":70,"y":264,"width":812,"height":11}},{"id":"975014aa-5708-4114-aac7-cb881c170bb9","block_type":"box","text":"shares, bonds, units in collective investment schemes and derivatives. In particular, MiFID II requires European Union","page_number":45,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"55f8a09a-b384-405e-9922-575af1945de7","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":45,"box":{"x":70,"y":294,"width":793,"height":11}},{"id":"c7d3c5d6-b180-4f89-aa1d-7fb993ea17c1","block_type":"box","text":"derivatives traded on European Union trading venues and in “economically equivalent” OTC contracts. If the","page_number":45,"box":{"x":69,"y":309,"width":765,"height":11}},{"id":"1c805a7e-085d-4bdd-9212-ebbf86fca589","block_type":"box","text":"requirements of EMIR and MiFID II apply, the cost of derivatives transactions is expected to increase.","page_number":45,"box":{"x":69,"y":324,"width":720,"height":11}},{"id":"7c37de8f-9f4d-48f7-8cce-add320fe81b0","block_type":"box","text":"In addition, regulations adopted by global prudential regulators that are now in effect require certain prudentially","page_number":45,"box":{"x":102,"y":347,"width":802,"height":11}},{"id":"9784ca3a-f5e9-4f00-b671-88769b41e6a2","block_type":"box","text":"regulated entities and certain of their affiliates and subsidiaries (including swap dealers) to include in their","page_number":45,"box":{"x":69,"y":362,"width":762,"height":11}},{"id":"492b5113-95f3-4786-812f-014738e608a6","block_type":"box","text":"derivatives contracts and certain other financial contracts, terms that delay or restrict the rights of counterparties","page_number":45,"box":{"x":69,"y":377,"width":810,"height":12}},{"id":"a3f6ff44-51e4-40b6-9a00-557c5921c84e","block_type":"box","text":"(such as the Funds) to terminate such contracts, foreclose upon collateral, exercise other default rights or restrict","page_number":45,"box":{"x":69,"y":392,"width":812,"height":12}},{"id":"7dd5ade3-c2d5-4768-89fa-39c95f27ebe2","block_type":"box","text":"transfers of credit support in the event that the prudentially regulated entity and/or its affiliates are subject to","page_number":45,"box":{"x":68,"y":407,"width":787,"height":12}},{"id":"036c0920-cd80-457b-80f3-ddf41b12f4ed","block_type":"box","text":"certain types of resolution or insolvency proceedings. Similar regulations and laws have been adopted in non-U.S.","page_number":45,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"e3641364-8677-4778-9caf-0bf9aa98b443","block_type":"box","text":"jurisdictions that may apply to a Fund’s counterparties located in those jurisdictions. In particular, in the United","page_number":45,"box":{"x":67,"y":438,"width":795,"height":11}},{"id":"763822f8-27ce-4ce9-9395-913779c5d384","block_type":"box","text":"Kingdom and the European Union, governmental authorities could reduce, eliminate or convert to equity the liabilities","page_number":45,"box":{"x":70,"y":453,"width":835,"height":11}},{"id":"e0a6be51-ff18-4448-9b07-3c2e35e6535e","block_type":"box","text":"to a Fund of a counterparty experiencing financial difficulties (sometimes referred to as a “bail in”). It is possible that","page_number":45,"box":{"x":68,"y":468,"width":839,"height":11}},{"id":"ced1c3af-7d83-480e-9951-52e7ca9e8050","block_type":"box","text":"these requirements, as well as potential additional related government regulation, could adversely affect a Fund’s","page_number":45,"box":{"x":68,"y":483,"width":814,"height":11}},{"id":"06330030-9dfb-47a7-a02e-538921096424","block_type":"box","text":"ability to terminate existing derivatives contracts, exercise default rights or satisfy obligations owed to it with","page_number":45,"box":{"x":69,"y":498,"width":773,"height":11}},{"id":"39dd77e2-55e6-466f-ac93-a4098f36a333","block_type":"box","text":"collateral received under such contracts.","page_number":45,"box":{"x":69,"y":514,"width":288,"height":8}},{"id":"b1a5b380-15fe-4e51-922f-013fabed6fa1","block_type":"box","text":"Risk Factors in Derivatives.","page_number":45,"box":{"x":102,"y":536,"width":191,"height":9}},{"id":"9685d2b8-1fc9-4f90-8d89-5ffae79218aa","block_type":"box","text":"There are significant risks that apply generally to derivatives transactions, including:","page_number":45,"box":{"x":101,"y":559,"width":597,"height":11}},{"id":"d448bb72-d110-4826-8778-6b0b939d45e3","block_type":"box","text":"Correlation Risk","page_number":45,"box":{"x":102,"y":581,"width":114,"height":9}},{"id":"3106751d-de5d-4165-ad8b-7ef61215feb0","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":45,"box":{"x":220,"y":581,"width":668,"height":12}},{"id":"7e377c59-1af2-40cb-b1ec-a7ae3d132043","block_type":"box","text":"the portfolio holdings that are being hedged or of the particular market or security to which the Fund seeks exposure.","page_number":45,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"0d6b4ad5-cdbf-4660-b82c-a7aef8a23616","block_type":"box","text":"There are a number of factors which may prevent a derivative instrument from achieving the desired correlation (or","page_number":45,"box":{"x":68,"y":612,"width":818,"height":11}},{"id":"82ae3e92-0931-4cdd-a0c6-48f3806deb0e","block_type":"box","text":"inverse correlation) with an underlying asset, rate or index, such as the impact of fees, expenses and transaction","page_number":45,"box":{"x":70,"y":627,"width":806,"height":11}},{"id":"5e4eaf9e-3160-4219-9a3e-d26af2fa93b1","block_type":"box","text":"costs, the timing of pricing, and disruptions or illiquidity in the markets for such derivative instrument.","page_number":45,"box":{"x":69,"y":642,"width":725,"height":11}},{"id":"d6badfb3-d5c3-4fbe-aec4-d9a76d8f466b","block_type":"box","text":"Counterpar ty Risk","page_number":45,"box":{"x":102,"y":665,"width":128,"height":11}},{"id":"ac04bd9f-073d-452d-ad28-4e75f8f434b4","block_type":"box","text":"— the risk that a derivatives transaction counterparty will be unable or unwilling to make","page_number":45,"box":{"x":233,"y":665,"width":632,"height":11}},{"id":"6771b147-293d-4fff-bc34-433593902c9d","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":45,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"f839f0dc-3dad-4ec5-b2c4-c512c66336fa","block_type":"box","text":"a counterparty. In particular, derivatives traded in OTC markets often are not guaranteed by an exchange or clearing","page_number":45,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"26785f04-7c60-4803-a3fb-f86b1a98fe27","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":45,"box":{"x":69,"y":710,"width":834,"height":11}},{"id":"183629d1-e22f-4e13-a925-f52c9adf0d8b","block_type":"box","text":"instruments or has deposited collateral with its counterparties the Fund is at risk that its counterparties will become","page_number":45,"box":{"x":70,"y":725,"width":831,"height":11}},{"id":"e499db58-82a7-4340-80cf-ed23db2bae2a","block_type":"box","text":"bankrupt or otherwise fail to honor their obligations. A Fund will typically attempt to minimize counterparty risk by","page_number":45,"box":{"x":69,"y":740,"width":806,"height":11}},{"id":"92d72a4a-73ad-46fd-8cff-f12e2d40ac19","block_type":"box","text":"engaging in OTC derivatives transactions only with creditworthy entities that have substantial capital or that have","page_number":45,"box":{"x":69,"y":755,"width":803,"height":11}},{"id":"2464c345-d177-469b-9a92-1906e03e3108","block_type":"box","text":"provided the Fund with a third-party guaranty or other credit support. When a Fund enters into a derivatives","page_number":45,"box":{"x":70,"y":771,"width":760,"height":11}},{"id":"b0bdebc3-e3a3-4374-b191-9c88aa35563b","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":45,"box":{"x":68,"y":785,"width":819,"height":12}},{"id":"16826b53-e87d-4be9-a7c1-df4ed6421e2b","block_type":"box","text":"clearing house and the clearing member through which it holds its cleared position. Credit risk of market participants","page_number":45,"box":{"x":69,"y":801,"width":834,"height":11}},{"id":"e41159a7-c7cb-4fef-a851-146113b3c77e","block_type":"box","text":"with respect to derivatives that are centrally cleared is concentrated in a few clearing houses and increasingly fewer","page_number":45,"box":{"x":68,"y":816,"width":826,"height":11}},{"id":"be7ab774-beb7-4e87-9c0c-85c6086d2b17","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":45,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"db27e02f-3048-46ea-a342-73d5f0fc359e","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":45,"box":{"x":70,"y":846,"width":824,"height":11}},{"id":"8f1868f9-07e9-49a8-9a31-72cf5d11938e","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":45,"box":{"x":70,"y":861,"width":816,"height":11}},{"id":"8cad0c8a-ca0b-4515-8e04-7a31ff0d684d","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":45,"box":{"x":70,"y":876,"width":771,"height":11}},{"id":"79efad93-2fc2-4364-a00f-d4882d9b013d","block_type":"box","text":"derivatives. Although a clearing member is required to segregate assets from customers with respect to cleared","page_number":45,"box":{"x":69,"y":891,"width":797,"height":12}},{"id":"895ae714-9df4-4fd1-b8a7-c2aed7818ab0","block_type":"box","text":"derivatives positions from the clearing member’s proprietary assets, if a clearing member does not comply with the","page_number":45,"box":{"x":69,"y":906,"width":822,"height":12}},{"id":"a4c968bd-c03c-4135-b3a8-9ccd970ce096","block_type":"box","text":"II-15","page_number":45,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3d9d9088-a134-4da0-9c2b-90a9f16b30c5","block_type":"box","text":"NM1026U-5979889-45/232","page_number":45,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"b16bb0a5-bbb8-48b8-a067-93e7e27e6a71","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":46,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"66766c2a-9e29-46ba-8724-9750ffea11c2","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":46,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"ec57aece-8f42-42fb-8901-f6327a72b65d","block_type":"box","text":"by the clearing member.","page_number":46,"box":{"x":69,"y":75,"width":169,"height":11}},{"id":"17362bc0-8686-46b0-a02c-a813456d6d80","block_type":"box","text":"Credit Risk","page_number":46,"box":{"x":102,"y":98,"width":78,"height":9}},{"id":"d6c19578-e82b-4736-96c1-1a45663178d5","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":46,"box":{"x":184,"y":98,"width":698,"height":11}},{"id":"cd3a5d31-e86b-49c3-8865-17fe51bdc253","block_type":"box","text":"honor its financial obligations.","page_number":46,"box":{"x":69,"y":113,"width":213,"height":11}},{"id":"079298bc-8ac0-4bb9-b948-9ab3bd7c7029","block_type":"box","text":"Currency Risk","page_number":46,"box":{"x":102,"y":135,"width":98,"height":11}},{"id":"4ef8d998-5142-403e-a54f-975b5f8485ea","block_type":"box","text":"— the risk that changes in the exchange rate between two currencies will adversely affect the","page_number":46,"box":{"x":204,"y":135,"width":669,"height":12}},{"id":"0e095d5f-9229-44cd-8e03-3adf04f01629","block_type":"box","text":"value (in U.S. dollar terms) of a derivative.","page_number":46,"box":{"x":68,"y":150,"width":300,"height":11}},{"id":"8d9df61e-c237-4d43-b02a-62d2e0079200","block_type":"box","text":"Illiquidity Risk","page_number":46,"box":{"x":102,"y":173,"width":98,"height":11}},{"id":"4d0b54ee-f7cf-4dd8-b595-82d6317fcd89","block_type":"box","text":"— the risk that certain securities or instruments may be difficult or impossible to sell at the time","page_number":46,"box":{"x":204,"y":173,"width":693,"height":11}},{"id":"ee95c161-1f89-4a4f-b72e-b4248663a7d6","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":46,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"2635c807-e2f8-42c5-b35b-28511888ea5a","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":46,"box":{"x":69,"y":203,"width":799,"height":12}},{"id":"e6108d6a-866b-414d-af0c-bc780ba4bd90","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":46,"box":{"x":69,"y":218,"width":799,"height":12}},{"id":"6007676f-bdfd-4a4c-a78a-4ab2ce82101a","block_type":"box","text":"incurring substantial losses (if at all). Certain OTC derivatives, including swaps and OTC options, involve substantial","page_number":46,"box":{"x":70,"y":234,"width":824,"height":11}},{"id":"9801d086-9907-41da-bade-6fe76a9f8d1d","block_type":"box","text":"illiquidity risk. Illiquidity may also make it more difficult for a Fund to ascertain a market value for such derivatives. A","page_number":46,"box":{"x":70,"y":249,"width":830,"height":11}},{"id":"46108cfd-6880-4d84-9907-98dcc095a61f","block_type":"box","text":"Fund will, therefore, acquire illiquid OTC derivatives (i) if the agreement pursuant to which the instrument is","page_number":46,"box":{"x":70,"y":264,"width":762,"height":11}},{"id":"7b4b0599-0ea6-4fc8-815c-a3fe92ec4433","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":46,"box":{"x":70,"y":279,"width":827,"height":11}},{"id":"21b2030e-04c2-44ae-8a5a-24e03d7292b7","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":46,"box":{"x":69,"y":294,"width":816,"height":11}},{"id":"403191e8-d9c0-4d14-a0e9-c7640b3677f1","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":46,"box":{"x":68,"y":309,"width":831,"height":11}},{"id":"a7faf5bd-2323-4700-96f0-15828502eca9","block_type":"box","text":"markets may be due to various factors, including congestion, disorderly markets, limitations on deliverable supplies,","page_number":46,"box":{"x":69,"y":324,"width":828,"height":12}},{"id":"3b505bb0-33b9-45df-9b6c-f0edd566e012","block_type":"box","text":"the participation of speculators, government regulation and intervention, and technical and operational or system","page_number":46,"box":{"x":68,"y":339,"width":809,"height":12}},{"id":"19ee13c7-bbcf-4a1d-8d04-914aed17f422","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":46,"box":{"x":68,"y":355,"width":826,"height":11}},{"id":"0f889a97-f18a-4787-8258-a65ec3e8f213","block_type":"box","text":"“daily price fluctuation limits” established by the exchanges which limit the amount of fluctuation in an exchange","page_number":46,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"262617da-f482-480b-b964-3f1fe23ba9ec","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":46,"box":{"x":68,"y":385,"width":838,"height":11}},{"id":"3627d443-7c2e-4512-b6e3-99d20cd4f7e2","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":46,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"fee48a13-9e22-4447-a0c6-718a0f990cf6","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":46,"box":{"x":69,"y":415,"width":828,"height":11}},{"id":"ef8f9a8a-27f1-433c-921a-60a097308f11","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":46,"box":{"x":69,"y":430,"width":796,"height":11}},{"id":"aa532fbc-9a8c-46e5-afa3-e059d622cdfa","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":46,"box":{"x":70,"y":445,"width":759,"height":12}},{"id":"36d5e5c8-ac34-4c59-a4e4-1d3226ce187f","block_type":"box","text":"insufficient cash, it may have to sell portfolio securities to meet daily variation margin requirements at a time when it","page_number":46,"box":{"x":70,"y":460,"width":837,"height":12}},{"id":"039c6f15-938f-4cca-bbb5-70eb90b0c42c","block_type":"box","text":"may be disadvantageous to do so.","page_number":46,"box":{"x":69,"y":476,"width":243,"height":11}},{"id":"ecdd3328-39cc-433a-ad8a-4d96f56f58cc","block_type":"box","text":"Index Risk","page_number":46,"box":{"x":102,"y":498,"width":73,"height":9}},{"id":"9c53d802-e1dc-4aa6-97af-3ab0dd0bd779","block_type":"box","text":"— if the derivative is linked to the performance of an index, it will be subject to the risks associated","page_number":46,"box":{"x":179,"y":498,"width":714,"height":11}},{"id":"3c25e6b1-4935-4a8a-8b2b-a1dc16b0f499","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":46,"box":{"x":68,"y":513,"width":800,"height":12}},{"id":"64117af0-3e12-4938-932b-2372e6d3974f","block_type":"box","text":"reduction in the value of the derivative to below the price that the Fund paid for such derivative.","page_number":46,"box":{"x":69,"y":528,"width":678,"height":11}},{"id":"3185a90b-077c-4139-970c-820b430f74f3","block_type":"box","text":"Legal Risk","page_number":46,"box":{"x":102,"y":551,"width":73,"height":11}},{"id":"227c1692-5c1e-4124-bb1a-70d7e7170903","block_type":"box","text":"— the risk of insufficient documentation, insufficient capacity or authority of counterparty, or legality","page_number":46,"box":{"x":179,"y":551,"width":717,"height":11}},{"id":"f4e1207b-6b34-486e-a23c-b82c899a7aa6","block_type":"box","text":"or enforceability of a contract.","page_number":46,"box":{"x":69,"y":566,"width":211,"height":11}},{"id":"477139b5-3085-4118-bfd9-3c5266b984a6","block_type":"box","text":"Leverage Risk","page_number":46,"box":{"x":102,"y":589,"width":99,"height":11}},{"id":"83040a01-fec1-40f0-af70-cea5e02b0e07","block_type":"box","text":"— the risk that a Fund’s derivatives transactions can magnify the Fund’s gains and losses.","page_number":46,"box":{"x":205,"y":589,"width":648,"height":11}},{"id":"3b317b68-8e10-48dc-a983-2690f005dfe5","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":46,"box":{"x":70,"y":604,"width":823,"height":11}},{"id":"adf35dd5-f596-4e19-b33e-d8042ffc5a75","block_type":"box","text":"in losses that greatly exceed the amount originally invested.","page_number":46,"box":{"x":70,"y":619,"width":425,"height":11}},{"id":"41246a32-d54a-43c2-931c-877cc9f0f700","block_type":"box","text":"Market Risk","page_number":46,"box":{"x":102,"y":642,"width":85,"height":9}},{"id":"1005a72d-e050-40d1-b935-7687ad48345d","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":46,"box":{"x":191,"y":642,"width":716,"height":11}},{"id":"c3d376a3-fe79-4811-93a3-229a883f1477","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":46,"box":{"x":68,"y":657,"width":833,"height":11}},{"id":"6c728dc0-0c37-4766-adcf-2d9f3396be74","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":46,"box":{"x":69,"y":672,"width":794,"height":11}},{"id":"6bad528a-c879-4472-9528-08b2f55dfc26","block_type":"box","text":"affected.","page_number":46,"box":{"x":69,"y":687,"width":62,"height":9}},{"id":"2801b34a-6b14-454a-9723-dca8ad622665","block_type":"box","text":"Operational Risk","page_number":46,"box":{"x":102,"y":710,"width":117,"height":11}},{"id":"a1a51454-ab8c-45c3-9c2c-67ef95510762","block_type":"box","text":"— the risk related to potential operational issues, including documentation issues, settlement","page_number":46,"box":{"x":223,"y":710,"width":674,"height":11}},{"id":"0a46ad38-e6a9-42a7-a974-a9a270e2ecfe","block_type":"box","text":"issues, systems failures, inadequate controls and human error.","page_number":46,"box":{"x":70,"y":725,"width":451,"height":11}},{"id":"b4aafee3-00e6-480b-a98c-afe63e8d83c2","block_type":"box","text":"Valuation Risk","page_number":46,"box":{"x":103,"y":748,"width":99,"height":9}},{"id":"8f324e7e-56f0-4ea6-8fb0-191c7d96cb20","block_type":"box","text":"— the risk that valuation sources for a derivative will not be readily available in the market. This is","page_number":46,"box":{"x":206,"y":748,"width":701,"height":11}},{"id":"e99a1096-7199-4d8b-b18f-19378fa08019","block_type":"box","text":"possible especially in times of market distress, since many market participants may be reluctant to purchase","page_number":46,"box":{"x":70,"y":763,"width":779,"height":11}},{"id":"cdeb2861-317d-4782-88a7-b603a454203a","block_type":"box","text":"complex instruments or quote prices for them.","page_number":46,"box":{"x":69,"y":778,"width":329,"height":11}},{"id":"4d9dd548-9e7c-4bb5-9f1b-c7c6469ed52d","block_type":"box","text":"Volatility Risk","page_number":46,"box":{"x":103,"y":801,"width":93,"height":11}},{"id":"a408496f-302b-47eb-b46f-f66fea3abc4c","block_type":"box","text":"— the risk that the value of derivatives will fluctuate significantly within a short time period.","page_number":46,"box":{"x":200,"y":801,"width":652,"height":11}},{"id":"2e60bdea-81d6-47ce-b8e5-4180ede4ac42","block_type":"box","text":"Types of Derivatives Transactions.","page_number":46,"box":{"x":103,"y":823,"width":240,"height":11}},{"id":"f7ca4de1-bc12-4372-95c1-b8f428ff4eb4","block_type":"box","text":"A Fund may enter into derivatives transactions in accordance with its investment guidelines and restrictions,","page_number":46,"box":{"x":101,"y":846,"width":771,"height":11}},{"id":"3188faed-3166-4522-a208-323cade189c5","block_type":"box","text":"including the following:","page_number":46,"box":{"x":70,"y":861,"width":159,"height":11}},{"id":"2b6be9a3-e346-4fa4-813f-d3ce6e7564cf","block_type":"box","text":"Futures.","page_number":46,"box":{"x":102,"y":884,"width":56,"height":9}},{"id":"24e0b03a-db25-463b-b7e3-cac6f8f74ddb","block_type":"box","text":"II-16","page_number":46,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4ea0c4d4-54c5-4e9e-9bb0-70fe1cf69c63","block_type":"box","text":"NM1026U-5979889-46/232","page_number":46,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"06354b73-a4cf-4906-b5f5-19d67a017fc2","block_type":"box","text":"A Fund may enter into futures contracts (“futures”) and options on futures contracts. Futures are standardized,","page_number":47,"box":{"x":101,"y":45,"width":791,"height":11}},{"id":"0e7d88fe-5615-4d34-b028-e75650290b64","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":47,"box":{"x":69,"y":60,"width":799,"height":11}},{"id":"e7d9cd57-3e44-4edc-bc6c-7368e678c319","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":47,"box":{"x":69,"y":75,"width":800,"height":11}},{"id":"e0604380-17b5-4c9e-8267-e7e54baceca6","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":47,"box":{"x":69,"y":90,"width":838,"height":11}},{"id":"5ab114c7-a873-44f6-830b-b2e106749f13","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":47,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"ecc6aee3-7761-4588-97d9-aa7a55bb496c","block_type":"box","text":"applicable, based on the mark-to-market movement of the contract.","page_number":47,"box":{"x":69,"y":120,"width":478,"height":11}},{"id":"23b30cc4-34b5-40ea-b4c7-de12934b28b0","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":47,"box":{"x":101,"y":143,"width":801,"height":11}},{"id":"dd52c3a5-94f3-46de-9cfa-58027791335a","block_type":"box","text":"market value of portfolio holdings correlated with the futures contract. However, in the event the market value of the","page_number":47,"box":{"x":69,"y":158,"width":829,"height":11}},{"id":"f00d2630-7689-482c-a573-8ccfdba8e289","block_type":"box","text":"portfolio holdings correlated with the futures contract increases rather than decreases, a Fund will realize a loss on","page_number":47,"box":{"x":70,"y":173,"width":822,"height":11}},{"id":"86dbca52-3d98-43f0-9d09-bbc7067f3091","block_type":"box","text":"the futures position and a lower return on the portfolio holdings than would have been realized without the purchase","page_number":47,"box":{"x":68,"y":188,"width":830,"height":12}},{"id":"12dcdc8d-6519-42ea-b5f0-29e774ab8e92","block_type":"box","text":"of the futures contract.","page_number":47,"box":{"x":69,"y":203,"width":162,"height":9}},{"id":"45ee9193-4014-42b8-99c2-8577e3d32a09","block_type":"box","text":"The purchase of a futures contract may provide a Fund a lower cost alternative to purchasing securities or","page_number":47,"box":{"x":101,"y":226,"width":756,"height":11}},{"id":"99106199-cf1d-49b8-b9b6-d29f3afa6ff8","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":47,"box":{"x":69,"y":241,"width":820,"height":11}},{"id":"e60050bd-65ff-4908-b95e-8eac1615c013","block_type":"box","text":"complete an anticipatory hedge transaction relating to a futures contract, however, the Fund may realize a loss","page_number":47,"box":{"x":69,"y":256,"width":789,"height":12}},{"id":"55d4672d-678e-4a85-97da-67f9366ac8e2","block_type":"box","text":"relating to the futures position.","page_number":47,"box":{"x":69,"y":271,"width":219,"height":12}},{"id":"68334612-ee7f-40e2-84c8-3758765c71af","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":47,"box":{"x":102,"y":294,"width":757,"height":11}},{"id":"957d6767-4acb-4ab9-8a20-e3aa7b6a90fb","block_type":"box","text":"required to liquidate positions or may not be able to fully implement trading instructions. Any such liquidation or","page_number":47,"box":{"x":69,"y":309,"width":797,"height":11}},{"id":"966be591-8c0b-42c6-bc8f-5c083b598181","block_type":"box","text":"limited implementation could result in substantial costs to a Fund. See “—Regulation of Derivatives — Dodd-Frank","page_number":47,"box":{"x":70,"y":324,"width":816,"height":12}},{"id":"1252b1ba-b736-43cb-9d7b-066c9b0f30d4","block_type":"box","text":"Regulations” above.","page_number":47,"box":{"x":70,"y":340,"width":140,"height":11}},{"id":"d74a28b8-0a74-4cb4-ad38-b95aaad7a9a8","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":47,"box":{"x":101,"y":362,"width":799,"height":11}},{"id":"063180d9-ba91-499b-8c88-6a15131e5b03","block_type":"box","text":"and stock indices. Generally, these strategies would be used under the same market and market sector conditions","page_number":47,"box":{"x":69,"y":377,"width":818,"height":12}},{"id":"d8cb83fa-b2b0-4ea4-9414-3f1f99a4caba","block_type":"box","text":"(","page_number":47,"box":{"x":69,"y":393,"width":3,"height":10}},{"id":"fdd3bee1-cab7-457f-b5eb-4b4a66af5f21","block_type":"box","text":"i.e.","page_number":47,"box":{"x":74,"y":393,"width":21,"height":8}},{"id":"58555961-9ac6-4bbf-afd2-80caf2fa4ac3","block_type":"box","text":", conditions relating to specific types of investments) in which the Fund entered into futures transactions. A Fund","page_number":47,"box":{"x":97,"y":392,"width":803,"height":12}},{"id":"40911e87-75fc-40cc-836d-3b95b515ab47","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":47,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"e00da4d2-572d-4598-a8b5-6fe267342514","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":47,"box":{"x":68,"y":423,"width":835,"height":11}},{"id":"2f676030-1b27-4449-8497-26926c2e74dd","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":47,"box":{"x":69,"y":438,"width":831,"height":11}},{"id":"c1603967-e442-4b78-8a5d-40acfd9197aa","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":47,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"e658b06c-b33c-4ef1-8b69-da634c071608","block_type":"box","text":"Fund intends to purchase.","page_number":47,"box":{"x":70,"y":468,"width":183,"height":11}},{"id":"86dc2e4f-8f12-4509-90c3-f1f37c6c2e57","block_type":"box","text":"To maintain greater flexibility, a Fund may invest in instruments which have characteristics similar to futures","page_number":47,"box":{"x":101,"y":491,"width":768,"height":11}},{"id":"eb0988dc-1e88-4b20-b2b6-f307796a1243","block_type":"box","text":"contracts. These instruments may take a variety of forms, such as debt securities with interest or principal payments","page_number":47,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"c8cf866b-1d84-4eca-8468-7177e25c7f8d","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":47,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"3ad6f36f-5fff-4d75-89b3-e6d9e1537b06","block_type":"box","text":"risks of such investments could reflect the risks of investing in futures and securities, including volatility and","page_number":47,"box":{"x":69,"y":536,"width":773,"height":11}},{"id":"461f2073-fb3e-492e-8af4-84cf14326142","block_type":"box","text":"illiquidity.","page_number":47,"box":{"x":70,"y":551,"width":63,"height":11}},{"id":"a1ae7b92-5eb6-44dc-b6a8-69fd3feb0e6d","block_type":"box","text":"Futures contracts and options on futures contracts are subject to significant correlation risk, leverage risk,","page_number":47,"box":{"x":102,"y":574,"width":757,"height":11}},{"id":"9dc1d85e-85c8-460e-9207-1ba5f075a8ed","block_type":"box","text":"illiquidity risk, market risk and counterparty risk with respect to a Fund’s futures broker or the clearinghouse. See","page_number":47,"box":{"x":70,"y":589,"width":807,"height":11}},{"id":"1f2246e8-eb98-48dc-946e-56afd87e02fc","block_type":"box","text":"“—Risk Factors in Derivatives” above.","page_number":47,"box":{"x":70,"y":604,"width":269,"height":9}},{"id":"6b03823a-c5f9-437b-a20e-c61aba0fe441","block_type":"box","text":"Certain Funds may invest in futures based on carbon “allowances.” Under certain regulatory regimes, a limit is","page_number":47,"box":{"x":102,"y":627,"width":791,"height":11}},{"id":"e2110ee1-ac9a-4416-b0c4-83b3c52ef465","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":47,"box":{"x":69,"y":642,"width":838,"height":11}},{"id":"ad5b4091-db0f-4a7d-84ea-bbbe1994d68a","block_type":"box","text":"can be emitted by regulated entities, such as manufacturers or energy producers. The regulator then may issue or","page_number":47,"box":{"x":69,"y":657,"width":814,"height":11}},{"id":"af2f5d5f-d1c8-4c8e-b04a-8480d69ed9b8","block_type":"box","text":"sell individual “emission allowances” to regulated entities, which can then be traded on the open market. Commodity","page_number":47,"box":{"x":69,"y":672,"width":837,"height":11}},{"id":"f0437efd-4b8a-41bf-8197-ae2c8417da19","block_type":"box","text":"futures contracts linked to the value of emission allowances are known as “carbon futures.”","page_number":47,"box":{"x":68,"y":687,"width":657,"height":9}},{"id":"c3b1f9fb-bf85-4dde-a1b8-70b2fa95a0a3","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":47,"box":{"x":101,"y":710,"width":792,"height":11}},{"id":"0ed5e3d8-f648-44a8-86b6-b04ff382233c","block_type":"box","text":"for carbon futures contracts. Changes in law, market conditions and expectations, position limits, collateral","page_number":47,"box":{"x":68,"y":725,"width":764,"height":11}},{"id":"45e692c9-390f-46d7-9561-23ffb298928a","block_type":"box","text":"requirements, and other factors each can impact the supply of and demand for carbon futures contracts. The market","page_number":47,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"942d55c3-aa57-4803-b9f8-ae646001e576","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":47,"box":{"x":68,"y":755,"width":841,"height":11}},{"id":"5ad9f1c2-076a-4c79-b287-ac629c40c687","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":47,"box":{"x":69,"y":770,"width":819,"height":11}},{"id":"c8511479-545f-4b56-999e-2f86b2590616","block_type":"box","text":"difficult to find a counterparty willing to transact at a reasonable price and sufficient size.","page_number":47,"box":{"x":69,"y":785,"width":637,"height":12}},{"id":"13a09a48-116e-40a2-9674-1b631c17f470","block_type":"box","text":"Swap Agreements.","page_number":47,"box":{"x":102,"y":808,"width":131,"height":11}},{"id":"bcc64c4a-94cc-4b41-828a-c044d7837c77","block_type":"box","text":"A Fund may enter into swap agreements for hedging purposes or speculative purposes. Swap agreements are","page_number":47,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"a8f97379-3a54-4c38-b7fa-087eca2dd56a","block_type":"box","text":"OTC contracts entered into primarily by financial institutions and institutional investors which may or may not be","page_number":47,"box":{"x":69,"y":846,"width":796,"height":11}},{"id":"ca5b120b-7f92-41de-a6bc-d179d509022a","block_type":"box","text":"cleared by a central clearinghouse. In a standard “swap” transaction, two parties agree to exchange the returns","page_number":47,"box":{"x":69,"y":861,"width":799,"height":11}},{"id":"aa7edb6a-c92f-4fb1-9dd8-db16a5aaf7cd","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":47,"box":{"x":69,"y":876,"width":792,"height":11}},{"id":"6501edb9-053e-4939-bd02-79031c688f66","block_type":"box","text":"factor. The gross returns to be exchanged or “swapped” between the parties are generally calculated with respect to","page_number":47,"box":{"x":68,"y":891,"width":832,"height":12}},{"id":"673def96-9060-4f9b-a6ce-84812f46e15b","block_type":"box","text":"a “notional amount,”","page_number":47,"box":{"x":69,"y":907,"width":147,"height":10}},{"id":"6c89fd0b-2a9d-4c59-bd45-72e92bb77ed1","block_type":"box","text":"e.g.","page_number":47,"box":{"x":223,"y":908,"width":25,"height":10}},{"id":"5f5b23b8-623a-42e9-9fc2-fa5b3bfb4f2c","block_type":"box","text":", the return or increase in value of a particular dollar amount invested at a particular","page_number":47,"box":{"x":251,"y":906,"width":602,"height":11}},{"id":"e304449c-ebc9-435f-bf29-11678622b96c","block_type":"box","text":"II-17","page_number":47,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7e2bafe5-34d2-4e6a-bb04-fc0ca1ce23b7","block_type":"box","text":"NM1026U-5979889-47/232","page_number":47,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"405f15bb-2f3e-4cb0-951b-e1ed7b08ab0e","block_type":"box","text":"interest rate, in a particular foreign currency, or in a “basket” of securities representing a particular index. The","page_number":48,"box":{"x":70,"y":45,"width":787,"height":11}},{"id":"8a1c2ac1-268c-4e9a-9b9e-32c82089ac9f","block_type":"box","text":"notional amount of the swap agreement is only used to calculate the obligations that the parties to a swap","page_number":48,"box":{"x":69,"y":60,"width":762,"height":11}},{"id":"d849e400-6f68-445b-aa02-33c951cedf6c","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":48,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"cee06a94-8449-44e1-9910-2eec74f946f5","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":48,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"1066ebba-6864-4513-8f50-8a5e40f1b89b","block_type":"box","text":"by each party to the agreement. Swaps that are not cleared involve substantial counterparty risk. A Fund will typically","page_number":48,"box":{"x":69,"y":105,"width":835,"height":11}},{"id":"3232a18f-814d-481e-ba2e-c231a648e128","block_type":"box","text":"attempt to mitigate this counterparty risk by entering into swap agreements only with creditworthy entities that have","page_number":48,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"9fec8a57-248d-4000-8c79-0e3193ace36c","block_type":"box","text":"substantial capital or that have provided the Fund with a third-party guaranty or other credit support. A Fund’s ability","page_number":48,"box":{"x":69,"y":136,"width":827,"height":11}},{"id":"7bd6189b-13e1-4444-8296-57d06d1e10e9","block_type":"box","text":"to use swap agreements may be restricted by the tax rules applicable to registered investment companies.","page_number":48,"box":{"x":68,"y":151,"width":763,"height":11}},{"id":"b4b2f0d9-664a-4f51-a592-cefd3996448c","block_type":"box","text":"Credit Default Swaps and Similar Instruments.","page_number":48,"box":{"x":102,"y":173,"width":329,"height":11}},{"id":"11629aaa-441a-4861-9b89-12e5b3b59da3","block_type":"box","text":"Certain Funds may enter into credit default swaps and similar","page_number":48,"box":{"x":438,"y":173,"width":439,"height":11}},{"id":"aa57e9a7-6359-4de8-aaab-f252b6964955","block_type":"box","text":"instruments. Credit default swaps are standardized agreements in which the protection “buyer” pays the protection","page_number":48,"box":{"x":70,"y":188,"width":821,"height":12}},{"id":"72be98a9-7745-4497-a214-4929e324bd51","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":48,"box":{"x":70,"y":203,"width":831,"height":12}},{"id":"0cd29dc2-c4ba-46c9-9a2c-8eab6d1d0397","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":48,"box":{"x":69,"y":218,"width":801,"height":12}},{"id":"486f52f3-1f4a-4935-90cb-ed20f019c688","block_type":"box","text":"buyer the difference between the notional amount of the contract and the value of a portfolio of securities issued by","page_number":48,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"b00d2abb-f79b-4775-877c-774263a331e9","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":48,"box":{"x":68,"y":249,"width":798,"height":11}},{"id":"846bad61-d62b-4745-a3f6-b455180d1842","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":48,"box":{"x":69,"y":264,"width":827,"height":11}},{"id":"60357464-5301-4930-9683-c80a12be9e0f","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":48,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"464f18f6-03e9-48ca-855d-1402c3ce6e77","block_type":"box","text":"index CDS.","page_number":48,"box":{"x":70,"y":294,"width":75,"height":9}},{"id":"357d63c2-4f3d-4b5b-9427-9f9425e35233","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":48,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"8cd5a69b-fa9f-46e4-8cf0-e3caeffa376d","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":48,"box":{"x":69,"y":332,"width":806,"height":9}},{"id":"5f5df10c-e733-4dad-a0ff-c34d55b0ea11","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":48,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"242429ff-85c3-4062-ae32-5fb809bf2cf7","block_type":"box","text":"available only at unfavorable prices, as would be the case in a so-called “short squeeze.” In certain instances of","page_number":48,"box":{"x":69,"y":362,"width":804,"height":11}},{"id":"45a719e3-c184-4a8b-876b-fa8c1633892c","block_type":"box","text":"issuer defaults or restructurings, it has been unclear under the standard industry documentation for credit default","page_number":48,"box":{"x":70,"y":377,"width":812,"height":12}},{"id":"90640e75-54ee-4910-aad5-d52413903ac3","block_type":"box","text":"swaps whether or not a “credit event” triggering the seller’s payment obligation had occurred. Certain initiatives","page_number":48,"box":{"x":69,"y":392,"width":798,"height":12}},{"id":"1bb32cf0-58fd-49bd-b8ba-566d0678f78d","block_type":"box","text":"adopted by derivatives market participants, including the International Swaps and Derivatives Association (“ISDA”),","page_number":48,"box":{"x":69,"y":408,"width":819,"height":11}},{"id":"1015e50b-2474-4af6-bdb0-ab2d26cf4f3c","block_type":"box","text":"are designed to implement uniform settlement terms into standard credit default swap documentation, as well as","page_number":48,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"3ffe2e0e-3e4d-4908-b593-557ce0fd5acc","block_type":"box","text":"refine the practices for the transparent conduct of the credit default swap market generally. Among these initiatives","page_number":48,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"cf480d97-8250-4a74-bb9a-a5d031fe252e","block_type":"box","text":"are the ISDA Credit Derivatives Determination Committee and the implementation of market-wide cash settlement","page_number":48,"box":{"x":69,"y":453,"width":811,"height":11}},{"id":"2e01c186-1734-4746-8456-f2c116d7c110","block_type":"box","text":"protocols applicable to all market-standard credit default swaps. These initiatives are intended to reduce both the","page_number":48,"box":{"x":70,"y":468,"width":809,"height":11}},{"id":"52ac08fe-050b-4298-91df-4398cd0864e6","block_type":"box","text":"uncertainty as to the occurrence of credit events and the risk of a “short squeeze” by providing that the ISDA Credit","page_number":48,"box":{"x":69,"y":483,"width":827,"height":11}},{"id":"3f57ddc8-6f2d-44b5-bfec-200d1842ed87","block_type":"box","text":"Derivatives Determinations Committee will make determinations as to whether a credit event has occurred, establish","page_number":48,"box":{"x":70,"y":498,"width":834,"height":11}},{"id":"b37c4135-c234-47d4-a40d-fdff47261fe4","block_type":"box","text":"an auction to determine a settlement price and identify the deliverable securities for purposes of the auction,","page_number":48,"box":{"x":69,"y":513,"width":778,"height":11}},{"id":"11e62208-170a-40cc-8510-92629ae72001","block_type":"box","text":"although the ISDA Credit Derivatives Determinations Committee may in certain limited circumstances refrain from","page_number":48,"box":{"x":69,"y":528,"width":809,"height":12}},{"id":"15b423f3-a3ce-4566-89d3-65e23381d032","block_type":"box","text":"doing so. In the event the ISDA Credit Derivatives Determinations Committee cannot reach a timely resolution with","page_number":48,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"174823c2-920e-4ec7-8ae7-0db1504f37bc","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":48,"box":{"x":69,"y":559,"width":807,"height":11}},{"id":"c2de418f-462b-4078-8cfe-bdc55a3c6e24","block_type":"box","text":"realize the full value of the credit default swap upon a default by the reference entity. Furthermore, a Fund may enter","page_number":48,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"d4739d93-b48a-4bc4-bd30-df316904ede5","block_type":"box","text":"into certain credit default swaps or similar instruments that may not be covered by these initiatives.","page_number":48,"box":{"x":70,"y":589,"width":711,"height":11}},{"id":"2e685168-c6a1-425d-85d1-40701ed79912","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":48,"box":{"x":102,"y":612,"width":757,"height":11}},{"id":"8520a246-fe05-4360-a229-19a6205f8332","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":48,"box":{"x":69,"y":627,"width":794,"height":11}},{"id":"fe9f565e-1442-43f1-9d00-2a76207822c3","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":48,"box":{"x":69,"y":642,"width":830,"height":11}},{"id":"920a8c85-48df-4a97-8b5a-3daaa6f6d89c","block_type":"box","text":"settlement auction, together with the up-front or periodic payments previously received, may be less than the amount","page_number":48,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"59416a09-0ea8-4a89-ad04-ab1c839d322f","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":48,"box":{"x":70,"y":672,"width":817,"height":11}},{"id":"09083534-7c45-4a41-8d90-8b29265b2d1e","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":48,"box":{"x":69,"y":687,"width":820,"height":11}},{"id":"7a85a1b4-d124-466d-8df2-aca8f9abe074","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":48,"box":{"x":68,"y":702,"width":833,"height":12}},{"id":"b3ffae28-c7cc-4b0d-8995-f81d8156fa1d","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":48,"box":{"x":69,"y":717,"width":837,"height":12}},{"id":"117b4fcc-0029-495b-9a41-317da8212cdc","block_type":"box","text":"the event the ISDA Credit Derivatives Determinations Committee does not establish a cash settlement auction and","page_number":48,"box":{"x":68,"y":733,"width":820,"height":9}},{"id":"33bb5d15-32e9-4679-a0df-933adcf0e697","block_type":"box","text":"identify the relevant deliverable securities or loans, the credit default swap buyer will have broad discretion to select","page_number":48,"box":{"x":70,"y":748,"width":828,"height":11}},{"id":"8a417fbd-5bf7-4c08-9a40-ce6dcb1de714","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":48,"box":{"x":68,"y":763,"width":815,"height":11}},{"id":"fef7ac1f-3df2-4eef-8aa0-5f5906a24076","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":48,"box":{"x":68,"y":778,"width":814,"height":11}},{"id":"f94b16f7-25bc-4543-95a7-b4f488ca1a7a","block_type":"box","text":"credit default swaps generally trade on the basis of theoretical pricing and valuation models, which may not","page_number":48,"box":{"x":69,"y":793,"width":766,"height":11}},{"id":"8a5401d5-0734-4663-881b-016ea24cfff7","block_type":"box","text":"accurately value such swap positions when established or when subsequently traded or unwound under actual market","page_number":48,"box":{"x":69,"y":808,"width":840,"height":11}},{"id":"fe5d2622-f1af-4dad-9eca-7d118bfb8d13","block_type":"box","text":"conditions.","page_number":48,"box":{"x":69,"y":823,"width":76,"height":9}},{"id":"b47816c3-1e89-4278-b0e8-d5d0838daf91","block_type":"box","text":"Dodd-Frank requires that certain index CDS be executed in regulated markets and submitted for clearing to","page_number":48,"box":{"x":102,"y":846,"width":762,"height":11}},{"id":"3f8eaac6-1053-4e90-8afa-1356abf5fa62","block_type":"box","text":"regulated clearinghouses. See “—Derivatives — Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":48,"box":{"x":69,"y":861,"width":824,"height":11}},{"id":"7fe53bb6-7875-454f-8447-78bfd84f96bf","block_type":"box","text":"single-name CDS and index CDS are permitted, although not required, to be cleared through regulated","page_number":48,"box":{"x":69,"y":876,"width":727,"height":11}},{"id":"37396357-ecf0-44aa-a5a7-60ca461903a7","block_type":"box","text":"clearinghouses. The Funds clear all credit default swaps that are subject to mandatory clearing and may voluntarily","page_number":48,"box":{"x":69,"y":891,"width":819,"height":12}},{"id":"f5f05520-705c-4ed5-adb9-1d8e2bdb8fe9","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":48,"box":{"x":69,"y":906,"width":764,"height":12}},{"id":"e5329fee-896e-498d-9ad5-186a69fa785f","block_type":"box","text":"II-18","page_number":48,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c7516635-2ab5-4d03-8dd0-3cb968e2df99","block_type":"box","text":"NM1026U-5979889-48/232","page_number":48,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9093b8e9-634f-45da-a874-207e420bfbbd","block_type":"box","text":"counterparty risk with respect to the clearinghouse when entering into cleared single-name CDS and cleared index","page_number":49,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"d5e8fd5f-31d4-4041-9601-502df6c9f6db","block_type":"box","text":"CDS. The Funds face significant counterparty risk with respect to their counterparties to non-cleared credit default","page_number":49,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"84ee6322-c0fc-46a4-a60b-2cdd88327eed","block_type":"box","text":"swaps and similar instruments. A Fund typically will enter into non-cleared credit default swaps and similar","page_number":49,"box":{"x":69,"y":75,"width":759,"height":11}},{"id":"92f7d041-19ec-4277-aac5-32378fb51c9c","block_type":"box","text":"instruments with swap dealers and creditworthy entities that have substantial capital or that have provided the Fund","page_number":49,"box":{"x":70,"y":90,"width":828,"height":11}},{"id":"7efac0cc-7c7a-4031-b843-5bbae6616246","block_type":"box","text":"with a third-party guaranty or other credit support.","page_number":49,"box":{"x":68,"y":105,"width":355,"height":11}},{"id":"2979167a-133b-4c6f-87b8-6d3591d4e5bc","block_type":"box","text":"In certain instances, a Fund may enter into bespoke credit default swaps or similar instruments either as","page_number":49,"box":{"x":102,"y":128,"width":750,"height":11}},{"id":"542b193c-2c31-4a97-ab6d-33318030163a","block_type":"box","text":"protection buyer or protection seller. While these contracts are similar in their operation to the market-standard credit","page_number":49,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"fe43cd9a-8726-4f67-9697-316e47154ae2","block_type":"box","text":"default swaps described above, they are less standardized and instead have bespoke or tailored features. For","page_number":49,"box":{"x":69,"y":158,"width":785,"height":11}},{"id":"a72c38f5-8b5a-4765-be8b-7c2db59a84b2","block_type":"box","text":"example, as compared to market-standard credit defaults, the range of “credit events” triggering settlement of such","page_number":49,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"a248aa6a-12fa-4509-b775-6ffc2084f71c","block_type":"box","text":"bespoke contracts may be narrower or broader, any such triggered contracts are settled by physical delivery of the","page_number":49,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"687de0d0-cbcb-4fcd-af58-065d67f72e5c","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":49,"box":{"x":69,"y":203,"width":839,"height":12}},{"id":"d5c37d0c-6129-4819-8f8b-a22047a48b9e","block_type":"box","text":"securities as the reference obligations and/or deliverable obligations.","page_number":49,"box":{"x":69,"y":218,"width":495,"height":12}},{"id":"127153b2-2b61-430e-9460-ff60c1369ff7","block_type":"box","text":"In addition, credit default swaps and similar instruments generally involve greater risks than if a Fund had","page_number":49,"box":{"x":102,"y":241,"width":752,"height":11}},{"id":"d747fcbd-c321-484d-811b-19a683600e43","block_type":"box","text":"invested in the reference obligation directly and are subject to significant credit risk, correlation risk, leverage risk,","page_number":49,"box":{"x":70,"y":256,"width":814,"height":12}},{"id":"c4b80b36-3820-4028-af01-f9d3665cd017","block_type":"box","text":"illiquidity risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":49,"box":{"x":70,"y":272,"width":520,"height":11}},{"id":"c00fe0d9-7b1b-4f73-af92-39f205fc261d","block_type":"box","text":"Interest Rate Swaps, Floors and Caps.","page_number":49,"box":{"x":102,"y":294,"width":273,"height":11}},{"id":"a0e73e62-118b-41dd-a6bd-86dcb6e9abc8","block_type":"box","text":"Certain Funds may enter into OTC derivatives in the form of interest rate","page_number":49,"box":{"x":381,"y":294,"width":515,"height":11}},{"id":"09cd3241-4c33-4b7d-bd51-5edf0a732087","block_type":"box","text":"swaps and interest rate caps and floors. As described in further detail below, a Fund may enter into these","page_number":49,"box":{"x":69,"y":309,"width":755,"height":11}},{"id":"88594cec-12ae-4797-93f7-ccb68d242161","block_type":"box","text":"transactions primarily to preserve a return or spread on a particular investment or portion of its holdings, as a","page_number":49,"box":{"x":68,"y":324,"width":788,"height":12}},{"id":"af9c5361-3bbc-4418-ad52-87491593f9a9","block_type":"box","text":"duration management technique, to protect against an increase in the price of securities a Fund anticipates","page_number":49,"box":{"x":69,"y":339,"width":768,"height":12}},{"id":"c6092384-15c9-49ad-b919-6112943381b5","block_type":"box","text":"purchasing at a later date, or for speculation to increase returns.","page_number":49,"box":{"x":70,"y":355,"width":461,"height":11}},{"id":"90219a26-4eb6-4529-bc9f-9ee378bd4d0c","block_type":"box","text":"Dodd-Frank requires that certain interest rate swaps be executed in regulated markets and submitted for","page_number":49,"box":{"x":102,"y":377,"width":748,"height":12}},{"id":"794f26e1-374f-4ae6-8ea4-c1fee17fc4b9","block_type":"box","text":"clearing to regulated clearinghouses. See “—Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":49,"box":{"x":69,"y":392,"width":799,"height":12}},{"id":"a6346d5c-764b-432c-a8e6-6ddd2d2b240e","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":49,"box":{"x":70,"y":407,"width":829,"height":12}},{"id":"f7978d03-5d86-4012-b2cd-97713d9a65e1","block_type":"box","text":"by the Funds are cleared. The Funds face counterparty risk with respect to the clearinghouse when entering into","page_number":49,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"a90888fd-64c4-483d-a95d-71235021412a","block_type":"box","text":"cleared interest rate swaps.","page_number":49,"box":{"x":69,"y":438,"width":198,"height":11}},{"id":"962bacea-88f8-417b-8440-af97ea125394","block_type":"box","text":"The Funds face significant counterparty risk with respect to their counterparties to non-cleared interest rate","page_number":49,"box":{"x":101,"y":460,"width":766,"height":12}},{"id":"a56a1a3b-fc82-46e8-a446-db7c781a54aa","block_type":"box","text":"swaps and interest rate caps and floors. The typical counterparties for a Fund’s non-cleared interest rate derivatives","page_number":49,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"9c522d0b-6455-496b-b975-6775e0fbc5b1","block_type":"box","text":"transactions are swap dealers and other creditworthy entities that have substantial capital or that have provided the","page_number":49,"box":{"x":68,"y":491,"width":830,"height":11}},{"id":"9fdd3408-5a4a-477d-b1f1-ad29f85a7d76","block_type":"box","text":"Fund with a third-party guaranty or other credit support. If the Fund’s counterparty defaults on such a transaction, a","page_number":49,"box":{"x":70,"y":506,"width":822,"height":11}},{"id":"86bb4426-ac35-4e69-bf98-009445c1e79a","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":49,"box":{"x":70,"y":521,"width":824,"height":11}},{"id":"d5efd9dd-b3f8-451f-9db0-46663e866bdc","block_type":"box","text":"be successful in enforcing such remedies. The market for interest rate swaps is relatively liquid in comparison with","page_number":49,"box":{"x":69,"y":536,"width":819,"height":11}},{"id":"57c015bd-10b4-4d39-829f-46a1f497fee0","block_type":"box","text":"other similar instruments traded in the interbank market. A Fund may be limited in its ability to enter into certain","page_number":49,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"64deae36-0eda-423c-9dd8-23820261251c","block_type":"box","text":"interest rate derivatives due to applicable income tax requirements.","page_number":49,"box":{"x":70,"y":566,"width":480,"height":11}},{"id":"87891bc0-3ae2-4e6a-8d66-afbd0e230c93","block_type":"box","text":"Interest rate swaps are transactions in which each party makes periodic interest payments based on a fixed or","page_number":49,"box":{"x":102,"y":589,"width":790,"height":11}},{"id":"c4b38cdd-950b-4306-9864-53b9c183d7b1","block_type":"box","text":"variable interest rate, index or asset in return for periodic payments from its counterparty based on a different fixed","page_number":49,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"1e3e16fd-8cff-4837-9140-d6ad7f0ee560","block_type":"box","text":"or variable interest rate, index or asset.","page_number":49,"box":{"x":69,"y":619,"width":280,"height":11}},{"id":"412beff2-8e0b-4b14-a770-62111e87f9f4","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":49,"box":{"x":101,"y":642,"width":780,"height":11}},{"id":"cd5da316-a5ea-41bc-9037-b29c0f0aa7ad","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the party selling","page_number":49,"box":{"x":70,"y":657,"width":805,"height":11}},{"id":"44f3cc35-30f4-46a9-b42c-d4fe5f333165","block_type":"box","text":"such interest rate floor.","page_number":49,"box":{"x":69,"y":672,"width":165,"height":9}},{"id":"7492d1ed-26ba-4e29-8a5f-ab0daeb392ab","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":49,"box":{"x":101,"y":695,"width":780,"height":11}},{"id":"1906169b-919e-4d5d-b44b-d8cfe92ef4b7","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the party selling","page_number":49,"box":{"x":70,"y":710,"width":805,"height":11}},{"id":"c09b935b-0e93-46c9-b857-dd10e04c1d97","block_type":"box","text":"such interest rate cap.","page_number":49,"box":{"x":69,"y":725,"width":159,"height":11}},{"id":"dc1d9f28-df43-4af9-a605-e09f5518d85e","block_type":"box","text":"A Fund may enter into an interest rate swap to effectively exchange with another party their respective","page_number":49,"box":{"x":101,"y":748,"width":729,"height":11}},{"id":"7632251c-d727-42e1-9af2-01323274308a","block_type":"box","text":"commitments to pay or receive interest,","page_number":49,"box":{"x":69,"y":763,"width":282,"height":11}},{"id":"75d7762e-46b1-4cf4-9f86-6360a8e7aeb7","block_type":"box","text":"e.g.","page_number":49,"box":{"x":359,"y":764,"width":24,"height":10}},{"id":"92f668df-b8bf-422d-b67d-95abd1f92a20","block_type":"box","text":", an exchange of fixed rate payments for floating rate payments. For","page_number":49,"box":{"x":386,"y":763,"width":482,"height":11}},{"id":"9fcdd3cb-55bb-4571-bfbd-82417ae4eb18","block_type":"box","text":"example, if a Fund holds a mortgage-backed security with an interest rate that is reset only once each year, it may","page_number":49,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"a0d7b2db-963a-4aaa-97a1-065610ecdc12","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":49,"box":{"x":69,"y":793,"width":823,"height":11}},{"id":"41015840-db52-461d-8176-c393c4925ea8","block_type":"box","text":"This would enable a Fund to offset a decline in the value of the mortgage-backed security due to rising interest rates","page_number":49,"box":{"x":68,"y":808,"width":832,"height":11}},{"id":"afa417ba-70a6-4021-a108-309a818552b8","block_type":"box","text":"but would also limit its ability to benefit from falling interest rates. Conversely, if a Fund holds a mortgage-backed","page_number":49,"box":{"x":69,"y":823,"width":807,"height":12}},{"id":"bb0925a2-889c-492f-ba5b-b2cdecc38ef0","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":49,"box":{"x":69,"y":839,"width":836,"height":11}},{"id":"1231b15f-bfd5-4a31-83a2-69f3715f56e1","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":49,"box":{"x":69,"y":853,"width":826,"height":12}},{"id":"38cccdbc-e277-4479-ae92-8bc994a22e4e","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":49,"box":{"x":69,"y":869,"width":840,"height":11}},{"id":"b1997779-131a-4526-a7d9-1d74f3162916","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":49,"box":{"x":69,"y":884,"width":810,"height":11}},{"id":"5fd1a852-2f38-4cab-a9f1-359783fe3643","block_type":"box","text":"year interest rates, but would preclude it from taking full advantage of rising interest rates.","page_number":49,"box":{"x":68,"y":899,"width":646,"height":11}},{"id":"01113953-09cc-4fd5-87bd-28a11926c2b7","block_type":"box","text":"II-19","page_number":49,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"54ed59de-6fbb-4474-8f8a-1faa1a3b0838","block_type":"box","text":"NM1026U-5979889-49/232","page_number":49,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4e31dcdf-11d9-4714-b601-c2c57be6f85d","block_type":"box","text":"Gains from transactions in interest rate swaps distributed to shareholders will be taxable as ordinary income or,","page_number":50,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"d0fe1add-d960-4eab-bcd0-92f86aa61c3e","block_type":"box","text":"in certain circumstances, as long term capital gains to shareholders.","page_number":50,"box":{"x":70,"y":60,"width":490,"height":11}},{"id":"6ef46c87-988f-4f01-834d-e2663689c1c7","block_type":"box","text":"Interest rate swaps and interest rate caps and floors may be subject to correlation risk, leverage risk, illiquidity","page_number":50,"box":{"x":102,"y":82,"width":791,"height":12}},{"id":"add65afc-b22a-4d7e-8361-63a3db9f4da1","block_type":"box","text":"risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":50,"box":{"x":69,"y":98,"width":454,"height":9}},{"id":"14ba5712-7290-4d69-98bb-3e4224478247","block_type":"box","text":"Total Return Swaps.","page_number":50,"box":{"x":103,"y":120,"width":139,"height":11}},{"id":"cb02d073-df03-4dc7-9a35-9e93cf212274","block_type":"box","text":"Total return swaps are contracts in which one party agrees to make periodic payments to","page_number":50,"box":{"x":249,"y":120,"width":634,"height":12}},{"id":"f4c47c30-ae44-4478-aad0-21def96efeaa","block_type":"box","text":"the other party based on the return of the assets underlying the contract in exchange for periodic payments based on","page_number":50,"box":{"x":68,"y":135,"width":838,"height":12}},{"id":"65def965-3eaa-4b42-90c7-bdd7774d0abf","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":50,"box":{"x":69,"y":150,"width":764,"height":12}},{"id":"f28f85c3-ec03-4aac-be78-926c77336a7c","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":50,"box":{"x":69,"y":166,"width":791,"height":11}},{"id":"109a0bb7-3f05-4cb1-9128-55fdc09705a5","block_type":"box","text":"asset. The asset underlying the contract may include a specified security, basket of securities or securities indices.","page_number":50,"box":{"x":69,"y":181,"width":821,"height":11}},{"id":"ff66cba0-84b0-4c21-9291-315621967840","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":50,"box":{"x":68,"y":196,"width":838,"height":11}},{"id":"7419ee03-5e3a-4dfc-aa48-073e422b0412","block_type":"box","text":"“contracts for difference.”","page_number":50,"box":{"x":70,"y":211,"width":184,"height":9}},{"id":"93a4fa1b-7f78-4c38-b9b6-8811e9bb9dbc","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":50,"box":{"x":101,"y":234,"width":770,"height":11}},{"id":"aea8e0fc-5042-4566-91cb-d81fc5c69569","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":50,"box":{"x":69,"y":249,"width":780,"height":11}},{"id":"6ec6aa6a-2898-4e61-a66f-7576eba59db9","block_type":"box","text":"required to deposit initial margin but the parties do not exchange the notional amount. As a result, total return swaps","page_number":50,"box":{"x":69,"y":264,"width":839,"height":11}},{"id":"db43954a-b334-4b34-bcf5-f880e3c9251e","block_type":"box","text":"may effectively add leverage to the Fund’s portfolio because the Fund would be subject to investment exposure on","page_number":50,"box":{"x":69,"y":279,"width":816,"height":11}},{"id":"a5e80e74-2960-4450-a64f-64cdca3df2b8","block_type":"box","text":"the notional amount of the swap.","page_number":50,"box":{"x":68,"y":294,"width":235,"height":11}},{"id":"7eae4c52-c0bf-40cb-a08c-02a7d56a279d","block_type":"box","text":"Total return swaps are subject to significant correlation risk, leverage risk, illiquidity risk, market risk and","page_number":50,"box":{"x":101,"y":317,"width":746,"height":11}},{"id":"cd47e52e-9dfe-4980-82eb-6d17dc85860f","block_type":"box","text":"counterparty risk. See “—Risk Factors in Derivatives” above.","page_number":50,"box":{"x":69,"y":332,"width":433,"height":11}},{"id":"c29158a6-b260-4a29-8a83-0805e0b415bb","block_type":"box","text":"Options.","page_number":50,"box":{"x":102,"y":355,"width":57,"height":11}},{"id":"7140b78f-5ed7-4548-8e01-b5e357ec8b3f","block_type":"box","text":"Options on Securities and Securities Indices.","page_number":50,"box":{"x":102,"y":377,"width":319,"height":11}},{"id":"97fe81de-7249-40d8-a4e9-afb2dc45a226","block_type":"box","text":"A Fund may engage in transactions in options on individual","page_number":50,"box":{"x":427,"y":377,"width":418,"height":12}},{"id":"ae023992-25fe-42f0-a7a5-5591988c8336","block_type":"box","text":"securities, baskets of securities or securities indices, or particular measurements of value or rates, such as an index","page_number":50,"box":{"x":69,"y":392,"width":838,"height":11}},{"id":"918111dc-95d8-48ca-b789-d09da0d8a76b","block_type":"box","text":"of the price of treasury securities or an index representative of short-term interest rates. Such investments may be","page_number":50,"box":{"x":69,"y":407,"width":820,"height":12}},{"id":"a725e334-8c6f-4440-88f7-cce1bde8a177","block_type":"box","text":"made on exchanges and in the OTC markets. In general, exchange-traded options have standardized exercise prices","page_number":50,"box":{"x":69,"y":423,"width":826,"height":11}},{"id":"ef672669-50c3-42db-aac4-4bb7454e0532","block_type":"box","text":"and expiration dates and require the parties to post margin against their obligations, and the performance of the","page_number":50,"box":{"x":69,"y":438,"width":806,"height":11}},{"id":"a1be1d45-66d8-409b-ae5f-af36849257b3","block_type":"box","text":"parties’ obligations in connection with such options is guaranteed by the exchange or a related clearing corporation.","page_number":50,"box":{"x":70,"y":453,"width":825,"height":11}},{"id":"8421b723-1884-4942-9a09-8840035716bf","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":50,"box":{"x":69,"y":468,"width":822,"height":11}},{"id":"c7d0b6d6-dc5b-4a5b-84b1-6f22f5fb4806","block_type":"box","text":"risk. OTC options also involve greater illiquidity risk.","page_number":50,"box":{"x":69,"y":483,"width":366,"height":11}},{"id":"59688d45-f521-4839-b96b-14619e2b0564","block_type":"box","text":"A Fund may also engage in transactions in options which have additional features that result in different","page_number":50,"box":{"x":101,"y":506,"width":743,"height":11}},{"id":"21096682-1729-4488-89ae-a8672821439b","block_type":"box","text":"payment structures and/or expirations (commonly referred to as exotic options). For example, barrier options are","page_number":50,"box":{"x":70,"y":521,"width":804,"height":11}},{"id":"47c166d6-8752-41f8-85f9-311e7909ea1c","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":50,"box":{"x":69,"y":536,"width":827,"height":11}},{"id":"20a68b64-653e-4870-a30b-f80073887dae","block_type":"box","text":"more predetermined levels on or before expiration. Binary options are another example of exotic options which have","page_number":50,"box":{"x":69,"y":551,"width":827,"height":11}},{"id":"2809fdb6-a9ba-485f-a01a-c1432d2e6879","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":50,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"fd0c8c12-ad0c-4199-864c-a7db233fe913","block_type":"box","text":"OTC markets.","page_number":50,"box":{"x":69,"y":581,"width":95,"height":9}},{"id":"91ff92ad-f6b4-4b53-905b-483a766fd0ae","block_type":"box","text":"There are several risks associated with transactions in options on securities and indexes. For example, there are","page_number":50,"box":{"x":101,"y":604,"width":806,"height":11}},{"id":"9e4ccf0b-67bb-45c5-b77b-f368002de8a9","block_type":"box","text":"significant differences between the securities and options markets that could result in an imperfect correlation","page_number":50,"box":{"x":69,"y":619,"width":791,"height":11}},{"id":"7e49e3b8-feba-4282-9dfa-af7e5100a564","block_type":"box","text":"between these markets, causing a given transaction not to achieve its objectives. In addition, a liquid market for","page_number":50,"box":{"x":69,"y":634,"width":801,"height":12}},{"id":"6e0c77bb-3bfb-464a-8668-33eb4119b409","block_type":"box","text":"particular options, whether traded OTC or on a national securities exchange (“Exchange”) may be absent for reasons","page_number":50,"box":{"x":70,"y":649,"width":831,"height":12}},{"id":"f5566e99-7a79-4351-9754-d52937e4afba","block_type":"box","text":"which include the following: there may be insufficient trading interest in certain options; restrictions may be imposed","page_number":50,"box":{"x":68,"y":664,"width":833,"height":12}},{"id":"c35d444f-cc01-454c-a8c8-28834f78529e","block_type":"box","text":"by an Exchange on opening transactions or closing transactions or both; trading halts, suspensions or other","page_number":50,"box":{"x":69,"y":680,"width":769,"height":11}},{"id":"4fa6d7cc-9875-4341-9b42-13fea4193868","block_type":"box","text":"restrictions may be imposed with respect to particular classes or series of options or underlying securities; unusual","page_number":50,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"b157e300-23e6-410b-b0e0-f7fbb61cc56a","block_type":"box","text":"or unforeseen circumstances may interrupt normal operations on an Exchange; the facilities of an Exchange or the","page_number":50,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"e49983ad-0f2f-438d-84f5-f2580a163ac7","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":50,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"b0f7809b-cdb7-450a-a122-01ccdfdb8272","block_type":"box","text":"Exchanges could, for economic or other reasons, decide or be compelled at some future date to discontinue the","page_number":50,"box":{"x":70,"y":740,"width":798,"height":11}},{"id":"0bcb8cce-8a63-458d-84f0-90aaaa2fe6d8","block_type":"box","text":"trading of options (or a particular class or series of options), in which event the market on that Exchange (or in that","page_number":50,"box":{"x":68,"y":755,"width":822,"height":11}},{"id":"f8eb6d4f-6bd2-4f44-9ca3-14cdf80bba85","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":50,"box":{"x":69,"y":770,"width":818,"height":12}},{"id":"f7807cc0-e2e5-4fa6-bea5-e04683784b29","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":50,"box":{"x":69,"y":785,"width":836,"height":12}},{"id":"9f21e0e2-6e47-4a21-b087-9b773a122147","block_type":"box","text":"terms.","page_number":50,"box":{"x":68,"y":801,"width":45,"height":9}},{"id":"f5d2d818-c172-4edb-9c87-d1f266ba7e6d","block_type":"box","text":"Each of the options exchanges has established limitations governing the maximum number of call or put options","page_number":50,"box":{"x":102,"y":823,"width":801,"height":12}},{"id":"1934e60a-7d66-412d-a0b4-a445c75a4aac","block_type":"box","text":"on the same asset that may be bought or written by a single investor, whether acting alone or in concert with others","page_number":50,"box":{"x":69,"y":839,"width":826,"height":11}},{"id":"cfd67c13-d114-44a7-8c25-208687fad006","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":50,"box":{"x":69,"y":853,"width":823,"height":12}},{"id":"3ba7248d-ebcf-4db2-9c37-c1b4bad08d33","block_type":"box","text":"more accounts or through one or more brokers). Under these limitations, option positions of all investment","page_number":50,"box":{"x":69,"y":869,"width":762,"height":11}},{"id":"ec7eec4a-2cf3-489a-b5c5-1ab86b7c1d82","block_type":"box","text":"companies advised by the Manager are combined for purposes of these limits. Pursuant to these limitations, an","page_number":50,"box":{"x":69,"y":884,"width":798,"height":11}},{"id":"0d679141-ddf3-4995-94bd-ee479b3ca87f","block_type":"box","text":"II-20","page_number":50,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"045195bd-3ecd-4372-8f40-8dd09afd7542","block_type":"box","text":"NM1026U-5979889-50/232","page_number":50,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"1f565635-71aa-4d1d-9cb7-4f03b682bf7b","block_type":"box","text":"exchange may order the liquidation of positions and may impose other sanctions or restrictions. These position limits","page_number":51,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"ab9e3e47-a479-4794-a2f7-7d89ca3dfba5","block_type":"box","text":"may restrict the number of listed options that a Fund may buy or sell.","page_number":51,"box":{"x":69,"y":60,"width":491,"height":11}},{"id":"6ce49e3e-8bb1-494e-ad24-25563161dfcf","block_type":"box","text":"Call Options.","page_number":51,"box":{"x":102,"y":83,"width":89,"height":10}},{"id":"cd98c4b1-114e-427d-a105-24b5257e2c83","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":51,"box":{"x":197,"y":82,"width":694,"height":12}},{"id":"53a5eb47-9814-4ea8-954d-6e4fea5b86e1","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":51,"box":{"x":70,"y":98,"width":838,"height":11}},{"id":"cb28b5b8-25bb-4168-bd19-78dc3c00d24b","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":51,"box":{"x":68,"y":113,"width":813,"height":11}},{"id":"51601cec-d52a-4529-97cd-4a7189533075","block_type":"box","text":"Index options are similar to options on securities except that, rather than taking or making delivery of securities","page_number":51,"box":{"x":70,"y":128,"width":795,"height":11}},{"id":"22521935-3ead-4420-a1fe-96b856174370","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":51,"box":{"x":69,"y":143,"width":807,"height":11}},{"id":"8dda5edd-f421-47b9-9e49-1a278642a6fd","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":51,"box":{"x":69,"y":158,"width":830,"height":11}},{"id":"48b69d18-b9eb-4695-a752-3b1df3150e90","block_type":"box","text":"of the option.","page_number":51,"box":{"x":69,"y":173,"width":93,"height":11}},{"id":"0670523b-9a2c-4e06-a21a-33b10ba4e836","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":51,"box":{"x":101,"y":196,"width":794,"height":11}},{"id":"9fab1a88-f222-4445-b678-093f5db08304","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":51,"box":{"x":69,"y":211,"width":823,"height":11}},{"id":"8f862de2-f003-49fc-82c1-c6bd9e501537","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":51,"box":{"x":69,"y":226,"width":839,"height":11}},{"id":"62994a41-b826-473f-bfe2-d1c58abae1f9","block_type":"box","text":"illiquid investments under the Funds’ Liquidity Program (as defined below) (“liquid assets”) designated on the","page_number":51,"box":{"x":70,"y":241,"width":778,"height":11}},{"id":"a8b4db77-e0ae-4ad8-a31c-e0968b3261a1","block_type":"box","text":"Manager’s or the sub-adviser’s books and records to the extent required by Commission guidelines.","page_number":51,"box":{"x":70,"y":256,"width":711,"height":12}},{"id":"5aea4da1-9d66-488b-bcff-73a465feab36","block_type":"box","text":"A Fund may write (","page_number":51,"box":{"x":101,"y":279,"width":130,"height":11}},{"id":"848eb9a3-4955-49e5-a38b-e397f89f3584","block_type":"box","text":"i.e.","page_number":51,"box":{"x":233,"y":279,"width":20,"height":9}},{"id":"961dd1b3-476c-461a-b2b5-be8b12915e89","block_type":"box","text":", sell) covered call options on the securities or instruments in which it may invest and to","page_number":51,"box":{"x":256,"y":279,"width":627,"height":11}},{"id":"94a02f1f-88fb-409e-b202-8969075d37c4","block_type":"box","text":"enter into closing purchase transactions with respect to certain of such options. A covered call option is an option in","page_number":51,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"456abd20-970b-43dd-b08d-8f5b80150bc4","block_type":"box","text":"which a Fund, in return for a premium, gives another party a right to buy specified securities owned by the Fund at a","page_number":51,"box":{"x":68,"y":309,"width":827,"height":11}},{"id":"e58174b0-c8d9-4c39-b773-f9dae0edb196","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":51,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"b091ff2f-eb30-491e-9d45-950cc9b09340","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":51,"box":{"x":69,"y":339,"width":823,"height":12}},{"id":"528330a7-ae30-49ed-bd1f-518539b39378","block_type":"box","text":"By writing covered call options, a Fund gives up the opportunity, while the option is in effect, to profit from any price","page_number":51,"box":{"x":70,"y":355,"width":823,"height":11}},{"id":"8fd2b75d-1b1f-484b-965f-42a61fd3cf36","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":51,"box":{"x":70,"y":370,"width":825,"height":11}},{"id":"68836d94-5799-498b-b5e1-4bb10d1dc83f","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":51,"box":{"x":69,"y":385,"width":800,"height":11}},{"id":"1b46de31-ae98-48f3-822f-2d937ff3dba3","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":51,"box":{"x":69,"y":400,"width":792,"height":11}},{"id":"00fa4361-425e-4e8d-9eb9-720172128ec0","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":51,"box":{"x":70,"y":415,"width":826,"height":11}},{"id":"b1a61152-88a0-4ff6-b74c-ce78db3298a6","block_type":"box","text":"a partial hedge to the extent of the premium received against the price of the underlying security declining.","page_number":51,"box":{"x":69,"y":430,"width":760,"height":11}},{"id":"7ca20d31-850a-44a8-8006-47e1136441ce","block_type":"box","text":"A Fund may write","page_number":51,"box":{"x":101,"y":453,"width":120,"height":11}},{"id":"1518165a-078b-4820-9361-5bf9f8701656","block_type":"box","text":"(i.e.","page_number":51,"box":{"x":228,"y":453,"width":25,"height":11}},{"id":"7e0f425c-a310-4245-8a10-9a0b270bfc08","block_type":"box","text":", sell) uncovered call options on securities or instruments in which it may invest but that","page_number":51,"box":{"x":256,"y":453,"width":628,"height":11}},{"id":"20f75448-eef8-425e-ac36-96731d5c6578","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":51,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"7c7956ec-3a0c-4e16-8ef0-becabd852eee","block_type":"box","text":"committing capital to the ownership of the underlying securities or instruments. When writing uncovered call options,","page_number":51,"box":{"x":69,"y":483,"width":830,"height":11}},{"id":"a4cece03-2406-45eb-93e9-605e38980f4a","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":51,"box":{"x":69,"y":498,"width":825,"height":11}},{"id":"2e227e24-375e-45fe-98af-356beeed84eb","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":51,"box":{"x":69,"y":513,"width":818,"height":11}},{"id":"08790974-e346-4792-ac1b-4c62e68729e4","block_type":"box","text":"During periods of declining securities prices or when prices are stable, writing uncovered calls can be a profitable","page_number":51,"box":{"x":70,"y":528,"width":806,"height":12}},{"id":"5ebcb5eb-e4ca-43f5-a86a-2359154fbd42","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":51,"box":{"x":69,"y":544,"width":839,"height":11}},{"id":"ab9b39f6-7c5e-40f7-b62f-a5598fdd338f","block_type":"box","text":"there is no underlying security held by a Fund that can act as a partial hedge. Uncovered calls have speculative","page_number":51,"box":{"x":68,"y":559,"width":793,"height":11}},{"id":"2d55dfd7-265d-47e8-bc3b-c0e96ac39b73","block_type":"box","text":"characteristics and the potential for loss is unlimited. When an uncovered call is exercised, a Fund must purchase","page_number":51,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"f9752a4a-951b-48c8-b46d-fe8801f88bb0","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":51,"box":{"x":68,"y":589,"width":818,"height":11}},{"id":"351f1879-beaf-4cc2-92e5-d738fb6f5e72","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":51,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"73d25724-0ff1-4771-b4e0-cb4a38e09606","block_type":"box","text":"exercise price, a Fund will lose the difference.","page_number":51,"box":{"x":69,"y":619,"width":326,"height":11}},{"id":"5b1395f9-0520-475a-9e5a-3b75574cc981","block_type":"box","text":"Put Options.","page_number":51,"box":{"x":102,"y":642,"width":85,"height":11}},{"id":"adeb253f-3d50-4702-ab03-6d383deaa858","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":51,"box":{"x":194,"y":642,"width":712,"height":11}},{"id":"975c450e-c31a-40dd-a166-1281ea0c729c","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":51,"box":{"x":68,"y":657,"width":828,"height":11}},{"id":"fa4b1a7b-d802-477e-af50-817548216e10","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":51,"box":{"x":69,"y":672,"width":816,"height":11}},{"id":"cd13af6b-84ed-45f5-bbd5-193a3b14dbf2","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":51,"box":{"x":70,"y":687,"width":820,"height":11}},{"id":"39773eab-3af8-4b1d-95d8-e5acc4b4beb9","block_type":"box","text":"instruments will be partially offset by the amount of the premium paid for the put option and any related transaction","page_number":51,"box":{"x":70,"y":702,"width":826,"height":11}},{"id":"ee29dd45-e7c6-43c0-b81f-6c08b969b62c","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":51,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"fe081e7e-f502-4960-b47e-d4ea0faf0006","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":51,"box":{"x":68,"y":732,"width":839,"height":11}},{"id":"5f6ce23e-c0e3-4813-8784-90260bafec28","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":51,"box":{"x":68,"y":748,"width":841,"height":11}},{"id":"1f16a12e-7a55-4546-b4d6-b65a635d8c13","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":51,"box":{"x":69,"y":763,"width":785,"height":11}},{"id":"0d67c5a7-603b-4f48-a2a1-8c27abc43a29","block_type":"box","text":"purchase uncovered put options.","page_number":51,"box":{"x":70,"y":778,"width":231,"height":11}},{"id":"e958cd92-dd91-44a6-b927-bb68acfa4a99","block_type":"box","text":"A Fund also may write (","page_number":51,"box":{"x":101,"y":801,"width":165,"height":11}},{"id":"a5565f1f-a4e8-48f1-a533-58d9a7d7bcbe","block_type":"box","text":"i.e.","page_number":51,"box":{"x":268,"y":801,"width":20,"height":9}},{"id":"1ead6789-8df2-4d80-9337-ff93acc6b2d5","block_type":"box","text":", sell) put options on the types of securities or instruments that may be held by the","page_number":51,"box":{"x":291,"y":801,"width":591,"height":11}},{"id":"c7223a63-22f6-4ffe-9f2f-b31f407ffc8e","block_type":"box","text":"Fund. A Fund will receive a premium for writing a put option, which increases the Fund’s return.","page_number":51,"box":{"x":70,"y":816,"width":675,"height":11}},{"id":"81441739-0e8d-4de0-95a0-a4a66db5abc2","block_type":"box","text":"A Fund also may write (","page_number":51,"box":{"x":101,"y":839,"width":165,"height":10}},{"id":"4debcc87-0d5e-420a-9349-97e66ed07f18","block_type":"box","text":"i.e.","page_number":51,"box":{"x":268,"y":839,"width":20,"height":8}},{"id":"ad091cbb-5b92-49fa-a643-824e8e1815da","block_type":"box","text":", sell) uncovered put options on securities or instruments in which it may invest but","page_number":51,"box":{"x":291,"y":839,"width":593,"height":10}},{"id":"867e2e2f-eece-423a-8d7f-31c821baf233","block_type":"box","text":"with respect to which the Fund does not currently have a corresponding short position or has not deposited as","page_number":51,"box":{"x":68,"y":854,"width":789,"height":11}},{"id":"27de2401-f330-4e3e-8b83-8ef433d8a2e8","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":51,"box":{"x":69,"y":869,"width":773,"height":11}},{"id":"9ce76531-7d3b-4a7e-91cc-c09d649316e3","block_type":"box","text":"uncovered put option. The principal reason for writing uncovered put options is to receive premium income and to","page_number":51,"box":{"x":69,"y":884,"width":807,"height":11}},{"id":"0d74c8cb-96a4-4494-b98e-fbd2a7cc8944","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":51,"box":{"x":69,"y":899,"width":835,"height":11}},{"id":"ca9d7a8f-369d-4b0f-815f-f1ca0ee9fe78","block_type":"box","text":"II-21","page_number":51,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3305cb58-77a7-4843-87b3-10794d08ec80","block_type":"box","text":"NM1026U-5979889-51/232","page_number":51,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"21a4a215-6888-4980-85ff-7be3fbdc6e69","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":52,"box":{"x":68,"y":45,"width":818,"height":11}},{"id":"16b769a4-1b38-4d2f-a344-61e2253f84c2","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":52,"box":{"x":68,"y":60,"width":800,"height":11}},{"id":"08eb2aec-1e70-4d7a-9dbe-44022ab10efc","block_type":"box","text":"expire worthless and a Fund will retain the premium and will not have to purchase the securities or instruments at","page_number":52,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"9235ee2e-d5e7-493f-afe4-acc6c96ec8d2","block_type":"box","text":"the exercise price.","page_number":52,"box":{"x":68,"y":90,"width":130,"height":11}},{"id":"8177ff95-92fe-442b-8fff-ab9bc4d28145","block_type":"box","text":"Options on Government National Mor tgage Association (“GNMA”) Cer tificates.","page_number":52,"box":{"x":102,"y":113,"width":556,"height":11}},{"id":"a1a359b5-9f27-429a-944c-e410b12792ea","block_type":"box","text":"The following information relates","page_number":52,"box":{"x":664,"y":113,"width":232,"height":11}},{"id":"6675f999-acb3-4152-a450-8ff1dc4c8d5b","block_type":"box","text":"to the unique characteristics of options on GNMA Certificates. Since the remaining principal balance of GNMA","page_number":52,"box":{"x":68,"y":128,"width":784,"height":11}},{"id":"5ebae47b-88bb-4f31-b3c7-d514a0ce6500","block_type":"box","text":"Certificates declines each month as a result of mortgage payments, a Fund, as a writer of a GNMA call holding GNMA","page_number":52,"box":{"x":69,"y":143,"width":840,"height":11}},{"id":"0dcae472-1334-496e-bcb9-52a8b3500c32","block_type":"box","text":"Certificates as “cover” to satisfy its delivery obligation in the event of exercise, may find that the GNMA Certificates","page_number":52,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"18da502b-a42f-4ba1-bcbe-1f5845a42be1","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":52,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"a0a0b111-b9a0-4ba3-8e16-4dcbf7ef1b79","block_type":"box","text":"purchase additional GNMA Certificates from the same pool (if obtainable) or other GNMA Certificates in the cash","page_number":52,"box":{"x":70,"y":188,"width":803,"height":11}},{"id":"1460bc66-2fc2-4323-b283-69f6bb114f34","block_type":"box","text":"market in order to maintain its “cover.”","page_number":52,"box":{"x":69,"y":204,"width":277,"height":8}},{"id":"795481e4-57f6-41af-893b-fbe0cb7c8408","block_type":"box","text":"A GNMA Certificate held by a Fund to cover an option position in any but the nearest expiration month may cease","page_number":52,"box":{"x":101,"y":226,"width":807,"height":11}},{"id":"531db6ed-658b-4883-93b0-b62e3e8e6878","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":52,"box":{"x":68,"y":241,"width":835,"height":11}},{"id":"9124ef69-8a54-46e4-8b44-5a8a899028e8","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":52,"box":{"x":69,"y":256,"width":821,"height":12}},{"id":"e5a67b14-af22-4bce-ab3f-a0ac50f1f109","block_type":"box","text":"the Fund will either enter into a closing purchase transaction or replace such Certificate with a certificate that","page_number":52,"box":{"x":68,"y":271,"width":784,"height":12}},{"id":"c7a01a5d-c115-4274-928a-b707c594e21d","block_type":"box","text":"represents cover. When a Fund closes its position or replaces such Certificate, it may realize an unanticipated loss","page_number":52,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"06c2db6b-2e87-461c-95d5-af0bb77df0c1","block_type":"box","text":"and incur transaction costs.","page_number":52,"box":{"x":69,"y":302,"width":197,"height":9}},{"id":"91c0256e-6735-477e-8756-4bd2617910ec","block_type":"box","text":"Options on Swaps (“Swaptions”).","page_number":52,"box":{"x":102,"y":324,"width":235,"height":11}},{"id":"b6795dc8-6495-4103-b7b7-86397c4cab05","block_type":"box","text":"A swaption gives a counterparty the option (but not the obligation) to enter into","page_number":52,"box":{"x":343,"y":325,"width":563,"height":11}},{"id":"f8c36a98-2bbb-40ad-9328-ce7e8affc113","block_type":"box","text":"a new swap agreement or to shorten, extend, cancel or otherwise modify an existing swap agreement, at a","page_number":52,"box":{"x":69,"y":339,"width":763,"height":12}},{"id":"45aa2093-584f-4eda-a023-4b3a7bbde6be","block_type":"box","text":"designated future time on specified terms. A Fund may write (","page_number":52,"box":{"x":69,"y":355,"width":439,"height":11}},{"id":"1d5530bf-a161-45cf-a526-81ae5a091907","block_type":"box","text":"i.e.","page_number":52,"box":{"x":510,"y":355,"width":20,"height":9}},{"id":"b3f04864-1ddf-4a34-9a74-6d765ee06ba6","block_type":"box","text":", sell) and purchase put and call swaptions.","page_number":52,"box":{"x":533,"y":355,"width":309,"height":11}},{"id":"a22f0b40-b202-4723-b895-d1ea8e65b00a","block_type":"box","text":"Depending on the terms of the particular option agreement, a Fund will generally incur a greater degree of risk when","page_number":52,"box":{"x":70,"y":370,"width":826,"height":11}},{"id":"37f11db7-f92b-4369-851c-b9a4a8977a48","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":52,"box":{"x":70,"y":385,"width":793,"height":11}},{"id":"2b89d721-c417-4f1d-bdb8-8f495ccf3e6b","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":52,"box":{"x":70,"y":400,"width":802,"height":11}},{"id":"4dabfe8b-f47e-4ceb-9eec-ee5b3400dc87","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":52,"box":{"x":68,"y":415,"width":836,"height":11}},{"id":"1201dd87-4a2b-4066-8f64-502e31f336bc","block_type":"box","text":"the underlying agreement and the potential for loss may be unlimited. Certain swaptions are permitted, although not","page_number":52,"box":{"x":68,"y":430,"width":832,"height":11}},{"id":"bde9c1fa-293f-4362-98a0-22ffde9ed359","block_type":"box","text":"required, to be cleared.","page_number":52,"box":{"x":69,"y":446,"width":165,"height":10}},{"id":"fdd3f1c1-56ee-49e0-ba47-7e86ec9739b0","block_type":"box","text":"A Fund will likely enter into these transactions to preserve a return or spread on a particular investment or","page_number":52,"box":{"x":101,"y":468,"width":760,"height":11}},{"id":"b196c2dd-7171-4a1e-8b37-378f6e754b90","block_type":"box","text":"portion of its portfolio or to protect against any increase in the price of securities the Fund anticipates purchasing at","page_number":52,"box":{"x":70,"y":483,"width":830,"height":11}},{"id":"3f8708d7-945b-498d-80f7-7306d2ee9b9a","block_type":"box","text":"a later date. A Fund generally will use these transactions for hedging purposes, not for speculation.","page_number":52,"box":{"x":69,"y":498,"width":706,"height":11}},{"id":"40e809cc-2be3-4af7-bda0-a372afe27eff","block_type":"box","text":"Swaptions may be subject to correlation risk, leverage risk, illiquidity risk and market risk. See “—Risk Factors in","page_number":52,"box":{"x":102,"y":521,"width":805,"height":11}},{"id":"8ca3d524-050f-446b-8f1c-695d59a4fe6f","block_type":"box","text":"Derivatives” above.","page_number":52,"box":{"x":70,"y":536,"width":135,"height":9}},{"id":"2a9ae0d9-242c-4ef6-a1de-ea969c76e325","block_type":"box","text":"FLEX Options.","page_number":52,"box":{"x":102,"y":559,"width":96,"height":11}},{"id":"b4e87707-2372-45aa-80e7-48ff974247bd","block_type":"box","text":"FLEX Options are customized option contracts available through national securities exchanges that","page_number":52,"box":{"x":206,"y":559,"width":702,"height":11}},{"id":"aaa73f67-57c7-4e5f-a86e-8ee9d9646ceb","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":52,"box":{"x":69,"y":574,"width":839,"height":11}},{"id":"40143b40-f890-4819-bc18-d396469eaa01","block_type":"box","text":"securities exchange. FLEX Options provide investors with the ability to customize assets referenced by the options,","page_number":52,"box":{"x":69,"y":589,"width":818,"height":11}},{"id":"b0535850-bda8-4c0b-b6c8-f49bddff6ebb","block_type":"box","text":"exercise prices, exercise styles (","page_number":52,"box":{"x":69,"y":604,"width":231,"height":11}},{"id":"6739e4ed-6660-4f13-9a42-1fd9631f7609","block_type":"box","text":"i.e.","page_number":52,"box":{"x":302,"y":604,"width":20,"height":9}},{"id":"e1e6f0d4-3e81-4619-a986-a8c6e7fb437d","block_type":"box","text":", American-style, exercisable any time prior to the expiration date, or European","page_number":52,"box":{"x":325,"y":604,"width":561,"height":11}},{"id":"e5dbeec5-3346-41a3-af49-1f2ff2c1a1f7","block_type":"box","text":"style, exercisable only on the option expiration date) and expiration dates, while achieving price discovery in","page_number":52,"box":{"x":69,"y":619,"width":768,"height":11}},{"id":"6c99556c-2fec-4dcc-a000-619a27776108","block_type":"box","text":"competitive, transparent auctions markets and avoiding the counterparty exposure of OTC options positions. Each","page_number":52,"box":{"x":69,"y":634,"width":812,"height":12}},{"id":"48ae1a41-10db-45f9-b292-0270600aaebc","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":52,"box":{"x":69,"y":649,"width":830,"height":11}},{"id":"42c3fdec-3980-438a-b5df-c48e771517bd","block_type":"box","text":"reference asset at the strike price. A Fund’s portfolio may include several types of FLEX Options, including both","page_number":52,"box":{"x":69,"y":664,"width":792,"height":12}},{"id":"36cac2ad-f7cf-4054-ad9c-44d9ffac1b75","block_type":"box","text":"purchased and written put and call options (as further described below). The FLEX Options are all European style","page_number":52,"box":{"x":70,"y":680,"width":802,"height":11}},{"id":"d482c80b-b841-44b8-b940-44fe2bd7740c","block_type":"box","text":"options, which means that they are exercisable at a predetermined specified price (the “strike price”) only on the","page_number":52,"box":{"x":69,"y":695,"width":806,"height":11}},{"id":"2552a0b0-eca6-4698-bd92-2ec63b456a57","block_type":"box","text":"FLEX Option’s expiration date.","page_number":52,"box":{"x":70,"y":710,"width":211,"height":11}},{"id":"8520ee66-5e8f-4cd9-8c62-cae6cbe263f4","block_type":"box","text":"The OCC guarantees performance by each of the counterparties to the FLEX Options, becoming the “buyer for","page_number":52,"box":{"x":101,"y":732,"width":783,"height":12}},{"id":"bc8f749b-c7fd-45f9-a1f0-fc6d0be4661c","block_type":"box","text":"every seller and the seller for every buyer”, reducing counterparty risk for clearing members and options traders.","page_number":52,"box":{"x":69,"y":748,"width":802,"height":11}},{"id":"664ba131-37da-441f-b65f-2e75046942f4","block_type":"box","text":"Although guaranteed for settlement by the OCC, FLEX Options are still subject to counterparty risk with the OCC and","page_number":52,"box":{"x":68,"y":763,"width":826,"height":11}},{"id":"7fb6ee7b-ea8f-4d77-b837-f04334ca387a","block_type":"box","text":"subject to the risk that the OCC may fail to perform the settlement of the FLEX Options due to bankruptcy or other","page_number":52,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"91e85a67-1c40-451e-baf5-75cfca15ead7","block_type":"box","text":"adverse reasons. A Fund bears the risk that the OCC will be unable or unwilling to perform its obligations under the","page_number":52,"box":{"x":69,"y":793,"width":822,"height":11}},{"id":"bce8a374-a6b0-489c-964a-fcf83d2686cc","block_type":"box","text":"FLEX Options contracts.","page_number":52,"box":{"x":70,"y":808,"width":166,"height":11}},{"id":"8811a19c-40b6-4698-aa6c-10e14baf5533","block_type":"box","text":"Subject to determination by the Securities Committee of the OCC, adjustments may be made to the FLEX","page_number":52,"box":{"x":102,"y":831,"width":748,"height":11}},{"id":"d959d6fa-0371-42c5-8ba9-0792fddd98aa","block_type":"box","text":"Options for certain events (collectively, “Corporate Actions”) specified in the OCC’s by-laws and rules: certain stock","page_number":52,"box":{"x":69,"y":846,"width":822,"height":11}},{"id":"10625eba-df5a-453c-be2d-f224672488b6","block_type":"box","text":"dividends or distributions, stock splits, reverse stock splits, rights offerings, distributions, reorganizations,","page_number":52,"box":{"x":69,"y":861,"width":759,"height":11}},{"id":"e1dacb42-532e-4840-a818-9df10ca01cb1","block_type":"box","text":"recapitalizations, or reclassifications with respect to an underlying security, or a merger, consolidation, dissolution or","page_number":52,"box":{"x":69,"y":876,"width":833,"height":11}},{"id":"8b938956-f3d4-43e1-b33d-a8adc8744003","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":52,"box":{"x":70,"y":891,"width":829,"height":12}},{"id":"0f414717-e41c-4332-982a-9636315e05b0","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":52,"box":{"x":69,"y":906,"width":821,"height":12}},{"id":"84c441e4-80ea-41cc-b05d-dacbd47fa645","block_type":"box","text":"II-22","page_number":52,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2f400517-f8f9-4311-b0f4-4c3d4e4ad716","block_type":"box","text":"NM1026U-5979889-52/232","page_number":52,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"2c3e6f43-2cd4-4e2d-a99a-ffc663ce73cd","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":53,"box":{"x":68,"y":45,"width":835,"height":11}},{"id":"d0419d1d-26a7-499c-a358-d33b88fb7c63","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":53,"box":{"x":68,"y":60,"width":829,"height":11}},{"id":"db4545c1-f95f-44e9-a88c-4e2d52834d8e","block_type":"box","text":"the affected options, the maintenance of a fair and orderly market in the affected options, consistency of","page_number":53,"box":{"x":68,"y":75,"width":753,"height":11}},{"id":"9beeb012-e981-4a95-96e5-5e08a280bcc9","block_type":"box","text":"interpretation and practice, efficiency of exercise settlement procedures, and the coordination with other clearing","page_number":53,"box":{"x":70,"y":90,"width":806,"height":11}},{"id":"7ef3bf9a-4190-4c1c-8c2c-02f1905660bd","block_type":"box","text":"agencies of the clearance and settlement of transactions in the underlying interest.","page_number":53,"box":{"x":69,"y":105,"width":593,"height":11}},{"id":"44ab0fe6-c433-4796-8c09-7f3e3c93e5f4","block_type":"box","text":"Cer tain Considerations Regarding Options","page_number":53,"box":{"x":135,"y":128,"width":298,"height":11}},{"id":"f6f8043a-eb95-4c31-bf81-435e4d9203ab","block_type":"box","text":". The FLEX Options in which each Fund may invest will be options","page_number":53,"box":{"x":435,"y":128,"width":461,"height":11}},{"id":"c70558bf-e27d-409e-8e73-e0657ec91d6b","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":53,"box":{"x":102,"y":143,"width":768,"height":11}},{"id":"717b003b-23a3-4222-87c1-1618eaad61e1","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":53,"box":{"x":102,"y":158,"width":775,"height":11}},{"id":"7c2890f8-9ec9-4129-b0a1-6c24f999e709","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":53,"box":{"x":102,"y":173,"width":777,"height":11}},{"id":"1139808f-73af-4d4f-a01c-798adc39d2c0","block_type":"box","text":"reflect, among other things, the time remaining until expiration (the end of the Outcome Period), the relationship","page_number":53,"box":{"x":102,"y":188,"width":799,"height":12}},{"id":"f3a0bd0c-97c1-4037-abc8-d5a7e5aa73ad","block_type":"box","text":"of the exercise price to the market price of the Reference Asset, and general market conditions. Options that","page_number":53,"box":{"x":102,"y":203,"width":777,"height":12}},{"id":"5b9515bc-232c-4e22-badc-62d7b44fec5e","block_type":"box","text":"expire unexercised have no value.","page_number":53,"box":{"x":101,"y":219,"width":240,"height":10}},{"id":"e488235c-8dd5-4ee4-9e59-ad4fc553cbee","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":53,"box":{"x":134,"y":241,"width":747,"height":11}},{"id":"c97d6f30-ee0f-4c9f-81c7-66bb193a34e4","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":53,"box":{"x":101,"y":256,"width":792,"height":11}},{"id":"3863e296-744a-4fd2-a600-6c45f1828821","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":53,"box":{"x":101,"y":271,"width":786,"height":12}},{"id":"516c7bff-34f6-4cd1-95a4-0227fba6d095","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":53,"box":{"x":101,"y":286,"width":798,"height":12}},{"id":"b6378ce5-3618-4c2f-b2e4-970ab7168830","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":53,"box":{"x":102,"y":302,"width":802,"height":11}},{"id":"94e976cb-2af5-45c4-8902-9ce56ad5554e","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":53,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"8cc165fe-2c64-444b-885a-797a9e9929fd","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":53,"box":{"x":102,"y":332,"width":774,"height":11}},{"id":"91bc20e1-cc61-48fb-88f0-23795c555e51","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":53,"box":{"x":102,"y":347,"width":793,"height":11}},{"id":"23b9fe6d-7c8b-42c8-8a2b-036f507f3070","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":53,"box":{"x":102,"y":362,"width":764,"height":11}},{"id":"e2b3b9e6-7cd2-4976-9e96-6638f71459b8","block_type":"box","text":"number of shares of the ETF in exchange for the strike price.","page_number":53,"box":{"x":102,"y":377,"width":430,"height":12}},{"id":"deed8399-7aac-4942-94e1-31086c56c1a3","block_type":"box","text":"Although each Fund will generally utilize FLEX Options that are physically settled, a Fund may also utilize","page_number":53,"box":{"x":134,"y":400,"width":740,"height":11}},{"id":"2edb1499-c958-4796-b04d-9ff5fd2586da","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":53,"box":{"x":102,"y":415,"width":787,"height":11}},{"id":"6dc00943-143d-42c2-9dca-d1f8362f1879","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":53,"box":{"x":102,"y":430,"width":790,"height":11}},{"id":"4d040c5d-b747-4ff6-bbb4-e2a0fe0b9d07","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":53,"box":{"x":102,"y":445,"width":793,"height":12}},{"id":"e3e725ef-9d5a-4be2-be41-5bd118a9b8d0","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":53,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"d6570335-a3da-48e4-82f7-2f0083369315","block_type":"box","text":"multiple (“multiplier”), which determines the total value for each point of such difference.","page_number":53,"box":{"x":102,"y":475,"width":635,"height":12}},{"id":"26fba485-ed26-4010-bd69-30323d5dfc5b","block_type":"box","text":"Risks of Options on the Reference Assets","page_number":53,"box":{"x":135,"y":498,"width":297,"height":11}},{"id":"49c1ea29-6a90-41b7-a495-b0c8092a7408","block_type":"box","text":". If a Fund has purchased an option and exercises it before the","page_number":53,"box":{"x":433,"y":498,"width":448,"height":11}},{"id":"f1458ac8-63c0-4d3c-9cd3-3540f59ba997","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":53,"box":{"x":101,"y":513,"width":777,"height":12}},{"id":"9e472c3a-001c-4cfa-857f-e3085bc5e776","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":53,"box":{"x":101,"y":528,"width":753,"height":12}},{"id":"9782d145-ec62-4a5c-bc42-1bf81d8a16f3","block_type":"box","text":"required to pay the difference between the closing Reference Asset value and the exercise price of the option","page_number":53,"box":{"x":102,"y":543,"width":780,"height":12}},{"id":"6c84393a-5b96-4270-996d-096d25a424a6","block_type":"box","text":"(times the applicable multiplier) to the assigned writer.","page_number":53,"box":{"x":102,"y":559,"width":387,"height":11}},{"id":"a05a6d3f-088c-4d25-8fe9-b07bd66d9684","block_type":"box","text":"Foreign Exchange Transactions.","page_number":53,"box":{"x":102,"y":582,"width":222,"height":11}},{"id":"bbd839c3-8417-4617-9a5c-a43d93163c94","block_type":"box","text":"A Fund may enter into spot foreign exchange transactions, forward foreign exchange transactions (“FX forwards”)","page_number":53,"box":{"x":101,"y":604,"width":807,"height":11}},{"id":"31f89fab-2835-4cb9-bbad-23fb62f75ce8","block_type":"box","text":"and currency swaps, purchase and sell currency options, currency futures and related options thereon (collectively,","page_number":53,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"518f49d5-7510-4ada-a82c-7ff6dd983072","block_type":"box","text":"“Currency Instruments”) for purposes of hedging against the decline in the value of currencies in which its portfolio","page_number":53,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"cebc0baa-a5d2-40f4-9854-fe1d6810679e","block_type":"box","text":"holdings are denominated against the U.S. dollar or, with respect to certain Funds, to seek to enhance returns.","page_number":53,"box":{"x":69,"y":649,"width":792,"height":12}},{"id":"dc10e205-7812-49a9-a465-3c42ca2d86c8","block_type":"box","text":"Such transactions could be effected to hedge with respect to foreign dollar denominated securities owned by a","page_number":53,"box":{"x":102,"y":672,"width":790,"height":11}},{"id":"1b04181c-5639-4ba7-8ae8-07cd0519d679","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":53,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"0018af56-102e-40c6-b407-3af826d36508","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":53,"box":{"x":69,"y":702,"width":808,"height":12}},{"id":"f20eed71-bf8c-46ce-9656-f0b2ea345e7a","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":53,"box":{"x":69,"y":717,"width":824,"height":12}},{"id":"e3311541-4077-4213-a539-4451db38591e","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":53,"box":{"x":68,"y":732,"width":823,"height":12}},{"id":"114f9471-d09f-4e5b-8533-f6ad5ffd1bf1","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":53,"box":{"x":68,"y":748,"width":821,"height":11}},{"id":"3f363e57-6ac5-495b-b049-db12e3deed38","block_type":"box","text":"part, the cost of acquiring such a put option, the Fund may also sell a call option which, if exercised, requires it to","page_number":53,"box":{"x":70,"y":763,"width":813,"height":11}},{"id":"9684a4ee-649e-493f-b92d-610a4b069a8a","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":53,"box":{"x":69,"y":778,"width":813,"height":11}},{"id":"df5041cf-dc38-4e7f-a1c6-9b78e3c5f3a7","block_type":"box","text":"selling such a call option in this illustration, the Fund gives up the opportunity to profit without limit from increases in","page_number":53,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"9748c8d6-1de2-4127-891d-a10240a7f02f","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":53,"box":{"x":68,"y":808,"width":836,"height":11}},{"id":"c25b63d2-4085-4635-a42d-c5d212773db9","block_type":"box","text":"transactions. Certain Funds have a fundamental investment restriction that restricts currency option strategies.","page_number":53,"box":{"x":68,"y":823,"width":794,"height":12}},{"id":"8148289a-74d3-481a-b74c-642fb805948f","block_type":"box","text":"Hedging transactions involving Currency Instruments involve substantial risks, including correlation risk. A Fund’s","page_number":53,"box":{"x":102,"y":846,"width":805,"height":11}},{"id":"ecb290ff-4c57-4eb7-a6f5-882c3f12d16b","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":53,"box":{"x":69,"y":861,"width":828,"height":11}},{"id":"5801bb39-06d7-42bd-a641-baa6b27384af","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":53,"box":{"x":69,"y":876,"width":819,"height":11}},{"id":"e2104261-efc4-475b-b63c-2d2ae9418517","block_type":"box","text":"Moreover, although Currency Instruments will be used with the intention of hedging against adverse currency","page_number":53,"box":{"x":70,"y":891,"width":773,"height":12}},{"id":"7db4a935-b597-42eb-86d5-896aabfccd9a","block_type":"box","text":"movements, transactions in Currency Instruments involve the risk that anticipated currency movements will not be","page_number":53,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"e001dfd9-0852-4285-9de2-629941a49da2","block_type":"box","text":"II-23","page_number":53,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7c673950-7e46-4c91-bf24-9668cfd758f6","block_type":"box","text":"NM1026U-5979889-53/232","page_number":53,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"28de3d73-80e3-441e-bf01-e707e8788890","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":54,"box":{"x":69,"y":45,"width":796,"height":11}},{"id":"5a003eb3-c4c7-4622-b32f-858b25fa8199","block_type":"box","text":"against anticipated currency movements that do not occur, the Fund may realize losses and decrease its total return.","page_number":54,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"ee975304-0962-4b48-b276-bc7a078b9973","block_type":"box","text":"Furthermore, a Fund will only engage in hedging activities from time to time and may not be engaging in hedging","page_number":54,"box":{"x":70,"y":75,"width":798,"height":11}},{"id":"b31258cf-f52b-43cc-84dc-55b6f28549f0","block_type":"box","text":"activities when movements in currency exchange rates actually occur.","page_number":54,"box":{"x":69,"y":90,"width":493,"height":11}},{"id":"fe92596f-fd8c-45e1-9529-2bc2098773ed","block_type":"box","text":"In connection with its trading in forward foreign currency contracts, a Fund will contract with a foreign or","page_number":54,"box":{"x":102,"y":113,"width":738,"height":11}},{"id":"0ee82b89-0249-4841-a8a3-a7b57ce4a7db","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":54,"box":{"x":69,"y":128,"width":814,"height":11}},{"id":"2b465455-a19f-4856-b347-7172a120fabb","block_type":"box","text":"particular currency. There are no limitations on daily price moves in such forward contracts, and banks and dealers","page_number":54,"box":{"x":70,"y":143,"width":819,"height":11}},{"id":"462c0c14-7016-4017-975c-9661405b7b5e","block_type":"box","text":"are not required to continue to make markets in such contracts. There have been periods during which certain banks","page_number":54,"box":{"x":69,"y":158,"width":834,"height":11}},{"id":"5cf6f005-e009-4862-b6bb-960696ea16b9","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":54,"box":{"x":69,"y":173,"width":797,"height":11}},{"id":"a9928329-61b3-40df-a034-babb633a559b","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":54,"box":{"x":69,"y":188,"width":794,"height":11}},{"id":"fb62ec36-9b8e-417e-8a65-e557ed741ee0","block_type":"box","text":"Governmental imposition of currency controls might limit any such forward contract trading. With respect to its trading","page_number":54,"box":{"x":69,"y":203,"width":841,"height":12}},{"id":"bcdf93aa-267d-401e-9b20-c4bfd216422a","block_type":"box","text":"of forward contracts, if any, a Fund will be subject to counterparty risk. Any such failure to perform by a counterparty","page_number":54,"box":{"x":69,"y":218,"width":831,"height":12}},{"id":"1803ba57-0bf7-43c9-be86-e335e7fa301c","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":54,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"bb479bf9-78b8-441a-b329-24f5081246ca","block_type":"box","text":"then market price and could result in a loss to the Fund.","page_number":54,"box":{"x":68,"y":249,"width":401,"height":11}},{"id":"a729ef0c-87a9-4f15-a209-5f904696216c","block_type":"box","text":"It may not be possible for a Fund to hedge against currency exchange rate movements, even if correctly","page_number":54,"box":{"x":102,"y":271,"width":738,"height":12}},{"id":"9993d86d-2530-48fc-a775-682202405480","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":54,"box":{"x":69,"y":287,"width":837,"height":11}},{"id":"8ed13626-ad64-4152-873f-f60b986145e6","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":54,"box":{"x":69,"y":302,"width":837,"height":11}},{"id":"201f18fc-4737-4c75-83e7-85d02dabcac5","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":54,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"77812ece-5419-4689-8427-e810926f4b89","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":54,"box":{"x":68,"y":332,"width":829,"height":11}},{"id":"a5f1f747-ef69-43d9-8755-71505f62996d","block_type":"box","text":"the currencies involved, the length of the contract period and the market conditions then prevailing. Since","page_number":54,"box":{"x":68,"y":347,"width":753,"height":11}},{"id":"7257813d-882b-41f1-b7ca-5888c464e06d","block_type":"box","text":"transactions in foreign currency exchange usually are conducted on a principal basis, no fees or commissions are","page_number":54,"box":{"x":68,"y":362,"width":811,"height":11}},{"id":"e96e9f67-35a6-4fbf-afed-bb9d1c9d611b","block_type":"box","text":"involved.","page_number":54,"box":{"x":70,"y":377,"width":59,"height":9}},{"id":"ed60eb91-8d97-47b0-8e54-9757f062ed7a","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":54,"box":{"x":101,"y":400,"width":803,"height":11}},{"id":"3ed8c401-4b90-487b-a659-e3ae3856037a","block_type":"box","text":"receivables for unsettled securities sales), or has committed to purchase or anticipates purchasing, which are","page_number":54,"box":{"x":69,"y":415,"width":785,"height":11}},{"id":"16bcef63-6806-403a-86dc-c1f2ad6f7700","block_type":"box","text":"denominated in such currency.","page_number":54,"box":{"x":69,"y":430,"width":216,"height":11}},{"id":"f20128df-d756-4318-a304-8597fd808eee","block_type":"box","text":"Spot Transactions and FX Forwards.","page_number":54,"box":{"x":102,"y":453,"width":254,"height":11}},{"id":"f187e962-64f1-477e-8932-b283ed995144","block_type":"box","text":"FX forwards are OTC contracts to purchase or sell a specified amount of a","page_number":54,"box":{"x":364,"y":453,"width":527,"height":11}},{"id":"85290705-305c-45d7-bdfa-32718823139c","block_type":"box","text":"specified currency or multinational currency unit at a specified price and specified future date. Spot foreign exchange","page_number":54,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"9060278b-cf7b-4997-8c21-f825ae8e9a43","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":54,"box":{"x":68,"y":483,"width":798,"height":11}},{"id":"c4cc2619-ad75-4b20-9320-22f82b9742a9","block_type":"box","text":"transactions for purposes of hedging either a specific transaction or a portfolio position, or, with respect to certain","page_number":54,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"297bf65f-c22c-477a-9718-a74039640558","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":54,"box":{"x":70,"y":513,"width":830,"height":11}},{"id":"9adbd9dc-8993-4e46-be53-9bca529c9656","block_type":"box","text":"may enter into a foreign exchange transaction for purposes of hedging a specific transaction by, for example,","page_number":54,"box":{"x":69,"y":528,"width":774,"height":12}},{"id":"c14b1b6a-eb16-4a63-b961-96216cad2000","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":54,"box":{"x":70,"y":544,"width":828,"height":11}},{"id":"b31424d1-149a-4008-af57-bbd2d5b5e3e3","block_type":"box","text":"anticipates receiving a dividend or distribution. A Fund may enter into a foreign exchange transaction for purposes of","page_number":54,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"072e5b7d-21ca-4630-886d-8057fbdd71b4","block_type":"box","text":"hedging a portfolio position by selling forward a currency in which a portfolio position of the Fund is denominated or","page_number":54,"box":{"x":69,"y":574,"width":826,"height":11}},{"id":"b9754d92-9864-46bd-a73b-5d9ae061fc75","block_type":"box","text":"by purchasing a currency in which the Fund anticipates acquiring a portfolio position in the near future. A Fund may","page_number":54,"box":{"x":69,"y":589,"width":819,"height":11}},{"id":"0ca1d4e1-579c-4c69-bf5d-bf1d66141025","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":54,"box":{"x":69,"y":604,"width":822,"height":11}},{"id":"761ca18a-4389-462a-a30d-7fc00e367077","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":54,"box":{"x":68,"y":619,"width":819,"height":11}},{"id":"9be5f0eb-480f-425e-be4f-62e6b22d481f","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":54,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"d6940677-5853-49c4-a871-b589a3de245f","block_type":"box","text":"currency being hedged, and (ii) executing a cross-hedge through the currency in which the cross-hedge is","page_number":54,"box":{"x":69,"y":650,"width":745,"height":11}},{"id":"343421b5-b033-407c-b91e-33889dfca4f1","block_type":"box","text":"denominated will be significantly more cost-effective or provide substantially greater liquidity than executing a similar","page_number":54,"box":{"x":69,"y":664,"width":832,"height":12}},{"id":"8784b1a2-c613-437b-b1d4-8ae27324a689","block_type":"box","text":"hedging transaction by means of the currency being hedged.","page_number":54,"box":{"x":69,"y":680,"width":428,"height":11}},{"id":"d7d84829-4d24-4ae9-8dae-93c6160e6dd0","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":54,"box":{"x":101,"y":702,"width":797,"height":12}},{"id":"24831bca-3a84-42b7-9327-98422b8c6589","block_type":"box","text":"of existing or anticipated holdings of portfolio securities. Proxy hedging is often used when the currency to which the","page_number":54,"box":{"x":69,"y":717,"width":829,"height":12}},{"id":"f3d45660-4d20-413a-b984-41f2425cc43a","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":54,"box":{"x":70,"y":732,"width":838,"height":12}},{"id":"ae8b095c-2bbd-481d-8e89-031b61583873","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":54,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"33c1a714-17a4-4815-a462-5626e07ecd80","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":54,"box":{"x":70,"y":763,"width":827,"height":11}},{"id":"7463336c-a472-46e2-867f-9182810b07b2","block_type":"box","text":"hedging involves some of the same risks and considerations as other transactions with similar instruments. Currency","page_number":54,"box":{"x":69,"y":778,"width":838,"height":11}},{"id":"8b6454c0-401f-487d-9dc4-3a7c65db897a","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":54,"box":{"x":68,"y":793,"width":798,"height":11}},{"id":"dfc21db1-e41f-499a-9eb5-b69f68030a07","block_type":"box","text":"direction that is not anticipated. In addition, there is the risk that the perceived linkage between various currencies","page_number":54,"box":{"x":69,"y":808,"width":819,"height":11}},{"id":"9e8e2b95-4c50-44c4-8aef-5e435e9c5cb3","block_type":"box","text":"may not be present, including during the particular time that a Fund is engaging in proxy hedging.","page_number":54,"box":{"x":69,"y":823,"width":691,"height":12}},{"id":"638ea308-a293-470a-9083-fa9455ff2e95","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":54,"box":{"x":101,"y":846,"width":785,"height":11}},{"id":"4ffbf9ef-156d-4ed2-bf5f-a0eef66c97f5","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":54,"box":{"x":69,"y":861,"width":811,"height":11}},{"id":"2f2a9aff-7b4e-4132-a254-d353104263a4","block_type":"box","text":"have portfolio exposure. For example, a Fund may hold both Canadian government bonds and Japanese government","page_number":54,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"bb2261b4-056f-45cd-bdc9-12764d0f6b82","block_type":"box","text":"bonds, and the Manager or sub-adviser may believe that Canadian dollars will deteriorate against Japanese yen. The","page_number":54,"box":{"x":69,"y":891,"width":829,"height":12}},{"id":"e2851465-da6f-4c7d-8653-aa220233f107","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":54,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"b53095cc-1990-405d-bb1d-c85604a33801","block_type":"box","text":"II-24","page_number":54,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"70bd6679-2b1e-4c12-bed5-5634c8371879","block_type":"box","text":"NM1026U-5979889-54/232","page_number":54,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"10a70c8e-2b09-43f0-8ed0-bb56d0f63b1a","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":55,"box":{"x":69,"y":45,"width":818,"height":11}},{"id":"cf89c813-8037-4df8-8b0c-04bb7131474a","block_type":"box","text":"value of the Japanese yen relative to the U.S. dollar.","page_number":55,"box":{"x":68,"y":60,"width":372,"height":11}},{"id":"76ac4913-f45c-4180-81dc-6b9214addb8d","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":55,"box":{"x":102,"y":82,"width":768,"height":12}},{"id":"2b06deb1-fe69-47b0-b5bb-c284d85d1040","block_type":"box","text":"forwards (“NDFs”). NDFs are cash-settled, short-term forward contracts that may be thinly traded or are denominated","page_number":55,"box":{"x":68,"y":98,"width":838,"height":11}},{"id":"1146be21-faf9-4cc6-806d-bd4771ca00d9","block_type":"box","text":"in non-convertible foreign currency, where the profit or loss at the time at the settlement date is calculated by taking","page_number":55,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"cfecdc8b-9515-4c4c-9175-cf0f03ff15c6","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":55,"box":{"x":68,"y":128,"width":806,"height":11}},{"id":"1b1deb2c-ec2b-47f1-a186-bf429ccad031","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":55,"box":{"x":69,"y":143,"width":839,"height":11}},{"id":"9db1d93e-b477-40e3-baf6-d7617a30274a","block_type":"box","text":"the difference between the prevailing market exchange rate and the agreed upon exchange rate is calculated. The","page_number":55,"box":{"x":68,"y":158,"width":812,"height":11}},{"id":"c71e9ad7-3eef-4a6d-babb-227859e06e77","block_type":"box","text":"settlement date is the date by which the payment of the difference is due to the party receiving payment. NDFs are","page_number":55,"box":{"x":69,"y":173,"width":821,"height":11}},{"id":"2188c6c8-e87d-4650-818e-a7027d451fdc","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":55,"box":{"x":69,"y":188,"width":835,"height":11}},{"id":"b63717e7-8775-4c81-96f9-eda3b4562b65","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":55,"box":{"x":68,"y":203,"width":802,"height":12}},{"id":"b8924800-0006-45b9-8973-167311d82bc8","block_type":"box","text":"traded.","page_number":55,"box":{"x":68,"y":219,"width":49,"height":8}},{"id":"d228c6a5-d1dd-42ea-b45a-6aa11ce4d173","block_type":"box","text":"Currency Futures.","page_number":55,"box":{"x":102,"y":241,"width":123,"height":11}},{"id":"82e80ddb-450f-4c43-b91c-dd1f50cb24d7","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":55,"box":{"x":232,"y":241,"width":654,"height":11}},{"id":"b8415b3f-4e9f-46d4-a2ff-5be2040d5a72","block_type":"box","text":"through use of currency futures or options on currency futures. Currency futures are similar to forward foreign","page_number":55,"box":{"x":68,"y":256,"width":782,"height":12}},{"id":"2ae41353-7d54-440a-9f5d-d714831b4138","block_type":"box","text":"exchange transactions except that futures are standardized, exchange-traded contracts while forward foreign","page_number":55,"box":{"x":69,"y":271,"width":774,"height":12}},{"id":"793a4232-f684-4b7f-a450-109752016e93","block_type":"box","text":"exchange transactions are traded in the OTC market. Currency futures involve substantial currency risk as well as the","page_number":55,"box":{"x":69,"y":286,"width":836,"height":12}},{"id":"611288de-f5a7-4733-92b0-7b374fa7393e","block_type":"box","text":"risks discussed above in “—Futures.”","page_number":55,"box":{"x":69,"y":302,"width":269,"height":9}},{"id":"a07db2c3-02f8-487c-89a3-c396b0a079c9","block_type":"box","text":"Currency Options.","page_number":55,"box":{"x":102,"y":324,"width":125,"height":11}},{"id":"b0d02e92-36c1-448a-9059-65bb360c6d40","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":55,"box":{"x":233,"y":324,"width":654,"height":12}},{"id":"1bda6e8d-e2c4-46f0-9959-ee2641adff41","block_type":"box","text":"through the use of currency options. Certain Funds have fundamental investment restrictions that permit the","page_number":55,"box":{"x":68,"y":339,"width":776,"height":12}},{"id":"83103750-e6fc-48f1-9f0d-0a24dabab8de","block_type":"box","text":"purchase of currency options, but prohibit the writing of currency options. Currency options are similar to options on","page_number":55,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"655e8639-ac02-4f95-984b-0290627902ad","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":55,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"83cc5fd5-4796-49c5-9202-d95699f8bb92","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":55,"box":{"x":68,"y":385,"width":820,"height":11}},{"id":"d9623f99-aa49-4cea-b32f-f9bc3bf01d6f","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":55,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"7052c74c-91ea-49c2-9f69-159c262caa4d","block_type":"box","text":"on currencies either on exchanges or OTC markets. Such transactions in options may include exotic options on","page_number":55,"box":{"x":69,"y":415,"width":790,"height":11}},{"id":"a9d72931-6867-466d-a438-35ec29ec9057","block_type":"box","text":"currencies, which are typically traded in OTC markets and have additional features that result in different payment","page_number":55,"box":{"x":69,"y":430,"width":813,"height":11}},{"id":"1a6656e0-304c-47b6-a739-b71912124229","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":55,"box":{"x":69,"y":446,"width":826,"height":10}},{"id":"bff644f8-29b2-43fe-8c85-2993dae23b01","block_type":"box","text":"on up to 100% of the currencies in its portfolio. See “—Options” above. Currency options involve substantial","page_number":55,"box":{"x":69,"y":460,"width":776,"height":12}},{"id":"7677920e-f595-4598-bfa7-dc333829c749","block_type":"box","text":"currency risk, and may also involve credit, leverage or illiquidity risk.","page_number":55,"box":{"x":69,"y":476,"width":483,"height":11}},{"id":"fda4424e-c047-4e09-ab30-91ec9708408c","block_type":"box","text":"Currency Swaps.","page_number":55,"box":{"x":102,"y":498,"width":117,"height":11}},{"id":"38702682-52cc-424d-bdcc-b6a4511f9bd8","block_type":"box","text":"A Fund may enter into currency swaps in order to protect against currency fluctuations or to","page_number":55,"box":{"x":225,"y":498,"width":652,"height":11}},{"id":"f4565fd0-2050-4e22-8db3-621a9f324899","block_type":"box","text":"hedge portfolio positions. Currency swaps are transactions in which one currency is simultaneously bought for a","page_number":55,"box":{"x":69,"y":513,"width":799,"height":12}},{"id":"41bd0efa-0704-41ed-82d1-147c2f6f1f96","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":55,"box":{"x":69,"y":528,"width":812,"height":12}},{"id":"ef18305c-f1b9-4179-84ef-46e372ab9746","block_type":"box","text":"exchange of the rights of a Fund and another party to make or receive payments in specified currencies, and typically","page_number":55,"box":{"x":69,"y":543,"width":836,"height":12}},{"id":"33d33ab4-705a-4221-8722-3b4bcdf05ead","block_type":"box","text":"require the delivery of the entire principal value of one designated currency in exchange for the other designated","page_number":55,"box":{"x":69,"y":559,"width":800,"height":11}},{"id":"6ead9911-0e6a-48b6-a048-69a983a86d11","block_type":"box","text":"currency. As a result, the entire principal value of a currency swap is subject to the risk that the other party to the","page_number":55,"box":{"x":69,"y":574,"width":810,"height":11}},{"id":"ccfb74d9-d0ca-4591-bc08-b58b78d2ad05","block_type":"box","text":"swap will default on its contractual delivery obligations.","page_number":55,"box":{"x":69,"y":589,"width":393,"height":11}},{"id":"a6d47c38-d8cf-42e6-9e4f-90f5a10b4006","block_type":"box","text":"Distressed Securities.","page_number":55,"box":{"x":102,"y":612,"width":159,"height":9}},{"id":"8880b595-6c38-404f-b88e-7fbe7b789723","block_type":"box","text":"A Fund may invest in securities, including loans purchased in the secondary market, that","page_number":55,"box":{"x":267,"y":612,"width":633,"height":11}},{"id":"414d2c96-8b4f-4e42-b7a9-e6cdab4eb54f","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":55,"box":{"x":69,"y":627,"width":834,"height":11}},{"id":"7133e3d4-8450-4604-820c-ddc10bbfa08f","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":55,"box":{"x":70,"y":642,"width":827,"height":11}},{"id":"75518560-17cb-4511-b71f-e1593b539c0b","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":55,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"6543ae88-36b8-4aab-a739-5fbc51b5a262","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":55,"box":{"x":69,"y":672,"width":784,"height":11}},{"id":"50ef5c09-8a06-48a9-ad8c-117da39afd06","block_type":"box","text":"Investment in Distressed Securities is speculative and involves significant risks.","page_number":55,"box":{"x":70,"y":687,"width":569,"height":11}},{"id":"c8b15976-aa1b-452c-8255-d800561b32a2","block_type":"box","text":"A Fund will generally make such investments only when the Manager believes it is reasonably likely that the","page_number":55,"box":{"x":101,"y":710,"width":766,"height":11}},{"id":"db88eb48-44e8-420c-a8ca-84864bac4032","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":55,"box":{"x":70,"y":725,"width":795,"height":11}},{"id":"8cd22ac0-a547-4f0e-8c6e-1758606576ab","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":55,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"ac43fea7-3124-4765-910b-dd38d17621f8","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":55,"box":{"x":69,"y":755,"width":794,"height":11}},{"id":"507d508c-da41-413b-93f1-2c36e7feff99","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":55,"box":{"x":69,"y":770,"width":832,"height":12}},{"id":"cffcbf95-86cd-468b-aad0-305baf461e76","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":55,"box":{"x":69,"y":785,"width":824,"height":12}},{"id":"6599e258-d6a2-4038-8d44-8d01b6eaf46f","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":55,"box":{"x":69,"y":801,"width":789,"height":11}},{"id":"b02f1b6b-078e-448a-816f-1f58ea30e78a","block_type":"box","text":"significant uncertainty as to whether or not the exchange offer or plan of reorganization will be completed and the","page_number":55,"box":{"x":69,"y":816,"width":810,"height":11}},{"id":"ccf29bf2-e9b6-45ee-ba88-7add0b63f870","block_type":"box","text":"Fund may be required to bear certain extraordinary expenses to protect and recover its investment. Therefore, to the","page_number":55,"box":{"x":70,"y":831,"width":831,"height":11}},{"id":"de7862a3-9e1d-40b2-8860-9a92821698fa","block_type":"box","text":"extent the Fund seeks capital appreciation through investment in distressed securities, the Fund’s ability to achieve","page_number":55,"box":{"x":69,"y":846,"width":826,"height":11}},{"id":"f570cf51-3aa6-4ea5-b18a-70ad6254874f","block_type":"box","text":"current income for its shareholders may be diminished. The Fund also will be subject to significant uncertainty as to","page_number":55,"box":{"x":69,"y":861,"width":827,"height":11}},{"id":"ca8ebbdb-da6f-47fe-95ba-bc7dbc7660f2","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":55,"box":{"x":68,"y":876,"width":834,"height":11}},{"id":"4d578d84-96a7-465c-800d-872a64d84c6f","block_type":"box","text":"satisfied (","page_number":55,"box":{"x":69,"y":891,"width":70,"height":11}},{"id":"610bba0d-d0a4-4414-ac0d-c310c08fd7ad","block_type":"box","text":"e.g.","page_number":55,"box":{"x":140,"y":893,"width":25,"height":10}},{"id":"c7eb5354-78b5-4f13-b5a3-069df9b6046a","block_type":"box","text":", through a liquidation of the obligor’s assets, an exchange offer or plan of reorganization involving the","page_number":55,"box":{"x":168,"y":891,"width":729,"height":12}},{"id":"743da86b-1475-4a50-9472-c2f4dfb1cc24","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":55,"box":{"x":69,"y":906,"width":807,"height":12}},{"id":"8cb6c3fd-cc9b-4ca9-8251-546bd3db6cc9","block_type":"box","text":"II-25","page_number":55,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8311eff1-bbce-4587-afaa-92d2445c213a","block_type":"box","text":"NM1026U-5979889-55/232","page_number":55,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"88995eaf-20e5-4010-9408-bc25fd0a0491","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":56,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"e1c2d021-098e-4023-a851-cac2cb593e34","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":56,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"9b81d5e0-e5e5-4f84-959d-7758834a55ed","block_type":"box","text":"reorganization will not have a lower value or income potential than may have been anticipated when the investment","page_number":56,"box":{"x":69,"y":75,"width":821,"height":11}},{"id":"68f318c5-247e-4532-be34-d85275d4fcda","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":56,"box":{"x":68,"y":90,"width":827,"height":11}},{"id":"5c44a10d-94a6-42c3-b052-902e40d95136","block_type":"box","text":"reorganization may be restricted as to resale. Similarly, if a Fund participates in negotiations with respect to any","page_number":56,"box":{"x":69,"y":105,"width":800,"height":11}},{"id":"b0907c36-fbd3-46a1-8144-5336f4ffd8ae","block_type":"box","text":"exchange offer or plan of reorganization with respect to an issuer of Distressed Securities, the Fund may be","page_number":56,"box":{"x":69,"y":120,"width":770,"height":12}},{"id":"ca261067-8a5a-4d37-a2f9-e30ea2cf5007","block_type":"box","text":"restricted from disposing of such securities. To the extent that a Fund becomes involved in such proceedings, the","page_number":56,"box":{"x":69,"y":135,"width":809,"height":12}},{"id":"ebc6e157-52fc-4af4-8917-afbdc87cc704","block_type":"box","text":"Fund may have a more active participation in the affairs of the issuer than that assumed generally by an investor. The","page_number":56,"box":{"x":70,"y":150,"width":839,"height":12}},{"id":"0f2b12bb-d393-40a0-82a1-363338a1b770","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":56,"box":{"x":70,"y":166,"width":787,"height":11}},{"id":"d01fa6a7-f970-41da-9601-73f914cef5ff","block_type":"box","text":"affairs.","page_number":56,"box":{"x":69,"y":181,"width":49,"height":9}},{"id":"f50b8fbe-5c8b-4542-818f-c0ba3408b449","block_type":"box","text":"Environmental, Social and Governance (“ESG”) Integration","page_number":56,"box":{"x":102,"y":203,"width":428,"height":11}},{"id":"6fc2c0f7-5ed4-43dc-b300-19bc367c7888","block_type":"box","text":". Although a Fund does not seek to implement a","page_number":56,"box":{"x":531,"y":204,"width":341,"height":11}},{"id":"70fffc2b-f03b-4475-80ec-04c40a5a9b48","block_type":"box","text":"specific sustainability objective, strategy or process unless disclosed in its Prospectus, Fund management will","page_number":56,"box":{"x":69,"y":218,"width":785,"height":12}},{"id":"5990f5d8-cab2-4184-ae0d-803c40d8073a","block_type":"box","text":"consider ESG factors as part of the investment process for the Fund. Fund management views ESG integration as the","page_number":56,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"927e27ad-5fb4-4dc2-a3eb-32bed7fd52d2","block_type":"box","text":"practice of incorporating financially material ESG data or information into investment processes with the objective of","page_number":56,"box":{"x":70,"y":249,"width":827,"height":11}},{"id":"dab353d5-0e95-467f-9d9d-e9e97d532135","block_type":"box","text":"enhancing risk-adjusted returns. These ESG considerations will vary depending on a Fund’s particular investment","page_number":56,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"aeaf3588-aa57-43b1-80c1-381a48043d61","block_type":"box","text":"strategies and may include consideration of third-party research as well as consideration of proprietary BlackRock","page_number":56,"box":{"x":69,"y":279,"width":812,"height":11}},{"id":"098a4c00-9cec-4596-afc4-af59a63a2a6d","block_type":"box","text":"research across the ESG risks and opportunities regarding an issuer. The ESG characteristics utilized in a Fund’s","page_number":56,"box":{"x":69,"y":294,"width":807,"height":11}},{"id":"1b836d1e-b944-49c7-b742-55ba96a11154","block_type":"box","text":"investment process are anticipated to evolve over time and one or more characteristics may not be relevant with","page_number":56,"box":{"x":70,"y":309,"width":800,"height":11}},{"id":"f52a2b6c-e4c8-4709-abda-7200ea6ca846","block_type":"box","text":"respect to all issuers that are eligible for investment.","page_number":56,"box":{"x":69,"y":324,"width":377,"height":12}},{"id":"b2ae7c13-fc47-4f9b-8014-654b1e7a3d7a","block_type":"box","text":"Certain of these considerations may affect a Fund’s exposure to certain companies or industries. While Fund","page_number":56,"box":{"x":102,"y":347,"width":778,"height":11}},{"id":"594946eb-0559-431d-b0ea-d4a2f7df2ec5","block_type":"box","text":"management views ESG considerations as having the potential to contribute to a Fund’s long-term performance,","page_number":56,"box":{"x":69,"y":362,"width":800,"height":11}},{"id":"8fb7c81c-c4b4-45c0-b0f5-9de101e083a8","block_type":"box","text":"there is no guarantee that such results will be achieved.","page_number":56,"box":{"x":68,"y":377,"width":400,"height":12}},{"id":"493e53a4-9423-4727-90f5-66c743cbf564","block_type":"box","text":"Equity Securities.","page_number":56,"box":{"x":102,"y":400,"width":127,"height":11}},{"id":"392ab448-46d6-49e9-b1b8-2997736978f5","block_type":"box","text":"Certain Funds may invest in equity securities, which include common stock and, for certain","page_number":56,"box":{"x":235,"y":400,"width":648,"height":11}},{"id":"92f26b6b-d15b-4a91-ae34-ff2774e111a4","block_type":"box","text":"Funds, preferred stock (including convertible preferred stock); bonds, stock purchase warrants and rights; equity","page_number":56,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"96720ba1-fd9a-466e-8557-48deb1c61f7b","block_type":"box","text":"interests in trusts; general and limited partnerships and limited liability companies; and depositary receipts. Stock","page_number":56,"box":{"x":70,"y":430,"width":817,"height":11}},{"id":"58155a4f-733d-468e-a7c7-8b4f59fa973a","block_type":"box","text":"markets are volatile. The price of equity securities will fluctuate and can decline and reduce the value of a portfolio","page_number":56,"box":{"x":69,"y":445,"width":819,"height":11}},{"id":"de1350c8-8190-4855-be51-a36ae655fbee","block_type":"box","text":"investing in equities. The price of equity securities fluctuates based on changes in a company’s financial condition","page_number":56,"box":{"x":70,"y":460,"width":813,"height":12}},{"id":"2a638cd8-df34-4798-ab82-a52249bd0f82","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":56,"box":{"x":69,"y":475,"width":839,"height":12}},{"id":"23596ea4-64a6-408b-bfa2-3bc108e5e806","block_type":"box","text":"financial condition of the companies the Fund invests in decline or if overall market and economic conditions","page_number":56,"box":{"x":68,"y":491,"width":775,"height":11}},{"id":"18050147-f79b-45cd-8071-e5d08027dae9","block_type":"box","text":"deteriorate. They may also decline due to factors that affect a particular industry or industries, such as labor","page_number":56,"box":{"x":69,"y":506,"width":777,"height":11}},{"id":"9e452789-334d-48e0-b8aa-cacf36866c16","block_type":"box","text":"shortages or increase in production costs and competitive conditions within an industry. In addition, they may decline","page_number":56,"box":{"x":69,"y":521,"width":837,"height":11}},{"id":"374b5a44-dce9-4d8e-9695-b8d088914fb3","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":56,"box":{"x":69,"y":536,"width":831,"height":11}},{"id":"24705df7-7544-4566-acc3-3037445023af","block_type":"box","text":"adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency","page_number":56,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"71d751b4-a36f-456c-b706-a0f0e9bc9cbd","block_type":"box","text":"rates or generally adverse investor sentiment.","page_number":56,"box":{"x":69,"y":566,"width":325,"height":11}},{"id":"04c3a036-98a0-4e69-85f9-258f3f0b0256","block_type":"box","text":"From time to time certain of the Funds may invest in shares of companies through initial public offerings","page_number":56,"box":{"x":102,"y":589,"width":745,"height":11}},{"id":"f9381964-f78d-426c-a4db-b4d1324d5bea","block_type":"box","text":"(“IPOs”). IPOs have the potential to produce, and have in fact produced, substantial gains for certain Funds. There is","page_number":56,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"0b061785-c4fe-4e6e-b79e-20fd64ff3f7c","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":56,"box":{"x":69,"y":619,"width":824,"height":11}},{"id":"2decaf10-2571-4277-98e3-58773fe112e0","block_type":"box","text":"these past gains as an indication of future performance. The investment performance of a Fund during periods when","page_number":56,"box":{"x":68,"y":634,"width":834,"height":12}},{"id":"1e314b53-0294-4fb7-a9bc-7e58f432f908","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":56,"box":{"x":70,"y":649,"width":782,"height":12}},{"id":"06a84368-1329-4347-9697-b03dd7291338","block_type":"box","text":"addition, as a Fund increases in size, the impact of IPOs on its performance will generally decrease. Securities","page_number":56,"box":{"x":69,"y":664,"width":790,"height":12}},{"id":"75af1d1b-9c58-4009-b806-c43a4965aace","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":56,"box":{"x":70,"y":680,"width":823,"height":11}},{"id":"b655e29b-2131-4746-859f-6913ee33ad2c","block_type":"box","text":"Securities issued in IPOs have no trading history, and information about the companies may be available for very","page_number":56,"box":{"x":69,"y":695,"width":805,"height":11}},{"id":"e70f9737-2cfc-4718-8036-1a74f5c88372","block_type":"box","text":"limited periods. In addition, the prices of securities sold in IPOs may be highly volatile or may decline shortly after the","page_number":56,"box":{"x":70,"y":710,"width":836,"height":11}},{"id":"09a1e7b9-3bd5-4089-892c-c8450c1caed7","block_type":"box","text":"initial public offering.","page_number":56,"box":{"x":70,"y":725,"width":147,"height":11}},{"id":"568e21ac-bcc3-4bf1-8436-a83767b168fa","block_type":"box","text":"The Funds may invest in companies that have relatively small market capitalizations. These organizations will","page_number":56,"box":{"x":101,"y":748,"width":777,"height":11}},{"id":"5a12f57d-c2d7-427b-b583-d1aef8df2191","block_type":"box","text":"normally have more limited product lines, markets and financial resources and will be dependent upon a more limited","page_number":56,"box":{"x":69,"y":763,"width":838,"height":11}},{"id":"daad7ac1-7819-40ff-9f04-348a8cf852c8","block_type":"box","text":"management group than larger capitalized companies. In addition, it is more difficult to get information on smaller","page_number":56,"box":{"x":69,"y":778,"width":815,"height":11}},{"id":"3d57dcfd-6bf3-48d9-ba19-395d07b554e6","block_type":"box","text":"companies, which tend to be less well known, have shorter operating histories, do not have significant ownership by","page_number":56,"box":{"x":69,"y":793,"width":829,"height":11}},{"id":"d2804329-c485-43a3-a1b6-721fc6d45b05","block_type":"box","text":"large investors and are followed by relatively few securities analysts. The securities of smaller capitalized companies","page_number":56,"box":{"x":70,"y":808,"width":831,"height":11}},{"id":"b2513fe0-0970-4609-9a1f-41e3c8d2f5c6","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":56,"box":{"x":69,"y":823,"width":826,"height":11}},{"id":"bfc41432-d20d-4dd8-8cfa-158a1236d2f6","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":56,"box":{"x":68,"y":838,"width":810,"height":12}},{"id":"0c0f6442-29da-48d4-9b6c-baeaa0f5c385","block_type":"box","text":"more established companies.","page_number":56,"box":{"x":69,"y":854,"width":209,"height":10}},{"id":"50beb607-f6d7-4651-a906-d8a888fbe76c","block_type":"box","text":"II-26","page_number":56,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"72d95cab-8371-4633-a9cb-0badd5fa8664","block_type":"box","text":"NM1026U-5979889-56/232","page_number":56,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4b854c58-d752-44ef-b44e-480a51d76118","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":57,"box":{"x":102,"y":45,"width":776,"height":11}},{"id":"691e0b48-be12-4f8f-93b9-c4fbb0995b92","block_type":"box","text":"investing in such equity securities, see your Fund’s Prospectus. Certain of the Funds may also invest in shares of","page_number":57,"box":{"x":70,"y":60,"width":810,"height":11}},{"id":"9c4875e4-0750-4c1e-89de-a8cdab6fe656","block_type":"box","text":"private companies, which are subject to the risks of “Illiquid Investments” and “Restricted Securities” described","page_number":57,"box":{"x":70,"y":75,"width":799,"height":11}},{"id":"f07ac56e-44f3-470c-94ed-681e6acc0381","block_type":"box","text":"below.","page_number":57,"box":{"x":69,"y":90,"width":43,"height":9}},{"id":"ee35ddb7-3b93-4b82-9ed6-1f0222f90e89","block_type":"box","text":"Real Estate-Related Securities.","page_number":57,"box":{"x":102,"y":113,"width":219,"height":9}},{"id":"709a9688-3d69-4346-8b2b-e9486b3103bf","block_type":"box","text":"Although no Fund may invest directly in real estate, certain Funds may invest in","page_number":57,"box":{"x":327,"y":113,"width":565,"height":11}},{"id":"52f42979-0dfd-4685-b477-640bcf7b9ae6","block_type":"box","text":"equity securities of issuers that are principally engaged in the real estate industry. Such investments are subject to","page_number":57,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"13560abd-71e9-45c1-acc9-9e295502f0f3","block_type":"box","text":"certain risks associated with the ownership of real estate and with the real estate industry in general. These risks","page_number":57,"box":{"x":69,"y":143,"width":814,"height":11}},{"id":"915d6ab9-4bd3-472f-a0c3-8f03d756ef86","block_type":"box","text":"include, among others: possible declines in the value of real estate; risks related to general and local economic","page_number":57,"box":{"x":70,"y":158,"width":796,"height":11}},{"id":"fe7388d2-1c8a-4853-949f-474249c899b3","block_type":"box","text":"conditions; possible lack of availability of mortgage funds or other limitations on access to capital; overbuilding; risks","page_number":57,"box":{"x":69,"y":173,"width":836,"height":11}},{"id":"094a89c3-accc-4daa-a501-401826925d68","block_type":"box","text":"associated with leverage; market illiquidity; extended vacancies of properties; increase in competition, property","page_number":57,"box":{"x":69,"y":188,"width":795,"height":12}},{"id":"ae5851c4-c20c-4f34-b57a-537bf22847d8","block_type":"box","text":"taxes, capital expenditures and operating expenses; changes in zoning laws or other governmental regulation; costs","page_number":57,"box":{"x":68,"y":204,"width":828,"height":11}},{"id":"c133f8c8-29c9-4a97-976e-f3e8cc70fe3d","block_type":"box","text":"resulting from the clean-up of, and liability to third parties for damages resulting from, environmental problems;","page_number":57,"box":{"x":69,"y":218,"width":794,"height":12}},{"id":"25372e20-4ffa-4400-abf9-81df6243a0d9","block_type":"box","text":"tenant bankruptcies or other credit problems; casualty or condemnation losses; uninsured damages from floods,","page_number":57,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"9c0cf0eb-56a5-4703-861a-a15f60acff50","block_type":"box","text":"earthquakes or other natural disasters; limitations on and variations in rents, including decreases in market rates for","page_number":57,"box":{"x":69,"y":249,"width":836,"height":11}},{"id":"a9033821-abe7-43eb-b07f-0738179cdc4a","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":57,"box":{"x":69,"y":264,"width":838,"height":11}},{"id":"f6ca2d13-cbfe-49a6-86b8-0608c42210ae","block_type":"box","text":"interest rates. To the extent that assets underlying a Fund’s investments are concentrated geographically, by property","page_number":57,"box":{"x":70,"y":279,"width":838,"height":11}},{"id":"31a6b364-d018-40be-bb2f-e52f59d7ffd8","block_type":"box","text":"type or in certain other respects, the Fund may be subject to certain of the foregoing risks to a greater extent.","page_number":57,"box":{"x":68,"y":294,"width":785,"height":11}},{"id":"0605607f-d11e-4a99-a95f-7682d7846e62","block_type":"box","text":"Investments by a Fund in securities of companies providing mortgage servicing will be subject to the risks associated","page_number":57,"box":{"x":70,"y":309,"width":836,"height":11}},{"id":"57f1ea2d-8812-42db-8a5b-10be0663a722","block_type":"box","text":"with refinancings and their impact on servicing rights.","page_number":57,"box":{"x":68,"y":324,"width":381,"height":12}},{"id":"31a7cb76-bfcc-4097-9bc0-513166b33834","block_type":"box","text":"In addition, if a Fund receives rental income or income from the disposition of real property acquired as a result","page_number":57,"box":{"x":102,"y":347,"width":797,"height":11}},{"id":"70f56a8d-d53f-4d95-97b8-c27ce9586c3d","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":57,"box":{"x":69,"y":362,"width":829,"height":11}},{"id":"b5139950-c3aa-48b8-9792-2fe113edf2d4","block_type":"box","text":"its tax status as a regulated investment company because of certain income source requirements applicable to","page_number":57,"box":{"x":70,"y":377,"width":794,"height":12}},{"id":"553a20b9-a6fd-4e15-ba12-47ab93431ee5","block_type":"box","text":"regulated investment companies under the Internal Revenue Code of 1986, as amended (the “Code”).","page_number":57,"box":{"x":69,"y":392,"width":730,"height":12}},{"id":"d604157d-9598-4d84-93cd-7efd5be79bfb","block_type":"box","text":"Securities of Smaller or Emerging Growth Companies.","page_number":57,"box":{"x":102,"y":415,"width":381,"height":11}},{"id":"f18df424-2460-4588-a31a-7b6eacc475c5","block_type":"box","text":"Investment in smaller or emerging growth companies","page_number":57,"box":{"x":490,"y":415,"width":376,"height":11}},{"id":"0f8dcc46-fe1e-4413-b86b-c7a71273f7e3","block_type":"box","text":"involves greater risk than is customarily associated with investments in more established companies. The securities","page_number":57,"box":{"x":70,"y":430,"width":828,"height":11}},{"id":"d9047286-fab1-4335-8fce-131b6f6e1d2a","block_type":"box","text":"of smaller or emerging growth companies may be subject to more abrupt or erratic market movements than larger,","page_number":57,"box":{"x":69,"y":445,"width":815,"height":12}},{"id":"36616e99-58db-454c-8228-4ceb98ba3178","block_type":"box","text":"more established companies or the market average in general. These companies may have limited product lines,","page_number":57,"box":{"x":69,"y":461,"width":804,"height":11}},{"id":"727ad021-30f8-4e88-abc0-f328ba601d56","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":57,"box":{"x":69,"y":475,"width":647,"height":12}},{"id":"4c48b8a8-2a11-4f8b-b638-5a1c56e9a39f","block_type":"box","text":"Investments in smaller or emerging growth companies may involve greater risks and thus may be considered","page_number":57,"box":{"x":102,"y":498,"width":773,"height":11}},{"id":"40f36af5-9c94-4839-bf02-ccc52240b8f5","block_type":"box","text":"speculative. Full development of these companies and trends frequently takes time.","page_number":57,"box":{"x":69,"y":513,"width":597,"height":11}},{"id":"610b5226-a8a1-49a5-b884-f1219758383a","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":57,"box":{"x":102,"y":536,"width":797,"height":11}},{"id":"311d9147-eff3-480f-ada1-0e49b8ffa5c0","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":57,"box":{"x":69,"y":551,"width":832,"height":11}},{"id":"8ba0df30-8ac8-41c4-8b27-3b6b44a3ba84","block_type":"box","text":"result, the disposition by a Fund of portfolio securities to meet redemptions or otherwise may require the Fund to","page_number":57,"box":{"x":69,"y":566,"width":808,"height":11}},{"id":"d41bf430-6c45-4af5-a76d-c69cd1d33afa","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":57,"box":{"x":69,"y":581,"width":825,"height":12}},{"id":"74ab5489-7d4b-4970-8d83-7a659e29a25e","block_type":"box","text":"during periods when, in Fund management’s judgment, such disposition is not desirable.","page_number":57,"box":{"x":69,"y":597,"width":631,"height":11}},{"id":"316026ce-1ac1-4e4e-9a4d-19d3bea10110","block_type":"box","text":"The process of selection and continuous supervision by Fund management does not guarantee successful","page_number":57,"box":{"x":101,"y":619,"width":758,"height":11}},{"id":"00ebc6ea-a372-4d03-87e4-084382c38d6b","block_type":"box","text":"investment results. Careful initial selection is particularly important in this area as many new enterprises have","page_number":57,"box":{"x":70,"y":634,"width":787,"height":11}},{"id":"142f4f7c-221c-41a4-8e66-ba1ed91f6f9a","block_type":"box","text":"promise but lack certain of the fundamental factors necessary to prosper. Investing in small cap and emerging","page_number":57,"box":{"x":70,"y":649,"width":789,"height":12}},{"id":"a560e6d8-8531-4469-a88d-84c526eb6d6e","block_type":"box","text":"growth companies requires specialized research and analysis.","page_number":57,"box":{"x":68,"y":665,"width":442,"height":11}},{"id":"37429750-b94f-42b4-a6db-bef1f3621ffc","block_type":"box","text":"Fund management believes that relatively small companies may have the opportunity to develop into significant","page_number":57,"box":{"x":102,"y":687,"width":795,"height":11}},{"id":"9a595b25-5a7f-4b45-930b-f69ec2c581c2","block_type":"box","text":"business enterprises. A Fund may invest in securities of small issuers in the relatively early stages of business","page_number":57,"box":{"x":69,"y":702,"width":791,"height":12}},{"id":"dd1280a3-14d7-48bd-b055-2830f8d6657d","block_type":"box","text":"development that have a new technology, a unique or proprietary product or service, or a favorable market position.","page_number":57,"box":{"x":69,"y":717,"width":823,"height":12}},{"id":"e887f07c-a513-46e5-821f-3d3b6954fa4a","block_type":"box","text":"Equity securities of specific small cap issuers may present different opportunities for long-term capital","page_number":57,"box":{"x":102,"y":740,"width":729,"height":11}},{"id":"4ff707e3-4409-4fc7-ab84-4041ca7dc39e","block_type":"box","text":"appreciation during varying portions of economic or securities market cycles, as well as during varying stages of their","page_number":57,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"84ed8070-7852-4e9f-a10d-9837c31f142a","block_type":"box","text":"business development. The market valuation of small cap issuers tends to fluctuate during economic or market","page_number":57,"box":{"x":69,"y":770,"width":794,"height":12}},{"id":"0a6c81b1-fbbf-4330-b61a-8c78374cbce6","block_type":"box","text":"cycles.","page_number":57,"box":{"x":69,"y":786,"width":46,"height":11}},{"id":"70016627-fb3c-46a6-85dc-3c85d4084976","block_type":"box","text":"Tracking Stocks","page_number":57,"box":{"x":103,"y":808,"width":110,"height":11}},{"id":"38490f38-e052-49c2-99bb-3a869f437298","block_type":"box","text":". A tracking stock is a separate class of common stock whose value is linked to a specific","page_number":57,"box":{"x":214,"y":808,"width":640,"height":11}},{"id":"ad474a10-7368-470a-9811-40c684f0bb61","block_type":"box","text":"business unit or operating division within a larger company and is designed to “track” the performance of such","page_number":57,"box":{"x":69,"y":823,"width":791,"height":12}},{"id":"9734a251-5876-4557-91cb-f3d29960ab86","block_type":"box","text":"business unit or division. The tracking stock may pay dividends to shareholders independent of the parent company.","page_number":57,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"886d0761-d5af-49dd-9759-62a17754ead1","block_type":"box","text":"The parent company, rather than the business unit or division, generally is the issuer of tracking stock. However,","page_number":57,"box":{"x":68,"y":853,"width":801,"height":12}},{"id":"b198ec5d-054a-4eb3-9108-d5e8f137de3f","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":57,"box":{"x":69,"y":869,"width":740,"height":11}},{"id":"129c1ff0-fe1b-4e33-a75b-ffe62b024a91","block_type":"box","text":"Exchange-Traded Notes (“ETNs”).","page_number":57,"box":{"x":102,"y":891,"width":245,"height":11}},{"id":"015930dc-8025-4626-b385-ae15e20bb5c3","block_type":"box","text":"Certain Funds may invest in ETNs. ETNs are generally notes representing","page_number":57,"box":{"x":354,"y":891,"width":521,"height":12}},{"id":"3c3f3fd4-ca7a-45e2-96d3-7d51d472daeb","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":57,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"723bb982-d848-4326-a8ed-ceda9eb913e0","block_type":"box","text":"II-27","page_number":57,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f90bd96e-3cff-415e-819d-82e6e07d8713","block_type":"box","text":"NM1026U-5979889-57/232","page_number":57,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"2737aa06-79bf-4279-ae57-9bf938667d11","block_type":"box","text":"are based on the performance of one or more underlying assets, reference rates or indexes, minus fees and","page_number":58,"box":{"x":69,"y":45,"width":774,"height":11}},{"id":"0f3ab921-1677-4505-b6a5-61c5a99efd5e","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":58,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"5c04c790-88e2-494d-8d2a-e9d5c8596d3e","block_type":"box","text":"ETF, an ETN can be held until the ETN’s maturity, at which time the issuer will pay a return linked to the performance","page_number":58,"box":{"x":70,"y":75,"width":831,"height":11}},{"id":"debbb58e-c3d6-4cdf-94b1-640b02ae0a1d","block_type":"box","text":"of the specific asset, index or rate (“reference instrument”) to which the ETN is linked minus certain fees. Unlike","page_number":58,"box":{"x":69,"y":90,"width":805,"height":11}},{"id":"1ccb9f25-c790-488f-bdcc-27709cd6ccfd","block_type":"box","text":"regular bonds, ETNs do not make periodic interest payments, and principal is not protected.","page_number":58,"box":{"x":69,"y":105,"width":654,"height":11}},{"id":"96abce6e-58bb-41c2-9b71-aafe4c4559e0","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":58,"box":{"x":101,"y":128,"width":794,"height":11}},{"id":"b9a28bb7-d2ba-4737-8888-4090e913f0f1","block_type":"box","text":"the ETN, volatility and lack of liquidity in underlying markets, changes in the applicable interest rates, the","page_number":58,"box":{"x":68,"y":143,"width":748,"height":11}},{"id":"cf1ddd4a-045d-45c0-9d18-733268b099ba","block_type":"box","text":"performance of the reference instrument, changes in the issuer’s credit rating and economic, legal, political or","page_number":58,"box":{"x":70,"y":158,"width":789,"height":11}},{"id":"f0427987-f09e-4a3f-a660-b6ffd95c6bd9","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":58,"box":{"x":68,"y":173,"width":831,"height":11}},{"id":"eaf3c78f-d551-4af9-ab8f-261cb3fb4f8f","block_type":"box","text":"drop due to a downgrade in an issuer’s credit rating, despite the underlying reference instrument remaining","page_number":58,"box":{"x":69,"y":188,"width":766,"height":12}},{"id":"41cd4620-7a0d-4c57-b000-80a8141b45bc","block_type":"box","text":"unchanged. When a Fund invests in ETNs, it will bear its proportionate share of any fees and expenses borne by the","page_number":58,"box":{"x":69,"y":203,"width":828,"height":12}},{"id":"665a205e-2d7a-44fa-8042-9fdc367d88c3","block_type":"box","text":"ETN.","page_number":58,"box":{"x":70,"y":219,"width":30,"height":8}},{"id":"bf566f21-8f5f-48ff-9d0a-5da54c82d1cf","block_type":"box","text":"An ETN that is tied to a reference instrument may not replicate the performance of the reference instrument.","page_number":58,"box":{"x":101,"y":241,"width":776,"height":11}},{"id":"9cbacb62-2cc4-456c-9422-afb24141e63d","block_type":"box","text":"ETNs also incur certain expenses not incurred by their applicable reference instrument. Some ETNs that use leverage","page_number":58,"box":{"x":70,"y":256,"width":837,"height":12}},{"id":"b7bc047b-651d-4a39-99a2-8199506f6883","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":58,"box":{"x":69,"y":271,"width":840,"height":12}},{"id":"fd8722d7-5f30-4335-a264-554aeac75a20","block_type":"box","text":"risk as other instruments that use leverage in any form. While leverage allows for greater potential return, the","page_number":58,"box":{"x":69,"y":286,"width":781,"height":12}},{"id":"f0397c52-850f-4248-99df-f5250c281149","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":58,"box":{"x":70,"y":302,"width":827,"height":11}},{"id":"02c7b037-81b8-497d-90af-6fbdc65102dc","block_type":"box","text":"addition to the money lost on the investment, the loan still needs to be repaid.","page_number":58,"box":{"x":69,"y":317,"width":560,"height":11}},{"id":"37b5146b-8fa2-4167-95d5-506ab8f2be68","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":58,"box":{"x":102,"y":340,"width":774,"height":11}},{"id":"829679a1-4648-483f-9351-0272e0e435e3","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":58,"box":{"x":68,"y":355,"width":788,"height":11}},{"id":"335259bd-7340-4540-b254-24001dd5234e","block_type":"box","text":"reference instrument. The market value of ETN shares may differ from the value of the reference instrument. This","page_number":58,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"398c6660-27a1-4c76-9a5f-6db89dee19db","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":58,"box":{"x":69,"y":385,"width":815,"height":11}},{"id":"4c268322-330c-4d0c-8ac6-4155f432b2d0","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":58,"box":{"x":68,"y":400,"width":766,"height":11}},{"id":"715a1d58-5e64-4664-90be-f50c8b31c214","block_type":"box","text":"instrument that the ETN seeks to track.","page_number":58,"box":{"x":70,"y":415,"width":279,"height":9}},{"id":"c6a2a3e5-103d-4d43-afad-e94bd2d2d1c4","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":58,"box":{"x":101,"y":438,"width":791,"height":11}},{"id":"82d0e09b-7d50-4872-8063-2d37d2ef5ec9","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":58,"box":{"x":69,"y":453,"width":818,"height":11}},{"id":"324ae909-2385-47de-9a92-d22bb2ac4f0f","block_type":"box","text":"market. An investor in an ETN could lose some or all of the amount invested.","page_number":58,"box":{"x":69,"y":468,"width":547,"height":9}},{"id":"ca9d0aa4-53fa-4935-b2d2-fda3b3653fd1","block_type":"box","text":"ETNs are also subject to tax risks. The Internal Revenue Service (the “IRS”) may not accept, and a court may not","page_number":58,"box":{"x":102,"y":491,"width":807,"height":11}},{"id":"3430138a-dc8f-4ad1-bb2d-24d96f9f1468","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":58,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"8d137294-0e72-48a5-8445-430b8bb7d50a","block_type":"box","text":"derived by a Fund from investments in ETNs may be affected by future legislation.","page_number":58,"box":{"x":69,"y":521,"width":581,"height":11}},{"id":"6f95fd0a-6348-4947-84a5-3f703a02da90","block_type":"box","text":"Foreign Investments.","page_number":58,"box":{"x":102,"y":544,"width":152,"height":11}},{"id":"3b0ebdff-1bb3-46dd-aa46-7bc290db2a55","block_type":"box","text":"Foreign Investment Risks.","page_number":58,"box":{"x":102,"y":566,"width":182,"height":11}},{"id":"a5e7ffc8-ef41-4f4f-a160-bba739e4261d","block_type":"box","text":"Certain Funds may invest in foreign securities, including securities from issuers","page_number":58,"box":{"x":291,"y":566,"width":567,"height":11}},{"id":"bccd2cf7-b3bc-4844-aaa9-071190a47e61","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":58,"box":{"x":70,"y":581,"width":822,"height":12}},{"id":"2f275442-c26c-4049-8fc6-642a2ac443be","block_type":"box","text":"Investing in foreign securities involves risks not typically associated with investing in securities of companies","page_number":58,"box":{"x":70,"y":596,"width":774,"height":12}},{"id":"34d6e3e1-deb3-4d8a-8eba-3d27181caa7d","block_type":"box","text":"organized and operated in the United States that can increase the chances that a Fund will lose money.","page_number":58,"box":{"x":69,"y":612,"width":738,"height":11}},{"id":"0381f6fb-970c-494a-8b9b-6089134f1a40","block_type":"box","text":"Securities issued by certain companies organized outside the United States may not be deemed to be foreign","page_number":58,"box":{"x":102,"y":634,"width":782,"height":12}},{"id":"b0a639d8-c0b4-4e14-916e-f4361ef136e6","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":58,"box":{"x":69,"y":649,"width":824,"height":12}},{"id":"3d51739c-6696-4c0d-9957-3521ba5c9913","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":58,"box":{"x":70,"y":665,"width":771,"height":11}},{"id":"344c0d8a-ae91-4473-9a39-b7392cae17a1","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":58,"box":{"x":69,"y":680,"width":792,"height":11}},{"id":"fb4a5552-57ce-4842-b8bf-fbd9dab7c6ec","block_type":"box","text":"benchmark index.","page_number":58,"box":{"x":69,"y":695,"width":124,"height":9}},{"id":"532dbf15-ec72-4e8b-b2ac-5ae97aceb143","block_type":"box","text":"In addition to equity securities, foreign investments of the Funds may include: (a) debt obligations issued or","page_number":58,"box":{"x":102,"y":717,"width":767,"height":12}},{"id":"e8db7652-b569-4c28-a5d1-d5a252eae3ff","block_type":"box","text":"guaranteed by foreign sovereign governments or their agencies, authorities, instrumentalities or political","page_number":58,"box":{"x":68,"y":732,"width":742,"height":12}},{"id":"2dd73710-8ecd-4aa5-a63b-50ff4beb48ba","block_type":"box","text":"subdivisions, including a foreign state, province or municipality; (b) debt obligations of supranational organizations;","page_number":58,"box":{"x":69,"y":748,"width":818,"height":11}},{"id":"b82e9e1e-93f9-41a8-8e9d-2f353afd16bf","block_type":"box","text":"(c) debt obligations of foreign banks and bank holding companies; (d) debt obligations of domestic banks and","page_number":58,"box":{"x":69,"y":763,"width":780,"height":11}},{"id":"e5cc82be-ee36-44db-985a-6d8860181666","block_type":"box","text":"corporations issued in foreign currencies; (e) debt obligations denominated in the Euro; and (f) foreign corporate debt","page_number":58,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"a595de44-a8a8-4502-9a8c-a072975724e2","block_type":"box","text":"securities and commercial paper. Such securities may include loan participations and assignments, convertible","page_number":58,"box":{"x":69,"y":793,"width":794,"height":11}},{"id":"58f32269-a0f2-4320-906a-ab4351557c7b","block_type":"box","text":"securities and zero-coupon securities.","page_number":58,"box":{"x":69,"y":808,"width":268,"height":11}},{"id":"04de8b0a-bb2f-4140-85e5-201d8cd06ace","block_type":"box","text":"Dividends or interest on, or proceeds from the sale of, foreign securities may be subject to foreign withholding","page_number":58,"box":{"x":102,"y":831,"width":785,"height":11}},{"id":"793be99e-c975-4fda-bd2d-9079479bf86b","block_type":"box","text":"taxes.","page_number":58,"box":{"x":68,"y":847,"width":42,"height":8}},{"id":"5626572d-c66e-4228-af7b-5db74138463c","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":58,"box":{"x":101,"y":869,"width":798,"height":11}},{"id":"0c5f7302-2b9b-4d00-9d04-944d50c880f6","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":58,"box":{"x":68,"y":884,"width":815,"height":11}},{"id":"3aa27f5f-9c50-4a53-a803-f378547ca47d","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":58,"box":{"x":70,"y":899,"width":792,"height":11}},{"id":"2f37488a-1c6e-45a2-bc5c-9a40f172beb4","block_type":"box","text":"II-28","page_number":58,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"a971928e-5740-46f8-938a-55a8abdd006f","block_type":"box","text":"NM1026U-5979889-58/232","page_number":58,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"85c8933a-60c5-44f8-9d68-854226a863cc","block_type":"box","text":"underlying security (","page_number":59,"box":{"x":69,"y":45,"width":140,"height":11}},{"id":"9add7133-486d-4612-9ebf-c2fa06bee40a","block_type":"box","text":"i.e.","page_number":59,"box":{"x":211,"y":45,"width":20,"height":9}},{"id":"e522b3a9-b7bf-4334-a8b3-652eb18b38e2","block_type":"box","text":", the Fund’s quote from the closed foreign market). The impact of a closed foreign market on a","page_number":59,"box":{"x":234,"y":45,"width":675,"height":11}},{"id":"f35648a3-861f-4c76-a488-8c13d7b4c414","block_type":"box","text":"Fund is likely to be greater where a large portion of the Fund’s underlying securities or other instruments trade on","page_number":59,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"1a1c536f-4c7b-4157-85c9-59b5772bce13","block_type":"box","text":"that closed foreign market or when the foreign market is closed for unscheduled reasons. These deviations may","page_number":59,"box":{"x":68,"y":75,"width":800,"height":11}},{"id":"f1495f81-8e93-453d-a2c8-efde3b411b2c","block_type":"box","text":"result in premiums or discounts to certain Funds’ NAVs that may be greater than those experienced by other ETFs.","page_number":59,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"9500af73-bfc2-4b10-b085-b54df42cb01c","block_type":"box","text":"Foreign Market Risk.","page_number":59,"box":{"x":102,"y":113,"width":144,"height":11}},{"id":"d4de0ceb-387e-4690-9818-3c8e063b88ee","block_type":"box","text":"Funds that may invest in foreign securities offer the potential for more diversification than a","page_number":59,"box":{"x":254,"y":113,"width":652,"height":11}},{"id":"72636855-0f8f-469c-a71f-c55af795932c","block_type":"box","text":"Fund that invests only in the United States because securities traded on foreign markets have often (though not","page_number":59,"box":{"x":70,"y":128,"width":797,"height":11}},{"id":"e48827d4-c2a7-4685-8429-64067f58317a","block_type":"box","text":"always) performed differently from securities traded in the United States. However, such investments often involve","page_number":59,"box":{"x":69,"y":143,"width":817,"height":11}},{"id":"c592ff77-67a5-41ab-9df8-5c5942c8fa62","block_type":"box","text":"risks not present in U.S. investments that can increase the chances that a Fund will lose money. In particular, a Fund","page_number":59,"box":{"x":69,"y":158,"width":836,"height":11}},{"id":"f06da89a-acce-47fa-ac52-b1101f929005","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":59,"box":{"x":70,"y":173,"width":835,"height":11}},{"id":"fe8ebe4f-abbe-4fe7-8b76-446523a3801e","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":59,"box":{"x":69,"y":188,"width":810,"height":12}},{"id":"fafb8edd-635c-49af-809c-eeffe2538ef8","block_type":"box","text":"prices of foreign securities may fluctuate more than prices of securities traded in the United States. Investments in","page_number":59,"box":{"x":70,"y":203,"width":820,"height":12}},{"id":"e46eedcb-c54a-4924-92fe-8f43b5823efe","block_type":"box","text":"foreign markets may also be adversely affected by governmental actions such as the imposition of punitive taxes or","page_number":59,"box":{"x":68,"y":218,"width":826,"height":12}},{"id":"3073a8aa-9c93-49f9-8e6a-72d5e71d0724","block_type":"box","text":"tariffs. In addition, economic conditions, such as volatile currency exchange rates and interest rates, political events,","page_number":59,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"fc397fb6-3f11-4a5d-99b3-af55ca49893b","block_type":"box","text":"military action and other conditions may, without prior warning, lead to the governments of certain countries, or the","page_number":59,"box":{"x":69,"y":249,"width":821,"height":11}},{"id":"7b04eab8-82bf-4a95-b79e-7e261172f24e","block_type":"box","text":"U.S. Government with respect to certain countries, prohibiting or imposing substantial restrictions through capital","page_number":59,"box":{"x":70,"y":264,"width":807,"height":11}},{"id":"2bfa0ebd-d97b-4520-8d67-e6b5f69f4270","block_type":"box","text":"controls and/or sanctions on foreign investing in the capital markets or certain industries in those countries. Capital","page_number":59,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"fafd6da8-9b73-45cf-ac66-f25ebab094fd","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":59,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"d831474d-52b8-401c-8530-d7f6c0b42d18","block_type":"box","text":"securities, derivatives or other assets and may also include retaliatory actions of one government against another","page_number":59,"box":{"x":69,"y":309,"width":813,"height":11}},{"id":"1cfcee66-2ea3-4efc-afbe-fd82db3ffe55","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":59,"box":{"x":68,"y":324,"width":828,"height":12}},{"id":"2a8f14b6-1b60-4011-a289-42b5929a045c","block_type":"box","text":"transfer, receive, deliver or otherwise obtain exposure to foreign securities and assets, including the ability to","page_number":59,"box":{"x":68,"y":339,"width":782,"height":12}},{"id":"4a5b1bbb-ec77-4b1b-b4f4-91322e6358cb","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":59,"box":{"x":68,"y":355,"width":796,"height":11}},{"id":"62e0222a-7636-4958-9e37-325682db082c","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":59,"box":{"x":70,"y":370,"width":837,"height":11}},{"id":"1d248661-92cd-43a0-ab63-df942b0335ed","block_type":"box","text":"potential foreign market risks include exchange controls, difficulties in pricing securities, defaults on foreign","page_number":59,"box":{"x":70,"y":385,"width":768,"height":11}},{"id":"396ab683-4c94-4adf-ae13-4ce4e3e8768a","block_type":"box","text":"government securities, difficulties in enforcing favorable legal judgments in foreign courts, and political and social","page_number":59,"box":{"x":68,"y":400,"width":813,"height":11}},{"id":"5d6bfd44-ba52-4b03-929a-ac4c469d09f0","block_type":"box","text":"conditions, such as diplomatic relations, confiscatory taxation, expropriation, limitation on the removal of funds or","page_number":59,"box":{"x":69,"y":415,"width":814,"height":11}},{"id":"56744767-e809-4efa-b5f6-c8a6e02015f4","block_type":"box","text":"assets, or imposition of (or change in) exchange control regulations. Legal remedies available to investors in certain","page_number":59,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"5ccdacb7-3bb8-42df-bec6-ddea0fd3df0b","block_type":"box","text":"foreign countries may be less extensive than those available to investors in the United States or other foreign","page_number":59,"box":{"x":68,"y":445,"width":782,"height":12}},{"id":"7cc7d00f-728f-4652-92be-6b1407c675cf","block_type":"box","text":"countries. In addition, changes in government administrations or economic or monetary policies in the United States","page_number":59,"box":{"x":69,"y":460,"width":830,"height":12}},{"id":"e17f0c01-5dba-4fb2-bdd2-0f0cfcda2960","block_type":"box","text":"or abroad could result in appreciation or depreciation of portfolio securities and could favorably or adversely affect a","page_number":59,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"1f94001e-d370-406d-a429-491bd724bde4","block_type":"box","text":"Fund’s operations.","page_number":59,"box":{"x":70,"y":491,"width":130,"height":11}},{"id":"46d77e72-ce5a-466d-bbc0-46c070e984fc","block_type":"box","text":"Foreign Economy Risk.","page_number":59,"box":{"x":102,"y":514,"width":158,"height":11}},{"id":"b333884a-a4d7-4be8-bd33-a9bf68cef65c","block_type":"box","text":"The economies of certain foreign markets often do not compare favorably with that of the","page_number":59,"box":{"x":267,"y":513,"width":636,"height":12}},{"id":"0bf2cd47-ed7b-4891-b82c-824076614fdc","block_type":"box","text":"United States with respect to such issues as growth of gross national product, reinvestment of capital, resources,","page_number":59,"box":{"x":70,"y":528,"width":812,"height":12}},{"id":"dcb75bf1-7858-438a-af9e-fe5e940776c5","block_type":"box","text":"and balance of payments position. Certain such economies may rely heavily on particular industries or foreign capital","page_number":59,"box":{"x":69,"y":543,"width":835,"height":12}},{"id":"dbf97c14-b213-4317-a07e-07cf1def21e0","block_type":"box","text":"and are more vulnerable to diplomatic developments, the imposition of economic sanctions against a particular","page_number":59,"box":{"x":69,"y":559,"width":795,"height":11}},{"id":"e3b9b741-0e86-473a-861d-895b31ee8b39","block_type":"box","text":"country or countries, changes in international trading patterns, trade barriers, and other protectionist or retaliatory","page_number":59,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"b32cc5b9-982e-46c8-b2de-093687985051","block_type":"box","text":"measures.","page_number":59,"box":{"x":69,"y":591,"width":74,"height":7}},{"id":"85ac8b4e-51f8-4ba9-a835-1c52963f1467","block_type":"box","text":"Currency Risk and Exchange Risk.","page_number":59,"box":{"x":102,"y":612,"width":240,"height":11}},{"id":"de297748-4744-41d0-8d5d-b032dc10da96","block_type":"box","text":"Because foreign securities generally are denominated and pay dividends or","page_number":59,"box":{"x":349,"y":612,"width":534,"height":11}},{"id":"0064582a-f6e4-4c7a-bc14-fb0247cffe95","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":59,"box":{"x":70,"y":627,"width":838,"height":11}},{"id":"fc3fff13-1fd9-4113-9314-50d4bce6e321","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":59,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"39b7759b-5194-41e5-b782-08599eeb5b03","block_type":"box","text":"a foreign currency, a security denominated in that currency loses value because the currency is worth fewer U.S.","page_number":59,"box":{"x":69,"y":657,"width":801,"height":11}},{"id":"9f804283-b72e-4fb5-b2e6-9540382f8d74","block_type":"box","text":"dollars. Conversely, when the U.S. dollar decreases in value against a foreign currency, a security denominated in","page_number":59,"box":{"x":69,"y":672,"width":808,"height":11}},{"id":"2f9a7209-d77d-4171-af4b-053c52a46808","block_type":"box","text":"that currency gains value because the currency is worth more U.S. dollars. This risk, generally known as “currency","page_number":59,"box":{"x":68,"y":687,"width":816,"height":11}},{"id":"c4f97cd0-7fcb-4e80-93bf-0be89ab90d10","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":59,"box":{"x":69,"y":702,"width":814,"height":12}},{"id":"c4ed3d61-8a97-4bbe-aeb3-5067cb4f20e8","block_type":"box","text":"those returns. Currency exchange rates can also be affected unpredictably by intervention by U.S. or foreign","page_number":59,"box":{"x":68,"y":717,"width":771,"height":12}},{"id":"45905dd3-12e9-48e9-a479-127652165fb9","block_type":"box","text":"governments or central banks, or the failure to intervene, or buy currency controls or political developments in the","page_number":59,"box":{"x":68,"y":732,"width":813,"height":12}},{"id":"00ca3eae-d3d9-4d1b-81f4-5ac4c12315a9","block_type":"box","text":"United States or abroad.","page_number":59,"box":{"x":70,"y":748,"width":172,"height":9}},{"id":"2b960e4f-4af3-4cb8-82f9-70090e06204e","block_type":"box","text":"Governmental Supervision and Regulation/Accounting Standards.","page_number":59,"box":{"x":102,"y":770,"width":466,"height":12}},{"id":"321a1b85-511f-46a8-9696-c55cff5346a8","block_type":"box","text":"Many foreign governments supervise and","page_number":59,"box":{"x":575,"y":770,"width":293,"height":12}},{"id":"328e2817-0103-4bfc-8c7a-de5830b1ab45","block_type":"box","text":"regulate stock exchanges, brokers and the sale of securities less than does the United States. Some countries may","page_number":59,"box":{"x":69,"y":785,"width":828,"height":12}},{"id":"80bc79ec-fd2b-496a-9e95-cbd1219d6175","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":59,"box":{"x":69,"y":801,"width":826,"height":11}},{"id":"6424c41d-180f-4b6a-86ef-b9cb1b85ad54","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":59,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"15748f2b-6965-47be-980c-a79221d830a3","block_type":"box","text":"securities based on nonpublic information about that company. Accounting standards in other countries are not","page_number":59,"box":{"x":69,"y":831,"width":794,"height":11}},{"id":"bdd8c299-5001-4826-bdb0-ba543fea3612","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":59,"box":{"x":69,"y":846,"width":831,"height":11}},{"id":"91854ec6-22a2-495f-9571-8a9ced6a5d83","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":59,"box":{"x":69,"y":861,"width":840,"height":11}},{"id":"c936aa7f-cff8-4e03-a5e3-bb7ce347d93c","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":59,"box":{"x":69,"y":876,"width":760,"height":11}},{"id":"6622b882-919b-4952-861b-6a78eecbac90","block_type":"box","text":"restrictions, through penalties and otherwise, on foreign investments by U.S. investors such as the Fund. If such","page_number":59,"box":{"x":69,"y":891,"width":803,"height":12}},{"id":"a65e2b24-5eff-4b7c-8486-75d317dfd58f","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":59,"box":{"x":69,"y":906,"width":798,"height":12}},{"id":"8d9dbd69-d2df-498f-8c11-4fda7f6efa4f","block_type":"box","text":"II-29","page_number":59,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8b5a71fc-0a7c-49ad-ad40-fa19c5ba4731","block_type":"box","text":"NM1026U-5979889-59/232","page_number":59,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d3918762-e334-4ab7-9abe-fb2bba8569c3","block_type":"box","text":"assets in U.S. securities. Also, brokerage commissions and other costs of buying or selling securities often are","page_number":60,"box":{"x":69,"y":45,"width":793,"height":11}},{"id":"430d3602-e23e-488e-8253-9930f52d4f89","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":60,"box":{"x":69,"y":60,"width":797,"height":11}},{"id":"43c6ef81-175d-4c3e-b59a-963f60292e59","block_type":"box","text":"investments.","page_number":60,"box":{"x":70,"y":75,"width":89,"height":9}},{"id":"16aa31c4-7f9c-4782-9bef-1504a1d702f0","block_type":"box","text":"Cer tain Risks of Holding Fund Assets Outside the United States.","page_number":60,"box":{"x":102,"y":98,"width":458,"height":11}},{"id":"4f0f3e48-f884-4451-b6e0-955d1380a076","block_type":"box","text":"A Fund generally holds its foreign securities and","page_number":60,"box":{"x":566,"y":98,"width":341,"height":11}},{"id":"3d5f3354-9b7c-436d-a81e-0b4d352791ff","block_type":"box","text":"cash in foreign banks and securities depositories. Some foreign banks and securities depositories may be recently","page_number":60,"box":{"x":69,"y":113,"width":819,"height":11}},{"id":"e7312ec3-00f1-4853-b50d-92a981ddc3c1","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":60,"box":{"x":69,"y":128,"width":813,"height":11}},{"id":"88797e31-6a6c-4818-9c82-1b8dab5f5a34","block_type":"box","text":"their operations. Also, the laws of certain countries may put limits on a Fund’s ability to recover its assets if a foreign","page_number":60,"box":{"x":68,"y":143,"width":838,"height":11}},{"id":"bc24b274-5fc5-491c-9962-f06449127898","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":60,"box":{"x":69,"y":158,"width":835,"height":11}},{"id":"7da48f79-d5a5-4555-9972-7bc764e1ee58","block_type":"box","text":"for a Fund to buy, sell and hold securities in certain foreign markets than in the United States. The increased","page_number":60,"box":{"x":68,"y":173,"width":777,"height":11}},{"id":"ab980268-7f89-4ba1-8291-02ff6a65ba50","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":60,"box":{"x":69,"y":188,"width":831,"height":12}},{"id":"d239d2a9-0634-4967-9bad-d7fd37bd0bad","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":60,"box":{"x":70,"y":203,"width":828,"height":12}},{"id":"3c142e9d-2854-4acb-8da4-78dba1946de6","block_type":"box","text":"States.","page_number":60,"box":{"x":69,"y":219,"width":49,"height":8}},{"id":"8ad299ee-dc78-4c1c-9efb-ffff7409204a","block_type":"box","text":"Publicly Available Information.","page_number":60,"box":{"x":102,"y":241,"width":210,"height":11}},{"id":"00c14f28-34de-4caf-9524-3931d02d0aea","block_type":"box","text":"In general, less information is publicly available with respect to foreign issuers","page_number":60,"box":{"x":319,"y":241,"width":558,"height":11}},{"id":"6e5b38b8-c3d9-4669-9779-0c50a2fdee18","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":60,"box":{"x":68,"y":256,"width":779,"height":12}},{"id":"67b9fc3e-050c-4853-a187-efb509d28e21","block_type":"box","text":"accounting and financial reporting requirements applicable to issuers in the United States. While the volume of","page_number":60,"box":{"x":69,"y":271,"width":793,"height":12}},{"id":"49c11dbe-4538-49f5-8b8a-89f684a43064","block_type":"box","text":"transactions effected on foreign stock exchanges has increased in recent years, it remains appreciably below that of","page_number":60,"box":{"x":68,"y":286,"width":834,"height":12}},{"id":"685c5161-e5e8-4822-9ee3-c48c80a6fab9","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":60,"box":{"x":68,"y":302,"width":841,"height":11}},{"id":"ce9dc212-f16a-4f4f-9626-60a67d610d1e","block_type":"box","text":"be more volatile than, comparable investments in securities in U.S. companies. In addition, there is generally less","page_number":60,"box":{"x":69,"y":317,"width":813,"height":11}},{"id":"aa71c4db-1ac6-46fc-a08e-b5adc97013d7","block_type":"box","text":"government supervision and regulation of securities exchanges, brokers and issuers in foreign countries than in the","page_number":60,"box":{"x":68,"y":332,"width":827,"height":11}},{"id":"29f4cb2f-6a78-46d0-b308-00db0141f4a3","block_type":"box","text":"United States.","page_number":60,"box":{"x":70,"y":347,"width":99,"height":9}},{"id":"02820c07-bd57-4ab1-87e0-900bcb25001c","block_type":"box","text":"Settlement Risk.","page_number":60,"box":{"x":102,"y":370,"width":116,"height":9}},{"id":"a942267c-26a4-4044-af56-753dec9fded1","block_type":"box","text":"Settlement and clearance procedures in certain foreign markets differ significantly from those","page_number":60,"box":{"x":225,"y":370,"width":669,"height":11}},{"id":"e5250bdf-9cd0-4be7-8475-5bc8384b2119","block_type":"box","text":"in the United States. Supervisory authorities may also be unable to apply standards which are comparable with those","page_number":60,"box":{"x":70,"y":385,"width":837,"height":11}},{"id":"07991dea-6388-4eaf-993d-46caa8b27e1a","block_type":"box","text":"in the United States. Foreign settlement procedures and trade regulations also may involve certain risks (such as","page_number":60,"box":{"x":70,"y":400,"width":808,"height":11}},{"id":"4dc881a9-41c8-4079-85d6-77b05f0174c8","block_type":"box","text":"delays in payment for or delivery of securities) not typically generated by the settlement of U.S. investments.","page_number":60,"box":{"x":69,"y":415,"width":772,"height":11}},{"id":"8128a7b0-bc4f-4487-a280-f9272548e9a6","block_type":"box","text":"Communications between the United States and emerging market countries may be unreliable, increasing the","page_number":60,"box":{"x":102,"y":438,"width":781,"height":11}},{"id":"d6f4f396-64ed-44aa-8d24-f7dd0a0ee19e","block_type":"box","text":"risk of delayed settlements or losses of security certificates in markets that still rely on physical settlement.","page_number":60,"box":{"x":69,"y":453,"width":771,"height":11}},{"id":"17030553-fdce-4513-901a-d8f7b0c5aa0e","block_type":"box","text":"Settlements in certain foreign countries at times have not kept pace with the number of securities transactions;","page_number":60,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"bb0acc17-14e4-4c38-9f54-4a7ca188fe24","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":60,"box":{"x":68,"y":483,"width":802,"height":11}},{"id":"d6dc7afc-40ac-4671-b3ee-853cfdd348d3","block_type":"box","text":"settling a purchase of securities, it may miss attractive investment opportunities and certain of its assets may be","page_number":60,"box":{"x":69,"y":498,"width":812,"height":11}},{"id":"3827d747-7006-438b-8fe6-ae3b65e55b41","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":60,"box":{"x":69,"y":513,"width":821,"height":12}},{"id":"d1e094a3-cb68-4178-8702-cd1478cdac9c","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":60,"box":{"x":69,"y":528,"width":816,"height":12}},{"id":"1ff5a626-caaa-4ecd-8e79-34f00f31940c","block_type":"box","text":"another party, the Fund could be liable to that party for any losses incurred.","page_number":60,"box":{"x":69,"y":543,"width":539,"height":12}},{"id":"bac338cf-1387-4ea8-bbaa-ef754780f0b7","block_type":"box","text":"Because of uncertainties in the operation of settlement systems in individual markets, competing claims may","page_number":60,"box":{"x":102,"y":566,"width":781,"height":11}},{"id":"75323882-acfd-4cb8-bc8e-b29ba25ba17c","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":60,"box":{"x":69,"y":581,"width":810,"height":11}},{"id":"9468f043-7515-4738-a87c-f24679068a76","block_type":"box","text":"otherwise be limited or inadequate to meet the Fund’s claims in case of such event.","page_number":60,"box":{"x":69,"y":596,"width":601,"height":11}},{"id":"b56d73f3-0ff4-4b2c-9c20-c344a21d9813","block_type":"box","text":"Sovereign Debt.","page_number":60,"box":{"x":102,"y":619,"width":111,"height":11}},{"id":"ae459634-dc7c-4c6a-9a67-208fd66137c2","block_type":"box","text":"Investment in sovereign debt can involve a high degree of risk. The governmental entity that","page_number":60,"box":{"x":221,"y":619,"width":653,"height":11}},{"id":"9986639e-fb2b-48ad-a158-13f729a7fe74","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":60,"box":{"x":69,"y":634,"width":837,"height":12}},{"id":"bb9a4598-1ac8-4558-b27b-0161f301a93f","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":60,"box":{"x":69,"y":649,"width":826,"height":12}},{"id":"64d6d097-521a-4f02-a109-a356031d8ff0","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":60,"box":{"x":69,"y":664,"width":798,"height":12}},{"id":"b0f8e8d1-78b0-4a53-9220-4f8d0708bfba","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":60,"box":{"x":69,"y":680,"width":809,"height":11}},{"id":"806f7e48-910f-4afd-829d-22a7990266be","block_type":"box","text":"service burden to the economy as a whole, the governmental entity’s policy towards the International Monetary Fund","page_number":60,"box":{"x":69,"y":695,"width":832,"height":11}},{"id":"69151217-0d28-46df-9b2e-40da9450bc0e","block_type":"box","text":"and the political constraints to which a governmental entity may be subject. Governmental entities may also be","page_number":60,"box":{"x":69,"y":710,"width":790,"height":11}},{"id":"20bbf69f-5024-44ed-84d6-a8e700bf7c2a","block_type":"box","text":"dependent on expected disbursements from foreign governments, multilateral agencies and others abroad to reduce","page_number":60,"box":{"x":69,"y":725,"width":831,"height":11}},{"id":"75001854-82c2-4c1b-983d-e48f234c1fa4","block_type":"box","text":"principal and interest arrearages on their debt. The commitment on the part of these governments, agencies and","page_number":60,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"cfed28b6-dc8e-448d-8e9c-91b34e3aa1cb","block_type":"box","text":"others to make such disbursements may be conditioned on the implementation of economic reforms and/or","page_number":60,"box":{"x":69,"y":755,"width":772,"height":11}},{"id":"4f89084a-b960-4be5-8882-f377ad0b1863","block_type":"box","text":"economic performance and the timely service of such debtor’s obligations. Failure to implement such reforms,","page_number":60,"box":{"x":69,"y":770,"width":789,"height":12}},{"id":"f4864b00-cf05-42ff-b5ea-cf3e62de4c58","block_type":"box","text":"achieve such levels of economic performance or repay principal or interest when due may result in the cancellation of","page_number":60,"box":{"x":69,"y":785,"width":839,"height":12}},{"id":"f2b976d6-704d-4706-b94b-6a74b489775b","block_type":"box","text":"such third parties’ commitments to lend funds to the governmental entity, which may further impair such debtor’s","page_number":60,"box":{"x":69,"y":801,"width":810,"height":11}},{"id":"e3a853d0-7f11-4e27-a64d-066310f1fc4e","block_type":"box","text":"ability or willingness to timely service its debts. Consequently, governmental entities may default on their sovereign","page_number":60,"box":{"x":69,"y":816,"width":821,"height":11}},{"id":"54b13c35-3fa4-44ea-af4e-2a7090e245e8","block_type":"box","text":"debt.","page_number":60,"box":{"x":69,"y":831,"width":34,"height":9}},{"id":"35b687c4-e07e-4797-a61f-629b3d645c5b","block_type":"box","text":"Holders of sovereign debt may be requested to participate in the rescheduling of such debt and to extend further","page_number":60,"box":{"x":102,"y":853,"width":807,"height":12}},{"id":"ae4fcaed-22e5-4d04-b678-dad6bb27f384","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":60,"box":{"x":70,"y":869,"width":814,"height":11}},{"id":"42a60754-de08-4c8f-91bf-5f7360df37bc","block_type":"box","text":"legal remedies for collecting on such debt.","page_number":60,"box":{"x":70,"y":884,"width":300,"height":11}},{"id":"8264d735-b298-4f38-8f8b-c388478a4fcd","block_type":"box","text":"II-30","page_number":60,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5348c27b-cc52-4473-9c25-4fbb19b6f4ae","block_type":"box","text":"NM1026U-5979889-60/232","page_number":60,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"16b8f502-a624-4bb4-ab36-fc46d0e444c0","block_type":"box","text":"Withholding Tax Reclaims Risk","page_number":61,"box":{"x":103,"y":45,"width":215,"height":11}},{"id":"3821c126-e8c7-444e-8238-f3fb1c993794","block_type":"box","text":". A Fund may file claims to recover foreign withholding taxes on dividend and","page_number":61,"box":{"x":318,"y":45,"width":542,"height":11}},{"id":"051d92db-f2eb-4240-87c3-8bcbb63361c1","block_type":"box","text":"interest income (if any) received from issuers in certain countries and capital gains on the disposition of stocks or","page_number":61,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"98df8944-a1f2-4ea6-bb50-5342b8c8a877","block_type":"box","text":"securities where such withholding tax reclaim is possible. Whether or when a Fund will receive a withholding tax","page_number":61,"box":{"x":69,"y":75,"width":795,"height":11}},{"id":"c2fc54db-c611-4e75-acb2-0d0e03b1db05","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":61,"box":{"x":69,"y":90,"width":799,"height":11}},{"id":"e8b89513-6a85-450f-b6c9-96309b10671b","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":61,"box":{"x":68,"y":105,"width":838,"height":11}},{"id":"117d2b31-d393-4661-8083-6c449060ca2f","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":61,"box":{"x":68,"y":120,"width":807,"height":12}},{"id":"d0dcdf12-6612-43da-935e-af90534f668a","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":61,"box":{"x":69,"y":135,"width":814,"height":12}},{"id":"9eca85ec-5053-47b1-acab-9ce8ecfbad11","block_type":"box","text":"down partially or in full, which will adversely affect the Fund’s net asset value. Shareholders in a Fund at the time an","page_number":61,"box":{"x":69,"y":150,"width":831,"height":12}},{"id":"730117a1-8161-4e85-be73-7c0ca716a6d7","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":61,"box":{"x":69,"y":166,"width":819,"height":11}},{"id":"2f6eafde-dfcc-43f3-b5b9-25de3f9644b1","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":61,"box":{"x":68,"y":181,"width":833,"height":11}},{"id":"9e699910-b39f-4f65-9a9c-bede0e646d48","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":61,"box":{"x":69,"y":196,"width":814,"height":11}},{"id":"4def8b35-0408-46d8-aa62-ccff4223aa70","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":61,"box":{"x":68,"y":211,"width":835,"height":11}},{"id":"fcb469e5-c129-4c63-90f7-74eebce1c374","block_type":"box","text":"in the Fund’s net asset value.","page_number":61,"box":{"x":70,"y":226,"width":209,"height":9}},{"id":"4dd2a277-3299-41a8-a8e0-556ce5f2d727","block_type":"box","text":"U.S. Economic Trading Par tners Risk.","page_number":61,"box":{"x":103,"y":249,"width":263,"height":11}},{"id":"2b406a10-9300-4d85-83ca-e0d87ac33fda","block_type":"box","text":"The United States is a significant, and in some cases the most significant,","page_number":61,"box":{"x":372,"y":249,"width":532,"height":11}},{"id":"7ef33ea7-0ad7-4079-9457-32778556cf10","block_type":"box","text":"trading partner of, or foreign investor in, certain countries in which a Fund may invest. As a result, economic","page_number":61,"box":{"x":68,"y":264,"width":773,"height":11}},{"id":"06f84a98-ae38-4618-a0b3-7abfda5d68db","block_type":"box","text":"conditions of such countries may be particularly affected by changes in the U.S. economy. A decrease in U.S. imports","page_number":61,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"80757742-4571-40ac-ba91-f0891f6bb55b","block_type":"box","text":"or exports, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or an economic","page_number":61,"box":{"x":69,"y":294,"width":812,"height":11}},{"id":"5662ebee-b154-4331-880c-0b341268cc54","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":61,"box":{"x":69,"y":309,"width":803,"height":11}},{"id":"c41e03c5-b8f8-4884-86e1-2e430e078ed4","block_type":"box","text":"result, securities to which the Fund has exposure. Circumstances could arise that could prevent the timely payment","page_number":61,"box":{"x":69,"y":324,"width":824,"height":11}},{"id":"90c6af2f-4a97-4bbe-9763-d330c1528585","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":61,"box":{"x":69,"y":339,"width":819,"height":12}},{"id":"e8273033-fb5a-4cb3-8097-c36d6d7a8724","block_type":"box","text":"would result in substantial negative consequences for the U.S. economy and the global financial system.","page_number":61,"box":{"x":68,"y":355,"width":746,"height":11}},{"id":"e0dcff5c-9369-4f17-af75-6726314eb348","block_type":"box","text":"There are strained relations between the United States and a number of foreign countries, including traditional","page_number":61,"box":{"x":101,"y":377,"width":787,"height":12}},{"id":"57b40d20-d98f-4d7c-91e4-e48116b72b8d","block_type":"box","text":"allies, such as certain European countries, and historical adversaries, such as North Korea, Iran, China and Russia.","page_number":61,"box":{"x":69,"y":392,"width":827,"height":11}},{"id":"5f6d15ad-b77a-4ac9-b1d7-68d15b2eff85","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":61,"box":{"x":70,"y":407,"width":817,"height":12}},{"id":"d8a3381a-1217-4323-b21c-ec9577907073","block_type":"box","text":"United States for trade. The United States has also experienced increased internal unrest and discord. If these","page_number":61,"box":{"x":70,"y":423,"width":791,"height":11}},{"id":"05618569-d667-4eeb-83d2-c636dbb2451a","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":61,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"8f67e0ef-0d62-4c90-8dc0-837d48166d1f","block_type":"box","text":"Fund may invest.","page_number":61,"box":{"x":70,"y":453,"width":117,"height":11}},{"id":"ffd656dc-65b2-437e-91dc-aefea2a868cd","block_type":"box","text":"Funding Agreements.","page_number":61,"box":{"x":102,"y":476,"width":154,"height":11}},{"id":"23369863-cb52-4876-9792-9766af23f596","block_type":"box","text":"Certain Funds may invest in Guaranteed Investment Contracts and similar funding","page_number":61,"box":{"x":262,"y":475,"width":584,"height":12}},{"id":"116c1614-aaec-4d6d-9471-2501be4224c5","block_type":"box","text":"agreements. In connection with these investments, a Fund makes cash contributions to a deposit fund of an","page_number":61,"box":{"x":69,"y":491,"width":773,"height":11}},{"id":"5e390140-8b4e-459a-9201-9610eb8fe187","block_type":"box","text":"insurance company’s general account. The insurance company then credits to the Fund on a monthly basis","page_number":61,"box":{"x":70,"y":506,"width":761,"height":11}},{"id":"61587402-cf9c-4890-bbaa-1bdd752e74b8","block_type":"box","text":"guaranteed interest, which is based on an index. The funding agreements provide that this guaranteed interest will","page_number":61,"box":{"x":68,"y":521,"width":817,"height":11}},{"id":"b057b158-bc48-426e-9782-e046f271cd9f","block_type":"box","text":"not be less than a certain minimum rate. The purchase price paid for a funding agreement becomes part of the","page_number":61,"box":{"x":69,"y":536,"width":794,"height":11}},{"id":"7fe63cc4-089c-4e08-a6ae-a94e14be4164","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":61,"box":{"x":68,"y":551,"width":839,"height":11}},{"id":"cc406e03-447b-494a-ab46-184008bdcab3","block_type":"box","text":"Generally, funding agreements are not assignable or transferable without the permission of the issuing insurance","page_number":61,"box":{"x":69,"y":566,"width":806,"height":11}},{"id":"6cfc7363-94a9-472e-a314-5791fb7b45da","block_type":"box","text":"companies, and an active secondary market in some funding agreements does not currently exist.","page_number":61,"box":{"x":69,"y":581,"width":700,"height":12}},{"id":"16b63f76-9775-4d1a-af0d-0980e5f85f5b","block_type":"box","text":"Guarantees.","page_number":61,"box":{"x":102,"y":604,"width":87,"height":9}},{"id":"5403a216-0e62-4e7b-8ba0-bd2e02aac179","block_type":"box","text":"A Fund may purchase securities which contain guarantees issued by an entity separate from the","page_number":61,"box":{"x":194,"y":604,"width":685,"height":11}},{"id":"2777ecaa-6bf7-4574-9e3e-c98c85447f29","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":61,"box":{"x":70,"y":619,"width":797,"height":11}},{"id":"6a6cfb0b-2178-4e43-81ae-ef04e851bb36","block_type":"box","text":"payment obligations under a security if the issuer is unable to do so.","page_number":61,"box":{"x":70,"y":634,"width":488,"height":12}},{"id":"0eba587a-49d3-40b6-b763-96e8d0c5d886","block_type":"box","text":"Illiquid Investments.","page_number":61,"box":{"x":102,"y":657,"width":146,"height":11}},{"id":"d70b430f-b977-4272-a697-a553ad2279de","block_type":"box","text":"Each Fund may not acquire any illiquid investment if, immediately after the acquisition, a","page_number":61,"box":{"x":255,"y":657,"width":630,"height":11}},{"id":"25798add-4d68-402c-9d1f-9087efb2352a","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":61,"box":{"x":70,"y":672,"width":787,"height":11}},{"id":"54c437a4-8695-4870-be7f-80a73e6942e5","block_type":"box","text":"investment that a Fund reasonably expects cannot be sold or disposed of in current market conditions in seven","page_number":61,"box":{"x":70,"y":687,"width":792,"height":11}},{"id":"53693383-10a8-4798-a741-25b4e0cbc022","block_type":"box","text":"calendar days or less without the sale or disposition significantly changing the market value of the investment. Liquid","page_number":61,"box":{"x":69,"y":702,"width":834,"height":12}},{"id":"f5492241-33ae-4fb2-b1ee-e7a071d1c7ee","block_type":"box","text":"investments may become illiquid after purchase by a Fund, particularly during periods of market turmoil. There can be","page_number":61,"box":{"x":70,"y":717,"width":838,"height":12}},{"id":"b4bd2eb6-7a7d-4009-96b9-75dd3d6d9628","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":61,"box":{"x":69,"y":732,"width":824,"height":12}},{"id":"8335d7b2-1904-43fb-85c0-a5e210d08e08","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":61,"box":{"x":69,"y":748,"width":838,"height":11}},{"id":"e5df6092-d3e0-4136-b7ca-4947a7af8670","block_type":"box","text":"pursuant to the Fund’s liquidity risk management program. 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If illiquid","page_number":61,"box":{"x":69,"y":823,"width":781,"height":12}},{"id":"34d8c33c-3521-422d-90f0-79beff0b84a0","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":61,"box":{"x":70,"y":838,"width":822,"height":12}},{"id":"c801e5ea-0248-421d-b0e0-30ad50938feb","block_type":"box","text":"defined below) will require that certain remedial actions be taken. Illiquid investments may trade at a discount from","page_number":61,"box":{"x":69,"y":853,"width":822,"height":12}},{"id":"4128e910-64ea-4f6f-9638-9246b4dde6dc","block_type":"box","text":"comparable liquid investments. Investment of a Fund’s assets in illiquid investments may restrict the ability of the","page_number":61,"box":{"x":69,"y":869,"width":813,"height":11}},{"id":"9c26e972-7813-40a1-b0b4-4222927fa04f","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":61,"box":{"x":70,"y":884,"width":814,"height":11}},{"id":"50c44a6a-3fa2-4642-b8ea-1df49ff7c415","block_type":"box","text":"market opportunities. The risks associated with illiquidity will be particularly acute where a Fund’s operations require","page_number":61,"box":{"x":69,"y":899,"width":833,"height":11}},{"id":"f41fa6d6-6b75-4a92-b840-9de55c8406ed","block_type":"box","text":"II-31","page_number":61,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"09d15989-8d96-4a4c-9812-f08aef33f466","block_type":"box","text":"NM1026U-5979889-61/232","page_number":61,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"592b28f1-3c38-498f-833e-b9eb9827dec3","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":62,"box":{"x":69,"y":45,"width":801,"height":11}},{"id":"bd308018-9889-4f05-97d0-31cada46451b","block_type":"box","text":"short-term cash requirements or incurring capital losses on the sale of illiquid investments.","page_number":62,"box":{"x":69,"y":60,"width":651,"height":11}},{"id":"860f32c2-adf1-43f8-bac8-e9d9a144f56d","block_type":"box","text":"Index Funds.","page_number":62,"box":{"x":102,"y":83,"width":91,"height":8}},{"id":"0b88a3f3-8d91-4d84-8c45-71f4a1cefed9","block_type":"box","text":"Cash Flows; Expenses.","page_number":62,"box":{"x":102,"y":105,"width":162,"height":11}},{"id":"feee7d7a-ac7f-4486-a958-a9ab1d576440","block_type":"box","text":"The ability of each Fund to satisfy its investment objective depends to some extent on","page_number":62,"box":{"x":270,"y":105,"width":613,"height":11}},{"id":"dfae71e9-875d-4918-917c-2165d342791f","block_type":"box","text":"the Manager’s ability to manage cash flow (primarily from purchases and redemptions and distributions from the","page_number":62,"box":{"x":68,"y":120,"width":803,"height":12}},{"id":"babc0702-e40a-4fd1-aa05-1d0429a6e163","block_type":"box","text":"Fund’s investments). The Manager will make investment changes to a Fund’s portfolio to accommodate cash flow","page_number":62,"box":{"x":70,"y":135,"width":810,"height":12}},{"id":"f387bcdf-7aa4-4077-879a-614fb3c0b845","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":62,"box":{"x":68,"y":150,"width":823,"height":12}},{"id":"5d1fa93b-1700-4e5b-93f2-50515fee6517","block_type":"box","text":"the investment performance of each index is a hypothetical number which does not take into account brokerage","page_number":62,"box":{"x":68,"y":166,"width":799,"height":11}},{"id":"a0d0df0d-c2a3-4da3-9684-82924c2b0244","block_type":"box","text":"commissions and other transaction costs, custody and other costs of investing, and any incremental operating costs","page_number":62,"box":{"x":69,"y":181,"width":831,"height":11}},{"id":"ba65807a-5785-425e-ab4d-3ebea62c7417","block_type":"box","text":"(","page_number":62,"box":{"x":69,"y":196,"width":3,"height":11}},{"id":"0c3391d4-1840-4c3d-8179-84c387bb440b","block_type":"box","text":"e.g.","page_number":62,"box":{"x":74,"y":197,"width":25,"height":10}},{"id":"8bc7a7fc-8f40-4800-b7e7-cc906666d9bf","block_type":"box","text":", transfer agency and accounting costs) that will be borne by the Funds. Finally, since each Fund seeks to","page_number":62,"box":{"x":101,"y":196,"width":749,"height":11}},{"id":"920dc277-7998-4e68-833b-ae6b7ab2248b","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":62,"box":{"x":69,"y":211,"width":774,"height":11}},{"id":"27ece343-80a9-483e-9d2b-e8147e7915d8","block_type":"box","text":"particular security as an investment.","page_number":62,"box":{"x":70,"y":226,"width":258,"height":11}},{"id":"62cfb006-6b09-48ac-9c6a-ad039f2cfd53","block_type":"box","text":"Tracking Error Risk","page_number":62,"box":{"x":103,"y":249,"width":132,"height":11}},{"id":"f892b1d2-bbe7-4bf7-a589-7550c7749c46","block_type":"box","text":". A Fund may be subject to tracking error, which is the divergence of the Fund’s performance","page_number":62,"box":{"x":236,"y":249,"width":658,"height":11}},{"id":"317094de-652e-46ed-8f8f-1c380b503e5d","block_type":"box","text":"from that of the Underlying Index. Tracking error may occur because of differences between the securities and other","page_number":62,"box":{"x":68,"y":264,"width":827,"height":11}},{"id":"e4b45c70-dc3e-4bb0-a940-b8dd254d9150","block_type":"box","text":"instruments held in the Fund’s portfolio and those included in the Underlying Index, pricing differences (including, as","page_number":62,"box":{"x":70,"y":279,"width":830,"height":11}},{"id":"0c9ea6d9-9aab-43c7-8f02-a4e5514e4e03","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":62,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"a6ea1c44-2792-4b4d-865b-881941b788e2","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":62,"box":{"x":68,"y":309,"width":797,"height":11}},{"id":"3c61e0b0-a2c8-49fc-9d23-a6bb90a676b2","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":62,"box":{"x":70,"y":324,"width":787,"height":12}},{"id":"2522ae19-d471-4387-a6bd-5a13f4524c39","block_type":"box","text":"distributions, interest, the requirements to maintain pass-through tax treatment, portfolio transactions carried out to","page_number":62,"box":{"x":69,"y":339,"width":830,"height":12}},{"id":"d34b6ca6-ccf6-40d8-a284-2307c6dd1f6e","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":62,"box":{"x":69,"y":355,"width":838,"height":11}},{"id":"4de7c22e-a0b1-4837-a7e6-e3be9aef2897","block_type":"box","text":"complying with various new or existing regulatory requirements. These risks may be heightened during times of","page_number":62,"box":{"x":69,"y":370,"width":791,"height":11}},{"id":"ef8e5b18-e42a-43c6-b68c-1fae0663dd94","block_type":"box","text":"increased market volatility or other unusual market conditions. In addition, tracking error may result because the","page_number":62,"box":{"x":70,"y":385,"width":801,"height":11}},{"id":"409093fb-4fb7-40ac-9c43-084e5adc277b","block_type":"box","text":"Fund incurs fees and expenses, while the Underlying Index does not.","page_number":62,"box":{"x":70,"y":400,"width":487,"height":11}},{"id":"7bc1b482-f96d-46b7-8400-0c749683e41d","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":62,"box":{"x":101,"y":423,"width":799,"height":11}},{"id":"0cbae732-8abd-4c1f-848c-5d7b77adc049","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":62,"box":{"x":69,"y":438,"width":803,"height":11}},{"id":"b7902944-db3f-4ccb-b679-2c143525fb56","block_type":"box","text":"price growth that does not appear to be supported by publicly available information on the business and assets of","page_number":62,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"ea58c766-605f-40ce-ba6a-23fca908179b","block_type":"box","text":"the issuer, unusual or significant short interest or lending activity, negative sentiment, suspended trading or incorrect","page_number":62,"box":{"x":68,"y":468,"width":838,"height":11}},{"id":"e964137b-5102-41aa-887a-7c751f080c7c","block_type":"box","text":"free-float calculations, which could be indicators of possible irregularities, miscalculations or even fraud). 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If the securities continue to be included in the index, the Manager may underweight or","page_number":62,"box":{"x":68,"y":528,"width":819,"height":12}},{"id":"4d84ef0c-6f7e-40cf-9603-38b9aa319b99","block_type":"box","text":"exclude such securities from a Fund’s portfolio and, if it does so, such Fund will be subject to increased tracking","page_number":62,"box":{"x":69,"y":543,"width":804,"height":12}},{"id":"5d7d92f7-7d07-4d2c-bf89-87ec7b31935d","block_type":"box","text":"error due to the divergence in the securities included in its portfolio from its underlying index. 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S&P is not responsible for and has not","page_number":62,"box":{"x":70,"y":778,"width":803,"height":11}},{"id":"8ed9c384-eb8f-4969-a838-c20031466b76","block_type":"box","text":"participated in the determination of the prices and amount of any Fund or the timing of the issuance or sale of","page_number":62,"box":{"x":70,"y":793,"width":787,"height":11}},{"id":"10d54ec2-711d-43d0-a9a0-1a4cd0eb04a8","block_type":"box","text":"shares of a Fund or in the determination or calculation of the equation by which a Fund is to be converted into cash.","page_number":62,"box":{"x":69,"y":808,"width":828,"height":11}},{"id":"3fb938a2-72b7-4812-bbbb-0d1d8dc57e29","block_type":"box","text":"S&P has no obligation or liability in connection with the administration, marketing or trading of any Fund.","page_number":62,"box":{"x":69,"y":823,"width":742,"height":12}},{"id":"40766271-ffc6-4d37-9471-3930aca8d389","block_type":"box","text":"S&P does not guarantee the accuracy and/or the completeness of the S&P 500 Index or any data included","page_number":62,"box":{"x":102,"y":846,"width":761,"height":11}},{"id":"bbc6755c-0613-496e-b159-94f664a9f008","block_type":"box","text":"therein, and S&P shall have no liability for any errors, omissions, or interruptions therein. 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The Manager believes that indexed and inverse floating obligations represent flexible","page_number":64,"box":{"x":69,"y":506,"width":798,"height":11}},{"id":"39c82a62-9322-40f5-b5e5-50c29c8cc9ec","block_type":"box","text":"portfolio management instruments for a Fund that allow the Fund to seek potential investment rewards, hedge other","page_number":64,"box":{"x":70,"y":521,"width":829,"height":11}},{"id":"d7fb705e-3051-4c1c-9330-af6c38b410b7","block_type":"box","text":"portfolio positions or vary the degree of investment leverage relatively efficiently under different market conditions. A","page_number":64,"box":{"x":70,"y":536,"width":834,"height":11}},{"id":"496eced8-a0c8-4341-90e6-0072d898fa3c","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":64,"box":{"x":70,"y":551,"width":839,"height":11}},{"id":"36736903-4ae3-44c8-ac02-b54306708bec","block_type":"box","text":"hedging purposes, indexed and inverse securities involve correlation risk. Furthermore, where such a security","page_number":64,"box":{"x":69,"y":566,"width":781,"height":11}},{"id":"c93ee037-91e0-4b53-88e8-bd8ed1982189","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":64,"box":{"x":70,"y":581,"width":812,"height":12}},{"id":"3196b5a2-ed3a-4d93-b244-3c0bf8800cf3","block_type":"box","text":"may be required to pay substantial additional margin to maintain the position.","page_number":64,"box":{"x":69,"y":597,"width":553,"height":11}},{"id":"2ab404b9-3568-4125-85dc-2763732e2953","block_type":"box","text":"The Funds may invest up to 10% of their total assets in leveraged inverse floating rate debt instruments","page_number":64,"box":{"x":101,"y":619,"width":741,"height":11}},{"id":"819cf03e-3961-4234-87a9-a28d145681c5","block_type":"box","text":"(“inverse floaters”). Inverse floaters are securities the potential of which is inversely related to changes in interest","page_number":64,"box":{"x":69,"y":634,"width":815,"height":12}},{"id":"03ab8385-eb0b-450c-b062-5694e864b626","block_type":"box","text":"rates. In general, the return on inverse floaters will decrease when short-term interest rates increase and increase","page_number":64,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"326c6423-8eaa-4917-9aee-f182f2672f98","block_type":"box","text":"when short-term rates decrease. Municipal tender option bonds, both taxable and tax-exempt, which may include","page_number":64,"box":{"x":68,"y":665,"width":805,"height":11}},{"id":"96a84018-d89b-45a6-b509-39b33c8586f6","block_type":"box","text":"inverse floating rate debt instruments, (including residual interests thereon) are excluded from this 10% limitation.","page_number":64,"box":{"x":70,"y":680,"width":813,"height":11}},{"id":"dddbfadc-302b-4547-8857-49f1d7ed5337","block_type":"box","text":"Inflation Risk.","page_number":64,"box":{"x":102,"y":702,"width":100,"height":9}},{"id":"2af7faf6-e54c-427e-8281-9c450c767931","block_type":"box","text":"Like all funds, the Funds are subject to inflation risk. Inflation risk is the risk that the present","page_number":64,"box":{"x":209,"y":702,"width":663,"height":11}},{"id":"2b55aedc-3879-40b1-9cd3-e5f2883ea986","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":64,"box":{"x":68,"y":717,"width":820,"height":12}},{"id":"e05d378e-7601-4c9c-8197-32b2ef8240e2","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":64,"box":{"x":70,"y":732,"width":792,"height":11}},{"id":"ec14f901-9358-4321-b2f6-c480728e0f74","block_type":"box","text":"Inflation rates may change frequently and significantly due to a number of potential factors, including, among others,","page_number":64,"box":{"x":70,"y":748,"width":829,"height":11}},{"id":"5d12d576-7a1c-4a48-96e7-9c261504ed4d","block_type":"box","text":"unexpected economic shifts or changes in fiscal or monetary policies.","page_number":64,"box":{"x":69,"y":763,"width":497,"height":11}},{"id":"ba8a3e0f-d521-415f-b3ce-d3aadc8d3a38","block_type":"box","text":"Initial Public Offering (“IPO”) Risk.","page_number":64,"box":{"x":102,"y":785,"width":253,"height":12}},{"id":"1f8ed72f-5a92-4b26-a6f0-98f1bdbe0404","block_type":"box","text":"The volume of IPOs and the levels at which the newly issued stocks trade in","page_number":64,"box":{"x":361,"y":785,"width":540,"height":12}},{"id":"c8a32e7f-d917-4e7e-9fa1-a8705d18b54e","block_type":"box","text":"the secondary market are affected by the performance of the stock market overall. If IPOs are brought to the market,","page_number":64,"box":{"x":68,"y":801,"width":836,"height":11}},{"id":"355bf730-00f1-43d1-99bc-d2840feb0e7e","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":64,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"e3181e70-71f9-4259-9613-87667513ac16","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":64,"box":{"x":69,"y":831,"width":795,"height":11}},{"id":"f6e49dd3-cb2c-4af5-b03e-39a00ccc7427","block_type":"box","text":"securities involved in IPOs are often subject to greater and more unpredictable price changes than more established","page_number":64,"box":{"x":69,"y":846,"width":829,"height":11}},{"id":"fd27e28c-22eb-45fe-b8c6-8ff29444804b","block_type":"box","text":"stocks. IPOs have the potential to produce substantial gains. A Fund may hold shares from an IPO for only a short","page_number":64,"box":{"x":69,"y":861,"width":814,"height":11}},{"id":"1629978c-381e-4e3e-bc82-58f9cf7578dc","block_type":"box","text":"period of time given possible price volatility. This may result in increased portfolio turnover and expenses, such as","page_number":64,"box":{"x":70,"y":876,"width":813,"height":11}},{"id":"c2262279-1f69-4fd2-b006-612e83bfe31a","block_type":"box","text":"commissions and transaction costs, and potentially result in taxable gains that the Fund will subsequently distribute","page_number":64,"box":{"x":69,"y":891,"width":828,"height":12}},{"id":"b7206516-cea2-4ec9-8953-1b172ce83561","block_type":"box","text":"to shareholders. There is no assurance that any Fund will have access to profitable IPOs and therefore investors","page_number":64,"box":{"x":68,"y":906,"width":802,"height":12}},{"id":"2dbc810c-10a6-48ab-91b2-72262ea718bd","block_type":"box","text":"II-34","page_number":64,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0227db2a-9101-4d88-8df1-dc458d3e76e4","block_type":"box","text":"NM1026U-5979889-64/232","page_number":64,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"23f3fefd-217d-473e-81bf-da8d6e74b03e","block_type":"box","text":"should not rely on any past gains from IPOs as an indication of future performance. The investment performance of a","page_number":65,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"6ca526f5-2d44-43f0-8788-cd32d1a0317b","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":65,"box":{"x":70,"y":60,"width":832,"height":11}},{"id":"004f2664-866f-47b6-9a9b-82460aaacec9","block_type":"box","text":"is able to do so. In addition, as a Fund increases in size, the impact of IPOs on its performance will generally","page_number":65,"box":{"x":70,"y":75,"width":777,"height":11}},{"id":"80890a0b-c287-42b8-a9c9-eca20af9de76","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":65,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"edc1a125-7527-4bf4-984e-573c16b13027","block_type":"box","text":"market capitalizations. Securities issued in IPOs have no trading history, and information about the companies may","page_number":65,"box":{"x":69,"y":105,"width":823,"height":11}},{"id":"366a325c-df86-47c8-883a-16c2ad082b1c","block_type":"box","text":"be available for very limited periods.","page_number":65,"box":{"x":69,"y":120,"width":257,"height":11}},{"id":"8d352ee8-4020-4d88-bf82-41da783423a1","block_type":"box","text":"Investment in Emerging Markets.","page_number":65,"box":{"x":102,"y":143,"width":242,"height":11}},{"id":"32dbbdb8-d202-4ac5-8304-22bf6de306d0","block_type":"box","text":"General.","page_number":65,"box":{"x":102,"y":166,"width":58,"height":9}},{"id":"b0b3949a-3656-4f93-a0a8-2b1a3f15cf44","block_type":"box","text":"Certain Funds may invest in the securities of issuers domiciled in various countries with emerging capital","page_number":65,"box":{"x":102,"y":188,"width":748,"height":12}},{"id":"32ae4fd8-20f6-4f86-9815-90b11d2df310","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":65,"box":{"x":69,"y":204,"width":840,"height":11}},{"id":"4c25d057-6bc9-4227-ad5f-f05fba77c254","block_type":"box","text":"that is (i) generally recognized to be an emerging market country by the international financial community, such as","page_number":65,"box":{"x":68,"y":218,"width":813,"height":12}},{"id":"977bc301-12ab-4b01-932d-7a1e69637b70","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":65,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"8873fab7-8357-4133-9b2b-5939c1c3aece","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":65,"box":{"x":69,"y":249,"width":839,"height":11}},{"id":"bacc4507-60bf-4b3f-bcef-6810ac7a3b79","block_type":"box","text":"index that is generally representative of emerging markets. Countries with emerging markets can be found in regions","page_number":65,"box":{"x":70,"y":264,"width":831,"height":11}},{"id":"24d2305d-677c-4a35-8fe6-84b6860abf36","block_type":"box","text":"such as Asia, Latin America, Eastern Europe and Africa.","page_number":65,"box":{"x":69,"y":279,"width":396,"height":11}},{"id":"516972d5-1cb1-4840-ae5c-6066e2186e57","block_type":"box","text":"Investments in the securities of issuers domiciled in countries with emerging capital markets involve certain","page_number":65,"box":{"x":102,"y":302,"width":770,"height":11}},{"id":"f6256fa8-03a4-4dd8-b5a5-66fc7c7a1cc7","block_type":"box","text":"additional risks that do not generally apply to investments in securities of issuers in more developed capital markets,","page_number":65,"box":{"x":69,"y":317,"width":835,"height":11}},{"id":"cfa8c5e3-4a6f-4104-959b-f3049b0ddcdb","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":65,"box":{"x":69,"y":332,"width":828,"height":11}},{"id":"bd473ea0-2edb-46ec-b0b9-63441ef5efeb","block_type":"box","text":"securities, as compared to securities of comparable issuers in more developed capital markets; (ii) uncertain","page_number":65,"box":{"x":69,"y":347,"width":779,"height":11}},{"id":"9b0a5352-6ccc-4152-aae9-98a74dba0bf4","block_type":"box","text":"national policies and social, political and economic instability, increasing the potential for expropriation of assets,","page_number":65,"box":{"x":69,"y":362,"width":809,"height":11}},{"id":"857932a0-e6ec-4184-9bbb-4a4ccff3341c","block_type":"box","text":"confiscatory taxation, high rates of inflation or unfavorable diplomatic developments; (iii) possible fluctuations in","page_number":65,"box":{"x":69,"y":377,"width":800,"height":12}},{"id":"cde3b56e-e5d1-4586-8701-ef0141187ffb","block_type":"box","text":"exchange rates, differing legal systems and the existence or possible imposition of exchange controls, custodial","page_number":65,"box":{"x":69,"y":392,"width":800,"height":12}},{"id":"5f8afc54-df6b-430c-a669-fd1fdfe60e98","block_type":"box","text":"restrictions or other foreign or U.S. Governmental laws or restrictions applicable to such investments; (iv) national","page_number":65,"box":{"x":69,"y":407,"width":811,"height":12}},{"id":"d998711d-6060-4e15-88a7-433dc7c00de0","block_type":"box","text":"policies that may limit a Fund’s investment opportunities such as restrictions on investment in issuers or industries","page_number":65,"box":{"x":70,"y":423,"width":824,"height":11}},{"id":"907eeac5-2af8-4d0e-a161-f175983ca547","block_type":"box","text":"deemed sensitive to national interests; and (v) the lack or relatively early development of legal structures governing","page_number":65,"box":{"x":69,"y":438,"width":823,"height":11}},{"id":"104c8c0b-65d5-480d-a62d-85ff1d62188d","block_type":"box","text":"private and foreign investments and private property. In addition to withholding taxes on investment income, some","page_number":65,"box":{"x":70,"y":453,"width":813,"height":11}},{"id":"00b197ce-d9a5-439f-a7d2-db36debdec09","block_type":"box","text":"countries with emerging markets may impose differential capital gains taxes on foreign investors.","page_number":65,"box":{"x":69,"y":468,"width":694,"height":11}},{"id":"3be4c182-c864-44a6-98ca-a1a3061c37c0","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":65,"box":{"x":102,"y":491,"width":767,"height":11}},{"id":"1e9abb32-aade-47f6-8601-94ff8179869e","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":65,"box":{"x":69,"y":506,"width":814,"height":11}},{"id":"570c899a-28a1-485c-960d-93ecc4cda338","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":65,"box":{"x":69,"y":521,"width":792,"height":11}},{"id":"1bb4446e-cfb0-47f9-8486-545d96c3aea8","block_type":"box","text":"markets will continue to present viable investment opportunities for a Fund. In the past, governments of such nations","page_number":65,"box":{"x":69,"y":536,"width":838,"height":11}},{"id":"35e7fe4d-1d8e-41c6-98b6-b3521cfcefde","block_type":"box","text":"have expropriated substantial amounts of private property, and most claims of the property owners have never been","page_number":65,"box":{"x":69,"y":551,"width":828,"height":11}},{"id":"44b9be92-efd0-487c-88b3-9bd8099b73ae","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":65,"box":{"x":68,"y":566,"width":816,"height":11}},{"id":"77c09122-366e-4f29-a54e-7049b265fa65","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":65,"box":{"x":70,"y":581,"width":802,"height":11}},{"id":"1b29be48-f823-4050-a8ed-2097c7ea3b5d","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":65,"box":{"x":70,"y":596,"width":838,"height":12}},{"id":"31499994-a2c7-4af6-8cb8-0413ca640496","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":65,"box":{"x":69,"y":612,"width":788,"height":11}},{"id":"4ce45298-e194-411b-9be3-8dde58d848c3","block_type":"box","text":"additional investments. The small size and inexperience of the securities markets in certain of these countries and","page_number":65,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"10dc5e75-5917-415d-a1de-032c8ea726ec","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":65,"box":{"x":68,"y":642,"width":838,"height":11}},{"id":"efba422e-2a65-4f5c-bcad-abccf96bd1a4","block_type":"box","text":"volatile than investments in more established markets.","page_number":65,"box":{"x":68,"y":657,"width":392,"height":9}},{"id":"3feed34f-cb01-4cb9-92d0-2c1b4072ac2b","block_type":"box","text":"Also, there may be less publicly available information about issuers in emerging markets than would be available","page_number":65,"box":{"x":101,"y":680,"width":805,"height":11}},{"id":"2367ec9f-6904-4416-a973-264cdf2df378","block_type":"box","text":"about issuers in more developed capital markets, and such issuers may not be subject to accounting, auditing and","page_number":65,"box":{"x":69,"y":695,"width":818,"height":11}},{"id":"f6a3b4f9-385a-41d6-a6d8-4db086b81103","block_type":"box","text":"financial reporting standards and requirements comparable to those to which U.S. companies are subject. In certain","page_number":65,"box":{"x":68,"y":710,"width":831,"height":11}},{"id":"c2fe14e2-0394-4346-b57f-f13f32ed993a","block_type":"box","text":"countries with emerging capital markets, reporting standards vary widely. As a result, traditional investment","page_number":65,"box":{"x":69,"y":725,"width":768,"height":11}},{"id":"79510dbe-8635-4e34-9f8b-ece4509078c6","block_type":"box","text":"measurements used in the United States, such as price/earnings ratios, may not be applicable. Emerging market","page_number":65,"box":{"x":69,"y":740,"width":811,"height":11}},{"id":"83ea0156-f7fb-46c1-ae39-fd7c8f81a167","block_type":"box","text":"securities may be substantially less liquid than, and more volatile than, those of mature markets, and company","page_number":65,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"cca61d03-d747-4e17-b99c-a26140d599f9","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":65,"box":{"x":69,"y":770,"width":814,"height":12}},{"id":"d5274628-08bb-434d-ad38-93ec54e7b66e","block_type":"box","text":"acquisition or disposal of securities.","page_number":65,"box":{"x":69,"y":785,"width":257,"height":11}},{"id":"fbd27adc-4235-4276-87bd-0593a40f92ae","block_type":"box","text":"Practices in relation to settlement of securities transactions in emerging markets involve higher risks than those","page_number":65,"box":{"x":102,"y":808,"width":800,"height":11}},{"id":"40dcf40d-d503-43a7-94cb-31d425581254","block_type":"box","text":"in developed markets, in part because a Fund will need to use brokers and counterparties that are less well","page_number":65,"box":{"x":70,"y":823,"width":769,"height":11}},{"id":"e1172562-2b22-4073-8bfe-82b21545c9a8","block_type":"box","text":"capitalized, and custody and registration of assets in some countries may be unreliable. The possibility of fraud,","page_number":65,"box":{"x":69,"y":838,"width":798,"height":12}},{"id":"884fb6d7-08c3-4238-8bac-6f9fb065879b","block_type":"box","text":"negligence, undue influence being exerted by the issuer or refusal to recognize ownership exists in some emerging","page_number":65,"box":{"x":69,"y":853,"width":819,"height":12}},{"id":"a83662a1-7fa9-43c1-8d49-8ce93d147fd0","block_type":"box","text":"markets, and, along with other factors, could result in ownership registration being completely lost. A Fund would","page_number":65,"box":{"x":69,"y":869,"width":804,"height":11}},{"id":"deaa8ef7-933c-4ca2-abe8-7c388981408e","block_type":"box","text":"absorb any loss resulting from such registration problems and may have no successful claim for compensation.","page_number":65,"box":{"x":69,"y":884,"width":794,"height":11}},{"id":"e73dc12c-87fb-45a5-b0b9-9679f5d36c37","block_type":"box","text":"II-35","page_number":65,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"cca5c0fc-16c6-4dc4-9c42-47ec6886d884","block_type":"box","text":"NM1026U-5979889-65/232","page_number":65,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d93bb4fa-809b-41af-84ec-6447f4b1675e","block_type":"box","text":"Investment in non-dollar denominated securities including securities from issuers located in emerging market","page_number":66,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"0fca8515-d8eb-405f-9384-3f93cc1cb940","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":66,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"75f61d95-5c31-43e3-beb5-28be8eb9395a","block_type":"box","text":"foreign currencies pending investment or conversion into U.S. dollars. Some of these instruments may have the","page_number":66,"box":{"x":68,"y":75,"width":797,"height":11}},{"id":"e3af3a11-3161-4c7a-abc7-20750db67b4a","block_type":"box","text":"characteristics of futures contracts. In addition, certain Funds may engage in foreign currency exchange transactions","page_number":66,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"2df7389c-059e-410e-aaf3-40224ceba401","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":66,"box":{"x":68,"y":105,"width":799,"height":11}},{"id":"561e0014-f33d-40bf-b86e-8a7c6a7ab3ea","block_type":"box","text":"performance. These investments and transactions involving foreign securities, currencies, options (including options","page_number":66,"box":{"x":70,"y":120,"width":829,"height":12}},{"id":"0a3f84e7-b11e-4558-94e4-330aac7c1a3a","block_type":"box","text":"that relate to foreign currencies), futures, hedging and cross-hedging are described under “Derivatives.”","page_number":66,"box":{"x":68,"y":135,"width":740,"height":12}},{"id":"faed0690-0491-4297-8014-0458c62d2877","block_type":"box","text":"Risks of Investing in Asia-Pacific Countries.","page_number":66,"box":{"x":102,"y":158,"width":305,"height":11}},{"id":"a52fc5a3-cbe9-45ec-83f2-96f7663a757d","block_type":"box","text":"In addition to the risks of foreign investing and the risks of investing","page_number":66,"box":{"x":414,"y":158,"width":485,"height":11}},{"id":"3019da26-8676-49bf-a5b4-d216db48e802","block_type":"box","text":"in developing markets, the developing market Asia-Pacific countries in which a Fund may invest are subject to certain","page_number":66,"box":{"x":70,"y":173,"width":832,"height":11}},{"id":"d1b2f3dc-5950-45d0-95aa-57155a525eb4","block_type":"box","text":"additional or specific risks. Certain Funds may make substantial investments in Asia-Pacific countries. In many of","page_number":66,"box":{"x":69,"y":188,"width":808,"height":11}},{"id":"d004aa2e-9acf-4175-80fd-7596b661c2d7","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":66,"box":{"x":68,"y":203,"width":838,"height":12}},{"id":"57b3aab8-7cef-42ed-9a6e-1e6537cc3512","block_type":"box","text":"representing a limited number of industries, as well as a high concentration of investors and financial intermediaries.","page_number":66,"box":{"x":69,"y":218,"width":834,"height":12}},{"id":"db3becdc-ac5f-4906-9aee-1892f09a059d","block_type":"box","text":"Many of these markets also may be affected by developments with respect to more established markets in the","page_number":66,"box":{"x":70,"y":234,"width":791,"height":11}},{"id":"b43186cc-46cb-4c19-819b-8d09e0c2532a","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":66,"box":{"x":69,"y":249,"width":804,"height":11}},{"id":"8d6054a3-bf79-4167-8973-5e1463b638c5","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":66,"box":{"x":69,"y":264,"width":833,"height":11}},{"id":"8e9b47f3-66bb-44e6-b08a-b73f574e113e","block_type":"box","text":"requirements for open-end investment companies and the restrictions on foreign investment discussed below, result","page_number":66,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"bb3e39c1-612a-4cc0-982c-43eab0f00e80","block_type":"box","text":"in potentially fewer investment opportunities for a Fund and may have an adverse impact on the investment","page_number":66,"box":{"x":70,"y":294,"width":766,"height":11}},{"id":"54e671b9-b707-4fc9-ae52-2794c4fb3a8a","block_type":"box","text":"performance of the Fund.","page_number":66,"box":{"x":70,"y":309,"width":179,"height":11}},{"id":"0f09c034-6d81-4470-8092-e64a02b9a638","block_type":"box","text":"Many of the developing market Asia-Pacific countries may be subject to a greater degree of economic, political","page_number":66,"box":{"x":102,"y":332,"width":784,"height":11}},{"id":"c12a7932-0d0d-457a-a7e6-010ec7fd305a","block_type":"box","text":"and social instability than is the case in the United States and Western European countries. Such instability may","page_number":66,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"ae365019-0ee6-41a4-99fd-1d7e10db93de","block_type":"box","text":"result from, among other things: (i) authoritarian governments or military involvement in political and economic","page_number":66,"box":{"x":69,"y":362,"width":788,"height":11}},{"id":"9a786750-a121-40fe-a7ca-90de70c2ce4c","block_type":"box","text":"decision-making, including changes in government through extra-constitutional means; (ii) popular unrest associated","page_number":66,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"e4a536ca-cc30-47a8-9ca1-14b12a979122","block_type":"box","text":"with demands for improved political, economic and social conditions; (iii) internal insurgencies; (iv) hostile relations","page_number":66,"box":{"x":68,"y":392,"width":823,"height":12}},{"id":"ddb554c7-f317-4a33-a410-c3fe5ce97e4c","block_type":"box","text":"with neighboring countries; and (v) ethnic, religious and racial disaffection. In addition, the governments of many of","page_number":66,"box":{"x":68,"y":407,"width":822,"height":12}},{"id":"001b87f6-b488-4240-be31-dfac1647b26d","block_type":"box","text":"such countries, such as Indonesia, have a substantial role in regulating and supervising the economy. Another risk","page_number":66,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"783afc72-0c0b-4d52-aedf-6d35b4533f81","block_type":"box","text":"common to most such countries is that the economy is heavily export oriented and, accordingly, is dependent upon","page_number":66,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"11949e4a-354f-4267-a811-bb32a6fec308","block_type":"box","text":"international trade. The existence of overburdened infrastructure and obsolete financial systems also presents risks","page_number":66,"box":{"x":70,"y":453,"width":827,"height":11}},{"id":"a434ddb6-9f9a-46ac-9b24-b88fb4b31412","block_type":"box","text":"in certain countries, as do environmental problems. Certain economies also depend to a significant degree upon","page_number":66,"box":{"x":70,"y":468,"width":803,"height":11}},{"id":"51c672f5-77c9-4fe1-9863-81fb0a7c2eb3","block_type":"box","text":"exports of primary commodities and, therefore, are vulnerable to changes in commodity prices that, in turn, may be","page_number":66,"box":{"x":69,"y":483,"width":824,"height":11}},{"id":"8fb2058a-9f12-4ab1-8885-a644d90a3648","block_type":"box","text":"affected by a variety of factors.","page_number":66,"box":{"x":69,"y":498,"width":220,"height":11}},{"id":"eb6a0196-4db0-4b4c-9a9a-ec7b5681da21","block_type":"box","text":"The legal systems in certain developing market Asia-Pacific countries also may have an adverse impact on the","page_number":66,"box":{"x":101,"y":521,"width":785,"height":11}},{"id":"49e70c23-6baf-4325-a5e9-1c7e0b524427","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":66,"box":{"x":70,"y":536,"width":789,"height":11}},{"id":"89e69bce-008b-4cde-b42c-eaff818aad8d","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":66,"box":{"x":69,"y":551,"width":814,"height":11}},{"id":"59ec86a0-75ae-4448-a778-08e94a1a39ef","block_type":"box","text":"clear in certain emerging market Asia-Pacific countries. Similarly, the rights of investors in developing market Asia","page_number":66,"box":{"x":69,"y":566,"width":813,"height":11}},{"id":"0bed4c1f-9bd5-4c34-a96f-9be63b8186eb","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":66,"box":{"x":69,"y":581,"width":777,"height":11}},{"id":"02681ed5-8733-42ff-a4d9-262e8659ab50","block_type":"box","text":"impossible to obtain and/or enforce a judgment in a developing market Asia-Pacific country.","page_number":66,"box":{"x":70,"y":596,"width":652,"height":12}},{"id":"ad8fd790-9d96-4b54-a5e7-ff7be4bafa27","block_type":"box","text":"Governments of many developing market Asia-Pacific countries have exercised and continue to exercise","page_number":66,"box":{"x":102,"y":619,"width":737,"height":11}},{"id":"5ef5f14f-6b18-47b2-88ba-13bbc3bad0a1","block_type":"box","text":"substantial influence over many aspects of the private sector. In certain cases, the government owns or controls","page_number":66,"box":{"x":69,"y":634,"width":803,"height":12}},{"id":"32513e2a-8fb7-463e-a975-252e21411c38","block_type":"box","text":"many companies, including the largest in the country. Accordingly, government actions in the future could have a","page_number":66,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"4a5cedaf-a48c-461c-a6ad-e0f17c257791","block_type":"box","text":"significant effect on economic conditions in developing market Asia-Pacific countries, which could affect private","page_number":66,"box":{"x":69,"y":664,"width":793,"height":12}},{"id":"2a79b367-ed30-4af3-879b-0c98a85bf8ca","block_type":"box","text":"sector companies and a Fund itself, as well as the value of securities in the Fund’s portfolio. In addition, economic","page_number":66,"box":{"x":69,"y":680,"width":820,"height":11}},{"id":"5e9f89c0-c9b3-49bd-b22f-258d4fa74d4f","block_type":"box","text":"statistics of developing market Asia-Pacific countries may be less reliable than economic statistics of more developed","page_number":66,"box":{"x":69,"y":695,"width":839,"height":11}},{"id":"e77fe1ab-22d5-41e1-857a-cbc37e542c10","block_type":"box","text":"nations.","page_number":66,"box":{"x":69,"y":710,"width":56,"height":9}},{"id":"4d4f389e-832d-4333-aecd-2f5ba3628a2d","block_type":"box","text":"In addition to the relative lack of publicly available information about developing market Asia-Pacific issuers and","page_number":66,"box":{"x":102,"y":732,"width":794,"height":12}},{"id":"ea6bdccb-d477-4eeb-af47-b51f9d4af7e9","block_type":"box","text":"the possibility that such issuers may not be subject to the same accounting, auditing and financial reporting","page_number":66,"box":{"x":68,"y":748,"width":773,"height":11}},{"id":"7f1a626b-bb70-4d0c-a36a-54ebc62c6a97","block_type":"box","text":"standards as U.S. companies, inflation accounting rules in some developing market Asia-Pacific countries require","page_number":66,"box":{"x":69,"y":763,"width":808,"height":11}},{"id":"7fc7e409-4b8e-4193-ace3-a975bcdba7c7","block_type":"box","text":"companies that keep accounting records in the local currency, for both tax and accounting purposes, to restate","page_number":66,"box":{"x":69,"y":778,"width":791,"height":11}},{"id":"c151f3f4-0253-4ad3-a0fc-d13a13e07e9d","block_type":"box","text":"certain assets and liabilities on the company’s balance sheet in order to express items in terms of currency of","page_number":66,"box":{"x":69,"y":793,"width":790,"height":11}},{"id":"fc963bd9-84ab-412a-9245-3b2b336bc6c1","block_type":"box","text":"constant purchasing power. Inflation accounting may indirectly generate losses or profits for certain developing","page_number":66,"box":{"x":69,"y":808,"width":790,"height":11}},{"id":"f4287f84-d001-461d-bbb2-3821219dfc53","block_type":"box","text":"market Asia-Pacific companies.","page_number":66,"box":{"x":69,"y":823,"width":220,"height":11}},{"id":"c1ae9e31-16d8-42e7-ba69-4788ebf5da0d","block_type":"box","text":"Satisfactory custodial services for investment securities may not be available in some developing Asia-Pacific","page_number":66,"box":{"x":102,"y":846,"width":780,"height":11}},{"id":"04d67913-6f97-48d9-8f4d-266f35ec1f0d","block_type":"box","text":"countries, which may result in the Fund incurring additional costs and delays in providing transportation and custody","page_number":66,"box":{"x":69,"y":861,"width":829,"height":11}},{"id":"a7524984-c9a1-4417-9004-b2ed02e1a0ff","block_type":"box","text":"services for such securities outside such countries.","page_number":66,"box":{"x":69,"y":876,"width":367,"height":9}},{"id":"4df0bc07-6366-43f5-acdf-6d88429ff118","block_type":"box","text":"II-36","page_number":66,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"be064ffd-9897-42dd-a6b9-cded3e17f095","block_type":"box","text":"NM1026U-5979889-66/232","page_number":66,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9dd0fa2e-814a-4b01-96ea-f0f7ff522c03","block_type":"box","text":"Certain developing Asia-Pacific countries, such as the Philippines, India and Turkey, are especially large debtors","page_number":67,"box":{"x":102,"y":45,"width":795,"height":11}},{"id":"ce28aa83-5cde-4f4c-85c5-2af54779bfb8","block_type":"box","text":"to commercial banks and foreign governments.","page_number":67,"box":{"x":68,"y":60,"width":335,"height":11}},{"id":"eebb245f-b184-4261-814c-28c7073d61bb","block_type":"box","text":"Natural disasters in Asia-Pacific countries, and the resulting damage, could have a severe and negative impact","page_number":67,"box":{"x":102,"y":82,"width":788,"height":12}},{"id":"6fd45b6a-4a6b-48a7-8648-05dda8914b4b","block_type":"box","text":"on a Fund’s investment portfolio and, in the longer term, could impair the ability of issuers in which the Fund invests","page_number":67,"box":{"x":69,"y":98,"width":830,"height":11}},{"id":"f2292037-c610-4ca9-9fc3-decc60b19765","block_type":"box","text":"to conduct their businesses in the manner normally conducted.","page_number":67,"box":{"x":68,"y":113,"width":450,"height":11}},{"id":"dc8a7754-e491-42f0-bddc-3911c65819d1","block_type":"box","text":"Fund management may determine that, notwithstanding otherwise favorable investment criteria, it may not be","page_number":67,"box":{"x":102,"y":135,"width":782,"height":12}},{"id":"d8b804a2-3f79-46b8-aabe-ae28b648d9de","block_type":"box","text":"practicable or appropriate to invest in a particular developing Asia-Pacific country. A Fund may invest in countries in","page_number":67,"box":{"x":70,"y":150,"width":819,"height":12}},{"id":"3b4b5363-df87-4aa7-b96b-35768d9ddcc1","block_type":"box","text":"which foreign investors, including management of the Fund, have had no or limited prior experience.","page_number":67,"box":{"x":68,"y":166,"width":711,"height":11}},{"id":"cef54729-c6e1-4fe6-9298-b658e486f48d","block_type":"box","text":"Restrictions on Foreign Investments in Asia-Pacific Countries.","page_number":67,"box":{"x":102,"y":188,"width":435,"height":12}},{"id":"cdc93098-6d86-4842-ae55-655ef4126739","block_type":"box","text":"Some developing Asia-Pacific countries prohibit or","page_number":67,"box":{"x":543,"y":188,"width":355,"height":12}},{"id":"2e3f13b2-c33c-48c2-8c5b-58c2ad12ab1f","block_type":"box","text":"impose substantial restrictions on investments in their capital markets, particularly their equity markets, by foreign","page_number":67,"box":{"x":70,"y":203,"width":817,"height":12}},{"id":"13c144b3-b5bb-4f72-82f3-1c13d6949a15","block_type":"box","text":"entities such as a Fund. As illustrations, certain countries may require governmental approval prior to investments by","page_number":67,"box":{"x":69,"y":219,"width":836,"height":11}},{"id":"a7cd9638-69ca-4b47-a621-cf74e3064934","block_type":"box","text":"foreign persons or limit the amount of investment by foreign persons in a particular company or limit the investment","page_number":67,"box":{"x":68,"y":234,"width":828,"height":11}},{"id":"f7febd7a-8397-4ccf-b60d-e368fde6fe15","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":67,"box":{"x":69,"y":249,"width":794,"height":11}},{"id":"1aeb48fc-9387-47d7-a8d9-c3fcd905fbaf","block_type":"box","text":"(including price and shareholder rights) than securities of the company available for purchase by nationals. There can","page_number":67,"box":{"x":69,"y":264,"width":835,"height":11}},{"id":"935e5d2d-4ae6-46f3-b50b-d134fd169498","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":67,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"6c20e63d-9526-4389-992c-fc2faf008343","block_type":"box","text":"changes to restrictions on foreign ownership of securities subsequent to a Fund’s purchase of such securities may","page_number":67,"box":{"x":69,"y":294,"width":820,"height":11}},{"id":"f7ff3621-42d0-4b76-916b-9b0ac716f912","block_type":"box","text":"have an adverse effect on the value of such shares. Certain countries may restrict investment opportunities in","page_number":67,"box":{"x":69,"y":309,"width":788,"height":11}},{"id":"43cea8d1-4dc2-45f9-9f2b-726bf882ed85","block_type":"box","text":"issuers or industries deemed important to national interests.","page_number":67,"box":{"x":70,"y":325,"width":434,"height":10}},{"id":"e1db2686-f7fb-4522-a07e-cefae29f27bd","block_type":"box","text":"The manner in which foreign investors may invest in companies in certain developing Asia-Pacific countries, as","page_number":67,"box":{"x":101,"y":347,"width":787,"height":11}},{"id":"ebdc0f1b-193a-413b-8236-ca129bf23065","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":67,"box":{"x":68,"y":362,"width":833,"height":11}},{"id":"b01d66c8-ee69-4258-a35b-3d0d1317b069","block_type":"box","text":"a Fund may be required in certain of such countries to invest initially through a local broker or other entity and then","page_number":67,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"fa88f407-ac7b-478f-b57c-9180bc41a770","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":67,"box":{"x":69,"y":392,"width":831,"height":12}},{"id":"8e4a2ff9-a8bf-497b-8224-97fe50fa1ab8","block_type":"box","text":"to occur on a timely basis, resulting in a delay during which a Fund may be denied certain of its rights as an investor,","page_number":67,"box":{"x":68,"y":407,"width":834,"height":12}},{"id":"ce1c1e27-4807-4032-b553-41879298802f","block_type":"box","text":"including rights as to dividends or to be made aware of certain corporate actions. There also may be instances where","page_number":67,"box":{"x":70,"y":423,"width":836,"height":11}},{"id":"2fcfee14-e476-40f3-80e8-c7c77e148432","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":67,"box":{"x":69,"y":438,"width":800,"height":11}},{"id":"88475fba-db86-4b23-85e8-ffb0aa058133","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":67,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"55a596f4-250e-4db0-bb77-baaed29af43a","block_type":"box","text":"investment at that time.","page_number":67,"box":{"x":70,"y":468,"width":168,"height":9}},{"id":"d24abf84-0b91-4cd6-9060-0a3f019711a3","block_type":"box","text":"Substantial limitations may exist in certain countries with respect to a Fund’s ability to repatriate investment","page_number":67,"box":{"x":102,"y":491,"width":774,"height":11}},{"id":"dc5568f1-d7cc-4f4b-8bbc-d640f30214d8","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":67,"box":{"x":70,"y":506,"width":803,"height":11}},{"id":"fc54c831-016b-4b70-accb-50fa42b15bcd","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":67,"box":{"x":69,"y":521,"width":789,"height":11}},{"id":"26edf5bb-5770-4cd4-8cd6-1389eb4b6fdd","block_type":"box","text":"application to the Fund of any restrictions on investments. It is possible that certain countries may impose currency","page_number":67,"box":{"x":69,"y":536,"width":826,"height":11}},{"id":"79ffb2c6-e4ae-4c8d-a06a-b706bc9ea26b","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":67,"box":{"x":69,"y":551,"width":818,"height":11}},{"id":"61f80bd5-576d-4ce7-98eb-f60cb5572efe","block_type":"box","text":"that such restrictions have the effect of making certain investments illiquid, securities may not be available for sale","page_number":67,"box":{"x":68,"y":566,"width":826,"height":11}},{"id":"d69e178c-3cfd-43d6-8ff8-d2bdf63c8abd","block_type":"box","text":"to meet redemptions. Depending on a variety of financial factors, the percentage of a Fund’s portfolio subject to","page_number":67,"box":{"x":68,"y":581,"width":800,"height":12}},{"id":"4e84c2e2-9b63-439d-9cea-621691981e4a","block_type":"box","text":"currency controls may increase. In the event other countries impose similar controls, the portion of the Fund’s assets","page_number":67,"box":{"x":69,"y":596,"width":839,"height":12}},{"id":"5a714c0f-5280-4c16-98cf-e6bd7445caa4","block_type":"box","text":"that may be used to meet redemptions may be further decreased. Even where there is no outright restriction on","page_number":67,"box":{"x":68,"y":612,"width":798,"height":11}},{"id":"4c14a37a-dbba-4290-bef1-dd1be7c3f35b","block_type":"box","text":"repatriation of capital, the mechanics of repatriation may affect certain aspects of the operations of a Fund (for","page_number":67,"box":{"x":69,"y":627,"width":795,"height":11}},{"id":"5130de3b-eec6-4f14-bf15-cabe44b8beaa","block_type":"box","text":"example, if funds may be withdrawn only in certain currencies and/or only at an exchange rate established by the","page_number":67,"box":{"x":69,"y":642,"width":808,"height":11}},{"id":"80323056-193b-4764-ae7a-75e0d2281793","block_type":"box","text":"government).","page_number":67,"box":{"x":68,"y":657,"width":92,"height":11}},{"id":"639802da-bf5d-458e-b2a1-39e4c20d9623","block_type":"box","text":"In certain countries, banks or other financial institutions may be among the leading companies or have actively","page_number":67,"box":{"x":102,"y":680,"width":790,"height":11}},{"id":"4b1bfdca-4c67-4fc1-9fbe-25a219406e95","block_type":"box","text":"traded securities available for investment. The Investment Company Act restricts a Fund’s investments in any equity","page_number":67,"box":{"x":68,"y":695,"width":828,"height":11}},{"id":"e1875d3b-754e-4994-b347-d3ea0ed9d483","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":67,"box":{"x":69,"y":710,"width":808,"height":11}},{"id":"a64a0ba5-2f4d-47b0-a9dc-97f69b402212","block_type":"box","text":"related activities,” as defined by the rules thereunder. These provisions may restrict a Fund’s investments in certain","page_number":67,"box":{"x":69,"y":725,"width":829,"height":11}},{"id":"250d7a32-ee15-4805-8098-553185d01d18","block_type":"box","text":"foreign banks and other financial institutions.","page_number":67,"box":{"x":68,"y":740,"width":322,"height":11}},{"id":"3b79a7ff-6b1f-4990-ba05-60e8a1feedd0","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":67,"box":{"x":102,"y":763,"width":767,"height":11}},{"id":"64248cac-7189-4c21-bb91-ce0146d739e3","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":67,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"3eb4b01d-fe28-40f0-93b1-02bd3997ea3c","block_type":"box","text":"developed countries. Some of these countries may have in the past failed to recognize private property rights and","page_number":67,"box":{"x":69,"y":793,"width":809,"height":11}},{"id":"d08546ee-82ae-4668-82f0-1bee366097bb","block_type":"box","text":"have at times nationalized or expropriated the assets of private companies. As a result the risks described above,","page_number":67,"box":{"x":69,"y":808,"width":812,"height":11}},{"id":"4a242b64-3542-4211-b3b3-2738b3177701","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":67,"box":{"x":70,"y":823,"width":838,"height":12}},{"id":"e7e4d3fa-6819-46e1-9cf6-30af352dee5b","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":67,"box":{"x":69,"y":838,"width":788,"height":11}},{"id":"577be06d-cb75-4ed7-ac17-8da1a178344d","block_type":"box","text":"additional investments in emerging market countries. The small size and inexperience of the securities markets in","page_number":67,"box":{"x":69,"y":853,"width":812,"height":12}},{"id":"17a9328d-d60d-443c-8279-d6bad3b45d2e","block_type":"box","text":"certain of these countries and the limited volume of trading in securities in these countries may make investments in","page_number":67,"box":{"x":69,"y":869,"width":835,"height":11}},{"id":"65bf8945-7ee1-4d92-9e8e-95af44c4a5d5","block_type":"box","text":"the countries illiquid and more volatile than investments in Japan or most Western European countries. There may be","page_number":67,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"ef802374-b817-48c6-9da0-961a80032904","block_type":"box","text":"II-37","page_number":67,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6919006e-4d0e-462a-a295-a801a413122c","block_type":"box","text":"NM1026U-5979889-67/232","page_number":67,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"59e8170d-3f65-4dcc-915a-acb14e05e399","block_type":"box","text":"little financial or accounting information available with respect to issuers located in certain emerging market","page_number":68,"box":{"x":70,"y":45,"width":771,"height":11}},{"id":"04393018-3d6f-4a69-b0a2-8c78e598ae41","block_type":"box","text":"countries, and it may be difficult to assess the value or prospects of an investment in such issuers.","page_number":68,"box":{"x":69,"y":60,"width":711,"height":11}},{"id":"cc28d404-abe9-4cc5-83e9-dc4ef30e85dc","block_type":"box","text":"The expense ratios of the Funds investing significantly in foreign securities can be expected to be higher than","page_number":68,"box":{"x":101,"y":82,"width":779,"height":12}},{"id":"0751beb9-10ef-4329-837c-8a2d00004e47","block_type":"box","text":"those of Funds investing primarily in domestic securities. The costs attributable to investing abroad are usually higher","page_number":68,"box":{"x":68,"y":98,"width":840,"height":11}},{"id":"7945ef6b-a162-4d20-87d3-3f3acbce9d44","block_type":"box","text":"for several reasons, such as the higher cost of custody of foreign securities, higher commissions paid on comparable","page_number":68,"box":{"x":68,"y":113,"width":838,"height":11}},{"id":"2f82e934-8f01-4259-94e6-21a267120de0","block_type":"box","text":"transactions on foreign markets and additional costs arising from delays in settlements of transactions involving","page_number":68,"box":{"x":68,"y":128,"width":802,"height":11}},{"id":"9f8671c0-fa8e-4c5b-9088-0b6f234a6b1f","block_type":"box","text":"foreign securities.","page_number":68,"box":{"x":68,"y":143,"width":127,"height":11}},{"id":"6ae18059-14c4-4f1f-89e0-61bb2bef0605","block_type":"box","text":"Risks of Investments in Russia.","page_number":68,"box":{"x":102,"y":166,"width":224,"height":9}},{"id":"f42cea5b-df7e-4070-be9f-0eb45712a120","block_type":"box","text":"A Fund may invest a portion of its assets in securities issued by companies","page_number":68,"box":{"x":332,"y":166,"width":539,"height":11}},{"id":"44984ef1-3c0d-4d3f-a1e4-5c523863494a","block_type":"box","text":"located in Russia. The Russian securities market suffers from a variety of problems described above in “Investment","page_number":68,"box":{"x":70,"y":181,"width":826,"height":11}},{"id":"a6a33130-82e1-4eb6-be9c-eabf943b5816","block_type":"box","text":"in Emerging Markets” not encountered in more developed markets. The Russian securities market is relatively new,","page_number":68,"box":{"x":70,"y":196,"width":821,"height":11}},{"id":"edb24ada-9beb-415a-ae26-40963bb4307d","block_type":"box","text":"and a substantial portion of securities transactions in Russia are privately negotiated outside of stock exchanges.","page_number":68,"box":{"x":69,"y":211,"width":812,"height":11}},{"id":"45280846-2ca7-419b-9108-c71c07d8db14","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":68,"box":{"x":68,"y":226,"width":824,"height":11}},{"id":"4f5b7630-466c-40ad-906d-4965f479fcdd","block_type":"box","text":"make obtaining accurate prices on portfolio securities from independent sources more difficult than in more","page_number":68,"box":{"x":69,"y":241,"width":771,"height":11}},{"id":"d48ad616-076b-4a87-9ca4-f12e7221906c","block_type":"box","text":"developed markets.","page_number":68,"box":{"x":69,"y":257,"width":138,"height":10}},{"id":"b82ae671-9f73-47e4-928d-847bb2f04e98","block_type":"box","text":"Because of the underdeveloped state of Russia’s securities markets and banking and telecommunication","page_number":68,"box":{"x":102,"y":279,"width":751,"height":11}},{"id":"786459e5-10ec-45cf-b88c-9aeef1a34cfe","block_type":"box","text":"systems, settlement, clearing and registration of securities transactions are subject to additional risks. Prior to 2013,","page_number":68,"box":{"x":69,"y":294,"width":839,"height":11}},{"id":"bd17c769-b432-4d00-8291-51505903a4b7","block_type":"box","text":"there was no central registration system for equity share registration in Russia and registration was carried out either","page_number":68,"box":{"x":68,"y":309,"width":838,"height":11}},{"id":"6fcc9d66-951d-481d-9e42-78dbdabd3781","block_type":"box","text":"by the issuers themselves or by registrars located throughout Russia. These registrars may not have been subject to","page_number":68,"box":{"x":69,"y":325,"width":831,"height":11}},{"id":"9e190789-a345-4314-bd72-f1da3c4faa79","block_type":"box","text":"effective state supervision or licensed with any governmental entity. In 2013, Russia established the National","page_number":68,"box":{"x":69,"y":339,"width":783,"height":12}},{"id":"95ed6e11-6fb4-4583-81f5-23c3e6a1f137","block_type":"box","text":"Settlement Depository (“NSD”) as a recognized central securities depository, and title to Russian equities held","page_number":68,"box":{"x":69,"y":355,"width":790,"height":11}},{"id":"df5f8d08-f78b-4993-961f-9330408ce000","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":68,"box":{"x":68,"y":370,"width":833,"height":11}},{"id":"be2101a8-6db9-4005-8624-45d0be9d10f7","block_type":"box","text":"implementation of the NSD has enhanced the efficiency and transparency of the Russian securities market, loss still","page_number":68,"box":{"x":70,"y":385,"width":831,"height":11}},{"id":"8ff53cd9-5d5f-4ad1-b082-6fcc936499e6","block_type":"box","text":"can occur. Additionally, issuers and registrars remain prominent in the validation and approval of documentation","page_number":68,"box":{"x":69,"y":400,"width":797,"height":11}},{"id":"6708e33b-5242-4eaf-9e62-228445faa628","block_type":"box","text":"requirements for corporate action processing in Russia, and, because the documentation requirements and approval","page_number":68,"box":{"x":69,"y":415,"width":832,"height":11}},{"id":"17168977-34ae-4208-ae66-fa9c07f6916d","block_type":"box","text":"criteria vary between registrars and issuers, there remain inconsistent market standards in the Russian market with","page_number":68,"box":{"x":69,"y":430,"width":827,"height":11}},{"id":"c16813b3-1a29-471f-863f-b39bd7186b81","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":68,"box":{"x":69,"y":445,"width":800,"height":11}},{"id":"cbf4ba44-90f9-4add-9d67-79fb8a41eaaf","block_type":"box","text":"relating to title or corporate actions relating to its portfolio securities, it may be difficult for the Fund to enforce its","page_number":68,"box":{"x":69,"y":460,"width":813,"height":12}},{"id":"3c4838c3-d948-449c-82bd-729bcbd44d46","block_type":"box","text":"rights or otherwise remedy the loss. Russian securities laws may not recognize foreign nominee accounts held with a","page_number":68,"box":{"x":69,"y":475,"width":836,"height":12}},{"id":"197a3401-ae4f-4215-a8e1-60aa82c594da","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":68,"box":{"x":69,"y":491,"width":824,"height":11}},{"id":"16a43224-a64a-41c5-bda1-fc860133129a","block_type":"box","text":"their clients. A Fund also may experience difficulty in obtaining and/or enforcing judgments in Russia.","page_number":68,"box":{"x":68,"y":506,"width":723,"height":11}},{"id":"fef35721-60e6-4b94-8b90-6b2d4cbbd49c","block_type":"box","text":"In addition, Russia continues to assert its influence in the region through economic and military measures, as it","page_number":68,"box":{"x":102,"y":528,"width":801,"height":12}},{"id":"434aa248-8b50-4b02-9439-1790fafee140","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":68,"box":{"x":69,"y":543,"width":826,"height":12}},{"id":"eed8e5e1-f008-4f43-a3fc-6ce4562b0945","block_type":"box","text":"of Ukraine on February 24, 2022. The extent and duration of the military action, resulting sanctions and resulting","page_number":68,"box":{"x":69,"y":559,"width":809,"height":11}},{"id":"687448e1-aabc-41e2-9289-e6fa0ba6eec1","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":68,"box":{"x":68,"y":574,"width":821,"height":11}},{"id":"7f2ef0ba-a6c7-4213-afb6-585f9f7c9cb9","block_type":"box","text":"are impossible to predict. Any such disruptions caused by Russian military action or other actions (including","page_number":68,"box":{"x":69,"y":589,"width":770,"height":11}},{"id":"c92bdbf6-2293-4afd-b414-9eadbbb8471a","block_type":"box","text":"cyberattacks and espionage) or resulting actual and threatened responses to such activity, including purchasing and","page_number":68,"box":{"x":69,"y":604,"width":827,"height":11}},{"id":"e8b14cc5-5b4d-4f69-a375-e9369917c5d5","block_type":"box","text":"financing restrictions, boycotts or changes in consumer or purchaser preferences, sanctions, tariffs or cyberattacks","page_number":68,"box":{"x":68,"y":619,"width":824,"height":11}},{"id":"d04f6244-3f9e-4d26-a3ec-e38c9d04d4a4","block_type":"box","text":"on the Russian government, Russian companies or Russian individuals, including politicians, may impact Russia’s","page_number":68,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"adfb9110-cf6f-4364-9c3a-f10a3271e9fe","block_type":"box","text":"economy and Russian issuers of securities in which the Fund invests. Actual and threatened responses to such","page_number":68,"box":{"x":69,"y":649,"width":795,"height":12}},{"id":"c6d4d14b-c50b-4b61-aa55-3f72b5068bfb","block_type":"box","text":"activity, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Russian government or Russian","page_number":68,"box":{"x":69,"y":664,"width":814,"height":12}},{"id":"c397e2f5-f994-4aeb-b7a6-663c261ea49c","block_type":"box","text":"companies, may impact Russia’s economy and Russian issuers of securities in which the Fund invests. Actual and","page_number":68,"box":{"x":69,"y":680,"width":816,"height":11}},{"id":"eab0b0b1-e90b-48f2-ae0a-355c0527c4aa","block_type":"box","text":"threatened responses to such military action may also impact the markets for certain Russian commodities, such as","page_number":68,"box":{"x":68,"y":695,"width":836,"height":11}},{"id":"b8298ccb-8ea8-4e6f-84d4-4bd688470d0f","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":68,"box":{"x":69,"y":710,"width":829,"height":11}},{"id":"5920e6d0-7596-41e8-b7b0-dcf891eb905d","block_type":"box","text":"sectors globally.","page_number":68,"box":{"x":69,"y":725,"width":112,"height":11}},{"id":"db8e6ca7-3b93-401c-834b-bb99168145fc","block_type":"box","text":"Governments in the United States and many other countries (collectively, the “Sanctioning Bodies”) have","page_number":68,"box":{"x":102,"y":748,"width":745,"height":11}},{"id":"6045e569-aa49-430b-aaf3-5ea29a5a3162","block_type":"box","text":"imposed economic sanctions, which can consist of prohibiting certain securities trades, certain private transactions","page_number":68,"box":{"x":70,"y":763,"width":826,"height":11}},{"id":"f889e54b-0db6-4d23-a87d-99737a63f660","block_type":"box","text":"in the energy sector, asset freezes and prohibition of all business, against certain Russian individuals, including","page_number":68,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"37124d97-6132-4143-9eaf-5db3a22d3205","block_type":"box","text":"politicians, and Russian corporate and banking entities. The Sanctioning Bodies, or others, could also institute","page_number":68,"box":{"x":70,"y":793,"width":788,"height":11}},{"id":"dacb3284-c6bc-4d36-adce-bf24231acdfb","block_type":"box","text":"broader sanctions on Russia, including banning Russia from global payments systems that facilitate cross-border","page_number":68,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"014be4d0-7a94-455d-9fcb-fbb05c85955d","block_type":"box","text":"payments. These sanctions, or even the threat of further sanctions, may result in the decline of the value and","page_number":68,"box":{"x":70,"y":823,"width":782,"height":11}},{"id":"f6b62962-2351-4ac4-97ae-8d9c310b61e0","block_type":"box","text":"liquidity of Russian securities, a weakening of the ruble or other adverse consequences to the Russian economy.","page_number":68,"box":{"x":70,"y":838,"width":802,"height":12}},{"id":"ac072a8e-51bf-4507-996b-9a132e1d4b3d","block_type":"box","text":"These sanctions have resulted and may continue to result in the immediate freeze of Russian securities and/or","page_number":68,"box":{"x":68,"y":853,"width":797,"height":12}},{"id":"3988c204-bda7-462d-8440-b76b54f19897","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":68,"box":{"x":68,"y":869,"width":804,"height":11}},{"id":"44a11567-d7ab-4688-a44d-bd9a7b6ff093","block_type":"box","text":"and/or assets. Sanctions could also result in Russia taking counter measures or retaliatory actions which may","page_number":68,"box":{"x":69,"y":884,"width":791,"height":11}},{"id":"ee14627a-a138-4325-aad2-685bf1449979","block_type":"box","text":"further impair the value and liquidity of Russian securities.","page_number":68,"box":{"x":68,"y":899,"width":417,"height":11}},{"id":"6fad584d-2cfd-438b-a3e4-8fedcfd6bef8","block_type":"box","text":"II-38","page_number":68,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"84dd4b1c-44a7-415b-aa76-7661c769616e","block_type":"box","text":"NM1026U-5979889-68/232","page_number":68,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"945ab0d5-8c3b-4277-bc81-7b92c0d75ab5","block_type":"box","text":"Risks of Investing in Saudi Arabia.","page_number":69,"box":{"x":102,"y":45,"width":241,"height":11}},{"id":"5015728d-04c2-494f-96f6-8d5ad2dadf74","block_type":"box","text":"The ability of foreign investors (such as a Fund) to invest in Saudi Arabian","page_number":69,"box":{"x":350,"y":45,"width":523,"height":11}},{"id":"25882afc-3cd3-4f1c-a647-9966ba013ff7","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":69,"box":{"x":70,"y":60,"width":838,"height":11}},{"id":"6c5ad526-06d9-4cde-b7a4-3bc66b9e0f29","block_type":"box","text":"and unforeseen risks could materialize due to foreign ownership in such securities. In addition, the Capital Market","page_number":69,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"3898ecc1-1449-402b-9b1e-fd7ad0615017","block_type":"box","text":"Authority (“CMA”) places investment limitations on the ownership of Saudi Arabian issuers by foreign investors,","page_number":69,"box":{"x":68,"y":90,"width":793,"height":11}},{"id":"c066e436-98d8-46a6-a69d-aee09aee3b69","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":69,"box":{"x":70,"y":105,"width":819,"height":11}},{"id":"43a418b9-b99e-4a6e-a907-3b5973ef5f9f","block_type":"box","text":"may prevent a Fund from investing in accordance with its strategy and contribute to tracking error against the","page_number":69,"box":{"x":69,"y":120,"width":777,"height":12}},{"id":"02153d04-5f6f-45de-ad08-24b37dadd4f7","block_type":"box","text":"Underlying Index. These restrictions may be changed or new restrictions, such as licensing requirements, special","page_number":69,"box":{"x":70,"y":136,"width":803,"height":11}},{"id":"dc6ab914-b0a8-455b-b091-c14163f1d13c","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":69,"box":{"x":69,"y":150,"width":837,"height":12}},{"id":"40be531d-5fb2-4ad3-9caa-01e3fd653238","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":69,"box":{"x":69,"y":166,"width":765,"height":11}},{"id":"f2595707-e6af-46bd-be89-62c16679bad7","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":69,"box":{"x":69,"y":181,"width":838,"height":11}},{"id":"4fadb14d-4988-40e5-8e51-f4bfeefad72c","block_type":"box","text":"may be exacerbated, compared to more developed markets, given the limited history of foreign investment in the","page_number":69,"box":{"x":69,"y":196,"width":805,"height":11}},{"id":"176598c7-82eb-4fca-89b8-e189a4c6f1cd","block_type":"box","text":"Saudi Arabian market. Investments in Saudi Arabia may also be subject to loss due to expropriation or nationalization","page_number":69,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"edd8fb4e-03bf-4b46-b5a9-950a2aa32f53","block_type":"box","text":"of assets and property or the imposition of restrictions on additional foreign investments and repatriation of capital.","page_number":69,"box":{"x":69,"y":226,"width":826,"height":11}},{"id":"29fda8fd-2b57-4bad-a455-72ec843fa68c","block_type":"box","text":"Such heightened risks may include, among others, restrictions on and government intervention in international trade,","page_number":69,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"095f31e3-0384-41cf-9c76-a1830cb7ca95","block_type":"box","text":"confiscatory taxation, political instability, including authoritarian and/or military involvement in governmental decision","page_number":69,"box":{"x":69,"y":256,"width":835,"height":12}},{"id":"42bfc220-c5cf-4f1d-9180-8cfa5d3b4254","block_type":"box","text":"making, armed conflict, crime and instability as a result of religious, ethnic and/or socioeconomic unrest. Saudi","page_number":69,"box":{"x":69,"y":271,"width":797,"height":12}},{"id":"801eff6f-0d18-4c89-841c-98a011ddb82f","block_type":"box","text":"Arabia has privatized, or has begun the process of privatizing, certain entities and industries. Newly privatized","page_number":69,"box":{"x":68,"y":286,"width":781,"height":12}},{"id":"7734cab6-90f4-4c22-bc3e-98d7f4a9912b","block_type":"box","text":"companies may face strong competition from government-sponsored competitors that have not been privatized. In","page_number":69,"box":{"x":69,"y":302,"width":811,"height":11}},{"id":"4f079219-241c-4d0e-8b15-90130461ce58","block_type":"box","text":"some instances, investors in newly privatized entities have suffered losses due to the inability of the newly privatized","page_number":69,"box":{"x":69,"y":317,"width":833,"height":11}},{"id":"ec9f0268-753d-4430-861a-939f2639a33f","block_type":"box","text":"entities to adjust quickly to a competitive environment or changing regulatory and legal standards or, in some cases,","page_number":69,"box":{"x":69,"y":332,"width":831,"height":11}},{"id":"94871339-80d9-4782-8274-018d624ab24c","block_type":"box","text":"due to re-nationalization of such privatized entities. There is no assurance that similar losses will not recur. Further,","page_number":69,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"0663518e-d974-4c80-bae4-9c229dd7470a","block_type":"box","text":"under income tax laws imposed by the Department of Zakat and Income Tax, dividends paid by a Saudi Arabian","page_number":69,"box":{"x":69,"y":362,"width":791,"height":11}},{"id":"94e914f8-c6e8-4cbd-a2a4-e1f4058d9203","block_type":"box","text":"company to foreign stockholders are generally subject to a 5% withholding tax (different tax rates may apply pursuant","page_number":69,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"e45e48d0-3150-498d-b388-7acbf3ae7eac","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":69,"box":{"x":68,"y":392,"width":799,"height":12}},{"id":"98a8f43b-1697-44f1-8c43-892f2735562c","block_type":"box","text":"countries involved in the sale of petroleum, and its economy is therefore vulnerable to changes in foreign currency","page_number":69,"box":{"x":69,"y":407,"width":815,"height":12}},{"id":"22a6df78-1e64-4f3e-a009-9d3f151c12ae","block_type":"box","text":"values and the market for petroleum. As global demand for petroleum fluctuates, Saudi Arabia may be significantly","page_number":69,"box":{"x":68,"y":423,"width":818,"height":11}},{"id":"ff5833f9-e3d0-48b0-8dfc-334efa8ee767","block_type":"box","text":"impacted.","page_number":69,"box":{"x":70,"y":438,"width":67,"height":11}},{"id":"32cc0d49-5c1a-4d79-972c-bef379643b69","block_type":"box","text":"Like most Middle Eastern governments, the government of Saudi Arabia exercises substantial influence over","page_number":69,"box":{"x":102,"y":460,"width":773,"height":12}},{"id":"900beb80-e6d3-49a2-80ca-31c4f3f104b5","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":69,"box":{"x":69,"y":475,"width":812,"height":12}},{"id":"1ace27ab-1d42-40bb-a300-3d0a1633209f","block_type":"box","text":"lagged significantly: restrictions on foreign ownership persist, and the government has an ownership stake in many","page_number":69,"box":{"x":70,"y":491,"width":818,"height":11}},{"id":"48f69732-e7c8-435f-9385-8a6cfa405597","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":69,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"90a19da0-ef3f-4adc-a55b-8e234358fdef","block_type":"box","text":"Arabia has historically experienced strained relations with economic partners worldwide, including other countries in","page_number":69,"box":{"x":68,"y":521,"width":826,"height":11}},{"id":"ecc01da5-c77c-4ad7-bc10-777089d96ffe","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":69,"box":{"x":68,"y":536,"width":809,"height":11}},{"id":"99e575cf-cfdc-4366-9758-0fb56308f6b6","block_type":"box","text":"including terrorism, may cause uncertainty in their markets and may adversely affect its economy and a Fund’s","page_number":69,"box":{"x":70,"y":551,"width":790,"height":11}},{"id":"20982e4f-d767-40b0-a518-6142a34b6d45","block_type":"box","text":"investments. Governmental actions in the future could have a significant effect on economic conditions in Saudi","page_number":69,"box":{"x":70,"y":566,"width":798,"height":11}},{"id":"abc888ac-161b-4fa0-80ed-b6377754908a","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":69,"box":{"x":68,"y":581,"width":781,"height":11}},{"id":"d7dd3df1-1ae3-4e04-9670-f0f270a062d7","block_type":"box","text":"portfolio. Any economic sanctions on Saudi Arabian individuals or Saudi Arabian corporate entities, or even the threat","page_number":69,"box":{"x":70,"y":596,"width":836,"height":12}},{"id":"7ae39b8f-a758-4d08-8b5f-da3400006a9e","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":69,"box":{"x":69,"y":612,"width":837,"height":11}},{"id":"a3c2e3f1-f6e6-4d79-860e-6a509fc155d5","block_type":"box","text":"riyal or other adverse consequences to the Saudi Arabian economy. In addition, Saudi Arabia’s economy relies heavily","page_number":69,"box":{"x":69,"y":627,"width":838,"height":11}},{"id":"663b033a-8a37-469a-bc00-7f7e4addddb0","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":69,"box":{"x":69,"y":642,"width":790,"height":11}},{"id":"91e5bc9a-9376-4032-831c-00380869692f","block_type":"box","text":"economy.","page_number":69,"box":{"x":69,"y":659,"width":65,"height":9}},{"id":"8ce6b634-3661-4519-92c1-e9dc64d91f6c","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":69,"box":{"x":101,"y":680,"width":747,"height":11}},{"id":"4a7d05db-47b8-4c35-a51e-5ac9fe1f781d","block_type":"box","text":"securities markets in Saudi Arabia are subject to greater risks associated with market volatility, lower market","page_number":69,"box":{"x":69,"y":695,"width":776,"height":11}},{"id":"f70871b1-f1e9-4d34-b3f9-a43355db5019","block_type":"box","text":"capitalization, lower trading volume, illiquidity, inflation, greater price fluctuations, uncertainty regarding the existence","page_number":69,"box":{"x":69,"y":710,"width":836,"height":11}},{"id":"bf533601-7ac6-4867-a50e-56b843148cc1","block_type":"box","text":"of trading markets, governmental control and heavy regulation of labor and industry. Shares of certain Saudi Arabian","page_number":69,"box":{"x":69,"y":725,"width":830,"height":11}},{"id":"aedc6863-2132-4737-bde1-04c4919600d5","block_type":"box","text":"companies tend to trade less frequently than those of companies on exchanges in more developed markets. Such","page_number":69,"box":{"x":69,"y":740,"width":813,"height":11}},{"id":"c63204cb-f3a3-45d9-80b3-4573ce33aa86","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":69,"box":{"x":70,"y":755,"width":822,"height":11}},{"id":"4184c2de-7ef1-4923-94eb-8674f7f11a4f","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":69,"box":{"x":68,"y":770,"width":837,"height":12}},{"id":"8a136aed-380b-4a89-a5ab-308e1e8381d6","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":69,"box":{"x":69,"y":785,"width":826,"height":12}},{"id":"10574b5f-71e0-453f-8e6a-a1d76d441a80","block_type":"box","text":"typically the case for investment managers.","page_number":69,"box":{"x":68,"y":801,"width":309,"height":11}},{"id":"504257ac-12ca-44fc-8d47-76f3e3398198","block_type":"box","text":"Although the political situation in Saudi Arabia is largely stable, Saudi Arabia has historically experienced political","page_number":69,"box":{"x":101,"y":823,"width":806,"height":12}},{"id":"b8d9feeb-6c02-4782-a875-c5045fec8dc3","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":69,"box":{"x":70,"y":838,"width":828,"height":12}},{"id":"b04a2f01-f102-4937-8a7f-1418670fa5d1","block_type":"box","text":"Middle East region could adversely impact the economy of Saudi Arabia. Instability may be caused by military","page_number":69,"box":{"x":70,"y":853,"width":777,"height":12}},{"id":"efbcc4e1-5313-47aa-a894-0f70fb98e95a","block_type":"box","text":"developments, government interventions in the marketplace, terrorism, extremist attitudes, attempted social or","page_number":69,"box":{"x":69,"y":869,"width":796,"height":11}},{"id":"04b86010-ce1e-494c-a07f-7f302869a967","block_type":"box","text":"political reforms, religious differences, or other factors. Additionally, anti-Western views held by certain groups in the","page_number":69,"box":{"x":70,"y":884,"width":830,"height":11}},{"id":"87f21226-d1a4-479c-8b5e-64fc2849959f","block_type":"box","text":"Middle East may influence government policies regarding foreign investment. Further developments in U.S. relations","page_number":69,"box":{"x":70,"y":899,"width":827,"height":11}},{"id":"3d7fa699-e0e8-43a1-8ca7-30dab3c56046","block_type":"box","text":"II-39","page_number":69,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"13f09b2a-9d2e-4fa7-9716-9abcb7c5da2d","block_type":"box","text":"NM1026U-5979889-69/232","page_number":69,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"548d7c2c-f12f-4b49-a385-2e7aae5af1bd","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":70,"box":{"x":68,"y":45,"width":764,"height":11}},{"id":"0c264fcd-1823-4269-b7f6-9c0a8195a641","block_type":"box","text":"significant, and in some cases the most significant, trading partner of, or foreign investor in, Saudi Arabia. As a","page_number":70,"box":{"x":69,"y":60,"width":795,"height":11}},{"id":"5061213a-e82e-4e1a-b6c4-68d8c1c89cc4","block_type":"box","text":"result, economic conditions of Saudi Arabia may be particularly affected by changes in the U.S. economy. A decrease","page_number":70,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"d8c86761-edbc-44af-9174-cc2f60448e0b","block_type":"box","text":"in U.S. imports or exports, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or","page_number":70,"box":{"x":70,"y":90,"width":829,"height":11}},{"id":"a7057c16-6b88-4c44-aaca-e48fe87f5cec","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":70,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"effa7287-8e26-45ac-8b00-6c80ef1ad452","block_type":"box","text":"and, as a result, securities to which the Fund has exposure. Political instability in North Africa and the larger Middle","page_number":70,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"9fd7f59d-2513-491b-9e61-3e834a6bfed3","block_type":"box","text":"East region has caused significant disruptions to many industries. Continued political and social unrest in these","page_number":70,"box":{"x":70,"y":135,"width":797,"height":12}},{"id":"e045b9fa-805d-496d-aa95-bd57053b2ccd","block_type":"box","text":"areas may negatively affect the value of securities in a Fund’s portfolio.","page_number":70,"box":{"x":69,"y":150,"width":510,"height":12}},{"id":"a511f33d-0cb9-4b6c-8d34-416a94538c68","block_type":"box","text":"Certain issuers located in Saudi Arabia may operate in, or have dealings with, countries subject to sanctions","page_number":70,"box":{"x":102,"y":173,"width":773,"height":11}},{"id":"d48375ac-01b3-462c-b92d-a75eaca89aa8","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":70,"box":{"x":69,"y":188,"width":820,"height":12}},{"id":"72a6b963-1021-4904-8ff2-cf4805702b6e","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":70,"box":{"x":69,"y":203,"width":787,"height":12}},{"id":"6a070265-d602-48ab-af28-9c58beafb270","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":70,"box":{"x":70,"y":218,"width":837,"height":12}},{"id":"e973e4f0-8297-40c3-aa3b-535e71cda5e4","block_type":"box","text":"will be indirectly subject to those risks.","page_number":70,"box":{"x":68,"y":234,"width":277,"height":11}},{"id":"92ef5eac-1ff8-43f8-ac90-795b847523a9","block_type":"box","text":"Risks of Investing in Venezuela.","page_number":70,"box":{"x":102,"y":256,"width":223,"height":12}},{"id":"01f5611f-4c74-4912-be23-a0ee3044db4b","block_type":"box","text":"Investment in Venezuela may subject a Fund to legal, regulatory, political,","page_number":70,"box":{"x":332,"y":257,"width":521,"height":11}},{"id":"96af4763-d6fb-415b-b724-9fdc2c952879","block_type":"box","text":"currency, security, expropriation and/or nationalization of assets and economic risk specific to Venezuela. Venezuela","page_number":70,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"5619306b-128c-41cf-80c3-2ab6e3fcd5af","block_type":"box","text":"is extremely well endowed with natural resources, including oil and natural gas, and its economy is heavily dependent","page_number":70,"box":{"x":70,"y":287,"width":837,"height":11}},{"id":"48573989-4fda-4860-b1b7-cb018844b886","block_type":"box","text":"on export of natural resources to key trading partners. Any act of terrorism, an armed conflict or a breakdown of a","page_number":70,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"b3924ba2-a37d-4ec6-911f-bc6bf9870f71","block_type":"box","text":"key trading relationship that disrupts the production or export of natural resources will likely negatively affect the","page_number":70,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"275d708c-d369-487d-acd5-34257370e1cf","block_type":"box","text":"Venezuelan economy. The government continues to control key sectors of the economy, including upstream oil and","page_number":70,"box":{"x":68,"y":332,"width":816,"height":11}},{"id":"a5feaee8-2663-4ba6-9d3d-1a521c1e4cf5","block_type":"box","text":"gas production, and has sought to increase its role in key sectors, such as telecommunications and steel.","page_number":70,"box":{"x":68,"y":347,"width":758,"height":11}},{"id":"8222f790-f7e6-4d1b-9bff-f97ba39e6863","block_type":"box","text":"Meanwhile, ambiguities in the investment environment remain, such as continued high levels of bureaucracy and","page_number":70,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"60ecaf06-1e7c-4d11-9252-9837cef315b7","block_type":"box","text":"corruption, large macroeconomic imbalances, and political and policy uncertainty. Friction continues between the","page_number":70,"box":{"x":69,"y":377,"width":804,"height":12}},{"id":"fd0014fd-4a2c-4e79-9cb5-7a455d18acba","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":70,"box":{"x":68,"y":392,"width":822,"height":12}},{"id":"733cade1-421c-4c79-a1c1-58e99d37e0b4","block_type":"box","text":"and sectoral sanctions, on certain Venezuelan individuals and Venezuelan corporate entities, and on the Venezuelan","page_number":70,"box":{"x":69,"y":408,"width":827,"height":10}},{"id":"800bfc10-878c-41b7-b1fb-98b84c0b9fd0","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":70,"box":{"x":68,"y":423,"width":814,"height":11}},{"id":"c8fc2756-8350-4545-b94f-110175397817","block_type":"box","text":"against Venezuela in an effort to effect regime change. Military action, sanctions, or even the threat of further","page_number":70,"box":{"x":69,"y":438,"width":787,"height":11}},{"id":"76ffc870-0b1c-487e-a897-8ffa891c4460","block_type":"box","text":"military action and sanctions, may result in the decline of the value and liquidity of Venezuelan securities, a","page_number":70,"box":{"x":69,"y":453,"width":766,"height":11}},{"id":"30384923-4cb2-411a-b509-70362c1f0838","block_type":"box","text":"weakening of the bolivar or other adverse consequences to the Venezuelan economy. These sanctions impair the","page_number":70,"box":{"x":68,"y":468,"width":804,"height":11}},{"id":"d90454ad-41e0-4f97-babf-47bae4b8f911","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":70,"box":{"x":69,"y":483,"width":838,"height":11}},{"id":"a56a618b-fe02-4727-b6e7-d377bd20dbb5","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":70,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"6cdd514e-406d-44ca-a107-f20f4c3679ff","block_type":"box","text":"impact on a Fund’s investments.","page_number":70,"box":{"x":70,"y":514,"width":230,"height":10}},{"id":"8d4be7ba-f9ba-464e-8337-07d757248f63","block_type":"box","text":"Brady Bonds.","page_number":70,"box":{"x":102,"y":536,"width":92,"height":11}},{"id":"fbc26d79-91f5-4f9e-a41f-10d73d5d5347","block_type":"box","text":"Certain Funds may invest in Brady Bonds. A Fund’s emerging market debt securities may include","page_number":70,"box":{"x":201,"y":536,"width":689,"height":11}},{"id":"6c8460cc-27b7-486d-a861-baedb40657ff","block_type":"box","text":"emerging market governmental debt obligations commonly referred to as Brady Bonds. Brady Bonds are securities","page_number":70,"box":{"x":69,"y":551,"width":815,"height":11}},{"id":"3fa3903f-3237-4386-913a-533f93a84540","block_type":"box","text":"created through the exchange of existing commercial bank loans to sovereign entities for new obligations in","page_number":70,"box":{"x":69,"y":566,"width":766,"height":11}},{"id":"8e2e933d-ae07-42b8-a491-be46f7e3d746","block_type":"box","text":"connection with debt restructurings under a debt restructuring plan introduced by former U.S. Secretary of the","page_number":70,"box":{"x":69,"y":581,"width":784,"height":12}},{"id":"3afc58a0-e17c-4782-b4b1-f9b182c19940","block_type":"box","text":"Treasury, Nicholas F. Brady (the “Brady Plan”). Brady Plan debt restructurings have been implemented in a number of","page_number":70,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"968dd54e-d7b9-4b7f-847d-f3a71e291755","block_type":"box","text":"countries, including: Argentina, Bolivia, Brazil, Bulgaria, Costa Rica, the Dominican Republic, Ecuador, Jordan, Mexico,","page_number":70,"box":{"x":69,"y":612,"width":839,"height":11}},{"id":"b87cfd57-226e-4a7b-88fd-9508231092bd","block_type":"box","text":"Niger, Nigeria, Panama, Peru, the Philippines, Poland, Uruguay, Venezuela, and Vietnam. Beginning in the early","page_number":70,"box":{"x":70,"y":627,"width":786,"height":11}},{"id":"83011da7-3b5e-4d50-b4d9-00ceb78a8b87","block_type":"box","text":"2000s, certain countries began retiring their Brady Bonds, including Brazil, Colombia, Mexico, the Philippines, and","page_number":70,"box":{"x":69,"y":642,"width":814,"height":11}},{"id":"1146f038-53e1-47cd-836e-89c967ab2a14","block_type":"box","text":"Venezuela.","page_number":70,"box":{"x":68,"y":657,"width":75,"height":9}},{"id":"c4afa51a-7038-488b-af69-99e93bfd0149","block_type":"box","text":"Brady Bonds may be collateralized or uncollateralized, are issued in various currencies (primarily the U.S. dollar)","page_number":70,"box":{"x":102,"y":680,"width":798,"height":11}},{"id":"820a204f-7283-482a-b66a-dc9d3f3a0264","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":70,"box":{"x":69,"y":695,"width":780,"height":11}},{"id":"87b2b402-cbc6-4c0e-84b9-0620689f6819","block_type":"box","text":"Securities. U.S. dollar-denominated, collateralized Brady Bonds, which may be fixed rate par bonds or floating rate","page_number":70,"box":{"x":69,"y":710,"width":812,"height":11}},{"id":"0c5e25e5-ad1f-424d-8d8d-05c540e3000c","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":70,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"3d039dc6-ef52-4458-9fe2-1949050416ca","block_type":"box","text":"same maturity as the Brady Bonds. Interest payments on these Brady Bonds generally are collateralized on a one","page_number":70,"box":{"x":69,"y":740,"width":812,"height":11}},{"id":"192d0f22-edfb-43bb-a921-e13c8857a22e","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":70,"box":{"x":68,"y":755,"width":823,"height":11}},{"id":"1de216f6-1101-4a1e-8f6c-196dcf419f45","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":70,"box":{"x":68,"y":770,"width":833,"height":12}},{"id":"d720aca1-f13e-4ee4-b024-78e76eaa5143","block_type":"box","text":"interest payments based on the applicable interest rate at that time and is adjusted at regular intervals thereafter.","page_number":70,"box":{"x":70,"y":785,"width":816,"height":12}},{"id":"644ed549-32da-4444-83a9-0927e001798a","block_type":"box","text":"Certain Brady Bonds are entitled to “value recovery payments” in certain circumstances, which in effect constitute","page_number":70,"box":{"x":69,"y":801,"width":818,"height":11}},{"id":"4375215f-a01b-4954-bf91-b6142d2f805c","block_type":"box","text":"supplemental interest payments but generally are not collateralized. Brady Bonds are often viewed as having three or","page_number":70,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"a9619741-dcfc-4e66-b474-fb02b466055d","block_type":"box","text":"four valuation components: (i) the collateralized repayment of principal at final maturity; (ii) the collateralized interest","page_number":70,"box":{"x":68,"y":831,"width":832,"height":11}},{"id":"b8c5cc6f-d3ca-4329-9613-1955ee324cd6","block_type":"box","text":"payments; (iii) the uncollateralized interest payments; and (iv) any uncollateralized repayment of principal at maturity","page_number":70,"box":{"x":70,"y":846,"width":828,"height":11}},{"id":"3d710d5e-d80f-459c-96c0-e56f83de84bc","block_type":"box","text":"(the uncollateralized amounts constitute the “residual risk”).","page_number":70,"box":{"x":69,"y":861,"width":430,"height":11}},{"id":"0f714320-11ea-4a83-b4bc-3247b471a9c9","block_type":"box","text":"Brady Bonds involve various risk factors described above associated with investing in foreign securities, including","page_number":70,"box":{"x":102,"y":884,"width":807,"height":11}},{"id":"7ea59d86-ffea-4579-b8ae-e8c64d23ab04","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":70,"box":{"x":68,"y":899,"width":838,"height":11}},{"id":"0db63230-4420-4a88-bded-d99c8131170f","block_type":"box","text":"II-40","page_number":70,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"49ddfbb5-d4d1-4334-a06c-a31f386612f5","block_type":"box","text":"NM1026U-5979889-70/232","page_number":70,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"47c2e3f3-69b2-483f-a146-d087dd912642","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":71,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"40815eae-cc2b-429c-bc41-1b225d7646e2","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":71,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"3c888af0-f257-4175-a8b9-96477892f4c6","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":71,"box":{"x":68,"y":75,"width":841,"height":11}},{"id":"5676a624-630e-442a-b92a-55c5ac18bcf4","block_type":"box","text":"loss of interest or principal on any of its holdings.","page_number":71,"box":{"x":70,"y":90,"width":351,"height":11}},{"id":"9cf4a606-e6b8-4e8c-91f0-03d44d1979ed","block_type":"box","text":"China Investments Risk.","page_number":71,"box":{"x":102,"y":113,"width":171,"height":9}},{"id":"c5ffae42-ed6c-42cd-9bdf-5987e51a0264","block_type":"box","text":"Investments in securities of companies domiciled in the People’s Republic of China (“China” or the “PRC”),","page_number":71,"box":{"x":102,"y":135,"width":763,"height":11}},{"id":"68bbd09c-caa8-45ae-ad42-8c6edbf250fd","block_type":"box","text":"including certain Hong Kong-listed and U.S.-listed securities, involve a high degree of risk and special considerations","page_number":71,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"eba2fcaf-aa60-4e32-84eb-22f5dd1c75e9","block_type":"box","text":"not typically associated with investing in the U.S. securities markets. Such heightened risks include, among others,","page_number":71,"box":{"x":69,"y":166,"width":821,"height":11}},{"id":"38e2ff0f-5c32-45ad-96b7-5ef388a1e554","block_type":"box","text":"an authoritarian government, popular unrest associated with demands for improved political, economic and social","page_number":71,"box":{"x":69,"y":181,"width":809,"height":11}},{"id":"c66eae1a-21f3-4d80-bfaf-825df0fb4a05","block_type":"box","text":"conditions, the impact of regional conflict on the economy and hostile relations with other countries.","page_number":71,"box":{"x":69,"y":196,"width":713,"height":11}},{"id":"2fe9a0b1-7e44-4bff-a37e-13afb29c24d9","block_type":"box","text":"Military conflicts, either in response to internal social unrest or conflicts with other countries, could disrupt","page_number":71,"box":{"x":102,"y":218,"width":762,"height":12}},{"id":"d25494e8-b6c3-49a6-b82b-9f6f2767501c","block_type":"box","text":"economic development. The Chinese economy is vulnerable to the long-running disagreements and religious and","page_number":71,"box":{"x":69,"y":234,"width":800,"height":11}},{"id":"c5f01c9c-c3c3-4682-9fd9-371ebf82a758","block_type":"box","text":"nationalist disputes with Tibet and the Xinjiang region. Since 1997, there have been tensions between the Chinese","page_number":71,"box":{"x":69,"y":249,"width":820,"height":11}},{"id":"62afb2ae-25f4-49ca-be42-1017bbd588e7","block_type":"box","text":"government and many people in Hong Kong who perceive China as tightening control over Hong Kong’s semi","page_number":71,"box":{"x":68,"y":264,"width":777,"height":11}},{"id":"3f60be1f-5ede-493d-ad06-c1b45a211b3c","block_type":"box","text":"autonomous liberal political, economic, legal, and social framework. Protests and unrest have increased tensions","page_number":71,"box":{"x":69,"y":279,"width":809,"height":11}},{"id":"3ae0a3f2-a3e2-4d09-814b-4648bdf1d5b9","block_type":"box","text":"even further. Due to the interconnected nature of the Hong Kong and Chinese economies, this instability in Hong","page_number":71,"box":{"x":69,"y":294,"width":805,"height":11}},{"id":"7665290d-6d98-4eb5-8b79-bc5c97e2b671","block_type":"box","text":"Kong may cause uncertainty in the Hong Kong and Chinese markets. China has a complex territorial dispute","page_number":71,"box":{"x":70,"y":309,"width":770,"height":11}},{"id":"e771f563-dc45-45ae-acf3-01a924def338","block_type":"box","text":"regarding the sovereignty of Taiwan and has made threats of invasion. Taiwan-based companies and individuals are","page_number":71,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"d7be4f53-9e15-4b92-8932-eeaa7e90fc4e","block_type":"box","text":"significant investors in China. The continuing hostility between China and Taiwan may have an adverse impact on the","page_number":71,"box":{"x":69,"y":339,"width":831,"height":12}},{"id":"c8a062b7-31b6-463b-b8ef-5332ad5d53a6","block_type":"box","text":"value of the Fund’s investments in China or Taiwan, may cause a suspension in a Fund’s ability to trade in certain","page_number":71,"box":{"x":68,"y":355,"width":812,"height":11}},{"id":"5ce34a9f-9ce8-4d40-9651-5feb1171714e","block_type":"box","text":"securities or other assets or may otherwise make such investments impracticable or impossible. Any escalation of","page_number":71,"box":{"x":69,"y":370,"width":818,"height":11}},{"id":"17282508-3a31-43ad-afbe-fb11734044c9","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":71,"box":{"x":69,"y":385,"width":769,"height":11}},{"id":"d5cfd8ed-f97c-46b6-9358-178fbacd2e3f","block_type":"box","text":"investments in both countries and the region. In addition, China has strained international relations with Japan, India,","page_number":71,"box":{"x":70,"y":400,"width":836,"height":11}},{"id":"2af2af91-6061-43d9-853a-8bd95a66aadc","block_type":"box","text":"the Philippines and other neighbors due to territorial disputes, historical animosities and other defense concerns.","page_number":71,"box":{"x":68,"y":415,"width":810,"height":11}},{"id":"a55538b2-c7df-4e3b-8ba5-50024fd9c379","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":71,"box":{"x":70,"y":430,"width":813,"height":11}},{"id":"6f68d93c-4cf4-4bbc-8cb1-f67cd49c5bd9","block_type":"box","text":"military conflict. Additionally, China is alleged to have participated in state-sponsored cyberattacks against foreign","page_number":71,"box":{"x":69,"y":445,"width":811,"height":12}},{"id":"f3e4afd6-2ccd-4516-bb4d-43d8914693bb","block_type":"box","text":"companies and foreign governments. Actual and threatened responses to such activity and strained international","page_number":71,"box":{"x":69,"y":460,"width":804,"height":12}},{"id":"690ed127-a52e-407c-9d45-cb3be704b172","block_type":"box","text":"relations, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Chinese government or Chinese","page_number":71,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"d798cf4f-e2c8-41f5-ba91-1e9e49c9f4bf","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":71,"box":{"x":69,"y":491,"width":825,"height":11}},{"id":"096e203c-d847-4231-9ee3-b18222db39d9","block_type":"box","text":"affected by military events on the Korean peninsula or internal instability within North Korea. These situations may","page_number":71,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"3613397f-1399-41a5-bf09-31471e164590","block_type":"box","text":"cause uncertainty in the Chinese market and may adversely affect the performance of the Chinese economy.","page_number":71,"box":{"x":69,"y":521,"width":776,"height":11}},{"id":"e376b560-4d2e-4302-8c34-fe2e12df59e4","block_type":"box","text":"The Chinese government has implemented economic reforms in order to liberalize trade policy, promote foreign","page_number":71,"box":{"x":101,"y":543,"width":792,"height":12}},{"id":"68c2a065-f17f-4a58-a437-79e1aa2ff7aa","block_type":"box","text":"investment in the economy, reduce government control of the economy and develop market mechanisms. However,","page_number":71,"box":{"x":70,"y":559,"width":818,"height":11}},{"id":"1db5fcc4-7c5b-4388-98e9-0884b9319920","block_type":"box","text":"the Chinese government still exercises substantial influence over many aspects of the private sector and may own or","page_number":71,"box":{"x":68,"y":574,"width":835,"height":11}},{"id":"d036bf54-e832-4c20-b06f-d75f42f0f164","block_type":"box","text":"control many companies. Chinese companies, such as those in the financial services or technology sectors, and","page_number":71,"box":{"x":69,"y":589,"width":802,"height":11}},{"id":"d2c225b4-f904-42e5-b00a-faf0aa1e0ed3","block_type":"box","text":"potentially other sectors in the future, are subject to the risk that Chinese authorities can intervene in their","page_number":71,"box":{"x":70,"y":604,"width":763,"height":11}},{"id":"885b0843-7244-4be2-ae32-1716af49b1c4","block_type":"box","text":"operations and structure. The Chinese government continues to maintain a major role in economic policymaking and","page_number":71,"box":{"x":69,"y":619,"width":829,"height":11}},{"id":"8dd1f3eb-6571-43ce-add9-36e216a95a01","block_type":"box","text":"investing in China involves risk of loss due to expropriation, nationalization, confiscation of assets and property or","page_number":71,"box":{"x":70,"y":634,"width":813,"height":12}},{"id":"9825eeff-3e85-41d7-aece-147302acf9a3","block_type":"box","text":"the imposition of restrictions on foreign investments and on repatriation of capital invested.","page_number":71,"box":{"x":68,"y":649,"width":653,"height":12}},{"id":"6b679ac9-a51d-4bf8-9469-768895893277","block_type":"box","text":"The Chinese government may intervene in the Chinese financial markets, such as by the imposition of trading","page_number":71,"box":{"x":101,"y":672,"width":783,"height":11}},{"id":"359c7b06-65a3-473f-b8f1-981a1956b2ec","block_type":"box","text":"restrictions, a ban on “naked” short selling or the suspension of short selling for certain stocks. This may affect","page_number":71,"box":{"x":69,"y":687,"width":805,"height":11}},{"id":"ce847dca-1751-4fb0-99bb-606ec200675e","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":71,"box":{"x":69,"y":702,"width":827,"height":11}},{"id":"248c9a61-2881-448a-9d3d-5d15f6b545cc","block_type":"box","text":"Funds. Furthermore, such market interventions may have a negative impact on market sentiment which may in turn","page_number":71,"box":{"x":70,"y":718,"width":821,"height":11}},{"id":"979b62b9-0802-4e8d-8479-0ec9f988a300","block_type":"box","text":"affect the performance of the securities markets and as a result the performance of the Funds.","page_number":71,"box":{"x":69,"y":732,"width":683,"height":11}},{"id":"ee06d3a3-12d8-43d9-91ba-401f56d8fcb0","block_type":"box","text":"In addition, there is less regulation and monitoring of Chinese securities markets and the activities of investors,","page_number":71,"box":{"x":102,"y":755,"width":797,"height":11}},{"id":"83c13e8b-aec7-48fd-9c70-ca7b4530d880","block_type":"box","text":"brokers and other participants than in the United States. Accordingly, issuers of securities in China, including","page_number":71,"box":{"x":69,"y":770,"width":779,"height":12}},{"id":"4fac0b39-2038-4c4c-ba6d-0bed3e8bcf59","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":71,"box":{"x":69,"y":785,"width":822,"height":12}},{"id":"e9e5356b-d798-478a-90f8-76e5d6255bdd","block_type":"box","text":"issuers with respect to such matters as insider trading rules, tender offer regulation, accounting standards or auditor","page_number":71,"box":{"x":70,"y":801,"width":836,"height":11}},{"id":"b1a05619-797f-480c-a44a-e514e2291d7b","block_type":"box","text":"oversight, stockholder proxy requirements and the requirements mandating timely and accurate disclosure of","page_number":71,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"555dfa65-0317-4735-b5bc-aaaa34368c6b","block_type":"box","text":"information. Securities markets in China are in the process of change and further development. This may lead to","page_number":71,"box":{"x":70,"y":831,"width":803,"height":11}},{"id":"ba9cd2c3-ad2e-4095-a882-55da4c1c0fb5","block_type":"box","text":"trading volatility, difficulty in the settlement and recording of transactions and difficulty in interpreting and applying","page_number":71,"box":{"x":68,"y":846,"width":816,"height":11}},{"id":"8482bfa2-a8fd-4b9b-a7d2-16627ddf98b3","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":71,"box":{"x":68,"y":861,"width":816,"height":11}},{"id":"37fdda70-15ee-4ec6-83c7-de0449533bd8","block_type":"box","text":"settlement and administration of securities in China that is customary in more developed markets. In particular,","page_number":71,"box":{"x":69,"y":876,"width":798,"height":11}},{"id":"17da0ae9-9a54-40e6-9e8b-3e5b8ac23727","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":71,"box":{"x":68,"y":891,"width":826,"height":12}},{"id":"082e49c8-f554-4288-babd-e89c0fd607ec","block_type":"box","text":"sub-custodian.","page_number":71,"box":{"x":69,"y":907,"width":102,"height":8}},{"id":"50841271-ebce-4b75-8649-0f4f12e0bb23","block_type":"box","text":"II-41","page_number":71,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bd1059da-7bb5-42e1-ba12-bb29c85e747e","block_type":"box","text":"NM1026U-5979889-71/232","page_number":71,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"3f4aae8c-5c49-48a6-98f0-b0189a941344","block_type":"box","text":"There may be significant obstacles to obtaining information necessary for investigations into or litigation against","page_number":72,"box":{"x":101,"y":45,"width":801,"height":11}},{"id":"30cff734-5850-4fea-8bfb-c95b00e9c8fc","block_type":"box","text":"Chinese companies, and shareholders may have limited legal remedies. The Funds do not select investments based","page_number":72,"box":{"x":69,"y":60,"width":829,"height":11}},{"id":"30cc9680-21f7-44e6-bbfb-60c15361865f","block_type":"box","text":"on investor protection considerations.","page_number":72,"box":{"x":69,"y":75,"width":268,"height":11}},{"id":"ea87ef36-1bc1-4f2e-8875-75ea9cdb05ea","block_type":"box","text":"The Chinese government historically took positions that prevented the U.S. Public Company Accounting Oversight","page_number":72,"box":{"x":101,"y":98,"width":806,"height":11}},{"id":"b0c3d634-823c-4d65-838b-64545c67229e","block_type":"box","text":"Board (“PCAOB”) from inspecting the audit work and practices of accounting firms in mainland China and Hong Kong","page_number":72,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"30ef8798-4aa7-489d-8e6b-8d40674bae04","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":72,"box":{"x":68,"y":128,"width":810,"height":11}},{"id":"1db5bcb5-bf4d-416e-99a1-0e6586fc6be1","block_type":"box","text":"Protocol with the China Securities Regulatory Commission and the Ministry of Finance of the PRC, which marked the","page_number":72,"box":{"x":69,"y":143,"width":829,"height":11}},{"id":"d0257312-6250-41fe-b6a3-5b0252f894d8","block_type":"box","text":"first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms","page_number":72,"box":{"x":68,"y":158,"width":774,"height":11}},{"id":"c77b6027-a792-44ac-8bc8-d42bf0d9abea","block_type":"box","text":"headquartered in mainland China and Hong Kong completely in accordance with U.S. law. However, as this","page_number":72,"box":{"x":69,"y":173,"width":760,"height":11}},{"id":"c0a10f3b-5a79-4cbf-ab58-04a18258c310","block_type":"box","text":"development is relatively recent, the implementation of the Statement of Protocol remains to be tested. Audits","page_number":72,"box":{"x":69,"y":188,"width":788,"height":11}},{"id":"0800b77e-b5b3-4453-9005-52e5fe80e1c5","block_type":"box","text":"performed by PCAOB-registered accounting firms in mainland China and Hong Kong may be less reliable than those","page_number":72,"box":{"x":70,"y":203,"width":822,"height":12}},{"id":"d9045061-ef1b-487b-8c5a-94a57e9134b0","block_type":"box","text":"performed by firms subject to PCAOB inspection. Accordingly, information about the Chinese securities in which the","page_number":72,"box":{"x":70,"y":218,"width":821,"height":12}},{"id":"abca802c-4ae7-4099-a453-4c20e793264b","block_type":"box","text":"Funds invest may be less reliable or complete. Under amendments to the Sarbanes-Oxley Act enacted in December","page_number":72,"box":{"x":70,"y":234,"width":820,"height":11}},{"id":"f6e48e4b-81c5-4c43-b401-896fd82847a8","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":72,"box":{"x":69,"y":249,"width":805,"height":11}},{"id":"862b39aa-d624-4c91-91ff-5170ad515a74","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":72,"box":{"x":69,"y":264,"width":816,"height":11}},{"id":"77bf1f0b-49ed-462f-aaa2-5fd872f3b752","block_type":"box","text":"accounting firm.","page_number":72,"box":{"x":69,"y":279,"width":112,"height":11}},{"id":"b57d7151-f266-4a6f-b10f-85be288f88bf","block_type":"box","text":"The Renminbi (“RMB”) is currently not a freely convertible currency and is subject to foreign exchange control","page_number":72,"box":{"x":101,"y":302,"width":780,"height":11}},{"id":"46e1a33d-cf90-4d2b-88f4-67ec1514d833","block_type":"box","text":"policies and repatriation restrictions imposed by the Chinese government. The imposition of currency controls may","page_number":72,"box":{"x":70,"y":317,"width":815,"height":11}},{"id":"0c381d71-a20a-4360-bea0-bb80297342ad","block_type":"box","text":"negatively impact performance and liquidity of the Funds as capital may become trapped in the PRC. The Funds could","page_number":72,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"6f2c8fad-128d-43fb-a3a8-b49cadded6be","block_type":"box","text":"be adversely affected by delays in, or a refusal to grant, any required governmental approval for repatriation of","page_number":72,"box":{"x":69,"y":347,"width":787,"height":11}},{"id":"c8f8c289-1fcf-4e08-9208-9c71bf2421bb","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":72,"box":{"x":69,"y":362,"width":837,"height":11}},{"id":"8bc12489-0118-4aa2-b802-debcb92aab00","block_type":"box","text":"which have a substantial portion of their operations in, the PRC may require the Funds to adopt special procedures,","page_number":72,"box":{"x":68,"y":377,"width":825,"height":11}},{"id":"5637e0e8-9e06-4a94-be75-c08933bd5ebe","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":72,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"60aadcad-b6cc-4429-b31c-eda7cf5fc3e1","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":72,"box":{"x":70,"y":408,"width":812,"height":11}},{"id":"be3dbfb2-24e3-428c-a098-500270658ce1","block_type":"box","text":"connection with conversions between the two separate types of RMB, the onshore RMB (“CNY”) and the offshore","page_number":72,"box":{"x":69,"y":423,"width":808,"height":11}},{"id":"3e3d7296-771d-419e-a2fa-e39ee5bcb329","block_type":"box","text":"RMB (“CNH”).","page_number":72,"box":{"x":70,"y":438,"width":97,"height":11}},{"id":"55d1d445-983c-485e-b40f-0abd7741194c","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":72,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"60db0e15-6c9f-4c66-86aa-2b6043995a0c","block_type":"box","text":"result of foreign ownership restrictions. In a VIE structure, a Chinese operating company establishes a shell company","page_number":72,"box":{"x":69,"y":475,"width":837,"height":12}},{"id":"f90f4400-950e-4936-ba2a-6bdab040089a","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":72,"box":{"x":70,"y":491,"width":822,"height":11}},{"id":"b9e7f2aa-ec7a-4e6e-82b9-7da4d124b342","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":72,"box":{"x":70,"y":506,"width":775,"height":11}},{"id":"b6205e99-ee3c-4e22-9ca7-93696a88812e","block_type":"box","text":"company directly or indirectly enters into contracts with the Chinese operating company under Chinese law. These","page_number":72,"box":{"x":69,"y":521,"width":809,"height":11}},{"id":"076b8bed-050d-4135-9b59-425d3cb5cc9f","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":72,"box":{"x":69,"y":536,"width":803,"height":11}},{"id":"6a70defa-d3e9-4992-9a05-3e10185a6369","block_type":"box","text":"represent equity ownership in the operating company.","page_number":72,"box":{"x":69,"y":551,"width":380,"height":11}},{"id":"dd72323a-3fdd-4c79-a2b8-e6f31a4b1886","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":72,"box":{"x":101,"y":574,"width":801,"height":11}},{"id":"94ae8bae-7121-4142-998e-7a4e5f40da97","block_type":"box","text":"formally recognized under Chinese law. The Chinese government has provided guidance to and placed restrictions on","page_number":72,"box":{"x":68,"y":589,"width":833,"height":11}},{"id":"e35419f8-5246-4c71-bde3-c2333d4b38f5","block_type":"box","text":"Chinese-based companies raising capital offshore, including through VIEs. In 2023, the China Securities Regulatory","page_number":72,"box":{"x":69,"y":604,"width":825,"height":11}},{"id":"94d5b343-fef4-407d-81eb-7faa794a83a2","block_type":"box","text":"Commission (“CSRC”) released new rules that permit the use of VIE structures, provided they abide by Chinese laws","page_number":72,"box":{"x":69,"y":619,"width":832,"height":11}},{"id":"e600ff15-9ba2-4280-aa38-d6a3afd6fe87","block_type":"box","text":"and register with the CSRC. The rules, however, may cause Chinese companies to undergo greater scrutiny and add","page_number":72,"box":{"x":69,"y":634,"width":826,"height":12}},{"id":"d208f8a3-21f8-490f-97c1-366b9f7d71ad","block_type":"box","text":"costs to VIE structures. Intervention, rulemaking or guidance by the Chinese government with respect to VIE","page_number":72,"box":{"x":69,"y":649,"width":770,"height":12}},{"id":"3a6bad46-cae4-4e20-a891-ceeb37fb39bf","block_type":"box","text":"structures or the non-enforcement of VIE-related contractual rights could significantly affect the operating company’s","page_number":72,"box":{"x":69,"y":664,"width":829,"height":12}},{"id":"9531f2b0-8fa0-499e-b7e8-753b59ce3beb","block_type":"box","text":"business in China, the enforceability of the U.S.-listed shell company’s contractual arrangements with the Chinese","page_number":72,"box":{"x":69,"y":680,"width":815,"height":11}},{"id":"b864e1e2-f8ef-4f8d-8e36-2e4fbb2a31e0","block_type":"box","text":"company and the value of the U.S.-listed stock. Further, the VIE contractual arrangement would likely be subject to","page_number":72,"box":{"x":69,"y":695,"width":815,"height":11}},{"id":"89e95ddc-f124-41cb-8944-c32d4b9eaae7","block_type":"box","text":"Chinese law and jurisdiction, and remedies available to the U.S.-listed shell company are uncertain and could be","page_number":72,"box":{"x":69,"y":710,"width":802,"height":11}},{"id":"5f1b7dbc-fe91-445f-a460-27908be46952","block_type":"box","text":"ineffective. In addition to the risk of government intervention, investments through a VIE structure are subject to the","page_number":72,"box":{"x":70,"y":725,"width":828,"height":11}},{"id":"5762de72-afbe-45aa-8485-3c3f7e3d5fdb","block_type":"box","text":"risk that the China-based company (or its officers, directors, or Chinese equity owners) may breach those contractual","page_number":72,"box":{"x":69,"y":740,"width":833,"height":11}},{"id":"b100fca3-3780-4d2a-8c31-78a1f00c518a","block_type":"box","text":"arrangements, or Chinese law changes in a way that adversely affects the enforceability of these arrangements, or","page_number":72,"box":{"x":69,"y":755,"width":819,"height":11}},{"id":"7e3d50c7-78e3-4086-bde5-dd36bbf55a0e","block_type":"box","text":"those contracts are otherwise not enforceable under Chinese law, in which case the Fund may suffer significant","page_number":72,"box":{"x":68,"y":770,"width":798,"height":12}},{"id":"a84f07f4-f2f7-4b94-99ed-8a08a4999790","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":72,"box":{"x":70,"y":785,"width":833,"height":12}},{"id":"7497a808-e089-4443-adfc-b135faf5b68b","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":72,"box":{"x":69,"y":801,"width":837,"height":11}},{"id":"aaa6c21b-e3fc-4606-90ba-cc8964706d47","block_type":"box","text":"generally or with respect to specific industries, could result in significant, and possibly permanent and/or total,","page_number":72,"box":{"x":68,"y":816,"width":792,"height":11}},{"id":"0bf684bf-9e19-4fcf-9acc-f063107447ae","block_type":"box","text":"losses to a Fund.","page_number":72,"box":{"x":70,"y":831,"width":120,"height":9}},{"id":"94a682aa-49c8-4bf1-8aab-4e7f19cd0791","block_type":"box","text":"While the Chinese economy has experienced past periods of rapid growth, there is no assurance that such","page_number":72,"box":{"x":101,"y":853,"width":760,"height":12}},{"id":"2e21dcc4-73c3-4875-bdc8-c6066752cde9","block_type":"box","text":"growth rates will recur. Other economic challenges for China include indebtedness, weak consumer demand, trade","page_number":72,"box":{"x":68,"y":869,"width":815,"height":11}},{"id":"c99d8cd0-3655-4482-8bec-8637d246ae4e","block_type":"box","text":"tensions, and an aging population. China continues to face pressure from its trading partners over its exporting of its","page_number":72,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"fd83e359-9550-4b70-baf8-31ac75f97975","block_type":"box","text":"excess industrial capacity and overall approach to economic management. China’s economy is heavily dependent on","page_number":72,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"36951225-1dc1-4a42-8828-3a0b2d9c9a27","block_type":"box","text":"II-42","page_number":72,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"798dba27-6e8c-4c68-bbb3-b97d5e453267","block_type":"box","text":"NM1026U-5979889-72/232","page_number":72,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"b261998d-1878-4e73-b39e-d70601c18e41","block_type":"box","text":"export growth. Reduction in spending on Chinese products and services, supply chain diversification, institution of","page_number":73,"box":{"x":69,"y":45,"width":815,"height":11}},{"id":"e9c023ff-d5b9-42a0-9bcf-9689bfd3e1dc","block_type":"box","text":"additional tariffs, sanctions or other trade barriers (including as a result of heightened trade tensions between China","page_number":73,"box":{"x":69,"y":60,"width":832,"height":11}},{"id":"ba082cec-7a71-4db2-a70a-339f22f48c06","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":73,"box":{"x":69,"y":75,"width":765,"height":11}},{"id":"f906d566-78b9-4c26-b44b-f5bdddc050d2","block_type":"box","text":"economies of China’s key trading partners may have an adverse impact on the Chinese economy and the companies","page_number":73,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"fb2390dd-913f-4f3f-b4eb-9430cac23c8b","block_type":"box","text":"in which a Fund invests. Certain Chinese companies (which may change from time to time) are directly or indirectly","page_number":73,"box":{"x":70,"y":105,"width":816,"height":11}},{"id":"aabd3c53-5f50-47ba-8f62-847cd9f4fc10","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":73,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"6a29e882-a22b-4fcc-97b6-e6a36e537a45","block_type":"box","text":"rights or other concerns of such government. For example, certain foreign technology companies are subject to U.S.","page_number":73,"box":{"x":69,"y":135,"width":825,"height":12}},{"id":"1d129d88-ea53-4faa-964f-e61890d60012","block_type":"box","text":"export controls as those companies are believed to pose a risk to U.S. interests. The U.S. also bans imports of","page_number":73,"box":{"x":69,"y":150,"width":798,"height":11}},{"id":"4d1880f1-9fac-497e-ab51-39e57f3ecfdd","block_type":"box","text":"goods produced in certain regions of China or by certain Chinese companies due to concerns about forced labor.","page_number":73,"box":{"x":68,"y":166,"width":805,"height":11}},{"id":"00757974-0e59-4abb-b006-0d2c1782425b","block_type":"box","text":"Such restrictions may have unanticipated and adverse effects on the Chinese economy and companies. Any action","page_number":73,"box":{"x":69,"y":181,"width":817,"height":11}},{"id":"d766a2fe-4181-44b6-a162-7fec0733576a","block_type":"box","text":"that targets Chinese financial markets or securities exchanges could interfere with orderly trading, delay settlement","page_number":73,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"3f26d495-f6e0-4dce-ad0d-aeca878ee096","block_type":"box","text":"or cause market disruptions. Certain companies may be subject to economic or trade restrictions (but not investment","page_number":73,"box":{"x":69,"y":211,"width":839,"height":11}},{"id":"364b9ef2-d7bc-4977-ac4f-fd137bada0f0","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":73,"box":{"x":69,"y":226,"width":815,"height":11}},{"id":"80ff9d30-9ba3-4797-a0f9-2a4b663288f2","block_type":"box","text":"such government. So long as these restrictions do not include restrictions on investments, the Fund may invest in","page_number":73,"box":{"x":69,"y":241,"width":812,"height":11}},{"id":"edc4e4d0-3e07-45ef-866b-0ab9b637ce04","block_type":"box","text":"such companies.","page_number":73,"box":{"x":69,"y":257,"width":119,"height":10}},{"id":"de88b8a3-9ab9-4429-8c82-339ab5d7f4fe","block_type":"box","text":"The tax laws and regulations in the PRC are subject to change, including the issuance of authoritative guidance","page_number":73,"box":{"x":101,"y":279,"width":792,"height":11}},{"id":"ae1f2f16-0083-4aee-9a9f-0b323bcfb8d1","block_type":"box","text":"or enforcement, possibly with retroactive effect. The interpretation, applicability and enforcement of such laws by PRC","page_number":73,"box":{"x":69,"y":294,"width":840,"height":11}},{"id":"6cb537f5-5fbb-43df-bce7-13bce49be94f","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":73,"box":{"x":68,"y":309,"width":815,"height":11}},{"id":"af957a99-b015-48e0-ac7d-f4e0e010a8b7","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":73,"box":{"x":69,"y":324,"width":823,"height":12}},{"id":"886a968c-2758-428c-a9ec-2bd638a6cbcd","block_type":"box","text":"on a Fund and its investors, particularly in relation to capital gains withholding tax imposed upon non-residents. In","page_number":73,"box":{"x":69,"y":340,"width":812,"height":11}},{"id":"c56eb5d9-b37d-40a1-8a18-b2087792aef4","block_type":"box","text":"addition, the accounting, auditing and financial reporting standards and practices applicable to Chinese companies","page_number":73,"box":{"x":69,"y":355,"width":821,"height":11}},{"id":"64a85aa2-abde-4571-a6c4-d35885b73a6f","block_type":"box","text":"may be less rigorous, and may result in significant differences between financial statements prepared in accordance","page_number":73,"box":{"x":69,"y":370,"width":832,"height":11}},{"id":"cd9ddde4-b4b3-486d-84e7-cdbfce6f8055","block_type":"box","text":"with PRC accounting standards and practice and those prepared in accordance with international accounting","page_number":73,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"c28bd8f0-050f-481a-9ac1-67ec3ec17dea","block_type":"box","text":"standards.","page_number":73,"box":{"x":69,"y":400,"width":74,"height":9}},{"id":"c264525a-40e9-4db4-899a-3a814639ff32","block_type":"box","text":"From time to time and in recent years, China has experienced outbreaks of infectious illnesses and the country","page_number":73,"box":{"x":102,"y":423,"width":794,"height":11}},{"id":"d7b929ae-06ee-4b0d-8037-8aeebb21f75b","block_type":"box","text":"may be subject to other public health threats, infectious illnesses, diseases or similar issues in the future. Any","page_number":73,"box":{"x":69,"y":438,"width":792,"height":11}},{"id":"ca7268c1-0ae7-4c0d-906c-f7bdfc50df33","block_type":"box","text":"spread of an infectious illness, public health threat or similar issue could reduce consumer demand or economic","page_number":73,"box":{"x":69,"y":453,"width":803,"height":11}},{"id":"1a588b77-db9a-4419-9cf8-169f0a32ab24","block_type":"box","text":"output, result in market closures, travel restrictions or quarantines, and generally have a significant impact on the","page_number":73,"box":{"x":69,"y":468,"width":811,"height":11}},{"id":"bdffc85b-0d71-4489-a0ca-8e966caa22d9","block_type":"box","text":"Chinese economy, which in turn could adversely affect a Fund’s investments.","page_number":73,"box":{"x":69,"y":483,"width":548,"height":11}},{"id":"5e930b27-6691-4b4c-a176-6735d8f71e3c","block_type":"box","text":"Risk of Investing through Stock Connect.","page_number":73,"box":{"x":102,"y":506,"width":288,"height":11}},{"id":"da32247f-ecd4-4ac0-9a72-b5ad82a77ff8","block_type":"box","text":"General","page_number":73,"box":{"x":102,"y":529,"width":55,"height":8}},{"id":"08bdc35b-40cd-4d2f-9f11-b5238484ebc8","block_type":"box","text":". China A-shares are equity securities of companies domiciled in China that trade on Chinese stock","page_number":73,"box":{"x":158,"y":528,"width":704,"height":12}},{"id":"afa22fbd-cb99-4c4c-99aa-239a6fa2015b","block_type":"box","text":"exchanges such as the Shanghai Stock Exchange (“SSE”), the Shenzhen Stock Exchange (“SZSE”) and the Beijing","page_number":73,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"d1b4fc8d-c74c-4a93-a160-fb94773a58b4","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":73,"box":{"x":69,"y":559,"width":815,"height":11}},{"id":"1a5d9ba1-1c36-4d1b-bd6d-ad8403f07350","block_type":"box","text":"than pursuant to available exceptions, such as through a qualified foreign investor approved pursuant to the relevant","page_number":73,"box":{"x":68,"y":574,"width":833,"height":11}},{"id":"95e74aac-f98d-436b-ada0-52fc479db816","block_type":"box","text":"mainland China laws and regulations as may be promulgated and/or amended from time to time (“QFI”).","page_number":73,"box":{"x":69,"y":589,"width":744,"height":11}},{"id":"a5f77aa6-de69-4604-b343-62e2d895222b","block_type":"box","text":"Investment in eligible exchange traded funds and A-shares listed and traded on the SSE or SZSE (“Stock","page_number":73,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"e0c49691-12b4-4118-a7ce-03f4d668ed4e","block_type":"box","text":"Connect Securities”) is also permitted through the Shanghai-Hong Kong Stock Connect program or the Shenzhen","page_number":73,"box":{"x":69,"y":627,"width":807,"height":11}},{"id":"0f832133-6e65-4135-8a26-6202fb1361d9","block_type":"box","text":"Hong Kong Stock Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). Each","page_number":73,"box":{"x":70,"y":642,"width":834,"height":11}},{"id":"05d96571-e645-4f9f-b573-efdca3a78719","block_type":"box","text":"Stock Connect is a securities trading and clearing links program established by The Stock Exchange of Hong Kong","page_number":73,"box":{"x":69,"y":657,"width":812,"height":11}},{"id":"217c02ca-6c3e-4098-a79c-b2cac314a319","block_type":"box","text":"Limited (“SEHK”), the Hong Kong Securities Clearing Company Limited (“HKSCC”), the SSE or SZSE, as applicable,","page_number":73,"box":{"x":70,"y":672,"width":819,"height":11}},{"id":"589e1b17-c698-455e-be82-71fad0677d40","block_type":"box","text":"and China Securities Depository and Clearing Corporation Limited (“CSDCC”) that aims to provide mutual stock","page_number":73,"box":{"x":69,"y":687,"width":793,"height":11}},{"id":"2806238a-875c-42fd-a73d-f5216b4de2d3","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":73,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"0a76ec72-b8ca-43f5-a5dc-bd17fe5f30b5","block_type":"box","text":"through their local securities brokers. Under Stock Connects, a Fund’s trading of Stock Connect Securities listed on","page_number":73,"box":{"x":68,"y":717,"width":824,"height":12}},{"id":"ae97f923-c9bc-458b-b2d6-75a6b9fc7ef4","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":73,"box":{"x":68,"y":732,"width":827,"height":12}},{"id":"167d7541-a973-459c-a048-1cb2fcdc7e7a","block_type":"box","text":"company established by SEHK.","page_number":73,"box":{"x":69,"y":748,"width":219,"height":11}},{"id":"45cc0d25-168b-4474-863c-be45b34f7b57","block_type":"box","text":"Although no individual investment quotas or licensing requirements apply to investors in Stock Connect, trading","page_number":73,"box":{"x":101,"y":770,"width":794,"height":12}},{"id":"2b67ec04-38bf-41d7-9ee1-22585f35415b","block_type":"box","text":"through a Stock Connect’s Northbound Trading Link is subject to daily investment quota limitations which require that","page_number":73,"box":{"x":68,"y":786,"width":839,"height":11}},{"id":"cff2ce8d-6b6c-4308-a284-31c99eb48cba","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":73,"box":{"x":69,"y":801,"width":779,"height":11}},{"id":"f032ad0f-d609-4af8-99f7-10a2da6150c1","block_type":"box","text":"permitted to sell their Stock Connect Securities regardless of the quota). These limitations may restrict a Fund from","page_number":73,"box":{"x":70,"y":816,"width":824,"height":11}},{"id":"cf60be1c-21eb-427f-8ee6-66f12b6e2b60","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":73,"box":{"x":70,"y":831,"width":827,"height":11}},{"id":"bf6332b2-9c39-4ddd-a335-9d40da0ebb99","block_type":"box","text":"investment strategy. Investment quotas are also subject to change. Investment in Stock Connect Securities through a","page_number":73,"box":{"x":70,"y":846,"width":837,"height":11}},{"id":"2f2dca93-c5bc-4072-8ebe-aca7da13de1c","block_type":"box","text":"Stock Connect is subject to trading, clearance and settlement procedures that could pose risks to a Fund. Stock","page_number":73,"box":{"x":69,"y":861,"width":802,"height":11}},{"id":"b8bcb349-c92d-4fdb-99c5-9c67b935ad88","block_type":"box","text":"Connect Securities purchased through Stock Connects generally may not be sold or otherwise transferred other than","page_number":73,"box":{"x":69,"y":876,"width":831,"height":11}},{"id":"e491e4c5-1a14-4a19-8112-cf9f06a1e511","block_type":"box","text":"through Stock Connects in accordance with applicable rules. For example, the PRC regulations require that in order","page_number":73,"box":{"x":68,"y":891,"width":821,"height":12}},{"id":"74cb59e9-582c-4875-a10d-de0e6b6bad94","block_type":"box","text":"for an investor to sell any Stock Connect Securities on a certain trading day, there must be sufficient Stock Connect","page_number":73,"box":{"x":68,"y":906,"width":829,"height":12}},{"id":"2920b7cc-2b55-41e8-8376-348ba8ba022e","block_type":"box","text":"II-43","page_number":73,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9dfdb42d-0652-4fd8-b655-d74f9f0b99cb","block_type":"box","text":"NM1026U-5979889-73/232","page_number":73,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"6342303e-dec2-4903-ae7d-ac935914d6eb","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":74,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"49dba36d-ff4e-4bbc-b90a-0f3f4ed99c81","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":74,"box":{"x":69,"y":60,"width":820,"height":11}},{"id":"1702ef3d-a986-4129-95ef-7a62035cf1fb","block_type":"box","text":"out pre-trade checking on sell orders of certain stocks listed on the SSE market (“SSE Securities”) or SZSE market","page_number":74,"box":{"x":69,"y":75,"width":820,"height":11}},{"id":"e15612e1-d782-4902-8e77-49ebace44e70","block_type":"box","text":"(“SZSE Securities”) of its participants (","page_number":74,"box":{"x":69,"y":90,"width":278,"height":11}},{"id":"0d63c5b1-3be0-4a73-b7cd-81150b8e7112","block_type":"box","text":"i.e.","page_number":74,"box":{"x":349,"y":90,"width":21,"height":9}},{"id":"3a3595a6-4f53-417b-a51f-c487faea4279","block_type":"box","text":", stock brokers) to ensure that this requirement is satisfied. While shares","page_number":74,"box":{"x":372,"y":90,"width":524,"height":11}},{"id":"41631dd8-c1ac-4f84-8a9c-4aed16064d49","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":74,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"51b93c84-3b58-44ff-9654-d86ded98a754","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":74,"box":{"x":69,"y":120,"width":810,"height":12}},{"id":"542a9d60-9084-4f96-9f35-7e1c0bcc4acd","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":74,"box":{"x":69,"y":135,"width":834,"height":12}},{"id":"0182bc77-0c9f-4b38-b403-df8446fc0961","block_type":"box","text":"services are available in both markets on the corresponding settlement days. Therefore, an investment in Stock","page_number":74,"box":{"x":69,"y":150,"width":799,"height":12}},{"id":"3291d95c-f323-48df-8317-e0f721ad1965","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":74,"box":{"x":69,"y":166,"width":797,"height":11}},{"id":"09754e04-b1bb-49d3-95c9-7ede1186e0b5","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":74,"box":{"x":69,"y":181,"width":818,"height":11}},{"id":"bc1e1e0f-af01-49b6-bcae-bf68cb5d752c","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":74,"box":{"x":68,"y":196,"width":820,"height":11}},{"id":"c3eb53b8-35be-42a3-9acd-933706d87647","block_type":"box","text":"be able to sell the Stock Connect Securities on or after day T+1. Further, since all trades of Stock Connect Securities","page_number":74,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"ef6194ef-d0c2-4679-99a1-dab79017f49d","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":74,"box":{"x":69,"y":226,"width":811,"height":11}},{"id":"9f51cb26-72c0-421f-94e8-1a524149730a","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":74,"box":{"x":68,"y":241,"width":815,"height":11}},{"id":"dcfdc737-2e0b-4c11-b398-a6d6e4b76343","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":74,"box":{"x":69,"y":256,"width":824,"height":11}},{"id":"ab2ae031-6390-41e2-8fbd-061edbd75bd3","block_type":"box","text":"RMB, the Fund will be exposed to currency exchange risk if the Fund converts the local currency into RMB for","page_number":74,"box":{"x":70,"y":271,"width":777,"height":12}},{"id":"ff11f931-5cb6-4b2d-9279-c1fdb0d01ac7","block_type":"box","text":"investments in Stock Connect Securities. A Fund may also incur conversion costs.","page_number":74,"box":{"x":70,"y":287,"width":582,"height":11}},{"id":"bd1a4eb3-692a-4ae7-8d61-a6a015f0fef7","block_type":"box","text":"Stock Connect Securities held through the nominee structure under a Stock Connect will be held through HKSCC","page_number":74,"box":{"x":102,"y":309,"width":802,"height":11}},{"id":"2ed46769-8644-4ebf-840d-5d59666ee72a","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":74,"box":{"x":69,"y":324,"width":784,"height":12}},{"id":"7459bdbb-4aff-4599-8dff-7f3961cb3d0c","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":74,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"00442994-7ab6-4df8-9695-4fcc44a7da8b","block_type":"box","text":"clear definition of, and distinction between, legal ownership and beneficial ownership under the PRC laws and there","page_number":74,"box":{"x":69,"y":355,"width":822,"height":11}},{"id":"8891a12a-c20e-44ac-a821-839eb98744bc","block_type":"box","text":"have been few cases involving a nominee account structure in the PRC courts. The exact nature and methods of","page_number":74,"box":{"x":69,"y":370,"width":802,"height":11}},{"id":"64425318-1208-488d-b8fb-4bab123150bc","block_type":"box","text":"enforcement of the rights and interests of a Fund under the PRC laws is also uncertain. In the unlikely event that","page_number":74,"box":{"x":69,"y":385,"width":805,"height":11}},{"id":"2c70dd09-57b2-46b1-b1f1-6b4c933be3d7","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":74,"box":{"x":70,"y":400,"width":807,"height":11}},{"id":"69543cd0-462c-474e-97f6-3fc9f39ca3bd","block_type":"box","text":"Securities may not be regarded as held for the beneficial ownership of a Fund or as part of the general assets of","page_number":74,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"b8a7ceb2-90e6-492d-9402-edf5936734ea","block_type":"box","text":"HKSCC available for general distribution to its creditors. Notwithstanding the fact that HKSCC does not claim","page_number":74,"box":{"x":70,"y":430,"width":774,"height":11}},{"id":"cb619176-a4fd-4a65-aeff-1ed5de760e1d","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":74,"box":{"x":70,"y":445,"width":816,"height":11}},{"id":"8ac9e7ed-ac3e-4139-befa-686c58eb84cd","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":74,"box":{"x":69,"y":460,"width":808,"height":12}},{"id":"cfd744f7-10dd-41c6-8138-2cc419fca976","block_type":"box","text":"when it handles corporate actions in respect of such SSE Securities or SZSE Securities. HKSCC monitors the","page_number":74,"box":{"x":68,"y":475,"width":779,"height":11}},{"id":"762c4406-4571-4697-a219-e34c3916c21a","block_type":"box","text":"corporate actions affecting SSE Securities and SZSE Securities and keeps participants of Central Clearing and","page_number":74,"box":{"x":69,"y":491,"width":788,"height":11}},{"id":"e070fa77-f397-4767-8286-8206f1c71e3b","block_type":"box","text":"Settlement System (“CCASS”) informed of all such corporate actions that require CCASS participants to take steps in","page_number":74,"box":{"x":69,"y":506,"width":839,"height":11}},{"id":"6dcdb2e6-39d8-4e74-8ee7-c6245fffa34b","block_type":"box","text":"order to participate in them. Investors may only exercise their voting rights by providing their voting instructions to","page_number":74,"box":{"x":69,"y":521,"width":811,"height":11}},{"id":"02402165-2932-4b6e-a1dc-408126812446","block_type":"box","text":"HKSCC through participants of CCASS. All voting instructions from CCASS participants will be consolidated by","page_number":74,"box":{"x":70,"y":536,"width":783,"height":11}},{"id":"dcc5c9f9-d305-45a0-b752-632429dcec65","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":74,"box":{"x":70,"y":551,"width":826,"height":11}},{"id":"9c836d79-81dd-43b7-88df-81c6e782f7d3","block_type":"box","text":"result, a Fund may suffer difficulties or delays in enforcing its rights in SSE Securities or SZSE Securities.","page_number":74,"box":{"x":69,"y":566,"width":752,"height":11}},{"id":"cf8262e0-eef4-40c0-b472-462fe5b9452d","block_type":"box","text":"Hong Kong’s Investor Compensation Fund is established to pay compensation to investors of any nationality who","page_number":74,"box":{"x":102,"y":589,"width":804,"height":11}},{"id":"3e25c02b-e670-4bd7-9d5e-225b855a0a8d","block_type":"box","text":"suffer pecuniary losses as a result of default of a licensed intermediary or authorized financial institution in relation","page_number":74,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"75279ac3-44f2-431b-b34a-97d8c6275466","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":74,"box":{"x":68,"y":619,"width":769,"height":11}},{"id":"a7347f8d-86a0-4c7a-b15a-604037c5ad8c","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":74,"box":{"x":70,"y":634,"width":809,"height":11}},{"id":"abf84be6-f597-407c-bb6a-1c8f745ab12f","block_type":"box","text":"SZSE and (ii) in respect of which an order for sale or purchase is permitted to be routed through the Northbound","page_number":74,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"b6f5490d-c7c6-42be-bc32-24a53f4a4cef","block_type":"box","text":"Trading Link of a Stock Connect. On the other hand, since a Fund carries out Northbound trading through securities","page_number":74,"box":{"x":68,"y":664,"width":822,"height":12}},{"id":"b7e497ce-2c5f-4f6a-b7c6-3d2cae8da239","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":74,"box":{"x":69,"y":680,"width":829,"height":11}},{"id":"1ee041c4-6a61-4c7f-8ac5-490e5dc2303a","block_type":"box","text":"PRC.","page_number":74,"box":{"x":69,"y":695,"width":32,"height":9}},{"id":"8259a684-b563-4297-8cf6-eb17d408b724","block_type":"box","text":"Market participants are able to participate in Stock Connects subject to meeting certain information technology","page_number":74,"box":{"x":102,"y":717,"width":796,"height":12}},{"id":"45e461e6-8001-4e84-8b37-4223bfe39864","block_type":"box","text":"capability, risk management and other requirements as may be specified by the relevant exchange and/or clearing","page_number":74,"box":{"x":69,"y":732,"width":815,"height":12}},{"id":"adde11da-cc18-4704-8f17-7841184ac418","block_type":"box","text":"house. Further, the “connectivity” in Stock Connects requires routing of orders across the border of Hong Kong and","page_number":74,"box":{"x":69,"y":748,"width":822,"height":11}},{"id":"851a3c9f-02cb-4992-8541-f3eda7482c15","block_type":"box","text":"the PRC. This requires the development of new information technology systems on the part of SEHK and exchange","page_number":74,"box":{"x":68,"y":763,"width":818,"height":11}},{"id":"7c2b5610-ca13-4789-aef7-3059a28e8c7c","block_type":"box","text":"participants. There is no assurance that the systems of SEHK and market participants will function properly or will","page_number":74,"box":{"x":70,"y":778,"width":813,"height":11}},{"id":"81925022-dbec-4c6c-8150-3eb93044d034","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":74,"box":{"x":69,"y":793,"width":827,"height":11}},{"id":"a92beb6a-6e28-471f-97b1-786bca7e39d5","block_type":"box","text":"function properly, trading in Stock Connect Securities through Stock Connects could be disrupted.","page_number":74,"box":{"x":68,"y":808,"width":695,"height":11}},{"id":"f6334973-0743-4f59-ac17-865b3234c96e","block_type":"box","text":"The Shanghai-Hong Kong Stock Connect program launched in November 2014 and the Shenzhen-Hong Kong","page_number":74,"box":{"x":101,"y":831,"width":772,"height":11}},{"id":"8ca91789-18a5-4ac3-812c-65c1401c6cdb","block_type":"box","text":"Stock Connect program launched in December 2016. Each program does not have an extensive operating history.","page_number":74,"box":{"x":69,"y":846,"width":810,"height":11}},{"id":"4b631b0e-47ca-4195-86a5-e7d5ba49982d","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":74,"box":{"x":70,"y":861,"width":798,"height":11}},{"id":"ac53b7fc-7c64-4341-85cf-891b1534f337","block_type":"box","text":"Hong Kong in connection with operations, legal enforcement and cross-border trades under Stock Connects. In","page_number":74,"box":{"x":70,"y":876,"width":786,"height":11}},{"id":"4fbc5730-cad2-4a95-89c3-2e2c7e8d7840","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":74,"box":{"x":69,"y":891,"width":821,"height":11}},{"id":"39d502c9-cce2-449b-9d7a-1f8373e68e3f","block_type":"box","text":"as a result of such changes. Furthermore, the securities regimes and legal systems of China and Hong Kong differ","page_number":74,"box":{"x":69,"y":906,"width":819,"height":12}},{"id":"5fd03db4-f1f1-4e35-a5f9-8add0804e518","block_type":"box","text":"II-44","page_number":74,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b321baed-0128-4148-bdb2-554ca0bbd8ad","block_type":"box","text":"NM1026U-5979889-74/232","page_number":74,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"37f02a91-e7cd-4c9a-be45-0ab52dc373a9","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":75,"box":{"x":69,"y":45,"width":823,"height":11}},{"id":"33543916-0a6b-4d61-8ebb-fa47a7f71349","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":75,"box":{"x":68,"y":60,"width":814,"height":11}},{"id":"2e9c5149-8f9a-4af4-ac15-0d2032606fa5","block_type":"box","text":"achieve its investment objective may be adversely affected. In addition, a Fund’s investments in Stock Connect","page_number":75,"box":{"x":69,"y":75,"width":793,"height":11}},{"id":"ee74126a-96a1-4c34-a95e-1b57a98b5d49","block_type":"box","text":"Securities through Stock Connects are generally subject to Chinese securities regulations and listing rules, among","page_number":75,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"1b28eea4-4caf-492c-8d26-63041317837d","block_type":"box","text":"other restrictions. Further, different fees, costs and taxes are imposed on foreign investors acquiring Stock Connect","page_number":75,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"73c9df3c-41c4-4bf3-9ca6-b914fb0e25aa","block_type":"box","text":"Securities through Stock Connects, and these fees, costs and taxes may be higher than comparable fees, costs and","page_number":75,"box":{"x":69,"y":120,"width":831,"height":12}},{"id":"09725095-8415-479c-a589-dcf63e48b645","block_type":"box","text":"taxes imposed on owners of other securities providing similar investment exposure.","page_number":75,"box":{"x":68,"y":135,"width":596,"height":12}},{"id":"fad6ea5d-6cb6-42f5-8c05-6afcf2fba35d","block_type":"box","text":"Suspension Risk.","page_number":75,"box":{"x":102,"y":158,"width":122,"height":11}},{"id":"71813c41-7311-4b94-a0c7-ae7a7b5b1f18","block_type":"box","text":"SSE Securities and SZSE Securities may only be bought from, or sold to, a Fund at times when","page_number":75,"box":{"x":231,"y":158,"width":675,"height":11}},{"id":"53e15782-0245-47f3-a5c5-c25d1471debd","block_type":"box","text":"the relevant SSE Securities and SZSE Securities may be sold or purchased on the relevant Chinese stock exchange.","page_number":75,"box":{"x":68,"y":173,"width":829,"height":11}},{"id":"5d62b6dc-ee10-4174-b222-1a02de4c3ad3","block_type":"box","text":"The SSE Securities and SZSE Securities markets have a higher propensity for trading suspensions than many other","page_number":75,"box":{"x":68,"y":188,"width":823,"height":12}},{"id":"36cb7864-8e9d-4045-8810-dd93e68063d8","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":75,"box":{"x":68,"y":203,"width":831,"height":12}},{"id":"fc64de2b-96db-4c01-9863-be3d2d71d2c3","block_type":"box","text":"SZSE Securities purchased on the Stock Connects if necessary for ensuring an orderly and fair market and ensuring","page_number":75,"box":{"x":69,"y":218,"width":828,"height":12}},{"id":"1f174887-65ce-44ac-94e5-fc5372952db0","block_type":"box","text":"that risks are managed prudently. Consent from the relevant regulator would be sought before a suspension of","page_number":75,"box":{"x":68,"y":234,"width":791,"height":11}},{"id":"a687371b-2d25-4cf0-8101-05a31959139b","block_type":"box","text":"Northbound trading is triggered. The relevant PRC government authority may also impose “circuit breakers” and other","page_number":75,"box":{"x":70,"y":249,"width":837,"height":11}},{"id":"538452fe-0570-495e-b5e3-36729a5d8f0c","block_type":"box","text":"measures to halt or suspend Northbound trading. Where a suspension in the Northbound trading through Stock","page_number":75,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"3e92f2e0-9a26-4d8a-ab4e-7b1cc031d8fd","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":75,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"4f783e69-65d0-4ff4-84ce-aa20d73e475d","block_type":"box","text":"certain stocks could lead to greater market execution risk and costs for a Fund. The SSE and SZSE currently apply a","page_number":75,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"9f25d05c-fd3d-40ac-8c64-349cf025e1e0","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":75,"box":{"x":69,"y":309,"width":778,"height":11}},{"id":"2c06f509-6a74-45ea-9121-78e39806b651","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":75,"box":{"x":69,"y":324,"width":815,"height":12}},{"id":"d1ddc263-60c2-43ee-bf8b-df2d8620272e","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":75,"box":{"x":69,"y":340,"width":833,"height":11}},{"id":"ec20c525-c119-4c9b-a3ae-a111b05c3656","block_type":"box","text":"exist for any particular SSE Security or SZSE Security or for any particular time.","page_number":75,"box":{"x":69,"y":355,"width":563,"height":11}},{"id":"bee17880-544c-424d-8fc3-44ad3ffa5605","block_type":"box","text":"Risk of Investing in the China Interbank Bond Market through Bond Connect.","page_number":75,"box":{"x":102,"y":377,"width":542,"height":12}},{"id":"7b9336fb-25b5-4fb3-b8ae-07bb8f6fb74b","block_type":"box","text":"A Fund may invest directly in the","page_number":75,"box":{"x":650,"y":377,"width":230,"height":11}},{"id":"492585bc-a9c0-4393-bfb9-02d0e9f49ba2","block_type":"box","text":"domestic bond market in the PRC (the “China Interbank Bond Market”) through the northbound trading of Bond","page_number":75,"box":{"x":69,"y":392,"width":791,"height":12}},{"id":"c83fdc91-adf0-46d7-83cb-3ea6a7d54198","block_type":"box","text":"Connect (“Bond Connect”). Bond Connect is an initiative launched in July 2017 for mutual bond market access","page_number":75,"box":{"x":69,"y":407,"width":790,"height":12}},{"id":"49323e2f-fe72-4f0e-89ea-1bdd8312c84e","block_type":"box","text":"between the PRC and Hong Kong, established by the China Foreign Exchange Trade System & National Interbank","page_number":75,"box":{"x":69,"y":423,"width":803,"height":11}},{"id":"b2e4515f-e1ce-41a6-8931-b1c530594e5c","block_type":"box","text":"Funding Centre (“CFETS”), China Central Depository & Clearing Co., Ltd (“CDCC”), Shanghai Clearing House (“SCH”),","page_number":75,"box":{"x":70,"y":438,"width":832,"height":11}},{"id":"67a94206-bd5b-482d-9f79-db3d18be4377","block_type":"box","text":"Hong Kong Exchanges and Clearing Limited (“HKEX”) and Central Moneymarkets Unit (“CMU”). Under the prevailing","page_number":75,"box":{"x":70,"y":453,"width":821,"height":11}},{"id":"5879568b-aba1-44be-b499-4150b487ddc4","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":75,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"420404b4-dac1-4485-98e0-729b2ac65a3b","block_type":"box","text":"Bond Market through Bond Connect. Eligible foreign investors may submit trade requests for bonds circulated in the","page_number":75,"box":{"x":70,"y":483,"width":825,"height":11}},{"id":"ddf2745d-6b7b-4688-aaff-9d35c9cafc98","block_type":"box","text":"China Interbank Bond Market through offshore electronic bond trading platforms (such as Tradeweb), which will in","page_number":75,"box":{"x":69,"y":498,"width":809,"height":11}},{"id":"d8db3c94-ad17-4bec-ac2c-351954479375","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":75,"box":{"x":68,"y":513,"width":786,"height":11}},{"id":"cc3681ef-938b-4166-a65a-51a204908a8e","block_type":"box","text":"approved onshore dealers (including market makers and others engaged in the market making business) in the PRC.","page_number":75,"box":{"x":69,"y":529,"width":830,"height":11}},{"id":"c8de7e3b-6b6f-4f2d-bb69-2705031b7cbc","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":75,"box":{"x":68,"y":543,"width":788,"height":12}},{"id":"785010df-8920-405e-a9f1-508696cefc1e","block_type":"box","text":"responses to those eligible foreign investors through the same offshore electronic bond trading platforms. Once the","page_number":75,"box":{"x":69,"y":559,"width":827,"height":11}},{"id":"373402d2-1b00-411c-b7ef-73852e45d57c","block_type":"box","text":"eligible foreign investor accepts the quotation, the trade is concluded on CFETS.","page_number":75,"box":{"x":69,"y":574,"width":570,"height":11}},{"id":"1753a4da-7709-4eff-93f5-996d44e9ea8b","block_type":"box","text":"The settlement and custody of bonds traded in the China Interbank Bond Market under Bond Connect will be","page_number":75,"box":{"x":101,"y":596,"width":773,"height":12}},{"id":"08f8f3d0-bfb2-46ba-b21d-12cdf56397cb","block_type":"box","text":"effected through the settlement and custody link between CMU, as an offshore custody agent, and CDCC and SCH,","page_number":75,"box":{"x":69,"y":612,"width":823,"height":11}},{"id":"f9d0e32f-01c0-4fac-82b8-813d5ef0402f","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":75,"box":{"x":69,"y":627,"width":832,"height":11}},{"id":"e677d0da-da0b-42af-a077-e5c8bc65dbb0","block_type":"box","text":"settlement of confirmed trades onshore and CMU will process bond settlement instructions from CMU members on","page_number":75,"box":{"x":69,"y":642,"width":822,"height":11}},{"id":"b192f589-997b-4e64-9db6-bc546eae4abb","block_type":"box","text":"behalf of eligible foreign investors in accordance with its relevant rules. Since the introduction in August 2018 of","page_number":75,"box":{"x":69,"y":657,"width":804,"height":11}},{"id":"c5c3c215-1451-4f9b-8c2b-30b06eda075c","block_type":"box","text":"delivery versus payment (DVP) settlement in respect of Bond Connect, the movement of cash and securities is","page_number":75,"box":{"x":69,"y":672,"width":787,"height":11}},{"id":"b56f256a-7fa2-41a9-8272-cb8e62256c8f","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":75,"box":{"x":69,"y":687,"width":788,"height":11}},{"id":"a57d8dd6-c552-413f-8222-3709d589d009","block_type":"box","text":"offshore custody agent recognized by the Hong Kong Monetary Authority, will open omnibus nominee accounts with","page_number":75,"box":{"x":69,"y":702,"width":820,"height":12}},{"id":"9630049e-772f-4497-a460-8cd1c2fb82fc","block_type":"box","text":"the onshore custody agent recognized by the People’s Bank of China (","page_number":75,"box":{"x":68,"y":717,"width":500,"height":12}},{"id":"1e27960c-a76f-4ccf-898e-a80c0cb1efa2","block_type":"box","text":"i.e.","page_number":75,"box":{"x":570,"y":718,"width":20,"height":8}},{"id":"b2e96663-28bc-4b37-a898-a2748f357339","block_type":"box","text":", CDCC and SCH). All bonds traded by","page_number":75,"box":{"x":593,"y":718,"width":267,"height":11}},{"id":"f498b8c6-ea8e-445a-b9ff-7505cc0b830b","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":75,"box":{"x":69,"y":732,"width":832,"height":12}},{"id":"6ef0440d-4779-40c4-ae54-4198d39f897b","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":75,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"26544f3e-54bf-4a7c-b8ca-32ac48a4dfa3","block_type":"box","text":"CDCC or SCH default, CMU’s liabilities in Bond Connect bonds under its market contracts with clearing participants","page_number":75,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"6969a72c-95ab-4209-9314-8ed47e7137ce","block_type":"box","text":"will be limited to assisting clearing participants in pursuing their claims against CDCC or SCH. The Fund may suffer","page_number":75,"box":{"x":68,"y":778,"width":822,"height":11}},{"id":"63c28b24-abf4-42bd-8fb6-9a7e0bfe9cb1","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":75,"box":{"x":69,"y":793,"width":793,"height":11}},{"id":"ddec9e31-8bb4-4ac3-87eb-2c096a6ab3f7","block_type":"box","text":"filings, registration with the People’s Bank of China, and account opening have to be carried out by third parties,","page_number":75,"box":{"x":68,"y":808,"width":802,"height":11}},{"id":"037d06cb-0068-47eb-85d5-896398268218","block_type":"box","text":"including CMU, CDCC, SCH, and CFETS, a Fund is subject to the risks of default or errors on the part of such third","page_number":75,"box":{"x":70,"y":823,"width":812,"height":12}},{"id":"677ee757-14ec-496e-b67f-dac8c1f9fd29","block_type":"box","text":"parties.","page_number":75,"box":{"x":70,"y":839,"width":52,"height":10}},{"id":"8238df2c-82e9-492b-b8a2-6e2e1053c846","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":75,"box":{"x":101,"y":861,"width":799,"height":11}},{"id":"4a6bdfc9-2004-4456-97d9-198a0d79e87b","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":75,"box":{"x":70,"y":876,"width":785,"height":11}},{"id":"21a67638-24b8-43f5-baba-4e1554a9fc27","block_type":"box","text":"distinction between, legal ownership and beneficial ownership under PRC law and there have been few cases","page_number":75,"box":{"x":69,"y":891,"width":776,"height":12}},{"id":"650778e8-49a7-46f4-9056-31a944e5046e","block_type":"box","text":"II-45","page_number":75,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"72a724bb-d671-4d56-a381-1f7edbfa51db","block_type":"box","text":"NM1026U-5979889-75/232","page_number":75,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ae3ade9a-0cbe-435d-bc66-ab6ece3215be","block_type":"box","text":"involving a nominee account structure in the PRC courts. The exact nature and methods of enforcement of the rights","page_number":76,"box":{"x":70,"y":45,"width":830,"height":11}},{"id":"b04a3555-6322-4410-bfde-b92b866c55c8","block_type":"box","text":"and interests of a Fund under PRC law are also uncertain.","page_number":76,"box":{"x":69,"y":60,"width":412,"height":9}},{"id":"af02172b-b183-408e-a09f-9cfc395e71df","block_type":"box","text":"Market volatility and potential lack of liquidity due to low trading volume of certain bonds in the China Interbank","page_number":76,"box":{"x":102,"y":82,"width":793,"height":12}},{"id":"0d1b9041-5ab3-4635-9ceb-6c23988f433b","block_type":"box","text":"Bond Market may result in prices of certain bonds traded on such market fluctuating significantly. A Fund investing in","page_number":76,"box":{"x":70,"y":98,"width":832,"height":11}},{"id":"1426ba16-2126-46f1-99c0-acaa8f872495","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":76,"box":{"x":69,"y":113,"width":821,"height":11}},{"id":"c5b76e12-3437-45ab-bfaf-7dc1f58ff0c3","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":76,"box":{"x":69,"y":128,"width":836,"height":11}},{"id":"65cd8db4-6a65-444c-8e42-27d0ef165dbf","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":76,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"3fc886dd-8886-4952-b783-00381725418a","block_type":"box","text":"Fund’s ability to acquire or dispose of such securities at their expected prices.","page_number":76,"box":{"x":70,"y":158,"width":556,"height":11}},{"id":"173fb63a-a30f-4184-9cac-303ce82862e3","block_type":"box","text":"Investing in the China Interbank Bond Market through Bond Connect is also subject to regulatory risks. The","page_number":76,"box":{"x":102,"y":181,"width":762,"height":11}},{"id":"f235c9a4-ef8a-4dc7-88e0-c1ba5f94b798","block_type":"box","text":"relevant rules and regulations are subject to change, which may have potential retrospective effect, and there can be","page_number":76,"box":{"x":69,"y":196,"width":835,"height":11}},{"id":"b2d09885-c4e4-47b5-8be9-d8bed367bff7","block_type":"box","text":"no assurance that Bond Connect will not be discontinued or abolished. Furthermore, the securities regimes and legal","page_number":76,"box":{"x":69,"y":211,"width":835,"height":11}},{"id":"7c63935a-90b6-4b64-99c9-1853f8703b76","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":76,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"1c4b3902-ff24-4888-9362-1be476340ad5","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":76,"box":{"x":68,"y":241,"width":840,"height":11}},{"id":"b627760b-00e7-434e-9431-eef35ddb0621","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":76,"box":{"x":68,"y":256,"width":826,"height":11}},{"id":"e65751a8-03a6-415c-9405-0d77d58137a6","block_type":"box","text":"to achieve its investment objective will be negatively affected and, after exhausting other trading alternatives, the","page_number":76,"box":{"x":68,"y":271,"width":808,"height":12}},{"id":"086c204e-50a9-4a5c-9ea2-01f5db836932","block_type":"box","text":"Fund may suffer substantial losses as a result. Further, if Bond Connect is not operating, a Fund may not be able to","page_number":76,"box":{"x":70,"y":286,"width":826,"height":12}},{"id":"e0579793-cc9a-4165-9203-95a0d97cc645","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":76,"box":{"x":69,"y":302,"width":789,"height":11}},{"id":"4e9e3639-1911-43c7-a5e4-8564dcb7ef8e","block_type":"box","text":"performance.","page_number":76,"box":{"x":70,"y":317,"width":93,"height":11}},{"id":"340dd666-4f80-4152-afcc-54648ab5f63e","block_type":"box","text":"Trading through Bond Connect is performed through newly developed trading platforms and operational systems.","page_number":76,"box":{"x":101,"y":339,"width":803,"height":12}},{"id":"2c038e2b-01de-4a5c-b116-5df5df243835","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":76,"box":{"x":68,"y":355,"width":776,"height":11}},{"id":"73d37f9a-af98-430f-9289-6041604e78be","block_type":"box","text":"developments in the market. In the event that the relevant systems fail to function properly, trading through Bond","page_number":76,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"826ecc7f-0252-4bb5-9503-a6172a191259","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":76,"box":{"x":69,"y":385,"width":791,"height":11}},{"id":"b3cce6c6-d180-4e3a-84e7-aae722294f8b","block_type":"box","text":"strategy) may therefore be adversely affected. In addition, where a Fund invests in the China Interbank Bond Market","page_number":76,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"4c6b4d7c-6cbc-4154-834d-d029c2203a87","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":76,"box":{"x":68,"y":415,"width":827,"height":11}},{"id":"66cbaf56-a567-4800-9798-0da1293d1859","block_type":"box","text":"Bond Connect trades are settled in Chinese currency, the RMB, which is currently restricted and not freely","page_number":76,"box":{"x":102,"y":438,"width":755,"height":11}},{"id":"2073f7f7-8b00-4102-9b28-7c6a9d7ac8de","block_type":"box","text":"convertible. As a result, a Fund will be exposed to currency risk, and it cannot be guaranteed that investors will have","page_number":76,"box":{"x":69,"y":453,"width":830,"height":11}},{"id":"2a95d119-f7e9-4903-a327-375df27c7dc1","block_type":"box","text":"timely access to a reliable supply of RMB.","page_number":76,"box":{"x":68,"y":468,"width":298,"height":11}},{"id":"ad0ab410-4571-402c-a52c-3bf45d2ef7ad","block_type":"box","text":"Tax Risk – Withholding Income Tax Risk","page_number":76,"box":{"x":103,"y":491,"width":277,"height":11}},{"id":"b1dc7c7b-e47a-4be7-95cb-a0eb6f5b8f97","block_type":"box","text":".","page_number":76,"box":{"x":381,"y":498,"width":2,"height":2}},{"id":"e1c380cb-1e39-46a1-a112-06cc0eea057a","block_type":"box","text":"According to PRC tax regulations, a 10% withholding income tax is imposed on PRC sourced dividends and","page_number":76,"box":{"x":101,"y":513,"width":758,"height":12}},{"id":"c715f88b-5ad2-402d-a693-7394bdf3725e","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":76,"box":{"x":70,"y":528,"width":828,"height":12}},{"id":"243f7bfa-3146-4f82-bc89-276a80e4d182","block_type":"box","text":"applicable tax treaty. From a technical perspective, withholding income tax is also applicable to capital gains realized","page_number":76,"box":{"x":69,"y":544,"width":831,"height":11}},{"id":"f28e3beb-7456-4a67-a495-81dec64e3c15","block_type":"box","text":"by foreign investors on the disposal of PRC equity interests.","page_number":76,"box":{"x":69,"y":559,"width":425,"height":11}},{"id":"d6dd08e6-8ba4-400d-8538-d4f496fc0104","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":76,"box":{"x":101,"y":582,"width":697,"height":11}},{"id":"19335eb0-f3d4-44aa-9ca4-04cd7b90e475","block_type":"box","text":"On November 14, 2014, the Ministry of Finance (“MoF”), China Securities Regulatory Commission and the State","page_number":76,"box":{"x":102,"y":604,"width":803,"height":11}},{"id":"3603b54b-8c52-4858-9d46-1f105dbc389d","block_type":"box","text":"Taxation Administration (“STA”), acting with State Council’s approval, jointly released Circular 79, which temporarily","page_number":76,"box":{"x":68,"y":619,"width":822,"height":11}},{"id":"498b1ce3-cb6e-422a-aa7d-430847ca1920","block_type":"box","text":"exempts Qualified Foreign Institutional Investors (“QFIIs”) and Renminbi Qualified Foreign Institutional Investors","page_number":76,"box":{"x":69,"y":634,"width":794,"height":12}},{"id":"b3e0a066-4896-49c2-bb59-210b972dd105","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":76,"box":{"x":69,"y":649,"width":812,"height":12}},{"id":"090d0bc4-9769-4b8c-b886-0f4fb9475779","block_type":"box","text":"after November 17, 2014. Subsequently, Circulars 81 and 127 were issued to temporarily exempt tax on capital","page_number":76,"box":{"x":69,"y":664,"width":800,"height":12}},{"id":"ad1d0c33-9f6c-4add-888d-be15a7190ef6","block_type":"box","text":"gains derived from trading of equity securities of companies domiciled in the PRC that trade on Chinese stock","page_number":76,"box":{"x":68,"y":680,"width":783,"height":11}},{"id":"ed35b1e0-ddcd-4f54-82d8-1064d41cbfc5","block_type":"box","text":"exchanges (“A-Shares”) through the Shanghai-Hong Kong Stock Connect program or the Shenzhen-Hong Kong Stock","page_number":76,"box":{"x":69,"y":695,"width":825,"height":11}},{"id":"e542d4ef-43f3-435d-a27f-d4d3797660a9","block_type":"box","text":"Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). The duration of the","page_number":76,"box":{"x":69,"y":710,"width":809,"height":11}},{"id":"d2d86823-3684-48a7-ae9a-5dd9b8d758ce","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":76,"box":{"x":68,"y":725,"width":818,"height":11}},{"id":"d40c05ee-1ebd-4605-a435-b0de88c8ef03","block_type":"box","text":"without notice.","page_number":76,"box":{"x":68,"y":740,"width":103,"height":9}},{"id":"4c30f7a2-c358-4ac5-80e1-9145c23dcab5","block_type":"box","text":"On November 22, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":76,"box":{"x":102,"y":763,"width":759,"height":11}},{"id":"931b78f4-31e1-48cf-9e60-4f5efc864804","block_type":"box","text":"investors are temporarily exempt from withholding income tax with respect to interest income on bonds derived from","page_number":76,"box":{"x":70,"y":778,"width":827,"height":11}},{"id":"3dd4e9eb-8f40-403e-8a0f-d5b5cc0e5e34","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":76,"box":{"x":68,"y":793,"width":798,"height":10}},{"id":"25322410-7a9b-405e-9872-472e585824b8","block_type":"box","text":"issued Public Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. On","page_number":76,"box":{"x":70,"y":808,"width":798,"height":11}},{"id":"e33d995c-02f8-46af-bfb3-59cfbe50ea9c","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":76,"box":{"x":69,"y":823,"width":792,"height":12}},{"id":"baecc99c-825c-4672-9a8f-9ec9e89a4c75","block_type":"box","text":"December 31, 2027.","page_number":76,"box":{"x":70,"y":838,"width":147,"height":11}},{"id":"8de1dca0-b256-4046-814c-812ad3ece231","block_type":"box","text":"Value Added Tax (“VAT”) Risk —","page_number":76,"box":{"x":103,"y":861,"width":225,"height":11}},{"id":"66329f57-7b1a-46a4-8f99-13fd714f9738","block_type":"box","text":"From May 1, 2016, VAT applies to certain income derived by the Fund, including","page_number":76,"box":{"x":333,"y":861,"width":569,"height":11}},{"id":"696f221b-ec7e-4c1d-9046-d0febba98c5d","block_type":"box","text":"PRC sourced interest income on non-government bonds and trading gains.","page_number":76,"box":{"x":69,"y":876,"width":528,"height":11}},{"id":"c55a5783-aeb6-4979-92bb-d0390b1c1949","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":76,"box":{"x":101,"y":899,"width":697,"height":11}},{"id":"59eb6e9d-e928-45d3-aea0-378eb8e44e0c","block_type":"box","text":"II-46","page_number":76,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ce2832b5-b35d-42af-9004-6af34c689880","block_type":"box","text":"NM1026U-5979889-76/232","page_number":76,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"5a7a4da3-ee8c-40ca-8a2d-cf9941906b6f","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":77,"box":{"x":101,"y":45,"width":789,"height":11}},{"id":"640fa5ed-c7a3-43dc-9b93-d26a345382aa","block_type":"box","text":"Stock Connects and debt securities traded in the China Interbank Bond Market.","page_number":77,"box":{"x":69,"y":60,"width":565,"height":9}},{"id":"f4f87c57-9f46-4f4d-b1cc-bced3cc0e4c3","block_type":"box","text":"On November 7, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":77,"box":{"x":102,"y":82,"width":749,"height":12}},{"id":"184d7844-0a87-4414-9286-6d559562294a","block_type":"box","text":"investors are temporarily exempt from VAT with respect to interest income on bonds derived from the PRC bond","page_number":77,"box":{"x":70,"y":98,"width":791,"height":11}},{"id":"af7e7cfb-cc7f-4c3c-8f84-df1df30551e2","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":77,"box":{"x":69,"y":113,"width":840,"height":11}},{"id":"e26ba2f2-944a-4144-80a0-2e59eb5b292b","block_type":"box","text":"Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. However, on","page_number":77,"box":{"x":70,"y":128,"width":766,"height":11}},{"id":"c7c3eccf-6562-4236-9aa6-8590a8e65bec","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":77,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"66270ea7-d23c-4e9f-adc5-8415e1d9a20c","block_type":"box","text":"interest income derived from treasury bonds, local government bonds and financial bonds issued on or after","page_number":77,"box":{"x":70,"y":158,"width":772,"height":11}},{"id":"efd2a409-1052-46f6-b3ff-4634f019e1fb","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":77,"box":{"x":68,"y":173,"width":840,"height":11}},{"id":"5f7de51a-49bd-4fb4-9777-bfbfc6d589e5","block_type":"box","text":"for foreign institutional investors. This exemption was extended through December 31, 2027.","page_number":77,"box":{"x":68,"y":188,"width":665,"height":12}},{"id":"c35c97f7-ab4e-4e83-86c7-41b4ed171ded","block_type":"box","text":"Any changes in PRC tax law, future clarifications thereof, and/or subsequent retroactive enforcement by the PRC","page_number":77,"box":{"x":101,"y":211,"width":801,"height":11}},{"id":"624608b1-1ca9-454e-9c02-ceacba8321cc","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":77,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"7f8cfe68-dc57-4505-93f1-f9500a7363fa","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":77,"box":{"x":68,"y":241,"width":808,"height":11}},{"id":"5464d8bc-2c62-403e-b87c-181cd7eb6fb2","block_type":"box","text":"PRC sourced interest income on non-government bonds received by the Fund without giving any prior notice. If the","page_number":77,"box":{"x":69,"y":256,"width":810,"height":12}},{"id":"a8c9bcca-e8f7-40c0-89c5-9514d8f8d87f","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":77,"box":{"x":68,"y":272,"width":829,"height":11}},{"id":"c4e2ac6b-b7f7-4305-9988-7e60f25eca38","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":77,"box":{"x":69,"y":287,"width":819,"height":11}},{"id":"c9577fed-1bcc-47fc-8322-2f9f1a4bc095","block_type":"box","text":"advantaged or disadvantaged depending on when the investors purchased and/or sold the shares of the Fund. There","page_number":77,"box":{"x":69,"y":302,"width":833,"height":11}},{"id":"c4c59469-b120-4b7f-9b26-e97304f32310","block_type":"box","text":"will be no retrospective restatement of the Fund’s net asset value.","page_number":77,"box":{"x":68,"y":317,"width":474,"height":11}},{"id":"d2dacba2-e1ff-4855-a77a-987dc54ba844","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":77,"box":{"x":102,"y":339,"width":777,"height":12}},{"id":"da81af5a-fa6e-4b01-bc22-fc1a1ec3ece0","block_type":"box","text":"time, make a provision for potential tax liabilities if in its opinion such provision is warranted or as further clarified by","page_number":77,"box":{"x":68,"y":355,"width":836,"height":11}},{"id":"ecc76c73-8786-452f-b18c-7b553e6de543","block_type":"box","text":"the PRC in notifications.","page_number":77,"box":{"x":68,"y":370,"width":171,"height":9}},{"id":"37ffa8c9-0f78-46b9-a490-70c9cc05d7c3","block_type":"box","text":"Investment in Other Investment Companies.","page_number":77,"box":{"x":102,"y":392,"width":320,"height":11}},{"id":"6b4a8e8e-9b07-4077-9e99-1a2abdf407e0","block_type":"box","text":"Each Fund may, subject to applicable law, invest in other","page_number":77,"box":{"x":429,"y":393,"width":402,"height":11}},{"id":"db9a9961-cb74-435b-9aff-aca379b5ec91","block_type":"box","text":"investment companies (including investment companies managed by BlackRock and its affiliates), including money","page_number":77,"box":{"x":70,"y":407,"width":818,"height":12}},{"id":"c15c3c90-5319-4935-ae8d-aee7b596405c","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":77,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"61afbb09-8afc-4d77-9ad7-abb132cf0060","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":77,"box":{"x":70,"y":438,"width":822,"height":11}},{"id":"78daf28c-bba4-4634-b8bf-34a31c58fe32","block_type":"box","text":"in securities of other investment companies (measured at the time of such investment). In addition, under Section","page_number":77,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"cbfd3026-bf0c-4c53-ad5e-b411788fae76","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":77,"box":{"x":70,"y":468,"width":793,"height":11}},{"id":"183dfd77-338f-4766-beba-39052509a60d","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":77,"box":{"x":69,"y":483,"width":796,"height":11}},{"id":"a83b825e-a029-4664-8f72-ac6d2327e7ea","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":77,"box":{"x":69,"y":498,"width":837,"height":11}},{"id":"b8664389-73f0-4596-8c00-f953314edbb7","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":77,"box":{"x":68,"y":513,"width":812,"height":11}},{"id":"53d01fce-7cf7-491e-a4dc-052f31484c24","block_type":"box","text":"restrict a Feeder Fund from investing all of its assets in shares of its Master Portfolio.) In addition to the restrictions","page_number":77,"box":{"x":69,"y":528,"width":829,"height":12}},{"id":"ae549bc0-2519-4e40-bc31-4bb499bcda74","block_type":"box","text":"on investing in other investment companies discussed above, under Section 12(d)(1)(C) of the Investment Company","page_number":77,"box":{"x":69,"y":543,"width":827,"height":12}},{"id":"0542111c-e70f-41fb-8cf2-d63077e94fe4","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":77,"box":{"x":68,"y":559,"width":821,"height":11}},{"id":"d17ba94e-0ac5-47eb-ac16-24c077144306","block_type":"box","text":"and other BlackRock-advised investment companies to own more than 10% of the total outstanding voting stock of","page_number":77,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"5848b1a8-117c-4693-a336-801075c8747a","block_type":"box","text":"such closed-end investment company. Pursuant to Section 12(d)(1)(G) of the Investment Company Act, these","page_number":77,"box":{"x":69,"y":589,"width":776,"height":11}},{"id":"e0379a51-9b72-420b-b6af-431363f76fb9","block_type":"box","text":"percentage limitations do not apply to investments in affiliated investment companies, including ETFs, subject to","page_number":77,"box":{"x":70,"y":604,"width":802,"height":11}},{"id":"5936941d-d3a9-4822-9443-bd2f4ebd5eb4","block_type":"box","text":"certain conditions. In addition, a Fund may be able to rely on certain rules under the Investment Company Act to","page_number":77,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"40c9e8bb-bd0b-46d1-ae00-5e6767768c26","block_type":"box","text":"invest in shares of money market funds or other investment companies beyond the statutory limits noted above, but","page_number":77,"box":{"x":70,"y":634,"width":829,"height":11}},{"id":"eac7ae0a-41cf-4a41-b4ed-93d6adc9527f","block_type":"box","text":"subject to certain conditions.","page_number":77,"box":{"x":69,"y":650,"width":206,"height":10}},{"id":"4584d959-b3e1-4314-adaf-09776634fdfe","block_type":"box","text":"As with other investments, investments in other investment companies are subject to market and selection risk.","page_number":77,"box":{"x":101,"y":672,"width":799,"height":11}},{"id":"ce998b88-3065-45a8-9642-43f846739172","block_type":"box","text":"Shares of investment companies, such as closed-end fund investment companies, that trade on an exchange","page_number":77,"box":{"x":102,"y":695,"width":779,"height":11}},{"id":"aeeadb5f-4b00-49cb-b5f2-b90a8df3bbb7","block_type":"box","text":"may at times be acquired at market prices representing premiums to their NAVs. In addition, investment companies","page_number":77,"box":{"x":69,"y":710,"width":824,"height":11}},{"id":"ce9d5114-fde7-46ff-9d66-adf713571607","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":77,"box":{"x":69,"y":725,"width":836,"height":11}},{"id":"5d64e80c-354e-41bf-a2c0-152ee4bed5d2","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":77,"box":{"x":68,"y":740,"width":839,"height":11}},{"id":"908b1876-7416-45e4-9578-fbf89ac578dd","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":77,"box":{"x":68,"y":755,"width":806,"height":11}},{"id":"7fdcfb52-51d1-4450-8293-5a97699fe25b","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":77,"box":{"x":68,"y":771,"width":810,"height":10}},{"id":"a8ca8d49-d3b4-4a7e-b0fa-e72c229147c0","block_type":"box","text":"loss.","page_number":77,"box":{"x":70,"y":786,"width":31,"height":8}},{"id":"6d2d0bf3-492c-4885-b402-0dcaf1a281f0","block_type":"box","text":"In addition, if a Fund acquires shares in investment companies, including affiliated investment companies,","page_number":77,"box":{"x":102,"y":808,"width":758,"height":11}},{"id":"79d5e118-769d-4411-aeb3-560793031331","block_type":"box","text":"shareholders would bear both their proportionate share of expenses in the Fund and, indirectly, the expenses of such","page_number":77,"box":{"x":69,"y":823,"width":837,"height":11}},{"id":"b33e7d73-f604-49de-a5b3-47c432601588","block_type":"box","text":"investment companies. Such expenses, both at the Fund level and acquired investment company level, would include","page_number":77,"box":{"x":70,"y":838,"width":835,"height":11}},{"id":"5b72cae6-5127-4cba-8ea5-90815687c891","block_type":"box","text":"management and advisory fees, unless such fees have been waived by BlackRock. Please see the relevant Fund’s","page_number":77,"box":{"x":69,"y":853,"width":816,"height":12}},{"id":"f4418f42-aebb-4a80-93d5-5471803d9a89","block_type":"box","text":"Prospectus to determine whether any such management and advisory fees have been waived by BlackRock.","page_number":77,"box":{"x":69,"y":869,"width":768,"height":11}},{"id":"06a44acd-d789-4c24-91a9-8ee3408d221e","block_type":"box","text":"Investments by a Fund in wholly owned investment entities created under the laws of certain countries will not be","page_number":77,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"44f9f8db-27e7-4fde-b5aa-eb690d325de7","block_type":"box","text":"deemed an investment in other investment companies. Pursuant to guidance issued by the staff of the Commission,","page_number":77,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"833bf73e-f1a6-4cf6-9ac8-4cf7b57c38a1","block_type":"box","text":"II-47","page_number":77,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"873265c5-391e-4996-ba0c-544302c13ef7","block_type":"box","text":"NM1026U-5979889-77/232","page_number":77,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"152ab812-27c6-40ba-a62b-2a923c98d068","block_type":"box","text":"fees and expenses of money market funds used for the investment of cash collateral received in connection with","page_number":78,"box":{"x":68,"y":45,"width":804,"height":11}},{"id":"47fa9024-98f5-4634-ad9d-ae413fb1658d","block_type":"box","text":"loans of Fund securities are not treated as “acquired fund fees and expenses,” which are fees and expenses","page_number":78,"box":{"x":70,"y":60,"width":778,"height":11}},{"id":"e9cf9c8c-20b6-4cc9-a7f4-6e8963d2189b","block_type":"box","text":"charged by other investment companies and pooled investment vehicles in which a Fund invests a portion of its","page_number":78,"box":{"x":69,"y":75,"width":796,"height":11}},{"id":"2c4497e0-a088-455e-84a7-4eec36cb1696","block_type":"box","text":"assets.","page_number":78,"box":{"x":69,"y":91,"width":51,"height":8}},{"id":"8fe97c7f-cb97-470f-906f-f4019532af8d","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":78,"box":{"x":101,"y":113,"width":776,"height":11}},{"id":"4ff28f3a-a690-43f8-bf43-cdc8a2a0f2e9","block_type":"box","text":"may be limited. In addition, a fund-of-funds (","page_number":78,"box":{"x":69,"y":128,"width":313,"height":11}},{"id":"f31f9e92-9937-46da-90fb-9f60ec411798","block_type":"box","text":"e.g.","page_number":78,"box":{"x":384,"y":129,"width":24,"height":10}},{"id":"3c9e8e5d-1c0a-4de9-af58-e16ea2980f70","block_type":"box","text":", an investment company that seeks to meet its investment objective","page_number":78,"box":{"x":411,"y":128,"width":491,"height":11}},{"id":"e42cb075-1552-4f54-ac62-66f26171f198","block_type":"box","text":"by investing significantly in other investment companies) may be limited in its ability to purchase underlying funds if","page_number":78,"box":{"x":69,"y":143,"width":823,"height":11}},{"id":"97c47e31-e8ff-4ef3-90f6-2d7cd917c3a8","block_type":"box","text":"such underlying funds themselves own shares of underlying funds.","page_number":78,"box":{"x":69,"y":158,"width":472,"height":11}},{"id":"ca6e6760-20d6-4d4b-8edb-f1573d5156bc","block_type":"box","text":"A number of publicly traded closed-end investment companies have been organized to facilitate indirect foreign","page_number":78,"box":{"x":101,"y":181,"width":790,"height":11}},{"id":"6c9f09c7-8551-4c35-bd76-8272ad4f6b53","block_type":"box","text":"investment in developing countries, and certain of such countries, such as Thailand, South Korea, Chile and Brazil,","page_number":78,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"528135b8-ca38-4fb3-af1a-6db57fe79dcf","block_type":"box","text":"have specifically authorized such funds. There also are investment opportunities in certain of such countries in","page_number":78,"box":{"x":69,"y":211,"width":791,"height":11}},{"id":"a6d57cf3-63d5-45f5-9025-2f00c1716da4","block_type":"box","text":"pooled vehicles that resemble open-end investment companies. The restrictions on investments in securities of","page_number":78,"box":{"x":70,"y":226,"width":795,"height":11}},{"id":"7fa2cd84-147e-4fc3-b610-003e816d2541","block_type":"box","text":"investment companies set forth above may limit opportunities for a Fund to invest indirectly in certain developing","page_number":78,"box":{"x":70,"y":241,"width":807,"height":11}},{"id":"ca7a1c97-2207-484a-8185-f316799cb700","block_type":"box","text":"countries.","page_number":78,"box":{"x":69,"y":257,"width":69,"height":8}},{"id":"701c9a18-b2cf-4b06-bd9e-c446d61bb174","block_type":"box","text":"Issuer Insolvency Risk.","page_number":78,"box":{"x":102,"y":279,"width":166,"height":11}},{"id":"c86ddf88-4f4b-4088-96fa-1ab0cb5bcd69","block_type":"box","text":"Certain Funds’ potential exposure to financially or operationally troubled issuers involves","page_number":78,"box":{"x":275,"y":279,"width":631,"height":11}},{"id":"52bb2842-a4dc-41d4-9eb2-fa9d6a171029","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":78,"box":{"x":69,"y":294,"width":832,"height":11}},{"id":"3f80a1bc-6017-4270-b10b-a06a58b9a329","block_type":"box","text":"an issuer of securities held by a Fund become involved in a bankruptcy proceeding, reorganization or financial","page_number":78,"box":{"x":69,"y":309,"width":781,"height":11}},{"id":"ff397a19-736f-4828-911f-dfeb4872c4c4","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":78,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"fb6ef9de-6ad3-443a-b4b0-c130734823f4","block_type":"box","text":"issuer uncertain.","page_number":78,"box":{"x":70,"y":340,"width":118,"height":8}},{"id":"98584b31-7ec7-4543-89d0-bb805b88e7c8","block_type":"box","text":"During the period of a bankruptcy proceeding, reorganization or financial restructuring, it is unlikely that a Fund","page_number":78,"box":{"x":102,"y":362,"width":788,"height":11}},{"id":"c95bc3c7-d3de-4e8f-acd0-e8b94f27aff2","block_type":"box","text":"will receive any interest payments on the securities of the issuer. A Fund will be subject to significant uncertainty as","page_number":78,"box":{"x":68,"y":377,"width":827,"height":12}},{"id":"814677ac-c963-400d-9ceb-9471f5fb9e59","block_type":"box","text":"to whether the reorganization or restructuring will be completed, and the Fund may bear certain extraordinary","page_number":78,"box":{"x":68,"y":393,"width":779,"height":11}},{"id":"2371cfe7-ed94-421b-b16f-4eab3e399d5f","block_type":"box","text":"expenses to protect and recover its investment. A Fund will also be subject to significant uncertainty as to when and","page_number":78,"box":{"x":69,"y":407,"width":829,"height":12}},{"id":"31f3da1f-20b5-4390-b78f-e7554068355d","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":78,"box":{"x":70,"y":423,"width":797,"height":11}},{"id":"813bf53d-97ae-44cf-9303-6665fa8874ea","block_type":"box","text":"eventually be satisfied.","page_number":78,"box":{"x":69,"y":438,"width":162,"height":11}},{"id":"a4cc2d63-5358-4cbc-af24-10116223d81d","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":78,"box":{"x":102,"y":460,"width":805,"height":12}},{"id":"fc7196ae-f47b-44a8-b5ee-b072f9bebfba","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":78,"box":{"x":70,"y":476,"width":827,"height":11}},{"id":"f3c462fe-310f-4ba5-ac72-d740f0c43a07","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":78,"box":{"x":69,"y":491,"width":819,"height":11}},{"id":"548242d5-9bd0-4e48-818a-70dd4c5b83ee","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":78,"box":{"x":69,"y":506,"width":802,"height":11}},{"id":"ca95450e-c57e-462c-b072-f9661f487ace","block_type":"box","text":"interest in any collateral challenged, disallowed or subordinated to the claims or security interests of other creditors.","page_number":78,"box":{"x":70,"y":521,"width":830,"height":11}},{"id":"ac8b64e6-bd81-4a47-aacf-aeffc0908ad1","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":78,"box":{"x":70,"y":536,"width":805,"height":11}},{"id":"243ab29a-9785-47c3-b259-07abc95d87f5","block_type":"box","text":"introduce greater uncertainty regarding the outcome of the Fund’s securities holdings in the issuer. In a bankruptcy","page_number":78,"box":{"x":70,"y":551,"width":820,"height":11}},{"id":"8ebb48f8-22f3-49d2-96ed-050a429ba92e","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":78,"box":{"x":70,"y":566,"width":828,"height":11}},{"id":"b62ebade-4dff-4eb0-8357-4e3edd9dca18","block_type":"box","text":"a Fund may receive different securities or other assets, including equity securities. These types of equity securities","page_number":78,"box":{"x":69,"y":581,"width":820,"height":12}},{"id":"cac991a9-7561-434f-b52f-3c15c0a6fe0b","block_type":"box","text":"include, but are not limited to: common stock; preferred stock (including convertible preferred stock); bonds, notes","page_number":78,"box":{"x":70,"y":596,"width":820,"height":12}},{"id":"b5bf1f7d-5a98-48f6-8029-e9e6fee8b783","block_type":"box","text":"and debentures convertible into common or preferred stock; stock purchase warrants and rights; equity interests in","page_number":78,"box":{"x":69,"y":612,"width":824,"height":11}},{"id":"c801c884-7005-4dba-9d80-a11e53fd6340","block_type":"box","text":"trusts; and depositary receipts. Equity securities are subject to changes in value, and their value may be more","page_number":78,"box":{"x":68,"y":627,"width":788,"height":11}},{"id":"7c22ddb7-db24-4e6a-8d1a-26fae99fb3b7","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":78,"box":{"x":68,"y":642,"width":826,"height":11}},{"id":"3fb39303-4d6f-4c8b-851b-36e59d7100c3","block_type":"box","text":"securities because the status of equity holders is subordinate to debtholders in an issuer’s capital structure. The","page_number":78,"box":{"x":69,"y":657,"width":809,"height":11}},{"id":"82d7ee6a-3478-4234-8c82-b4fa83133eb5","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":78,"box":{"x":68,"y":672,"width":809,"height":11}},{"id":"19c49166-05af-4065-bfbe-427e9cbd0e99","block_type":"box","text":"overall market and economic conditions, or conditions within the issuer’s region or industry, deteriorate.","page_number":78,"box":{"x":69,"y":687,"width":741,"height":11}},{"id":"66109d84-d309-4e0c-947d-b5657b32aed8","block_type":"box","text":"To the extent that a Fund receives other assets in connection with a bankruptcy proceeding, reorganization or","page_number":78,"box":{"x":101,"y":710,"width":780,"height":11}},{"id":"2bf8a0e1-df05-433f-881f-c17c0079532f","block_type":"box","text":"financial restructuring, the Fund may also be subject to additional risks associated with the assets received. One","page_number":78,"box":{"x":68,"y":725,"width":807,"height":11}},{"id":"fe834c0e-fd6d-44ba-bf32-37256ba69ac0","block_type":"box","text":"example of assets that a Fund could receive is an interest in one or more loans made to the issuer as part of a","page_number":78,"box":{"x":69,"y":740,"width":795,"height":11}},{"id":"d8070198-dd05-4603-b316-81779cf4ab3c","block_type":"box","text":"workout agreed to by a consortium of lienholders and creditors of the issuer. A Fund may receive such interests in","page_number":78,"box":{"x":68,"y":755,"width":814,"height":11}},{"id":"0b6f3b27-d318-4cbf-9a4e-a77ad49bfd28","block_type":"box","text":"loans to the extent permitted by the Investment Company Act.","page_number":78,"box":{"x":70,"y":770,"width":439,"height":11}},{"id":"afe33da1-fddb-4f79-bcbc-e84b169865e3","block_type":"box","text":"Securities or other assets received in a reorganization or restructuring typically entail a higher degree of risk than","page_number":78,"box":{"x":102,"y":793,"width":806,"height":11}},{"id":"e9e92e0f-1a53-4e8e-898d-b3f094c0daac","block_type":"box","text":"investments in securities of issuers that have not undergone a reorganization or restructuring and may be subject to","page_number":78,"box":{"x":70,"y":808,"width":829,"height":11}},{"id":"7965bf2d-03b5-4afd-8029-cd9f7dce62e2","block_type":"box","text":"heavy selling or downward pricing pressure after completion of the reorganization or restructuring. The post","page_number":78,"box":{"x":69,"y":823,"width":767,"height":12}},{"id":"3dc01cbe-e7a2-479c-b855-45966905e5c5","block_type":"box","text":"reorganization/restructuring assets and securities may also be illiquid and difficult to sell or value. If a Fund","page_number":78,"box":{"x":69,"y":838,"width":771,"height":12}},{"id":"67b5b0dd-711f-41f2-b160-0db2dc5c11fa","block_type":"box","text":"participates in negotiations with respect to a plan of reorganization or restructuring with respect to securities of the","page_number":78,"box":{"x":70,"y":853,"width":823,"height":12}},{"id":"963cb897-15e5-42a0-afb2-1ce4aa126dfe","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":78,"box":{"x":70,"y":869,"width":822,"height":11}},{"id":"3968100d-7e8f-4318-89e9-9da61f205488","block_type":"box","text":"becomes involved in such proceedings, the Fund may have more active participation in the affairs of the issuer than","page_number":78,"box":{"x":69,"y":884,"width":828,"height":11}},{"id":"1fe1e328-fb91-42e1-93ae-5cb190d4ae47","block_type":"box","text":"that assumed generally by an investor.","page_number":78,"box":{"x":68,"y":899,"width":274,"height":11}},{"id":"4d73f57c-90e7-4971-ba8f-80ddb5a9537d","block_type":"box","text":"II-48","page_number":78,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"424b190a-109a-4535-90fe-6bceee9a71f2","block_type":"box","text":"NM1026U-5979889-78/232","page_number":78,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"97a22e45-7251-4ceb-814b-e761520c105c","block_type":"box","text":"Lease Obligations.","page_number":79,"box":{"x":102,"y":45,"width":133,"height":11}},{"id":"e2253e24-e961-481f-ba57-2e08b816b606","block_type":"box","text":"A Fund may hold participation certificates in a lease, an installment purchase contract, or a","page_number":79,"box":{"x":241,"y":45,"width":653,"height":11}},{"id":"93586752-f81f-4774-bd89-53cc7a106317","block_type":"box","text":"conditional sales contract (“lease obligations”). The Manager will monitor the credit standing of each borrower and","page_number":79,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"2728249c-ae90-4d12-ab73-9a7f32d85fca","block_type":"box","text":"each entity providing credit support and/or a put option relating to lease obligations.","page_number":79,"box":{"x":69,"y":75,"width":602,"height":11}},{"id":"9ba35876-f669-455e-b5fb-74baa67a3e93","block_type":"box","text":"Life Settlement Investments.","page_number":79,"box":{"x":102,"y":98,"width":210,"height":9}},{"id":"9806ad4b-a124-42a0-b42d-aa856c0cfefa","block_type":"box","text":"A Fund may invest in life settlements, which are sales to third parties, such as the","page_number":79,"box":{"x":318,"y":98,"width":589,"height":11}},{"id":"174b8704-21ed-4398-94a5-3852b1575f32","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":79,"box":{"x":70,"y":113,"width":838,"height":11}},{"id":"5066fce2-30bb-44c3-bd80-753310405d12","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":79,"box":{"x":70,"y":128,"width":834,"height":11}},{"id":"768557a0-9613-48ab-b1b0-25a0b38dc90e","block_type":"box","text":"receipt of the net benefit as the beneficiary under the policy. Investments in these contracts involve certain risks,","page_number":79,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"541e344c-1ffe-4560-a849-ab1f91a4a142","block_type":"box","text":"including liquidity risk, credit risk of the insurance company, and inaccurate estimations of life expectancy of the","page_number":79,"box":{"x":70,"y":158,"width":797,"height":11}},{"id":"016e0bdc-64b3-4440-8074-805a6a13dbe4","block_type":"box","text":"insured individuals (viators). These policies may be considered illiquid because they are bought and sold in a","page_number":79,"box":{"x":70,"y":173,"width":775,"height":11}},{"id":"1f971919-1ec9-4dd2-a6d1-d2e969c09826","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":79,"box":{"x":69,"y":188,"width":805,"height":12}},{"id":"a78688da-c357-4e96-b180-5abc4191c595","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":79,"box":{"x":70,"y":203,"width":789,"height":12}},{"id":"ad9c7f5f-b56a-4693-a45d-2c7dce2fedcb","block_type":"box","text":"investing in policies issued by a diverse range of highly-rated insurance carriers. Furthermore, a Fund may encounter","page_number":79,"box":{"x":70,"y":218,"width":829,"height":12}},{"id":"6cf93ac2-69ff-4c7b-b25a-45b6945b0e1c","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":79,"box":{"x":70,"y":234,"width":813,"height":11}},{"id":"5aaa24f5-1cfd-41b0-94a6-4729b7ee575d","block_type":"box","text":"reduce this life expectancy risk by investing only in contracts where the life expectancy was reviewed by an","page_number":79,"box":{"x":69,"y":249,"width":758,"height":11}},{"id":"64d5d5f3-e787-443a-8655-bbf3fe723492","block_type":"box","text":"experienced actuary, as well as by diversifying its investments across viators of varying ages and medical profiles. In","page_number":79,"box":{"x":69,"y":264,"width":832,"height":11}},{"id":"e8b84c05-285d-487d-9ce3-c17a131fa6ce","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":79,"box":{"x":69,"y":279,"width":800,"height":11}},{"id":"5d925028-d60a-421e-b081-3f64724bef9c","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":79,"box":{"x":68,"y":294,"width":809,"height":11}},{"id":"386e4985-f923-4442-aa19-6f0b1392555c","block_type":"box","text":"monitor its investments to ensure that the Fund remains qualified as a regulated investment company.","page_number":79,"box":{"x":69,"y":309,"width":730,"height":11}},{"id":"c2ae36ab-fe5a-49f9-8945-426963572059","block_type":"box","text":"Liquidity Risk Management.","page_number":79,"box":{"x":102,"y":332,"width":202,"height":11}},{"id":"a5437eb1-daec-46db-9168-0c07ea98d815","block_type":"box","text":"Rule 22e-4 under the Investment Company Act (the “Liquidity Rule”) requires open","page_number":79,"box":{"x":311,"y":332,"width":591,"height":11}},{"id":"910a1eb9-05dc-41a5-9159-bc2d3d9cb583","block_type":"box","text":"end funds, such as the Funds, to adopt a liquidity risk management program and enhance disclosures regarding fund","page_number":79,"box":{"x":69,"y":347,"width":835,"height":11}},{"id":"9812b7a6-f057-4eff-bd17-e3a47e66f221","block_type":"box","text":"liquidity. As required by the Liquidity Rule, the Funds have implemented a liquidity risk management program (the","page_number":79,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"80a61b60-d71c-4bed-ac9f-b67368b99b21","block_type":"box","text":"“Liquidity Program”), and the Boards of Directors of the Funds, including a majority of the independent Directors,","page_number":79,"box":{"x":70,"y":377,"width":801,"height":12}},{"id":"5eab8ed1-9bc6-4461-8e8b-db11005edcb0","block_type":"box","text":"have appointed the Manager as the liquidity risk program administrator of the Liquidity Program. Under the Liquidity","page_number":79,"box":{"x":69,"y":392,"width":822,"height":12}},{"id":"88efbac8-3ad5-4dbf-830a-f095681c58b9","block_type":"box","text":"Program, the Manager assesses, manages, and periodically reviews each Fund’s liquidity risk and classifies each","page_number":79,"box":{"x":69,"y":407,"width":808,"height":12}},{"id":"5211c2ed-40d8-4510-a958-5bf33b74a5c1","block_type":"box","text":"investment held by a Fund as a “highly liquid investment,” “moderately liquid investment,” “less liquid investment” or","page_number":79,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"da4ebc3b-31e3-4f9e-b712-0599c8945616","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":79,"box":{"x":70,"y":438,"width":804,"height":11}},{"id":"8b94f04a-4293-40fc-a738-0517250892b2","block_type":"box","text":"redeem shares issued by the Fund without significant dilution of the remaining investors’ interests in the Fund. The","page_number":79,"box":{"x":69,"y":453,"width":821,"height":11}},{"id":"5170c68a-2f83-4dfb-ba32-802d0998f753","block_type":"box","text":"liquidity of a Fund’s portfolio investments is determined based on relevant market, trading and investment-specific","page_number":79,"box":{"x":70,"y":468,"width":815,"height":11}},{"id":"1389392e-0dc5-4768-a236-baf189c5286a","block_type":"box","text":"considerations under the Liquidity Program. To the extent that an investment is deemed to be an illiquid investment","page_number":79,"box":{"x":69,"y":483,"width":823,"height":11}},{"id":"128103eb-5903-46e2-af13-b572149d9f25","block_type":"box","text":"or a less liquid investment, a Fund can expect to be exposed to greater liquidity risk.","page_number":79,"box":{"x":69,"y":498,"width":601,"height":11}},{"id":"19491299-a2ad-4a2d-92c3-1c50403483f5","block_type":"box","text":"Master Limited Partnerships.","page_number":79,"box":{"x":102,"y":521,"width":211,"height":11}},{"id":"9ba947d5-25b9-4491-9e84-53e584edd10c","block_type":"box","text":"Certain Funds may invest in publicly traded master limited partnerships (“MLPs”)","page_number":79,"box":{"x":320,"y":521,"width":577,"height":11}},{"id":"45986de6-ec57-4240-bcb4-cdead9561c70","block_type":"box","text":"which are limited partnerships or limited liability companies taxable as partnerships. MLPs may derive income and","page_number":79,"box":{"x":68,"y":536,"width":816,"height":11}},{"id":"f028f0fd-6dbd-48c6-9e7c-16b3933c167e","block_type":"box","text":"gains from the exploration, development, mining or production, processing, refining, transportation (including","page_number":79,"box":{"x":68,"y":551,"width":777,"height":11}},{"id":"9a4d8e0f-b38f-4728-b717-1b61d125a5d3","block_type":"box","text":"pipelines transporting gas, oil, or products thereof), or the marketing of any mineral or natural resources. MLPs","page_number":79,"box":{"x":70,"y":566,"width":792,"height":11}},{"id":"dc7c375d-9bef-4f49-8a54-5523fd809834","block_type":"box","text":"generally have two classes of owners, the general partner and limited partners. When investing in an MLP, a Fund","page_number":79,"box":{"x":68,"y":581,"width":811,"height":12}},{"id":"71987ed6-d5d5-40d4-a097-78117f1a4cb8","block_type":"box","text":"intends to purchase publicly traded common units issued to limited partners of the MLP. The general partner is","page_number":79,"box":{"x":70,"y":596,"width":791,"height":12}},{"id":"49705340-15d7-4ac4-a0c3-98ddc67e2cc2","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":79,"box":{"x":68,"y":612,"width":812,"height":11}},{"id":"bdc707c6-5da2-4f36-a282-5c032dbe52fc","block_type":"box","text":"owned by one or more of such parties. The general partner may be structured as a private or publicly traded","page_number":79,"box":{"x":69,"y":627,"width":770,"height":11}},{"id":"8c7224e1-38f6-4a48-a36c-ed21a4669f41","block_type":"box","text":"corporation or other entity. The general partner typically controls the operations and management of the MLP through","page_number":79,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"93865aac-ec82-4489-bc8c-d95546fe2d11","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":79,"box":{"x":69,"y":657,"width":799,"height":11}},{"id":"27d0b3e8-c8c1-4520-b6e7-e61eb7b31897","block_type":"box","text":"Limited partners own the remainder of the partnership, through ownership of common units, and have a limited role","page_number":79,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"064dc7d8-bbe2-4924-8447-2d7289c10d37","block_type":"box","text":"in the partnership’s operations and management.","page_number":79,"box":{"x":70,"y":687,"width":352,"height":11}},{"id":"57f9eaa5-3804-4d66-935c-a634bea73ffa","block_type":"box","text":"MLPs are typically structured such that common units and general partner interests have first priority to receive","page_number":79,"box":{"x":102,"y":710,"width":794,"height":11}},{"id":"b4b973cd-a5c3-423f-848e-0e564a6da9d1","block_type":"box","text":"quarterly cash distributions up to an established minimum amount (“minimum quarterly distributions” or “MQD”).","page_number":79,"box":{"x":69,"y":725,"width":809,"height":11}},{"id":"28f1467b-b050-4e86-b37a-1c92e179c4e0","block_type":"box","text":"Common and general partner interests also accrue arrearages in distributions to the extent the MQD is not paid.","page_number":79,"box":{"x":69,"y":740,"width":804,"height":11}},{"id":"d1f0c30f-fb1f-4199-9bbf-f01758581db8","block_type":"box","text":"Once common and general partner interests have been paid, subordinated units receive distributions of up to the","page_number":79,"box":{"x":69,"y":755,"width":808,"height":11}},{"id":"73577d9d-7a9c-4f46-93da-77afbe6b0254","block_type":"box","text":"MQD; however, subordinated units do not accrue arrearages. Distributable cash in excess of the MQD paid to both","page_number":79,"box":{"x":70,"y":770,"width":816,"height":12}},{"id":"a2c2a131-c112-44d5-908a-2166f91ff173","block_type":"box","text":"common and subordinated units is distributed to both common and subordinated units generally on a pro rata basis.","page_number":79,"box":{"x":69,"y":786,"width":831,"height":11}},{"id":"25003d74-ab49-4ca0-b194-e7585b4aceeb","block_type":"box","text":"The general partner is also eligible to receive incentive distributions if the general partner operates the business in a","page_number":79,"box":{"x":68,"y":801,"width":835,"height":11}},{"id":"2107c026-88c1-4639-9003-8b188a44787c","block_type":"box","text":"manner which results in distributions paid per common unit surpassing specified target levels. As the general partner","page_number":79,"box":{"x":69,"y":816,"width":838,"height":11}},{"id":"ad6c990d-190b-40f6-a700-ca504d5b56b6","block_type":"box","text":"increases cash distributions to the limited partners, the general partner receives an increasingly higher percentage of","page_number":79,"box":{"x":70,"y":831,"width":839,"height":11}},{"id":"24f2e2f6-ff5a-4e46-b82b-8c9d3bdc5891","block_type":"box","text":"the incremental cash distributions. A common arrangement provides that the general partner can reach a tier where","page_number":79,"box":{"x":68,"y":846,"width":828,"height":11}},{"id":"957e9aa8-dc83-44f2-ae9f-c49b23ca7e94","block_type":"box","text":"it receives 50% of every incremental dollar paid to common and subordinated unit holders. These incentive","page_number":79,"box":{"x":70,"y":861,"width":761,"height":11}},{"id":"50d51798-8b88-4a52-9911-6f1490681e2f","block_type":"box","text":"distributions encourage the general partner to streamline costs, increase capital expenditures and acquire assets in","page_number":79,"box":{"x":69,"y":876,"width":830,"height":11}},{"id":"992cadd4-0f1d-4738-9fe7-76c54da7e669","block_type":"box","text":"order to increase the partnership’s cash flow and raise the quarterly cash distribution in order to reach higher tiers.","page_number":79,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"6ca8439c-8087-4459-95b7-15043d048e29","block_type":"box","text":"Such results benefit all security holders of the MLP.","page_number":79,"box":{"x":69,"y":906,"width":366,"height":12}},{"id":"a928c86a-13c5-4106-b0e2-d7afd8c3042c","block_type":"box","text":"II-49","page_number":79,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"406339ce-768c-4552-a0ae-6149265b3e73","block_type":"box","text":"NM1026U-5979889-79/232","page_number":79,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"e2bc8373-2ac3-4fd0-9aca-959861a29c38","block_type":"box","text":"MLP common units represent a limited partnership interest in the MLP. Common units are listed and traded on","page_number":80,"box":{"x":102,"y":45,"width":790,"height":11}},{"id":"ddb8d259-18f9-4f84-ac44-1825004a682f","block_type":"box","text":"U.S. securities exchanges, with their value fluctuating predominantly based on prevailing market conditions and the","page_number":80,"box":{"x":70,"y":60,"width":820,"height":11}},{"id":"c4c94ca6-b17c-4903-9c3e-11d61c841ce0","block_type":"box","text":"success of the MLP. Certain Funds intend to purchase common units in market transactions. Unlike owners of","page_number":80,"box":{"x":69,"y":75,"width":787,"height":11}},{"id":"c7155a8c-c050-4b48-bba9-5a2ac0a10aff","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":80,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"f46663c6-8e3a-4ffb-b479-70a1ad4f23bf","block_type":"box","text":"elect directors. In the event of liquidation, common units have preference over subordinated units, but not over debt","page_number":80,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"fe45b8a2-1d75-4834-a1b9-408e270ead21","block_type":"box","text":"or preferred units, to the remaining assets of the MLP.","page_number":80,"box":{"x":69,"y":120,"width":387,"height":12}},{"id":"71e97cfa-b6bc-4aa3-baad-3f881c71fc76","block_type":"box","text":"Merger Transaction Risk.","page_number":80,"box":{"x":102,"y":143,"width":183,"height":11}},{"id":"3e5f5c0e-0f38-4328-b129-2c278da4d678","block_type":"box","text":"A Fund may buy stock of the target company in an announced merger transaction prior","page_number":80,"box":{"x":291,"y":143,"width":616,"height":11}},{"id":"275c0649-18d8-4451-9bef-cb0622dad1e5","block_type":"box","text":"to the consummation of such transaction. In that circumstance, a Fund would expect to receive an amount (whether","page_number":80,"box":{"x":68,"y":158,"width":827,"height":11}},{"id":"0491098b-f6cd-4f36-bdbd-3226facb2234","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":80,"box":{"x":70,"y":173,"width":816,"height":11}},{"id":"c2896af2-46cb-4c60-82f7-a75f9565c1c4","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":80,"box":{"x":68,"y":188,"width":825,"height":12}},{"id":"a05eae92-32ef-4c96-8d09-f1f0d7ea0fe1","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":80,"box":{"x":69,"y":203,"width":832,"height":12}},{"id":"474b8625-19ed-460d-91e5-500d2a9ce14f","block_type":"box","text":"the Fund and may lose significant value.","page_number":80,"box":{"x":68,"y":218,"width":286,"height":12}},{"id":"10184879-2e0d-4746-a535-dc01b11b6fef","block_type":"box","text":"Money Market Obligations of Domestic Banks, Foreign Banks and Foreign Branches of U.S. Banks.","page_number":80,"box":{"x":102,"y":241,"width":723,"height":11}},{"id":"6555d9fa-bd3c-40b4-8878-61b0a843f219","block_type":"box","text":"Certain","page_number":80,"box":{"x":831,"y":241,"width":50,"height":9}},{"id":"fbe7011f-f3b0-4534-86c8-76947711787b","block_type":"box","text":"Funds may purchase bank obligations, such as certificates of deposit, notes, bankers’ acceptances and time","page_number":80,"box":{"x":70,"y":256,"width":778,"height":12}},{"id":"69dda16e-310d-4399-a600-d7073d8100f9","block_type":"box","text":"deposits, including instruments issued or supported by the credit of U.S. or foreign banks or savings institutions","page_number":80,"box":{"x":69,"y":271,"width":802,"height":12}},{"id":"b3fbecab-ec4f-4f52-80ad-82340fed479e","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":80,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"c19d74b9-e611-4023-b985-39357a82a8f6","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":80,"box":{"x":68,"y":302,"width":794,"height":11}},{"id":"d40d8b82-04a5-44c1-a07f-21b1cdaf2d9a","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":80,"box":{"x":68,"y":317,"width":781,"height":11}},{"id":"f467e524-2d82-49c3-a34e-e4d5768aa4ba","block_type":"box","text":"domestic and foreign branches for purposes of a Fund’s investment policies. Investments in short-term bank","page_number":80,"box":{"x":69,"y":332,"width":776,"height":11}},{"id":"21b5e3eb-6ee1-40c3-8643-9902985fe19b","block_type":"box","text":"obligations may include obligations of foreign banks and domestic branches of foreign banks, and also foreign","page_number":80,"box":{"x":69,"y":347,"width":785,"height":11}},{"id":"e97bef15-e9db-4c71-af07-b3fe2b2b0160","block_type":"box","text":"branches of domestic banks.","page_number":80,"box":{"x":69,"y":362,"width":205,"height":9}},{"id":"cc912373-868a-4cb7-a05b-783dbb8844c0","block_type":"box","text":"To the extent consistent with their investment objectives, a Fund may invest in debt obligations of domestic or","page_number":80,"box":{"x":101,"y":385,"width":785,"height":11}},{"id":"6c65e55d-3ab8-43e1-aa42-69531b3b5298","block_type":"box","text":"foreign corporations and banks, and may acquire commercial obligations issued by Canadian corporations and","page_number":80,"box":{"x":68,"y":400,"width":787,"height":11}},{"id":"562d7a21-c30d-44cd-ba30-478dd3058872","block_type":"box","text":"Canadian counterparts of U.S. corporations, as well as Europaper, which is U.S. dollar-denominated commercial","page_number":80,"box":{"x":69,"y":415,"width":797,"height":11}},{"id":"4c0babcf-5503-4c70-a430-27905260b750","block_type":"box","text":"paper of a foreign issuer.","page_number":80,"box":{"x":70,"y":430,"width":176,"height":11}},{"id":"9bb86878-b4ca-49d0-b4ef-9245f80c337a","block_type":"box","text":"Money Market Securities.","page_number":80,"box":{"x":102,"y":453,"width":188,"height":11}},{"id":"74edd20e-5cfd-418a-97cb-6544e1745050","block_type":"box","text":"Certain Funds may invest in a broad range of short-term, high quality, U.S. dollar","page_number":80,"box":{"x":296,"y":453,"width":578,"height":11}},{"id":"3cea45aa-6954-4ffa-9dbd-5329cc3ebe1f","block_type":"box","text":"denominated instruments, such as government, bank, commercial and other obligations that are available in the","page_number":80,"box":{"x":69,"y":468,"width":802,"height":11}},{"id":"e7ba80a9-487d-47d6-ad9c-24ed1dac5757","block_type":"box","text":"money markets. In particular, the Funds may invest in:","page_number":80,"box":{"x":69,"y":483,"width":386,"height":11}},{"id":"1da9722f-89d8-49a6-939c-ed4d7700733b","block_type":"box","text":"(a) U.S. dollar-denominated obligations issued or supported by the credit of U.S. or foreign banks or savings","page_number":80,"box":{"x":69,"y":503,"width":779,"height":12}},{"id":"a867f627-8ab3-4e84-b6af-ac52e3501c7b","block_type":"box","text":"institutions with total assets in excess of $1 billion (including obligations of foreign branches of such banks);","page_number":80,"box":{"x":102,"y":518,"width":776,"height":12}},{"id":"f8c07038-5efd-4b2a-baf5-6aae6f218356","block_type":"box","text":"(b) high quality commercial paper and other obligations issued or guaranteed by U.S. and foreign corporations and","page_number":80,"box":{"x":69,"y":538,"width":821,"height":12}},{"id":"7ee3ffa2-ce6d-43ba-81cb-84ac417ff596","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":80,"box":{"x":102,"y":554,"width":795,"height":11}},{"id":"3b70533c-590e-4902-8dd0-d2f117c01d00","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":80,"box":{"x":102,"y":569,"width":757,"height":11}},{"id":"a0f55cd1-ebba-417c-ba57-bbe6f5757b92","block_type":"box","text":"agencies;","page_number":80,"box":{"x":102,"y":584,"width":66,"height":11}},{"id":"691e100d-0c96-4ae6-a099-116c57951a51","block_type":"box","text":"(c) unrated notes, paper and other instruments that are of comparable quality to the instruments described in","page_number":80,"box":{"x":69,"y":604,"width":792,"height":11}},{"id":"7dfc3839-d14c-4a26-be18-bc55c0177ec5","block_type":"box","text":"(b) above as determined by the Fund’s Manager;","page_number":80,"box":{"x":102,"y":619,"width":344,"height":11}},{"id":"5f2222e8-930d-419a-8081-e2027df5a65b","block_type":"box","text":"(d) asset-backed securities (including interests in pools of assets such as mortgages, installment purchase","page_number":80,"box":{"x":69,"y":639,"width":776,"height":12}},{"id":"3db53fb6-ae92-48b3-96a2-0f71ad0f8d6d","block_type":"box","text":"obligations and credit card receivables);","page_number":80,"box":{"x":102,"y":655,"width":283,"height":11}},{"id":"50647f0a-121b-450f-b4f4-4c69be214fd2","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":80,"box":{"x":69,"y":675,"width":778,"height":11}},{"id":"e46b414b-faef-4592-a873-4c987079791c","block_type":"box","text":"authorities and related custodial receipts;","page_number":80,"box":{"x":102,"y":690,"width":296,"height":11}},{"id":"2481667a-7da0-4415-aa95-5309df00ca68","block_type":"box","text":"(f) dollar-denominated securities issued or guaranteed by foreign governments or their political subdivisions,","page_number":80,"box":{"x":69,"y":710,"width":782,"height":11}},{"id":"f9989ec5-620a-40f2-9784-69780074741f","block_type":"box","text":"agencies or authorities;","page_number":80,"box":{"x":102,"y":725,"width":166,"height":11}},{"id":"a113a4c5-9d8d-4aa7-ae0c-faceac399551","block_type":"box","text":"(g) funding agreements issued by highly-rated U.S. insurance companies;","page_number":80,"box":{"x":69,"y":745,"width":528,"height":11}},{"id":"b16225f4-7c57-4f2f-a336-9e8266db6aa7","block_type":"box","text":"(h) securities issued or guaranteed by state or local governmental bodies;","page_number":80,"box":{"x":69,"y":766,"width":534,"height":11}},{"id":"8910f4de-2c70-48b7-8c90-8569eaf7e17c","block_type":"box","text":"(i) repurchase agreements relating to the above instruments;","page_number":80,"box":{"x":69,"y":786,"width":447,"height":11}},{"id":"a5501446-8b5f-4315-9a79-4e7ddd81af28","block_type":"box","text":"(j) municipal bonds and notes whose principal and interest payments are guaranteed by the U.S. Government or","page_number":80,"box":{"x":69,"y":806,"width":812,"height":11}},{"id":"296e61d1-7665-4dfc-985b-fdfb144b1519","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":80,"box":{"x":102,"y":821,"width":766,"height":11}},{"id":"574e11de-2a0f-4dfc-addf-14ee3e1987ac","block_type":"box","text":"States;","page_number":80,"box":{"x":102,"y":836,"width":49,"height":10}},{"id":"8202536b-9ba8-45cc-b1d2-49a9d6840841","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":80,"box":{"x":69,"y":856,"width":829,"height":11}},{"id":"4aa46b77-bdc9-42b4-9b4f-92287f35344c","block_type":"box","text":"SP-2 or A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":80,"box":{"x":102,"y":871,"width":379,"height":11}},{"id":"63657966-15fc-43ec-936f-9cd6eff97d5b","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":80,"box":{"x":69,"y":891,"width":826,"height":12}},{"id":"f570b88a-9653-4ad5-8d13-7339427c804b","block_type":"box","text":"S&P, or F-2 or higher by Fitch;","page_number":80,"box":{"x":102,"y":906,"width":207,"height":12}},{"id":"5468dfbd-b798-4bb1-bdb9-a56784c6b775","block_type":"box","text":"II-50","page_number":80,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"02d4b350-e395-41d7-b8f4-5036972808fc","block_type":"box","text":"NM1026U-5979889-80/232","page_number":80,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"e9e9cc1c-a93d-4c5b-9f34-aaa04932a6c1","block_type":"box","text":"(m) municipal bonds rated A or higher by Moody’s, S&P or Fitch;","page_number":81,"box":{"x":69,"y":45,"width":458,"height":11}},{"id":"2bcd9f38-4af1-46da-910c-9ffb9c76c280","block_type":"box","text":"(n) unrated notes, paper or other instruments that are of comparable quality to the instruments described above, as","page_number":81,"box":{"x":69,"y":65,"width":837,"height":11}},{"id":"bdf46ff2-e547-4fc4-81b2-53a643e16a61","block_type":"box","text":"determined by the Fund’s Manager under guidelines established by the Board; and","page_number":81,"box":{"x":101,"y":80,"width":589,"height":11}},{"id":"10529026-996e-47de-acf8-26048d496735","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":81,"box":{"x":69,"y":100,"width":795,"height":11}},{"id":"dce3006d-0a3b-4eaa-8a8b-c4c9a192e8a0","block_type":"box","text":"agency or instrumentality thereof or which otherwise depend directly or indirectly on the credit of the United","page_number":81,"box":{"x":102,"y":115,"width":764,"height":11}},{"id":"85d4e301-9a21-4a89-ba61-0cd7ef3bc749","block_type":"box","text":"States.","page_number":81,"box":{"x":102,"y":130,"width":49,"height":9}},{"id":"f55cf9b0-aec1-4ae0-9d98-288e7bb35970","block_type":"box","text":"Mortgage-Related Securities.","page_number":81,"box":{"x":102,"y":153,"width":213,"height":11}},{"id":"7c3481f0-a07e-45fc-b54f-fcc16d504bf5","block_type":"box","text":"Mor tgage-Backed Securities.","page_number":81,"box":{"x":102,"y":176,"width":203,"height":11}},{"id":"605db6b9-ccbf-4012-930e-24b0867e3b25","block_type":"box","text":"Mortgage-backed securities represent interests in pools of mortgages in which","page_number":81,"box":{"x":312,"y":176,"width":560,"height":11}},{"id":"2de53e58-8e3c-4967-9e36-774dc05d39c2","block_type":"box","text":"payments of both principal and interest on the securities are generally made monthly, in effect “passing through”","page_number":81,"box":{"x":70,"y":191,"width":805,"height":11}},{"id":"c66df9fb-3733-44e9-964b-8c5d1a42ec32","block_type":"box","text":"monthly payments made by borrowers on the residential or commercial mortgage loans that underlie the securities","page_number":81,"box":{"x":69,"y":206,"width":819,"height":11}},{"id":"7c95ec32-4be4-4418-b71f-f21073ab6958","block_type":"box","text":"(net of any fees paid to the issuer or guarantor of the securities). Mortgage-backed securities differ from other forms","page_number":81,"box":{"x":69,"y":221,"width":832,"height":11}},{"id":"11451275-525e-49b5-9198-6638752fcdb0","block_type":"box","text":"of debt securities, which normally provide for periodic payment of interest in fixed amounts with principal payments at","page_number":81,"box":{"x":69,"y":236,"width":838,"height":11}},{"id":"a53f98d7-7714-40c4-9be0-497e7a1c041e","block_type":"box","text":"maturity or specified call dates.","page_number":81,"box":{"x":69,"y":251,"width":222,"height":11}},{"id":"aedaee10-1c6a-4141-ab60-95743c92a30a","block_type":"box","text":"Mortgage-backed securities are subject to the general risks associated with investing in real estate securities;","page_number":81,"box":{"x":102,"y":274,"width":785,"height":11}},{"id":"be73ff91-bda0-4ec9-9c5e-80393f18bf8e","block_type":"box","text":"that is, they may lose value if the value of the underlying real estate to which a pool of mortgages relates declines. In","page_number":81,"box":{"x":68,"y":289,"width":838,"height":11}},{"id":"6108391c-89ac-4043-90c8-d90ce2b796e5","block_type":"box","text":"addition, investments in mortgage-backed securities involve certain specific risks. These risks include the failure of a","page_number":81,"box":{"x":69,"y":304,"width":836,"height":11}},{"id":"1bf252a0-4c40-46a2-b263-8f5fa7faacee","block_type":"box","text":"party to meet its commitments under the related operative documents, adverse interest rate changes and the effects","page_number":81,"box":{"x":70,"y":319,"width":837,"height":12}},{"id":"6eca57a7-8bf4-4cc4-a9b8-7d9f950a2504","block_type":"box","text":"of prepayments on mortgage cash flows. Mortgage-backed securities are “pass-through” securities, meaning that","page_number":81,"box":{"x":69,"y":334,"width":810,"height":12}},{"id":"5fbce7c3-6f25-45eb-b992-4fc5ea603b21","block_type":"box","text":"principal and interest payments made by the borrower on the underlying mortgages are passed through to a Fund.","page_number":81,"box":{"x":70,"y":350,"width":811,"height":11}},{"id":"1c79d89b-f9e0-4751-ae34-d4b64327be34","block_type":"box","text":"Accordingly, the value of mortgage-backed securities in which a Fund invests may be particularly sensitive to changes","page_number":81,"box":{"x":68,"y":365,"width":837,"height":11}},{"id":"fabd0608-595f-476b-baa4-d3a0b80de68c","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":81,"box":{"x":70,"y":380,"width":834,"height":11}},{"id":"0c4a20ad-d30f-4672-85f5-9d255d30d22b","block_type":"box","text":"successfully may depend in part upon the ability of the Manager to forecast interest rates and other economic factors","page_number":81,"box":{"x":69,"y":395,"width":840,"height":11}},{"id":"5fa96009-49b3-4709-971e-068fd2ea0313","block_type":"box","text":"correctly. The value of mortgage-backed securities, like that of traditional fixed-income securities, typically increases","page_number":81,"box":{"x":69,"y":410,"width":827,"height":11}},{"id":"4033647b-e96f-4998-a88a-ba7b40038ee8","block_type":"box","text":"when interest rates fall and decreases when interest rates rise. However, mortgage-backed securities differ from","page_number":81,"box":{"x":68,"y":425,"width":805,"height":11}},{"id":"584d314c-d1d1-4560-a59d-bac4f66fd850","block_type":"box","text":"traditional fixed-income securities because of their potential for prepayment without penalty. The price paid by a Fund","page_number":81,"box":{"x":68,"y":440,"width":834,"height":11}},{"id":"432f7392-04f7-4cf0-930c-c5accd694f9d","block_type":"box","text":"for its mortgage-backed securities, the yield the Fund expects to receive from such securities and the weighted","page_number":81,"box":{"x":68,"y":455,"width":791,"height":12}},{"id":"e2d44d94-eba5-492b-ba42-5541265eb692","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":81,"box":{"x":69,"y":470,"width":816,"height":12}},{"id":"5406eb29-697d-4a14-aa07-1ce5029d3531","block_type":"box","text":"underlying mortgages. In a period of declining interest rates, borrowers may prepay the underlying mortgages more","page_number":81,"box":{"x":69,"y":486,"width":819,"height":11}},{"id":"ec162a68-f8ec-4214-936c-ad1e96bc6ea2","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the mortgage-backed","page_number":81,"box":{"x":69,"y":501,"width":761,"height":11}},{"id":"18dd8f99-25ea-474c-bdfe-5c6d2ead81fb","block_type":"box","text":"securities. Moreover, when a Fund reinvests the proceeds of a prepayment in these circumstances, it will likely","page_number":81,"box":{"x":69,"y":516,"width":791,"height":11}},{"id":"6b78f0a5-8a2f-4184-8045-b611e67f8a5a","block_type":"box","text":"receive a rate of interest that is lower than the rate on the security that was prepaid.","page_number":81,"box":{"x":69,"y":531,"width":602,"height":11}},{"id":"3b68420a-1142-4e21-902a-3833ab6f1541","block_type":"box","text":"To the extent that a Fund purchases mortgage-backed securities at a premium, mortgage foreclosures and","page_number":81,"box":{"x":101,"y":554,"width":761,"height":11}},{"id":"c66dcecf-0ac3-4839-85d8-66dda31dc629","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":81,"box":{"x":70,"y":569,"width":800,"height":11}},{"id":"80ee11f4-f72a-4b3e-ae1f-3d9055d6520d","block_type":"box","text":"discount, both scheduled payments of principal and unscheduled prepayments will increase current and total returns","page_number":81,"box":{"x":69,"y":584,"width":833,"height":11}},{"id":"295e0815-5545-4d05-94c8-c89ad6724019","block_type":"box","text":"and will accelerate the recognition of income, which, when distributed to shareholders, will be taxable as ordinary","page_number":81,"box":{"x":69,"y":599,"width":809,"height":11}},{"id":"191b76ad-31b8-47df-8e81-d95f40546267","block_type":"box","text":"income. In a period of rising interest rates, prepayments of the underlying mortgages may occur at a slower than","page_number":81,"box":{"x":70,"y":614,"width":801,"height":11}},{"id":"9019c420-020c-45b6-ad0a-d383968c7763","block_type":"box","text":"expected rate, creating maturity extension risk. This particular risk may effectively change a security that was","page_number":81,"box":{"x":69,"y":629,"width":778,"height":11}},{"id":"92a0ca80-76fd-4e03-b713-277108e6a5a4","block_type":"box","text":"considered short- or intermediate-term at the time of purchase into a long-term security. Since the value of long-term","page_number":81,"box":{"x":69,"y":644,"width":831,"height":12}},{"id":"d2fb6093-2934-4a24-a112-62efe3e6f935","block_type":"box","text":"securities generally fluctuates more widely in response to changes in interest rates than that of shorter-term","page_number":81,"box":{"x":69,"y":659,"width":773,"height":12}},{"id":"4908e4f3-2eb7-49e9-821b-be136dba831f","block_type":"box","text":"securities, maturity extension risk could increase the inherent volatility of the Fund. Under certain interest rate and","page_number":81,"box":{"x":69,"y":675,"width":818,"height":11}},{"id":"302683d5-aacd-4c26-bed6-09a6410b44ee","block_type":"box","text":"prepayment scenarios, a Fund may fail to recoup fully its investment in mortgage-backed securities notwithstanding","page_number":81,"box":{"x":70,"y":690,"width":822,"height":11}},{"id":"34e99fdc-a9d6-4c89-9242-57e4f0ef8451","block_type":"box","text":"any direct or indirect governmental or agency guarantee.","page_number":81,"box":{"x":69,"y":705,"width":399,"height":11}},{"id":"8ba6700b-e588-4236-be8f-75a33e0f5010","block_type":"box","text":"There are currently three types of mortgage pass-through securities: (1) those issued by the U.S. Government or","page_number":81,"box":{"x":101,"y":727,"width":802,"height":12}},{"id":"789adef0-3582-4b44-bc22-916be0f239e4","block_type":"box","text":"one of its agencies or instrumentalities, such as the Government National Mortgage Association (“Ginnie Mae”), the","page_number":81,"box":{"x":69,"y":743,"width":830,"height":11}},{"id":"85d18566-f746-4b1a-b552-c5476794b437","block_type":"box","text":"Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie","page_number":81,"box":{"x":70,"y":758,"width":818,"height":11}},{"id":"a462265a-e84f-4de4-b43f-080a5b94945e","block_type":"box","text":"Mac”); (2) those issued by private issuers that represent an interest in or are collateralized by pass-through","page_number":81,"box":{"x":70,"y":773,"width":766,"height":11}},{"id":"7d932629-f0eb-471d-8ddc-f02889c55b9d","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":81,"box":{"x":69,"y":788,"width":808,"height":11}},{"id":"ccb87763-350b-4b7c-9723-5c633919010c","block_type":"box","text":"issued by private issuers that represent an interest in or are collateralized by whole mortgage loans or pass-through","page_number":81,"box":{"x":70,"y":803,"width":825,"height":11}},{"id":"2d226237-aaed-438f-bbc5-7bfff250e06f","block_type":"box","text":"securities without a government guarantee but that usually have some form of private credit enhancement.","page_number":81,"box":{"x":69,"y":818,"width":761,"height":11}},{"id":"f676af9e-515b-4c33-9dc4-9ddbb71334fe","block_type":"box","text":"Ginnie Mae is a wholly owned U.S. Government corporation within the Department of Housing and Urban","page_number":81,"box":{"x":102,"y":841,"width":743,"height":11}},{"id":"a9bdad9e-214e-442c-9e13-b04078ab96fc","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":81,"box":{"x":70,"y":856,"width":831,"height":11}},{"id":"ad931f02-cc34-4171-a7f3-23ab0aa33035","block_type":"box","text":"payment of principal and interest on securities issued by the institutions approved by Ginnie Mae (such as savings","page_number":81,"box":{"x":70,"y":871,"width":815,"height":11}},{"id":"6dd30c65-11a2-43d1-bccd-c764c8fdf000","block_type":"box","text":"and loan institutions, commercial banks and mortgage banks), and backed by pools of Federal Housing","page_number":81,"box":{"x":69,"y":886,"width":737,"height":12}},{"id":"c1c42075-bcfb-44f4-a260-05291518e1ef","block_type":"box","text":"Administration (“FHA”)-insured or Veterans’ Administration (“VA”)-guaranteed mortgages. Pass-through certificates","page_number":81,"box":{"x":68,"y":901,"width":814,"height":12}},{"id":"57717124-cca2-438d-a2c0-e1ca41f52779","block_type":"box","text":"II-51","page_number":81,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c7c1d17b-f333-4b5e-9a08-c62bd7d06c88","block_type":"box","text":"NM1026U-5979889-81/232","page_number":81,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ea6d9922-7fb5-430e-865b-e0cccf902c07","block_type":"box","text":"guaranteed by Ginnie Mae (such certificates are also known as “Ginnie Maes”) are guaranteed as to the timely","page_number":82,"box":{"x":68,"y":45,"width":794,"height":11}},{"id":"e49d8844-5c0d-4d92-9e44-0f2b240c00b4","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":82,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"aed0fef4-a6a4-4300-bc6d-a8cb379497fa","block_type":"box","text":"States. Ginnie Mae certificates also are supported by the authority of Ginnie Mae to borrow funds from the U.S.","page_number":82,"box":{"x":69,"y":75,"width":798,"height":11}},{"id":"d0d3b5eb-7b3f-4573-a417-545c3921e810","block_type":"box","text":"Treasury Department to make payments under its guarantee. Mortgage-related securities issued by Fannie Mae","page_number":82,"box":{"x":68,"y":90,"width":798,"height":11}},{"id":"e4195b55-a306-400c-bae1-9af698da2c24","block_type":"box","text":"include Fannie Mae guaranteed Mortgage Pass-Through Certificates (also known as “Fannie Maes”), which are","page_number":82,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"05c99b6e-73f7-4a4e-9c0e-0e1a1ded4750","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":82,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"2502786d-29d4-409b-9042-e7c590fab8d6","block_type":"box","text":"faith and credit of the United States, but are supported by the right of Fannie Mae to borrow from the U.S. Treasury","page_number":82,"box":{"x":68,"y":135,"width":825,"height":12}},{"id":"61cf1e4a-1e42-4565-a4d7-0d90b02e2ccd","block_type":"box","text":"Department. Fannie Mae was established as a federal agency in 1938 and in 1968 was chartered by Congress as a","page_number":82,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"ae936381-c4d0-4849-babb-8c9cf729a2c6","block_type":"box","text":"private shareholder-owned company. Mortgage-related securities issued by Freddie Mac include Freddie Mac","page_number":82,"box":{"x":70,"y":166,"width":770,"height":11}},{"id":"12fa7837-91d1-4afc-ab5b-18ce32ddf250","block_type":"box","text":"Mortgage Participation Certificates (also known as “Freddie Macs” or “PCs”). Freddie Mac is a stockholder-owned","page_number":82,"box":{"x":70,"y":181,"width":812,"height":11}},{"id":"5fb84b9a-91f0-4679-b9fa-33732d6233a0","block_type":"box","text":"corporation chartered by Congress in 1970. Freddie Macs are not guaranteed by the United States or by any Federal","page_number":82,"box":{"x":69,"y":196,"width":829,"height":11}},{"id":"f31dc81f-192c-465d-8bcc-8a2a1743c971","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":82,"box":{"x":70,"y":211,"width":832,"height":11}},{"id":"b4686c62-b07b-46ea-b60b-ba85237663aa","block_type":"box","text":"Freddie Macs entitle the holder to timely payment of interest, which is guaranteed by Freddie Mac. Freddie Mac","page_number":82,"box":{"x":70,"y":226,"width":792,"height":11}},{"id":"a0cef518-ced8-49fe-8948-f948fbafa04f","block_type":"box","text":"guarantees either ultimate collection or timely payment of all principal payments on the underlying mortgage loans.","page_number":82,"box":{"x":68,"y":241,"width":819,"height":11}},{"id":"0bbd2802-c46a-41b6-9a60-e11baa2a36a8","block_type":"box","text":"While Freddie Mac generally does not guarantee timely payment of principal, Freddie Mac may remit the amount due","page_number":82,"box":{"x":68,"y":256,"width":829,"height":12}},{"id":"1a8b39c1-5424-4b27-9cdf-8243d582433a","block_type":"box","text":"on account of its guarantee of ultimate payment of principal at any time after default on an underlying mortgage, but","page_number":82,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"0f9205cb-db22-4464-9b0f-ad74b69f3a35","block_type":"box","text":"in no event later than one year after it becomes payable.","page_number":82,"box":{"x":70,"y":286,"width":401,"height":12}},{"id":"fd3676e6-0055-4223-93f4-e08868bb2b08","block_type":"box","text":"Private mortgage pass-through securities are structured similarly to Ginnie Mae, Fannie Mae, and Freddie Mac","page_number":82,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"3d0f1ee3-1027-4605-aa59-004e0968ad09","block_type":"box","text":"mortgage pass-through securities and are issued by originators of and investors in mortgage loans, including","page_number":82,"box":{"x":69,"y":324,"width":777,"height":12}},{"id":"ee51f70d-81a4-4658-af93-90da77a781b3","block_type":"box","text":"depository institutions, mortgage banks, investment banks and special purpose subsidiaries of the foregoing.","page_number":82,"box":{"x":69,"y":339,"width":782,"height":12}},{"id":"b6c0f366-9fcc-4d8e-a5d2-127411e5a8d4","block_type":"box","text":"Pools created by private mortgage pass-through issuers generally offer a higher rate of interest than government","page_number":82,"box":{"x":102,"y":362,"width":802,"height":11}},{"id":"a2799518-3300-41a8-a94a-0e65b279b9bf","block_type":"box","text":"and government-related pools because there are no direct or indirect government or agency guarantees of payments","page_number":82,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"a572b6f0-d018-4f3b-ab52-7570a3530531","block_type":"box","text":"in the private pools. However, timely payment of interest and principal of these pools may be supported by various","page_number":82,"box":{"x":70,"y":392,"width":814,"height":12}},{"id":"9e8383d1-631e-4ba2-a672-a9877a576fd3","block_type":"box","text":"forms of insurance or guarantees, including individual loan, title, pool and hazard insurance and letters of credit. The","page_number":82,"box":{"x":68,"y":407,"width":833,"height":12}},{"id":"413298f7-e041-4991-b00c-d50527303e11","block_type":"box","text":"insurance and guarantees are issued by governmental entities, private insurers and the mortgage poolers. The","page_number":82,"box":{"x":70,"y":423,"width":789,"height":11}},{"id":"4adb1588-4f47-463d-a2bf-5e99e0c9f584","block_type":"box","text":"insurance and guarantees and the creditworthiness of the issuers thereof will be considered in determining whether","page_number":82,"box":{"x":70,"y":438,"width":827,"height":11}},{"id":"beff02cb-2862-42f1-b815-8dd87123324e","block_type":"box","text":"a mortgage-related security meets a Fund’s investment quality standards. There can be no assurance that the private","page_number":82,"box":{"x":69,"y":453,"width":838,"height":11}},{"id":"5d390f67-9660-4099-8671-8007cc2c284e","block_type":"box","text":"insurers or guarantors can meet their obligations under the insurance policies or guarantee arrangements. Private","page_number":82,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"03861de0-ad81-4594-a7f4-7219c567a510","block_type":"box","text":"mortgage pass-through securities may be bought without insurance or guarantees if, through an examination of the","page_number":82,"box":{"x":69,"y":483,"width":820,"height":11}},{"id":"06647ae7-6319-4501-a448-bfea3dcd2370","block_type":"box","text":"loan experience and practices of the originator/servicers and poolers, the Manager determines that the securities","page_number":82,"box":{"x":70,"y":498,"width":812,"height":11}},{"id":"94c16637-108a-4ec2-b36c-43086f86922c","block_type":"box","text":"meet a Fund’s quality standards. Any mortgage-related securities that are issued by private issuers have some","page_number":82,"box":{"x":69,"y":514,"width":790,"height":11}},{"id":"544ba238-393c-4ff4-bdd6-e0751ccf25f5","block_type":"box","text":"exposure to subprime loans as well as to the mortgage and credit markets generally.","page_number":82,"box":{"x":69,"y":529,"width":604,"height":11}},{"id":"4fabfa86-eb10-4d6e-a794-aa0ba79e0d21","block_type":"box","text":"In addition, mortgage-related securities that are issued by private issuers are not subject to the underwriting","page_number":82,"box":{"x":102,"y":551,"width":774,"height":11}},{"id":"6309506b-5792-4def-9198-4eac799cbd97","block_type":"box","text":"requirements for the underlying mortgages that are applicable to those mortgage-related securities that have a","page_number":82,"box":{"x":69,"y":566,"width":791,"height":11}},{"id":"b93ac1e8-7455-4102-841e-20994be9e4f6","block_type":"box","text":"government or government-sponsored entity guarantee. As a result, the mortgage loans underlying private mortgage","page_number":82,"box":{"x":68,"y":582,"width":832,"height":11}},{"id":"f1864325-e469-4bec-b9c1-48dd0d5b8220","block_type":"box","text":"related securities may, and frequently do, have less favorable collateral, credit risk or other underwriting","page_number":82,"box":{"x":69,"y":596,"width":742,"height":12}},{"id":"c703b4f0-ff8a-4542-9fa5-4c587ad36cdc","block_type":"box","text":"characteristics than government or government-sponsored mortgage-related securities and have wider variances in a","page_number":82,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"7dbcd2a7-9fac-40e0-ab27-3d3c587dd105","block_type":"box","text":"number of terms including interest rate, term, size, purpose and borrower characteristics. Privately issued pools more","page_number":82,"box":{"x":69,"y":627,"width":840,"height":11}},{"id":"ad044488-e770-4a84-8d5b-f0f8c607a4f7","block_type":"box","text":"frequently include second mortgages, high loan-to-value mortgages and manufactured housing loans. The coupon","page_number":82,"box":{"x":68,"y":642,"width":809,"height":11}},{"id":"3f4a21c6-a5a6-4b81-a1db-9181e79db841","block_type":"box","text":"rates and maturities of the underlying mortgage loans in a private-label mortgage-related securities pool may vary to","page_number":82,"box":{"x":69,"y":657,"width":828,"height":11}},{"id":"363489c0-bae0-4df7-805e-5cfebdc65185","block_type":"box","text":"a greater extent than those included in a government guaranteed pool, and the pool may include subprime mortgage","page_number":82,"box":{"x":69,"y":672,"width":830,"height":11}},{"id":"c60d9301-e59d-4232-90f3-a71980636521","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":82,"box":{"x":70,"y":687,"width":810,"height":11}},{"id":"3936a171-97df-476a-90eb-29ccfe2347b7","block_type":"box","text":"make timely payments on their loans. For these reasons, the loans underlying these securities have had in many","page_number":82,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"607dae6e-8372-4eee-8791-d0b8eaf726b7","block_type":"box","text":"cases higher default rates than those loans that meet government underwriting requirements.","page_number":82,"box":{"x":69,"y":717,"width":669,"height":12}},{"id":"4480ef7d-7d31-487f-a5f9-9d40de0080a7","block_type":"box","text":"The risk of non-payment is greater for mortgage-related securities that are backed by mortgage pools that","page_number":82,"box":{"x":101,"y":740,"width":754,"height":11}},{"id":"d2e7e3ac-ed7d-4ce5-b4bf-9ebbb2457433","block_type":"box","text":"contain subprime loans, but a level of risk exists for all loans. Market factors adversely affecting mortgage loan","page_number":82,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"d558e30e-fc1e-48ec-a43f-4859a35e677d","block_type":"box","text":"repayments may include a general economic turndown, high unemployment, a general slowdown in the real estate","page_number":82,"box":{"x":69,"y":771,"width":812,"height":11}},{"id":"ecd314be-c39c-4894-84da-acc5fd93fcdb","block_type":"box","text":"market, a drop in the market prices of real estate, or an increase in interest rates resulting in higher mortgage","page_number":82,"box":{"x":69,"y":785,"width":788,"height":12}},{"id":"1674b55a-c76e-44fc-8c5b-bdf185a8ccef","block_type":"box","text":"payments by holders of adjustable rate mortgages.","page_number":82,"box":{"x":70,"y":801,"width":361,"height":11}},{"id":"b0bbab5e-5f4b-4793-aef9-cbe187cfe63c","block_type":"box","text":"Privately issued mortgage-related securities are not traded on an exchange and there may be a limited market","page_number":82,"box":{"x":102,"y":823,"width":784,"height":12}},{"id":"146dce34-7a65-41f1-86a6-268b054ecefd","block_type":"box","text":"for the securities, especially when there is a perceived weakness in the mortgage and real estate market sectors.","page_number":82,"box":{"x":68,"y":838,"width":813,"height":12}},{"id":"22405a65-edc5-4fd4-b7d6-0137ffd8994b","block_type":"box","text":"Without an active trading market, mortgage-related securities held in a Fund’s portfolio may be particularly difficult to","page_number":82,"box":{"x":68,"y":853,"width":837,"height":12}},{"id":"e680fde1-e162-4d62-9a38-4cad01d182ba","block_type":"box","text":"value because of the complexities involved in assessing the value of the underlying mortgage loans.","page_number":82,"box":{"x":68,"y":869,"width":714,"height":11}},{"id":"97ad30ff-4e89-4bbb-8a25-43dbd987630e","block_type":"box","text":"Collateralized Mor tgage Obligations (“CMOs”).","page_number":82,"box":{"x":102,"y":891,"width":328,"height":12}},{"id":"384c84fd-ebbb-41a8-989c-e3aa394b5710","block_type":"box","text":"CMOs are debt obligations collateralized by residential or","page_number":82,"box":{"x":437,"y":891,"width":407,"height":12}},{"id":"4fa37d94-92d7-44c0-83bf-ece62c364e5f","block_type":"box","text":"commercial mortgage loans or residential or commercial mortgage pass-through securities. Interest and prepaid","page_number":82,"box":{"x":69,"y":907,"width":800,"height":11}},{"id":"1918db2b-25f5-4811-8ed0-bc6cd13a1724","block_type":"box","text":"II-52","page_number":82,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5aef10d0-8ddc-4330-b215-b349362407b5","block_type":"box","text":"NM1026U-5979889-82/232","page_number":82,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"805466c4-db55-4c32-bf44-c8d9c780ac3b","block_type":"box","text":"principal are generally paid monthly. CMOs may be collateralized by whole mortgage loans or private mortgage pass","page_number":83,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"d943f728-d6ff-4085-9592-854f4c2e36d5","block_type":"box","text":"through securities but are more typically collateralized by portfolios of mortgage pass-through securities guaranteed","page_number":83,"box":{"x":68,"y":60,"width":826,"height":11}},{"id":"813d2bcd-dd33-4180-abc7-3ffa6890134e","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":83,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"eb9486db-402a-42c6-882e-69fdbe380383","block_type":"box","text":"Mortgage Investment Conduit (“REMIC”). All future references to CMOs also include REMICs.","page_number":83,"box":{"x":70,"y":90,"width":661,"height":11}},{"id":"0fe02154-9f02-4893-a73f-6e310f5d76d6","block_type":"box","text":"CMOs are structured into multiple classes, often referred to as a “tranche,” each issued at a specific adjustable","page_number":83,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"9d1741f6-38a0-497f-8053-da348f91ae1c","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":83,"box":{"x":69,"y":128,"width":837,"height":11}},{"id":"c026886b-71eb-4adb-a8c6-11fefe3d0518","block_type":"box","text":"distribution date. Actual maturity and average life will depend upon the prepayment experience of the collateral, which","page_number":83,"box":{"x":69,"y":143,"width":838,"height":11}},{"id":"1d907053-4294-461e-a7ef-faad4e165aee","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":83,"box":{"x":70,"y":158,"width":836,"height":11}},{"id":"f746001f-c7cb-4263-9c0b-97f3d47079ec","block_type":"box","text":"de facto breakdown of the underlying pool of mortgages according to how quickly the loans are repaid. Monthly","page_number":83,"box":{"x":69,"y":173,"width":791,"height":11}},{"id":"d55d328d-ea9a-4e6b-853c-676e1608f004","block_type":"box","text":"payment of principal received from the pool of underlying mortgages, including prepayments, is first returned to","page_number":83,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"1a78c28e-4fbe-458d-a738-5e43404bb230","block_type":"box","text":"investors holding the shortest maturity class. Investors holding the longer maturity classes usually receive principal","page_number":83,"box":{"x":70,"y":204,"width":820,"height":11}},{"id":"d6677cf3-a630-44a8-8e0a-7ee98ac664cf","block_type":"box","text":"only after the first class has been retired. An investor may be partially protected against a sooner than desired return","page_number":83,"box":{"x":69,"y":218,"width":836,"height":12}},{"id":"c797f973-1450-4255-a807-e2b37d7e53ff","block_type":"box","text":"of principal because of the sequential payments.","page_number":83,"box":{"x":69,"y":234,"width":346,"height":11}},{"id":"067dc185-9602-4489-9871-1deca696d973","block_type":"box","text":"Certain issuers of CMOs are not considered investment companies pursuant to a rule adopted by the","page_number":83,"box":{"x":102,"y":256,"width":723,"height":11}},{"id":"3bfa2840-10f0-4118-a6ce-51a5a978afc2","block_type":"box","text":"Commission, and a Fund may invest in the securities of such issuers without the limitations imposed by the","page_number":83,"box":{"x":69,"y":271,"width":768,"height":12}},{"id":"36cb8656-ed79-483c-b878-7a7aae870058","block_type":"box","text":"Investment Company Act on investments by a Fund in other investment companies. In addition, in reliance on an","page_number":83,"box":{"x":70,"y":287,"width":800,"height":11}},{"id":"6271cc5f-89e6-44d0-a5a4-670e91af6497","block_type":"box","text":"earlier Commission interpretation, a Fund’s investments in certain other qualifying CMOs, which cannot or do not rely","page_number":83,"box":{"x":69,"y":302,"width":836,"height":11}},{"id":"ecc79fcb-bc5c-4320-bd11-fbf5a1024ffc","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":83,"box":{"x":69,"y":317,"width":793,"height":11}},{"id":"f8d7d9d9-cfd1-4044-bb97-e690a7415ad4","block_type":"box","text":"investment companies. In order to be able to rely on the Commission’s interpretation, these CMOs must be","page_number":83,"box":{"x":70,"y":332,"width":767,"height":11}},{"id":"08913a74-0265-4151-b639-cd8fe67763ed","block_type":"box","text":"unmanaged, fixed asset issuers, that: (1) invest primarily in mortgage-backed securities; (2) do not issue redeemable","page_number":83,"box":{"x":69,"y":347,"width":838,"height":11}},{"id":"26f650c8-bda5-4ac7-951a-f9b53a6c8d41","block_type":"box","text":"securities; (3) operate under general exemptive orders exempting them from all provisions of the Investment","page_number":83,"box":{"x":69,"y":362,"width":773,"height":11}},{"id":"3319b55e-3016-4392-9a39-1b7b41d8d90d","block_type":"box","text":"Company Act; and (4) are not registered or regulated under the Investment Company Act as investment companies.","page_number":83,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"01e2a87d-ef65-47da-981a-5c9276ff1884","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":83,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"1e2889fe-f08f-4940-9e11-d01b19aa66b9","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":83,"box":{"x":69,"y":407,"width":795,"height":12}},{"id":"9d8e31e6-237b-40e0-a898-3d80a89ea5e3","block_type":"box","text":"securities of any single such entity.","page_number":83,"box":{"x":69,"y":423,"width":248,"height":11}},{"id":"724763b4-263f-4e76-b27b-82b462c4437e","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":83,"box":{"x":101,"y":445,"width":807,"height":12}},{"id":"993a91a5-9f18-475f-bda1-e50931f58159","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":83,"box":{"x":69,"y":460,"width":805,"height":12}},{"id":"47f90e24-ac2b-4c69-b992-743d0685ab01","block_type":"box","text":"concurrently on a proportionate or disproportionate basis. These simultaneous payments are taken into account in","page_number":83,"box":{"x":69,"y":476,"width":819,"height":11}},{"id":"8b21151a-17f5-4395-96d0-087f934a6fb5","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":83,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"1bd497c2-9261-4a2e-8c53-77101bb2fe9d","block_type":"box","text":"a time while paying interest to several classes. A wide variety of REMIC Certificates may be issued in the parallel pay","page_number":83,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"ea41c247-41eb-42e5-9da0-f76c22504f84","block_type":"box","text":"or sequential pay structures. These securities include accrual certificates (also known as “Z-Bonds”), which only","page_number":83,"box":{"x":69,"y":521,"width":802,"height":11}},{"id":"07268671-cf35-4261-ac04-00e3715112ce","block_type":"box","text":"accrue interest at a specified rate until all other certificates having an earlier final distribution date have been retired","page_number":83,"box":{"x":69,"y":536,"width":833,"height":11}},{"id":"1a4e75b7-73e1-471b-8891-1918cceef9b8","block_type":"box","text":"and are converted thereafter to an interest-paying security. Floating rate CMOs are securities whose coupon rate","page_number":83,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"16d6bd08-719b-4207-a698-b3e76fdd2072","block_type":"box","text":"fluctuates according to some formula related to an existing market index or rate. Typical indices would include the","page_number":83,"box":{"x":68,"y":566,"width":813,"height":11}},{"id":"34920dce-dea1-4811-9163-259b53f15888","block_type":"box","text":"eleventh district cost-of-funds index (“COFI”), one-year Treasury yields, and ten-year Treasury yields.","page_number":83,"box":{"x":69,"y":581,"width":708,"height":11}},{"id":"7eee8042-e4ee-4c28-a26f-15876e449c9f","block_type":"box","text":"Classes of CMOs also include planned amortization classes (“PACs”) and targeted amortization classes","page_number":83,"box":{"x":102,"y":604,"width":742,"height":11}},{"id":"2c8f7742-fb06-4dff-99ad-a114aba541e4","block_type":"box","text":"(“TACs”). PAC bonds generally require payments of a specified amount of principal on each payment date. The","page_number":83,"box":{"x":69,"y":619,"width":784,"height":11}},{"id":"504fb1a2-783e-4070-926c-e56a8b77df8b","block_type":"box","text":"scheduled principal payments for PAC Certificates generally have the highest priority on each payment date after","page_number":83,"box":{"x":69,"y":634,"width":800,"height":12}},{"id":"17c2937a-4c7f-4cdf-8558-87598c12414a","block_type":"box","text":"interest due has been paid to all classes entitled to receive interest currently. Shortfalls, if any, are added to the","page_number":83,"box":{"x":70,"y":649,"width":802,"height":12}},{"id":"3b3bfb17-5e22-43f5-a61f-27f46eeac439","block_type":"box","text":"amount payable on the next payment date. The PAC Certificate payment schedule is taken into account in calculating","page_number":83,"box":{"x":69,"y":664,"width":834,"height":12}},{"id":"838dd623-5763-4b88-9fc0-dff7cfce6f24","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":83,"box":{"x":68,"y":680,"width":835,"height":11}},{"id":"2fe8cfc5-1c8b-4745-8d13-6e5ff94d3ffc","block_type":"box","text":"be created that absorb most of the volatility in the underlying mortgage assets. These tranches (often called","page_number":83,"box":{"x":69,"y":695,"width":772,"height":11}},{"id":"7074af1d-096d-4741-ac34-69d8473581a6","block_type":"box","text":"“supports” or “companion” tranches) tend to have market prices and yields that are more volatile than the PAC","page_number":83,"box":{"x":70,"y":710,"width":792,"height":11}},{"id":"6314e923-301b-4c03-8a25-deffacb1adf2","block_type":"box","text":"classes.","page_number":83,"box":{"x":69,"y":725,"width":57,"height":9}},{"id":"43808b1d-2fb6-4500-92b4-a500f3774ece","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":83,"box":{"x":101,"y":748,"width":774,"height":11}},{"id":"a277e109-9f49-41ab-9987-e39f7fa153e4","block_type":"box","text":"date to one or more classes of REMIC Certificates. A PAC’s payment schedule, however, remains in effect as long as","page_number":83,"box":{"x":69,"y":763,"width":835,"height":11}},{"id":"bbfa3848-81a3-49a1-991c-1b712d8d6640","block_type":"box","text":"prepayment rates on the underlying mortgages do not exceed certain ranges. In contrast, a TAC provides investors","page_number":83,"box":{"x":70,"y":778,"width":815,"height":11}},{"id":"ae36fd71-3fe7-4f5a-84de-e929e6457cdd","block_type":"box","text":"with protection, to a certain level, against either faster than expected or slower than expected prepayment rates, but","page_number":83,"box":{"x":68,"y":793,"width":833,"height":11}},{"id":"10e95a8c-ddab-46e3-be45-d4e2339f11a6","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":83,"box":{"x":69,"y":808,"width":839,"height":11}},{"id":"ac8283d3-cd24-48f5-a6a9-d93d8b6bee8f","block_type":"box","text":"also tend to have market prices and yields that are more volatile than PACs.","page_number":83,"box":{"x":69,"y":823,"width":541,"height":11}},{"id":"7a731ca0-d4d2-4b22-8651-b77fc40cb1ec","block_type":"box","text":"Adjustable Rate Mor tgage Securities.","page_number":83,"box":{"x":101,"y":846,"width":265,"height":11}},{"id":"cde36d56-9d29-4262-8d91-aa6328af8a2a","block_type":"box","text":"Adjustable rate mortgage securities (“ARMs”) are pass-through securities","page_number":83,"box":{"x":372,"y":846,"width":523,"height":11}},{"id":"86dd9626-679c-4af8-9d12-86b6feeed2ba","block_type":"box","text":"collateralized by mortgages with adjustable rather than fixed rates. ARMs eligible for inclusion in a mortgage pool","page_number":83,"box":{"x":69,"y":861,"width":807,"height":11}},{"id":"fd3122d5-3888-413b-80b8-45378a9e2428","block_type":"box","text":"generally provide for a fixed initial mortgage interest rate for a set number of scheduled monthly payments. After that","page_number":83,"box":{"x":68,"y":876,"width":835,"height":11}},{"id":"c7e8f03a-10f6-457d-87d4-05e1acc99a8d","block_type":"box","text":"schedule of payments has been completed, the interest rates are subject to periodic adjustment based on changes","page_number":83,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"151e6061-0021-4eb9-a220-ded89717e794","block_type":"box","text":"to a designated benchmark index.","page_number":83,"box":{"x":68,"y":907,"width":241,"height":11}},{"id":"991bf8b5-e0c7-4d80-b8e8-df53f3523b26","block_type":"box","text":"II-53","page_number":83,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"99fe2613-b337-4084-af6d-5a802c07f1b5","block_type":"box","text":"NM1026U-5979889-83/232","page_number":83,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"da51dc2b-4389-4d0c-8c0a-be20d93a628e","block_type":"box","text":"ARMs contain maximum and minimum rates beyond which the mortgage interest rate may not vary over the","page_number":84,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"e5983cb1-2383-41d7-af21-9a5bcbf1f271","block_type":"box","text":"lifetime of the security. In addition, certain ARMs provide for additional limitations on the maximum amount by which","page_number":84,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"5a4130ed-f514-43d0-8acb-f98ace33a3d3","block_type":"box","text":"the mortgage interest rate may adjust for any single adjustment period. In the event that market rates of interest rise","page_number":84,"box":{"x":68,"y":75,"width":837,"height":11}},{"id":"c0e42425-4191-4b20-a642-c8931fb00c46","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":84,"box":{"x":69,"y":90,"width":830,"height":11}},{"id":"9fb078ac-edfe-4877-8879-0da0fcf8e020","block_type":"box","text":"of interest. In these circumstances, the market value of the ARM security will likely have fallen.","page_number":84,"box":{"x":69,"y":105,"width":676,"height":11}},{"id":"62fe036f-c159-4663-9d9e-3c898f5fe98d","block_type":"box","text":"Certain ARMs contain limitations on changes in the required monthly payment. In the event that a monthly","page_number":84,"box":{"x":102,"y":128,"width":757,"height":11}},{"id":"392b473c-d1e9-442d-889c-bc58aebf3fb8","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":84,"box":{"x":70,"y":143,"width":822,"height":11}},{"id":"8dfb1941-e7c0-443b-8c68-6514e1935e69","block_type":"box","text":"balance of the mortgage loan, which is repaid through future monthly payments. If the monthly payment for such an","page_number":84,"box":{"x":69,"y":158,"width":823,"height":11}},{"id":"fe9e8761-dc38-4624-adc7-b5776390ba92","block_type":"box","text":"instrument exceeds the sum of the interest accrued at the applicable mortgage interest rate and the principal","page_number":84,"box":{"x":70,"y":173,"width":782,"height":11}},{"id":"24286263-c76c-4dec-9a26-07b3eb156733","block_type":"box","text":"payment required at such point to amortize the outstanding principal balance over the remaining term of the loan, the","page_number":84,"box":{"x":70,"y":188,"width":838,"height":12}},{"id":"08fc393c-c8fb-4f84-9eb2-e9d5fe58a7de","block_type":"box","text":"excess is then used to reduce the outstanding principal balance of the ARM.","page_number":84,"box":{"x":69,"y":203,"width":544,"height":12}},{"id":"b202b6f2-2bb4-4962-9737-36c7f179f10a","block_type":"box","text":"CMO Residuals.","page_number":84,"box":{"x":102,"y":226,"width":112,"height":9}},{"id":"a81811f3-6b62-4726-a691-4ccbefb28a32","block_type":"box","text":"CMO residuals are derivative mortgage securities issued by agencies or instrumentalities of the","page_number":84,"box":{"x":221,"y":226,"width":682,"height":11}},{"id":"7da671bb-a8bd-429c-8d0d-f7388eaeaa09","block_type":"box","text":"U.S. Government or by private originators of, or investors in, mortgage loans, including savings and loan","page_number":84,"box":{"x":70,"y":241,"width":740,"height":11}},{"id":"0b62ac68-affb-48ca-89d9-ffc5263724da","block_type":"box","text":"associations, homebuilders, mortgage banks, commercial banks, investment banks, and special purpose entities of","page_number":84,"box":{"x":69,"y":256,"width":829,"height":12}},{"id":"d8f3060f-6ce9-4e84-bd2b-18a5fbc47e21","block_type":"box","text":"the foregoing. The cash flow generated by the mortgage assets underlying a series of CMOs is applied first to make","page_number":84,"box":{"x":68,"y":271,"width":826,"height":12}},{"id":"edbc4ee9-96d7-45d2-a023-713084c84592","block_type":"box","text":"required payments of principal and interest on the CMOs and second to pay the related administrative expenses and","page_number":84,"box":{"x":69,"y":286,"width":831,"height":12}},{"id":"99fb0b4a-99b0-443a-90d9-e222c6fbb081","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":84,"box":{"x":69,"y":302,"width":827,"height":11}},{"id":"63487f47-125b-467b-a2db-5267f639708f","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":84,"box":{"x":69,"y":317,"width":829,"height":11}},{"id":"ac82eddc-2b7c-4b71-919d-0ee1bb4da650","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":84,"box":{"x":69,"y":332,"width":838,"height":11}},{"id":"c9ec9f1c-e344-486a-8fc0-6b7349a30342","block_type":"box","text":"CMO will depend on, among other things, the characteristics of the mortgage assets, the coupon rate of each class","page_number":84,"box":{"x":69,"y":347,"width":825,"height":11}},{"id":"2f478fdf-51e5-4b3c-bfe0-eb0e63e0d114","block_type":"box","text":"of CMO, prevailing interest rates, the amount of administrative expenses and the prepayment experience on the","page_number":84,"box":{"x":69,"y":362,"width":798,"height":11}},{"id":"4620c2aa-1495-4641-8805-37251c331903","block_type":"box","text":"mortgage assets. In part, the yield to maturity on the CMO residuals is extremely sensitive to prepayments on the","page_number":84,"box":{"x":69,"y":377,"width":813,"height":12}},{"id":"1a7b47a0-6400-473d-92e5-3ad336a59b81","block_type":"box","text":"related underlying mortgage assets, in the same manner as an interest-only class of stripped mortgage-related","page_number":84,"box":{"x":69,"y":392,"width":790,"height":12}},{"id":"ec6ee682-864e-47d2-b56d-e299e45d0362","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":84,"box":{"x":69,"y":407,"width":805,"height":12}},{"id":"3e4d9177-b1b9-42ab-9037-c7f19bdb2642","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":84,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"e53c3619-4934-43c7-82a6-82c8b369734b","block_type":"box","text":"interest rate adjustments are based. In certain circumstances, a Fund may fail to recoup fully its initial investment in","page_number":84,"box":{"x":70,"y":438,"width":831,"height":11}},{"id":"591fdaac-619b-43dd-bef5-f9777a802595","block_type":"box","text":"a CMO residual.","page_number":84,"box":{"x":69,"y":453,"width":112,"height":9}},{"id":"c695aba8-2421-4042-99ce-1be5f8388568","block_type":"box","text":"CMO residuals are generally purchased and sold by institutional investors through one or more investment","page_number":84,"box":{"x":102,"y":476,"width":758,"height":11}},{"id":"4f48a885-c615-4252-b70a-7b09b484f527","block_type":"box","text":"banking firms acting as brokers or dealers. Transactions in CMO residuals are generally completed only after careful","page_number":84,"box":{"x":69,"y":491,"width":827,"height":11}},{"id":"01f2f51b-f4a9-438e-b59a-3b7d8fc99dc6","block_type":"box","text":"review of the characteristics of the securities in question. In addition, CMO residuals may or, pursuant to an","page_number":84,"box":{"x":69,"y":506,"width":769,"height":11}},{"id":"0addd318-6904-4f52-8e4f-1bc952db7394","block_type":"box","text":"exemption therefrom, may not have been registered under the Securities Act. Residual interests generally are junior","page_number":84,"box":{"x":69,"y":521,"width":825,"height":11}},{"id":"a2ec2ea6-cd14-44d3-8b6d-35727b47173c","block_type":"box","text":"to, and may be significantly more volatile than, “regular” CMO and REMIC interests. CMO residuals, whether or not","page_number":84,"box":{"x":68,"y":536,"width":820,"height":11}},{"id":"e12fd340-dbb1-4e24-987b-8f93edb5b0b3","block_type":"box","text":"registered under the Securities Act, may be subject to certain restrictions on transferability.","page_number":84,"box":{"x":69,"y":551,"width":650,"height":11}},{"id":"0f9030de-9200-4b1f-a8cf-b83cc4b78041","block_type":"box","text":"Stripped Mor tgage-Backed Securities.","page_number":84,"box":{"x":102,"y":574,"width":267,"height":11}},{"id":"57bd7bbf-35d3-4550-a430-a31a48ed1a0b","block_type":"box","text":"A Fund may invest in stripped mortgage-backed securities (“SMBSs”)","page_number":84,"box":{"x":375,"y":574,"width":493,"height":11}},{"id":"405bc1ad-31f3-465f-9838-f9b4dd8f73d3","block_type":"box","text":"issued by agencies or instrumentalities of the United States. SMBSs are derivative multi-class mortgage-backed","page_number":84,"box":{"x":70,"y":589,"width":798,"height":11}},{"id":"0fbc8a91-71ef-4e00-9f22-68a909f694d8","block_type":"box","text":"securities. SMBS arrangements commonly involve two classes of securities that receive different proportions of the","page_number":84,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"e9287502-30a2-465c-83d4-558ce6d3096e","block_type":"box","text":"interest and principal distributions on a pool of mortgage assets. A common variety of SMBS is where one class (the","page_number":84,"box":{"x":70,"y":619,"width":832,"height":11}},{"id":"c08ba940-127e-4647-ba94-5bbc54ba57f5","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":84,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"4827a876-6fc4-4475-ae2d-b7440ead66ed","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":84,"box":{"x":68,"y":649,"width":826,"height":12}},{"id":"63e6bb4c-3f29-49a6-8196-4233d6e9fb1c","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":84,"box":{"x":69,"y":664,"width":822,"height":11}},{"id":"cbd96b9a-9476-428b-9a49-c747ba665a8d","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":84,"box":{"x":70,"y":680,"width":834,"height":11}},{"id":"dbb4760d-3743-4345-9302-5026ae92eadf","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":84,"box":{"x":68,"y":695,"width":800,"height":11}},{"id":"6dc311ae-5bf2-4f4a-b867-4acd52ee59bd","block_type":"box","text":"related underlying assets, and a rapid rate of principal prepayments in excess of that considered in pricing the","page_number":84,"box":{"x":69,"y":710,"width":786,"height":11}},{"id":"df5bf7f1-90d7-43c1-986b-e18f8dba5bb2","block_type":"box","text":"securities will have a material adverse effect on an IO security’s yield to maturity. If the underlying mortgage assets","page_number":84,"box":{"x":69,"y":725,"width":823,"height":11}},{"id":"f8a93c6f-d038-461c-8714-bc8a2b55a3b9","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":84,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"0e485b2a-67d3-4445-a57e-0333482b5fdc","block_type":"box","text":"In addition, there are certain types of IOs that represent the interest portion of a particular class as opposed to the","page_number":84,"box":{"x":70,"y":755,"width":824,"height":11}},{"id":"4aa61258-445e-46ce-90c1-cb4d7947977c","block_type":"box","text":"interest portion of the entire pool. The sensitivity of this type of IO to interest rate fluctuations may be increased","page_number":84,"box":{"x":70,"y":770,"width":800,"height":11}},{"id":"25113a26-d11d-45d8-8b9c-e59defd67b57","block_type":"box","text":"because of the characteristics of the principal portion to which they relate. As a result of the above factors, a Fund","page_number":84,"box":{"x":69,"y":785,"width":818,"height":12}},{"id":"066eafcf-d550-4761-b237-2d2bf8d3cc50","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":84,"box":{"x":68,"y":801,"width":840,"height":11}},{"id":"7fc1da6c-e5e3-44b5-ae5a-de9d2cb7968a","block_type":"box","text":"will be matched with certain purchases of other securities, such as POs, inverse floating rate CMOs or fixed rate","page_number":84,"box":{"x":68,"y":816,"width":802,"height":11}},{"id":"e82569ab-e4fc-4e63-8752-d9ed7fb3d79d","block_type":"box","text":"securities; as interest rates fall, presenting a greater risk of unanticipated prepayments of principal, the negative","page_number":84,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"d3dc01d2-9271-49bf-bbb8-c2884eb76a12","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":84,"box":{"x":69,"y":846,"width":814,"height":11}},{"id":"990a6a16-0598-45c9-b2be-b2b297bb79e5","block_type":"box","text":"the inverse floating rate CMOs or the increased appreciation on the POs or fixed rate securities.","page_number":84,"box":{"x":68,"y":861,"width":683,"height":11}},{"id":"62db8b4a-8920-4a3f-a744-848f14ef30e5","block_type":"box","text":"Tiered Index Bonds.","page_number":84,"box":{"x":103,"y":884,"width":138,"height":9}},{"id":"19b0b987-c3ef-453c-b5d7-00ea2f8f0740","block_type":"box","text":"Tiered index bonds are forms of mortgage-related securities. The interest rate on a tiered","page_number":84,"box":{"x":247,"y":884,"width":638,"height":11}},{"id":"453479ea-e303-4d73-a6ed-fb624c650d43","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":84,"box":{"x":70,"y":899,"width":825,"height":11}},{"id":"746c0ed8-ee15-4d18-adb3-19f6907d03d2","block_type":"box","text":"II-54","page_number":84,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"255ef83c-c55a-498a-be4a-00a7fc9849e4","block_type":"box","text":"NM1026U-5979889-84/232","page_number":84,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4f0a3f9e-8985-40c7-98b9-86a59ce46786","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":85,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"b7166bdb-6d7e-4a9c-8fd1-d80787c2b639","block_type":"box","text":"rises above the “strike” rate, the interest rate of the tiered index bond will decrease. Thus, under these","page_number":85,"box":{"x":69,"y":60,"width":738,"height":10}},{"id":"a2ab1c27-92c4-44a0-9fef-c13d4a783bf5","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":85,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"3a123b24-31ab-4327-92d7-b6df29c1f39e","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":85,"box":{"x":70,"y":90,"width":836,"height":11}},{"id":"e727bc02-f078-473d-bb81-90ed1c2b319d","block_type":"box","text":"that of a fixed-rate bond.","page_number":85,"box":{"x":68,"y":105,"width":174,"height":9}},{"id":"62169bac-e61c-4c5f-8c02-b1abf183ef30","block_type":"box","text":"TBA Commitments.","page_number":85,"box":{"x":103,"y":128,"width":133,"height":9}},{"id":"0ffcbd13-4458-4aea-9f01-187bc7d17c6a","block_type":"box","text":"Certain Funds may enter into “to be announced” or “TBA” commitments. TBA commitments","page_number":85,"box":{"x":243,"y":128,"width":653,"height":11}},{"id":"3ba84044-ed38-4ef1-8134-b8db3f34ffc2","block_type":"box","text":"are forward agreements for the purchase or sale of securities, including mortgage-backed securities for a fixed price,","page_number":85,"box":{"x":69,"y":143,"width":834,"height":11}},{"id":"38c77b2f-bca1-413b-a068-351abadda213","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":85,"box":{"x":68,"y":158,"width":825,"height":11}},{"id":"c213fab3-5615-4895-8d8d-ebda2c1cba6b","block_type":"box","text":"identified at the trade date. However, delivered securities must meet specified terms, including issuer, rate and","page_number":85,"box":{"x":70,"y":173,"width":793,"height":11}},{"id":"08a718fb-4bb0-4c6b-abdc-83740b34b729","block_type":"box","text":"mortgage terms. When the Fund enters into a TBA commitment for the sale of mortgage-backed securities for a fixed","page_number":85,"box":{"x":69,"y":188,"width":833,"height":12}},{"id":"a8ed1b8f-ced4-4159-95be-a601489f1db4","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":85,"box":{"x":70,"y":203,"width":804,"height":12}},{"id":"5c7a9a82-1767-4958-849c-7e25c6cbbcc4","block_type":"box","text":"short position in such TBA securities), the Fund may or may not hold the types of mortgage-backed securities","page_number":85,"box":{"x":69,"y":218,"width":779,"height":12}},{"id":"672ee483-d46f-41ec-944c-8c984860e65c","block_type":"box","text":"required to be delivered. See “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”","page_number":85,"box":{"x":69,"y":234,"width":810,"height":11}},{"id":"48b48017-b7f0-42c3-94db-aac6720b4597","block_type":"box","text":"below.","page_number":85,"box":{"x":69,"y":249,"width":43,"height":9}},{"id":"e3e96a2e-5fce-49ed-a8e1-1a05cb8c0497","block_type":"box","text":"Mor tgage Dollar Rolls.","page_number":85,"box":{"x":102,"y":272,"width":157,"height":11}},{"id":"75450c48-1c3b-42d0-b147-4e675395fbce","block_type":"box","text":"Certain Funds may invest in mortgage dollar rolls. In a mortgage dollar roll transaction, a","page_number":85,"box":{"x":266,"y":272,"width":634,"height":11}},{"id":"4bca39be-1e34-4b6a-b46f-060fde8827ca","block_type":"box","text":"Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase","page_number":85,"box":{"x":70,"y":286,"width":825,"height":12}},{"id":"52442e38-84bb-4394-be2b-90a360e371e9","block_type":"box","text":"substantially similar securities on a specified future date. The securities that are repurchased will bear the same","page_number":85,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"fcc05114-03c9-4b0c-8040-bcbba3af2d3a","block_type":"box","text":"interest rate and a similar maturity as those sold, but pools of mortgages collateralizing those securities may have","page_number":85,"box":{"x":70,"y":317,"width":817,"height":11}},{"id":"12522eb1-aa6c-4020-94af-53960444a810","block_type":"box","text":"different prepayment histories than those sold. During the period between the sale and repurchase, a Fund will not","page_number":85,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"ec6cca8c-33d7-4f2d-989f-2c386321a906","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":85,"box":{"x":69,"y":347,"width":827,"height":11}},{"id":"ce97fcf7-cbbd-4519-9247-76f4c5562200","block_type":"box","text":"additional instruments for the Fund, and the income from these investments will generate income for the Fund. If","page_number":85,"box":{"x":69,"y":362,"width":806,"height":11}},{"id":"affbc8e9-0fb1-4fb6-b926-6fd4ef1bdb19","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":85,"box":{"x":69,"y":377,"width":833,"height":12}},{"id":"09483c3d-1447-4fe3-964f-438c4a9444ae","block_type":"box","text":"securities sold as part of the dollar roll, the use of this technique will diminish the investment performance of a Fund","page_number":85,"box":{"x":69,"y":392,"width":836,"height":11}},{"id":"8a4e234d-2dae-43e6-a42f-d5e78886b192","block_type":"box","text":"compared with what the performance would have been without the use of dollar rolls.","page_number":85,"box":{"x":69,"y":407,"width":607,"height":11}},{"id":"14fe0609-e1a5-4537-a424-f7890bfee6f5","block_type":"box","text":"Each mortgage dollar roll transaction is accounted for as a sale or purchase of a portfolio security and a","page_number":85,"box":{"x":102,"y":430,"width":744,"height":11}},{"id":"6b7d506b-ffda-4c10-86c0-131f970e3c9f","block_type":"box","text":"subsequent purchase or sale of a substantially similar security in the forward market. Transactions in mortgage","page_number":85,"box":{"x":69,"y":445,"width":796,"height":12}},{"id":"4de36689-0d10-48ec-9b2f-b61a23338cab","block_type":"box","text":"dollar rolls may increase trading costs and portfolio turnover.","page_number":85,"box":{"x":69,"y":460,"width":433,"height":12}},{"id":"860e8d2a-0c61-4f2f-8c7d-46319346d8bc","block_type":"box","text":"In the event the buyer of the securities under a mortgage dollar roll files for bankruptcy or becomes insolvent, a","page_number":85,"box":{"x":102,"y":483,"width":795,"height":11}},{"id":"fbb439b6-06df-4276-90b9-4e08e41167ed","block_type":"box","text":"Fund’s use of the proceeds of the current sale portion of the transaction may be restricted pending a determination","page_number":85,"box":{"x":70,"y":498,"width":824,"height":11}},{"id":"78c807f5-6e11-447a-9bb6-57af3131173b","block_type":"box","text":"by the other party, or its trustee or receiver, whether to enforce the Fund’s obligation to purchase the similar","page_number":85,"box":{"x":69,"y":513,"width":774,"height":12}},{"id":"416c37b6-576e-4bbb-8461-0b2e9b87b9c0","block_type":"box","text":"securities in the forward transaction.","page_number":85,"box":{"x":69,"y":528,"width":261,"height":9}},{"id":"28eb6d87-0ac3-4bf2-9e85-98a4cb796652","block_type":"box","text":"A Fund may engage in dollar roll transactions to enhance returns. Successful use of mortgage dollar rolls may","page_number":85,"box":{"x":101,"y":551,"width":785,"height":11}},{"id":"68c0191b-09d0-4b8f-84fe-7e69ff7eab86","block_type":"box","text":"depend upon the Manager’s ability to correctly predict interest rates and prepayments. Dollar rolls involve the risk","page_number":85,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"4b218d19-512b-428f-8924-a2c452978d97","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":85,"box":{"x":68,"y":581,"width":824,"height":11}},{"id":"9a31c9b7-6135-4c8a-ad68-b97e01fb25cd","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":85,"box":{"x":69,"y":596,"width":824,"height":12}},{"id":"7c38c285-dddd-4976-87ac-eeeda8d743c3","block_type":"box","text":"of the forward commitment. Dollar rolls are speculative techniques that can be deemed to involve leverage. There is","page_number":85,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"e0a4559d-43a5-42b4-8316-8c106208d7ff","block_type":"box","text":"no assurance that dollar rolls can be successfully employed.","page_number":85,"box":{"x":69,"y":627,"width":430,"height":11}},{"id":"bc92ecc4-3241-42ba-8aad-e41559272399","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":85,"box":{"x":102,"y":649,"width":759,"height":12}},{"id":"a811c999-54c8-4f2b-8a90-73bbb4cd909b","block_type":"box","text":"securities (","page_number":85,"box":{"x":69,"y":665,"width":78,"height":11}},{"id":"71c3ea7c-9368-4df6-92e5-f6f1e3aaaca8","block_type":"box","text":"e.g.","page_number":85,"box":{"x":148,"y":666,"width":25,"height":10}},{"id":"393e5357-c3aa-4f67-aac8-04b3e562ed33","block_type":"box","text":", dollar rolls and firm and standby commitments, including TBA commitments) and non-standard","page_number":85,"box":{"x":176,"y":664,"width":681,"height":12}},{"id":"cdec934b-8306-4cae-8ea2-501d9d85a60a","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":85,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"b438e849-11a2-42d5-a1a2-ed26a92751f0","block_type":"box","text":"Investment Company Act, provided that the transaction meets the Delayed-Settlement Securities Provision (as","page_number":85,"box":{"x":70,"y":695,"width":783,"height":11}},{"id":"3b7cbe7e-5bc5-4edc-ac34-88722bcd4749","block_type":"box","text":"defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”). If a when","page_number":85,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"e7c96aae-51ee-4455-adaa-5a287d006131","block_type":"box","text":"issued, forward-settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities","page_number":85,"box":{"x":70,"y":725,"width":830,"height":11}},{"id":"3c41b499-8a70-4966-9a2e-536f22cd9c94","block_type":"box","text":"Provision, then it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of","page_number":85,"box":{"x":69,"y":740,"width":788,"height":11}},{"id":"1ceab056-a539-4335-ba70-70ef37060da5","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":85,"box":{"x":70,"y":755,"width":489,"height":11}},{"id":"59f1c01c-11a5-4ae6-ac95-7b6696679663","block_type":"box","text":"Net Interest Margin (NIM) Securities.","page_number":85,"box":{"x":102,"y":778,"width":260,"height":11}},{"id":"d161f2f3-a8fd-4c9c-a818-fd3b37fa836e","block_type":"box","text":"A Fund may invest in net interest margin (“NIM”) securities. These","page_number":85,"box":{"x":368,"y":778,"width":473,"height":11}},{"id":"371077dd-5bd4-4261-b95f-d0a3e20db6cb","block_type":"box","text":"securities are derivative interest-only mortgage securities structured off home equity loan transactions. NIM","page_number":85,"box":{"x":69,"y":793,"width":768,"height":11}},{"id":"2fae4039-f991-4cc5-8a03-cffc180467d8","block_type":"box","text":"securities receive any “excess” interest computed after paying coupon costs, servicing costs and fees and any credit","page_number":85,"box":{"x":69,"y":808,"width":836,"height":11}},{"id":"20efc0c3-63f3-4d21-8d6a-af9d45ff2c32","block_type":"box","text":"losses associated with the underlying pool of home equity loans. Like traditional stripped mortgage-backed","page_number":85,"box":{"x":70,"y":823,"width":760,"height":12}},{"id":"44b793d2-cd35-4aa6-babb-8611e6c44b3e","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":85,"box":{"x":69,"y":839,"width":832,"height":11}},{"id":"691f2a90-077b-4900-8086-4121f09e4ee5","block_type":"box","text":"to the rate of principal payments (including prepayments) on the underlying home equity loans. NIM securities are","page_number":85,"box":{"x":68,"y":853,"width":810,"height":12}},{"id":"ab24b0b1-e39d-42d1-bd4b-b2443c1360cc","block_type":"box","text":"highly sensitive to credit losses on the underlying collateral and the timing in which those losses are taken.","page_number":85,"box":{"x":69,"y":869,"width":764,"height":11}},{"id":"8bb577e8-7121-419a-9ca9-b60d58e45455","block_type":"box","text":"Municipal Investments.","page_number":85,"box":{"x":102,"y":891,"width":169,"height":11}},{"id":"c0b60316-cfd8-4292-ab77-d5e1e974319f","block_type":"box","text":"II-55","page_number":85,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3ab1431c-2068-4916-ba72-b5018ec1ce3f","block_type":"box","text":"NM1026U-5979889-85/232","page_number":85,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"85909264-637d-4c01-90fb-6bfed39f34dd","block_type":"box","text":"Certain Funds may invest in obligations issued by or on behalf of states, territories and possessions of the","page_number":86,"box":{"x":102,"y":45,"width":763,"height":11}},{"id":"00ae2ac2-81c7-4089-b117-92d3139cf5ef","block_type":"box","text":"United States and the District of Columbia and their political subdivisions, agencies and instrumentalities, the","page_number":86,"box":{"x":70,"y":60,"width":783,"height":11}},{"id":"2b820a09-2352-4529-adf5-27919cb56466","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":86,"box":{"x":70,"y":75,"width":833,"height":11}},{"id":"190a1cc2-4f3c-48b7-b990-452ada896f11","block_type":"box","text":"income tax purposes (“Municipal Bonds”). Certain of the Municipal Funds may also invest in Municipal Bonds that","page_number":86,"box":{"x":70,"y":90,"width":813,"height":11}},{"id":"1c570f69-f888-4354-ba0b-0f777e376178","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":86,"box":{"x":70,"y":105,"width":836,"height":11}},{"id":"9873ece7-7044-4e98-9245-8dfb9cf39967","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":86,"box":{"x":69,"y":120,"width":779,"height":12}},{"id":"da276c4b-b8d3-46c6-92b2-fa203acf52c2","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":86,"box":{"x":70,"y":135,"width":838,"height":11}},{"id":"61f0774b-def5-4241-9f38-b1f4ad4aab23","block_type":"box","text":"or by an agency or instrumentality thereof, if the Manager believes such securities to pay interest excludable from","page_number":86,"box":{"x":69,"y":150,"width":810,"height":12}},{"id":"bea46814-2cd5-43fd-a954-e21fed537136","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":86,"box":{"x":68,"y":166,"width":834,"height":11}},{"id":"9dcac7c7-3499-4c46-8fb8-6837a148cd34","block_type":"box","text":"or state and local personal property taxes of the designated state (“Non-Municipal Tax-Exempt Securities”). Non","page_number":86,"box":{"x":69,"y":181,"width":801,"height":11}},{"id":"e136cf45-9754-4e5c-8854-c0213c08a1c6","block_type":"box","text":"Municipal Tax-Exempt Securities could include trust certificates or other instruments evidencing interest in one or","page_number":86,"box":{"x":70,"y":196,"width":807,"height":11}},{"id":"92cc3809-ca15-4f32-ae9b-76d99c90db76","block_type":"box","text":"more long-term municipal securities. Non-Municipal Tax-Exempt Securities also may include securities issued by other","page_number":86,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"c3d11342-9a3d-4096-97d8-b3d3a0695d20","block_type":"box","text":"investment companies that invest in municipal bonds, to the extent such investments are permitted by applicable","page_number":86,"box":{"x":70,"y":226,"width":809,"height":11}},{"id":"edf98b5d-035b-40eb-8b36-473e3f845927","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":86,"box":{"x":70,"y":241,"width":826,"height":11}},{"id":"3d347611-c8be-403c-a46f-83c73a0bf5db","block_type":"box","text":"purposes will be considered “Municipal Bonds” for purposes of a Municipal Fund’s investment objective and policies.","page_number":86,"box":{"x":70,"y":256,"width":834,"height":11}},{"id":"0d7f20a3-e8ae-444c-bb8f-e12a39bae0c0","block_type":"box","text":"Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for purposes of U.S. federal","page_number":86,"box":{"x":70,"y":271,"width":800,"height":12}},{"id":"d64d7dcc-f34d-498d-9d22-4c02c8a5edba","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":86,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"4decc378-dc38-49a0-a079-419182706374","block_type":"box","text":"exempt from state and local personal property taxes of that state will be considered “State Municipal Bonds” for","page_number":86,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"bf1d030b-b134-48db-9d1e-c2e56419535d","block_type":"box","text":"purposes of the investment objective and policies of each of California Municipal Opportunities Fund, New Jersey","page_number":86,"box":{"x":70,"y":317,"width":805,"height":11}},{"id":"064b2bb8-20e7-431c-b49a-03d5d995c6b9","block_type":"box","text":"Municipal Bond Fund, New York Municipal Opportunities Fund and Pennsylvania Municipal Bond Fund.","page_number":86,"box":{"x":70,"y":332,"width":721,"height":11}},{"id":"fbbb834a-e875-4aaa-88c2-951a31b1fc90","block_type":"box","text":"Risk Factors and Special Considerations Relating to Municipal Bonds.","page_number":86,"box":{"x":102,"y":355,"width":495,"height":11}},{"id":"2a519f8a-83fc-4ee1-8798-b4d0d0a6615b","block_type":"box","text":"The risks and special considerations","page_number":86,"box":{"x":603,"y":355,"width":260,"height":11}},{"id":"a2ce18de-fa1a-4f9b-860c-a04116fd5a15","block_type":"box","text":"involved in investment in Municipal Bonds vary with the types of instruments being acquired. Investments in Non","page_number":86,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"20a505f8-a2df-46ca-adbe-cd4087b07e4c","block_type":"box","text":"Municipal Tax-Exempt Securities may present similar risks, depending on the particular product. Certain municipal","page_number":86,"box":{"x":70,"y":385,"width":810,"height":11}},{"id":"16780660-caec-4ef2-812d-166c70c7a02a","block_type":"box","text":"instruments in which a Fund may invest may be characterized as derivatives.","page_number":86,"box":{"x":70,"y":400,"width":544,"height":11}},{"id":"9f8ca5e5-e1d3-44d0-8628-21d8d2b2148c","block_type":"box","text":"The value of Municipal Bonds generally may be affected by uncertainties in the municipal markets as a result of","page_number":86,"box":{"x":101,"y":423,"width":799,"height":11}},{"id":"82029e54-031f-4c4d-b3f2-2f3c92a64e94","block_type":"box","text":"legislation or litigation, including legislation or litigation that changes the taxation of Municipal Bonds or the rights of","page_number":86,"box":{"x":70,"y":438,"width":829,"height":11}},{"id":"d6da53be-857d-4059-ada8-def994ce143d","block_type":"box","text":"Municipal Bond holders in the event of a bankruptcy. Municipal bankruptcies are rare and certain provisions of the","page_number":86,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"8336c904-a7da-4d82-8b94-5601a0692ee6","block_type":"box","text":"U.S. Bankruptcy Code governing such bankruptcies are unclear. Further, the application of state law to Municipal","page_number":86,"box":{"x":70,"y":468,"width":802,"height":11}},{"id":"771e1172-3500-4473-a082-0f2ed63cdee9","block_type":"box","text":"Bond issuers could produce varying results among the states or among Municipal Bond issuers within a state. These","page_number":86,"box":{"x":70,"y":483,"width":834,"height":11}},{"id":"b0aafcfb-fe94-4f48-834a-ccd98a868337","block_type":"box","text":"uncertainties could have a significant impact on the prices of the Municipal Bonds in which a Fund invests.","page_number":86,"box":{"x":69,"y":498,"width":761,"height":11}},{"id":"7b110afb-a6a8-4c56-a17b-31c14e0ae234","block_type":"box","text":"II-56","page_number":86,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3745b587-1670-452b-bf14-c7d1020d4cbe","block_type":"box","text":"NM1026U-5979889-86/232","page_number":86,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"8fe2f5c0-4ffb-4092-b084-a3ee4d33083b","block_type":"box","text":"Description of Municipal Bonds.","page_number":87,"box":{"x":70,"y":45,"width":224,"height":11}},{"id":"c1c602ff-c791-4754-b6a2-123697bb4f9b","block_type":"box","text":"Municipal Bonds include debt obligations issued to obtain funds for various public purposes, including the","page_number":87,"box":{"x":102,"y":67,"width":754,"height":12}},{"id":"f29a451d-fac4-46c1-bc3d-2257f7888d39","block_type":"box","text":"construction of a wide range of public facilities, refunding of outstanding obligations and obtaining funds for general","page_number":87,"box":{"x":69,"y":82,"width":824,"height":12}},{"id":"9eda50c2-abe4-479a-a1d0-849e15d82cde","block_type":"box","text":"operating expenses and loans to other public institutions and facilities. In addition, certain types of bonds are issued","page_number":87,"box":{"x":69,"y":98,"width":836,"height":11}},{"id":"a7f4c5ef-e796-4d78-93c3-f724518dc9d5","block_type":"box","text":"by or on behalf of public authorities to finance various privately owned or operated facilities, including certain","page_number":87,"box":{"x":69,"y":113,"width":776,"height":11}},{"id":"fa2045a1-5711-44b8-a0b4-a6566cae5efe","block_type":"box","text":"facilities for the local furnishing of electric energy or gas, sewage facilities, solid waste disposal facilities and other","page_number":87,"box":{"x":68,"y":128,"width":822,"height":11}},{"id":"25f39f93-257f-499a-9924-c53faf43779f","block_type":"box","text":"specialized facilities. Such obligations are included within the term Municipal Bonds if the interest paid thereon is","page_number":87,"box":{"x":69,"y":143,"width":810,"height":11}},{"id":"62857c13-5df4-4c6f-81fa-a12ca38a0c84","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":87,"box":{"x":69,"y":158,"width":808,"height":11}},{"id":"171cafbb-0f81-45de-a51c-a372c20ffd76","block_type":"box","text":"types of private activity bonds, the proceeds of which are used for the construction, equipment or improvement of","page_number":87,"box":{"x":68,"y":173,"width":812,"height":11}},{"id":"a4fa4856-6d3c-4b34-b469-1499a7f9975b","block_type":"box","text":"privately operated industrial or commercial facilities, may constitute Municipal Bonds, although the current U.S.","page_number":87,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"1913eeff-9d4b-42ed-91e2-dfdee851b87f","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":87,"box":{"x":68,"y":203,"width":835,"height":12}},{"id":"290256ab-29b5-4895-8333-2bd1f2dbbded","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":87,"box":{"x":68,"y":218,"width":840,"height":12}},{"id":"34e80bcb-99ba-4901-8699-273b50b746d6","block_type":"box","text":"obligation” and “revenue” or “special obligation” bonds, which latter category includes private activity bonds (“PABs”)","page_number":87,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"510fb554-667e-45b9-9513-2f2d0af60991","block_type":"box","text":"(or “industrial development bonds” under pre-1986 law).","page_number":87,"box":{"x":69,"y":249,"width":401,"height":11}},{"id":"2837a906-998d-439f-ab28-0223a3a9a59c","block_type":"box","text":"General Obligation Bonds.","page_number":87,"box":{"x":102,"y":272,"width":184,"height":11}},{"id":"41617422-542b-482c-b117-642efae5dfc0","block_type":"box","text":"General obligation bonds are secured by the issuer’s pledge of its full faith, credit and","page_number":87,"box":{"x":292,"y":271,"width":613,"height":12}},{"id":"fdbf87c1-df02-4b8e-8f07-164982ac773c","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":87,"box":{"x":68,"y":286,"width":816,"height":12}},{"id":"299da38a-2fc7-4a46-8914-5b4364a695a4","block_type":"box","text":"however, by provisions of its state constitution or laws, and an entity’s creditworthiness will depend on many factors,","page_number":87,"box":{"x":69,"y":302,"width":834,"height":11}},{"id":"06f97992-ebb3-4c74-a514-e7d5dfd033e0","block_type":"box","text":"including potential erosion of its tax base due to population declines, natural disasters, declines in the state’s","page_number":87,"box":{"x":70,"y":317,"width":786,"height":11}},{"id":"28dc3144-ca12-456c-bf35-cb63c42d472d","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":87,"box":{"x":70,"y":332,"width":835,"height":11}},{"id":"51b3735a-143a-4b48-9659-bb0cc8cb38fa","block_type":"box","text":"state legislative proposals or voter initiatives to limit ad valorem real property taxes and the extent to which the entity","page_number":87,"box":{"x":69,"y":347,"width":840,"height":11}},{"id":"36896829-f6be-4c6b-b66a-eac9fe154c96","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":87,"box":{"x":69,"y":362,"width":782,"height":11}},{"id":"a0ae45d5-64d8-4d0a-9f75-45e26f8c7be5","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":87,"box":{"x":68,"y":377,"width":791,"height":12}},{"id":"4132e30e-e37a-45a4-901f-af504786192e","block_type":"box","text":"repayment of principal when due is affected by the issuer’s maintenance of its tax base.","page_number":87,"box":{"x":69,"y":392,"width":630,"height":12}},{"id":"d2ac9358-8aed-42e2-ba39-549d46f81f0d","block_type":"box","text":"Revenue Bonds.","page_number":87,"box":{"x":102,"y":415,"width":114,"height":9}},{"id":"3949678e-dba7-4c71-b21e-77c0378ba0a5","block_type":"box","text":"Revenue bonds are payable only from the revenues derived from a particular facility or class of","page_number":87,"box":{"x":223,"y":415,"width":676,"height":11}},{"id":"1121ec8d-85e5-4d23-8471-d1f74e72e9eb","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":87,"box":{"x":68,"y":430,"width":791,"height":11}},{"id":"99e668a2-682f-414c-aa4a-9da5fabb881f","block_type":"box","text":"payments from the user of the facility being financed; accordingly, the timely payment of interest and the repayment","page_number":87,"box":{"x":70,"y":445,"width":824,"height":12}},{"id":"0fe0bc5a-a236-4ffa-896b-dd0aaa6acf1e","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":87,"box":{"x":69,"y":460,"width":798,"height":12}},{"id":"e4b6a003-2881-4101-ac25-fb3f2cc89798","block_type":"box","text":"viability of such facility or such revenue source.","page_number":87,"box":{"x":68,"y":475,"width":336,"height":12}},{"id":"27d6a046-7848-49f4-9590-152e3b3cd8cb","block_type":"box","text":"Revenue bonds issued by state or local agencies to finance the development of low-income, multi-family housing","page_number":87,"box":{"x":102,"y":498,"width":801,"height":11}},{"id":"4a7483c4-8fd7-4366-8e6e-9ab6dd61a38b","block_type":"box","text":"involve special risks in addition to those associated with municipal bonds generally, including that the underlying","page_number":87,"box":{"x":70,"y":514,"width":800,"height":11}},{"id":"fa80144a-9468-4dd4-ab68-a06482b2bd20","block_type":"box","text":"properties may not generate sufficient income to pay expenses and interest costs. Such bonds are generally non","page_number":87,"box":{"x":70,"y":528,"width":810,"height":12}},{"id":"f6b7d860-0c69-47f3-812b-aeb88d3c46af","block_type":"box","text":"recourse against the property owner, may be junior to the rights of others with an interest in the properties, may pay","page_number":87,"box":{"x":69,"y":543,"width":830,"height":12}},{"id":"27da1364-87e2-4060-bd0d-d68189b5ce63","block_type":"box","text":"interest that changes based in part on the financial performance of the property, may be prepayable without penalty","page_number":87,"box":{"x":70,"y":559,"width":828,"height":11}},{"id":"0440d326-a75a-456e-b002-1966a13d75cd","block_type":"box","text":"and may be used to finance the construction of housing developments which, until completed and rented, do not","page_number":87,"box":{"x":69,"y":574,"width":804,"height":11}},{"id":"8687bfc1-f464-406c-84c3-85af3a4be5f4","block_type":"box","text":"generate income to pay interest. Increases in interest rates payable on senior obligations may make it more difficult","page_number":87,"box":{"x":68,"y":589,"width":830,"height":11}},{"id":"ae8fb3d7-4b5d-411b-a17a-754ccb426486","block_type":"box","text":"for issuers to meet payment obligations on subordinated bonds.","page_number":87,"box":{"x":68,"y":604,"width":457,"height":11}},{"id":"b30791ac-c65d-40b7-9efa-562ef27dbf59","block_type":"box","text":"PABs.","page_number":87,"box":{"x":102,"y":627,"width":38,"height":9}},{"id":"592ef724-1c56-42be-804e-72b976fa48d1","block_type":"box","text":"PABs are, in most cases, tax-exempt securities issued by states, municipalities or public authorities to","page_number":87,"box":{"x":147,"y":627,"width":730,"height":11}},{"id":"92d36d71-44aa-4038-b4ca-ac70d480c2c7","block_type":"box","text":"provide funds, usually through a loan or lease arrangement, to a private entity for the purpose of financing","page_number":87,"box":{"x":70,"y":642,"width":755,"height":11}},{"id":"d12d49dc-f6ed-493c-94b0-f132db64abf2","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":87,"box":{"x":69,"y":657,"width":797,"height":11}},{"id":"5121fc53-a622-4685-9bac-56002e840b8c","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":87,"box":{"x":69,"y":672,"width":793,"height":11}},{"id":"a8f2bc09-4adb-478f-8a53-b7219e63c58d","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":87,"box":{"x":70,"y":687,"width":840,"height":11}},{"id":"ad51ad69-bd0b-407b-afa3-c2cb684865db","block_type":"box","text":"such bonds. Therefore, an investor should understand that repayment of such bonds generally depends on the","page_number":87,"box":{"x":69,"y":702,"width":789,"height":12}},{"id":"d962eebf-d80f-4556-ae5d-1636c9679ed9","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":87,"box":{"x":69,"y":717,"width":832,"height":12}},{"id":"073698c4-980f-48e4-af7b-f1ecc77e7b58","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":87,"box":{"x":69,"y":732,"width":802,"height":12}},{"id":"87b47c5f-c4a3-406e-bb06-daeee71bf77b","block_type":"box","text":"many factors including the size of the entity, its capital structure, demand for its products or services, competition,","page_number":87,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"c1923725-ce8c-43f6-bc08-315d13199d71","block_type":"box","text":"general economic conditions, government regulation and the entity’s dependence on revenues for the operation of","page_number":87,"box":{"x":68,"y":763,"width":816,"height":11}},{"id":"b6399ca7-b66d-4585-aa50-5f41a683ff5c","block_type":"box","text":"the particular facility being financed.","page_number":87,"box":{"x":68,"y":778,"width":258,"height":11}},{"id":"43398c3f-9740-4cfa-aef0-52e8d44dc24f","block_type":"box","text":"Moral Obligation Bonds.","page_number":87,"box":{"x":102,"y":801,"width":169,"height":11}},{"id":"39c859e4-d804-4e4b-b0b5-8389cd371f56","block_type":"box","text":"“Moral obligation” bonds are normally issued by special purpose public authorities. If an","page_number":87,"box":{"x":278,"y":801,"width":628,"height":11}},{"id":"0bc85e8c-c587-4f62-a4ba-de5bb1485a30","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":87,"box":{"x":70,"y":816,"width":809,"height":11}},{"id":"5eba8995-fb84-4445-93a8-1efdc652cd00","block_type":"box","text":"commitment but not a legal obligation of the state or municipality that created the special purpose public authority","page_number":87,"box":{"x":69,"y":831,"width":816,"height":11}},{"id":"8f17ef05-ff67-466a-bd9e-bee26f1ff0da","block_type":"box","text":"that issued the bonds.","page_number":87,"box":{"x":68,"y":846,"width":160,"height":9}},{"id":"576bb1e6-7bf9-4659-b0e7-cc5ce4131ac6","block_type":"box","text":"Municipal Notes.","page_number":87,"box":{"x":102,"y":869,"width":118,"height":11}},{"id":"435928c0-90c4-474e-88a2-c353b9d04838","block_type":"box","text":"Municipal notes are shorter term municipal debt obligations. They may provide interim financing","page_number":87,"box":{"x":227,"y":869,"width":683,"height":11}},{"id":"5d393a2b-29b9-4d09-84be-a16a81459a36","block_type":"box","text":"in anticipation of tax collection, bond sales or revenue receipts. If there is a shortfall in the anticipated proceeds,","page_number":87,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"1742803b-cb6f-4d9d-a537-511043dc3c01","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":87,"box":{"x":69,"y":899,"width":739,"height":11}},{"id":"216977f4-7191-4b74-a41c-e91dcd3e4a4a","block_type":"box","text":"II-57","page_number":87,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6fe92f58-016c-4eaf-8453-4cf73e7f7fcc","block_type":"box","text":"NM1026U-5979889-87/232","page_number":87,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"5982983d-7c4d-47c2-a6ec-3f72d2ba5450","block_type":"box","text":"Municipal Commercial Paper.","page_number":88,"box":{"x":102,"y":45,"width":205,"height":11}},{"id":"f08a8f26-cc53-4679-952d-6a5ab2bd6885","block_type":"box","text":"Municipal commercial paper is generally unsecured and issued to meet short-term","page_number":88,"box":{"x":314,"y":45,"width":586,"height":11}},{"id":"bd55cf31-7461-4826-b538-71239452ec13","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":88,"box":{"x":68,"y":60,"width":767,"height":11}},{"id":"2e555ba1-0f68-4b07-b374-5a65aeac7f0a","block_type":"box","text":"bankruptcy, unsecured creditors are repaid only after the secured creditors out of the assets, if any, that remain.","page_number":88,"box":{"x":69,"y":75,"width":803,"height":11}},{"id":"58bb4520-ca96-4822-a1b4-512e1cbfb2f5","block_type":"box","text":"Municipal Lease Obligations.","page_number":88,"box":{"x":102,"y":98,"width":203,"height":11}},{"id":"026db0a3-e040-46f6-bd73-f30b08833c7e","block_type":"box","text":"Also included within the general category of Municipal Bonds are certificates of","page_number":88,"box":{"x":311,"y":98,"width":566,"height":11}},{"id":"3feb2a2e-66c6-4a1f-8e21-1e260cbee6dc","block_type":"box","text":"participation (“COPs”) issued by government authorities or entities to finance the acquisition or construction of","page_number":88,"box":{"x":70,"y":113,"width":791,"height":11}},{"id":"96e564ae-80d6-4328-a7cc-61a0c7fe30a5","block_type":"box","text":"equipment, land and/or facilities. The COPs represent participations in a lease, an installment purchase contract or a","page_number":88,"box":{"x":69,"y":128,"width":840,"height":11}},{"id":"64d34eb4-c7e0-45a8-b4f1-e1c25f908850","block_type":"box","text":"conditional sales contract (hereinafter collectively called “lease obligations”) relating to such equipment, land or","page_number":88,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"aa5c1856-8fd9-4b7c-9e9b-17a719b464d9","block_type":"box","text":"facilities. Municipal leases, like other municipal debt obligations, are subject to the risk of non-payment. Although","page_number":88,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"10771409-894b-42fe-af27-612ee5893444","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":88,"box":{"x":70,"y":173,"width":820,"height":11}},{"id":"cc2c5c1b-d8ae-4429-8dbc-e1343e19fb8b","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":88,"box":{"x":70,"y":188,"width":808,"height":12}},{"id":"bc3d86d9-6e1d-4fdd-8cf0-3603a95ba797","block_type":"box","text":"payments due under the lease obligation. However, certain lease obligations contain “non-appropriation” clauses,","page_number":88,"box":{"x":70,"y":204,"width":809,"height":11}},{"id":"f4022afc-acbc-448b-b770-dd3c2e3e3d00","block_type":"box","text":"which provide that the issuer has no obligation to make lease or installment purchase payments in future years","page_number":88,"box":{"x":68,"y":218,"width":795,"height":12}},{"id":"9d7f044a-a51a-4bbd-ad8d-6e86383f3ff2","block_type":"box","text":"unless money is appropriated for such purpose on a yearly basis. Although “non-appropriation” lease obligations are","page_number":88,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"ab5b1df8-32f0-415a-b31e-69774080e352","block_type":"box","text":"secured by the leased property, disposition of the property in the event of foreclosure might prove difficult. These","page_number":88,"box":{"x":69,"y":249,"width":810,"height":11}},{"id":"656bb41a-7204-48f8-a830-3e318fb57e5c","block_type":"box","text":"securities represent a type of financing that has not yet developed the depth of marketability associated with more","page_number":88,"box":{"x":69,"y":264,"width":817,"height":11}},{"id":"04176857-b578-4534-a842-dc30fa98be45","block_type":"box","text":"conventional securities. Certain investments in lease obligations may be illiquid.","page_number":88,"box":{"x":69,"y":279,"width":572,"height":11}},{"id":"57e3cdb5-3c13-416c-8c3c-10a00462a9c0","block_type":"box","text":"The ability of issuers of municipal leases to make timely lease payments may be adversely impacted in general","page_number":88,"box":{"x":101,"y":302,"width":791,"height":11}},{"id":"5da15ace-34ab-4125-8064-668346f06b1c","block_type":"box","text":"economic downturns and as relative governmental cost burdens are allocated and reallocated among federal, state","page_number":88,"box":{"x":69,"y":317,"width":822,"height":11}},{"id":"6b283bff-18a2-42aa-98e2-97af8cadc91c","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":88,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"45068bed-7a5c-47b4-8a0c-d4b7dbed0520","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":88,"box":{"x":69,"y":347,"width":798,"height":11}},{"id":"2e578b21-622a-4672-992f-9cff5c3dd602","block_type":"box","text":"Fund. Issuers of municipal securities might seek protection under the bankruptcy laws. In the event of bankruptcy of","page_number":88,"box":{"x":70,"y":362,"width":828,"height":11}},{"id":"2fc4c9b0-b3bc-49e5-a997-a64d18f7f2ba","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":88,"box":{"x":69,"y":377,"width":833,"height":11}},{"id":"15b4afb9-9d2f-4a5b-a3d4-877e3d750618","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":88,"box":{"x":69,"y":393,"width":807,"height":11}},{"id":"d980018a-7a8e-4ead-960e-3cd74ad134b8","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":88,"box":{"x":68,"y":407,"width":835,"height":12}},{"id":"8b35d066-abf5-4e46-b1e4-5ab167fa9fe6","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":88,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"466ab802-500f-4f62-b675-d8cdccd1d72c","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":88,"box":{"x":69,"y":438,"width":829,"height":11}},{"id":"e6d44a01-6606-4f91-b074-bcddb396afaf","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":88,"box":{"x":68,"y":453,"width":793,"height":11}},{"id":"2eb65afc-1b40-4cc2-a59c-1c44636e89e3","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":88,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"273cd5f0-3a36-4ee5-b03b-a826db78120b","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":88,"box":{"x":70,"y":483,"width":820,"height":11}},{"id":"d50f9a9c-4a19-409f-a42c-2f0d8aeb53f0","block_type":"box","text":"exercise its rights by taking possession of such assets, because as a regulated investment company a Fund is","page_number":88,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"58c5c883-960f-4cc4-83ea-15c86c5a0e7f","block_type":"box","text":"subject to certain limitations on its investments and on the nature of its income.","page_number":88,"box":{"x":69,"y":513,"width":574,"height":11}},{"id":"99f40f15-c9e4-432a-9313-165bd9c2fdbf","block_type":"box","text":"Tender Option Bonds.","page_number":88,"box":{"x":103,"y":536,"width":150,"height":11}},{"id":"67397bb3-d324-4f60-a06a-682d0486f99a","block_type":"box","text":"Certain Funds may invest in residual inverse floating rate interest tender option bonds","page_number":88,"box":{"x":260,"y":536,"width":613,"height":11}},{"id":"d05822b0-0b7a-435d-97f6-5f9ba72565e0","block_type":"box","text":"(“TOB Residuals”), which are derivative interests in Municipal Bonds. The TOB Residuals in which the Funds will","page_number":88,"box":{"x":69,"y":551,"width":796,"height":11}},{"id":"4c991cac-6eda-470e-bd9e-3438ba5c4db8","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":88,"box":{"x":70,"y":566,"width":834,"height":11}},{"id":"4534fb53-2075-46d8-a5d3-d5c449fa597d","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":88,"box":{"x":68,"y":581,"width":807,"height":11}},{"id":"6a3a6e50-3269-4df7-b24b-cfca65f8114c","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":88,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"824e75b5-3143-4914-b08f-89f876f72361","block_type":"box","text":"the potential for yields exceeding the yields available on fixed rate Municipal Bonds with comparable credit quality.","page_number":88,"box":{"x":68,"y":612,"width":814,"height":11}},{"id":"b1ce51cd-6897-43bd-a00d-e7143497fc71","block_type":"box","text":"The Funds may invest in TOB Residuals for the purpose of using economic leverage.","page_number":88,"box":{"x":68,"y":627,"width":598,"height":11}},{"id":"4d5a21bb-c89c-4643-b0ba-a5ab20b4ac53","block_type":"box","text":"TOB Residuals represent beneficial interests in a special purpose trust formed for the purpose of holding","page_number":88,"box":{"x":101,"y":649,"width":751,"height":12}},{"id":"49c42f6b-8134-44e9-b62c-aa7bf5aa9a39","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":88,"box":{"x":70,"y":664,"width":786,"height":12}},{"id":"779c0bde-dabd-448f-8c40-5199a9713ff4","block_type":"box","text":"beneficial interests: short-term floating rate interests (“TOB Floaters”), which are sold to third-party investors, and","page_number":88,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"fc71d836-c64d-49ed-9176-87eb38b09e6b","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":88,"box":{"x":68,"y":695,"width":799,"height":11}},{"id":"567d4769-db88-44ac-bf9b-e42af20ed51f","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":88,"box":{"x":70,"y":710,"width":830,"height":11}},{"id":"dac6456b-ab08-4996-b028-ee4acbe11890","block_type":"box","text":"the Municipal Bonds held by the TOB Trust and are enhanced with a liquidity support arrangement from a third-party","page_number":88,"box":{"x":68,"y":725,"width":828,"height":11}},{"id":"82b1bb49-2327-47c5-95cf-9a12cbe93c54","block_type":"box","text":"Liquidity Provider (defined below) which allows holders to tender their position at par (plus accrued interest). A Fund,","page_number":88,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"530fbed8-8350-462a-b195-56d4970b97a8","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":88,"box":{"x":69,"y":755,"width":768,"height":11}},{"id":"9c892499-db86-4549-b75c-101bf3340772","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":88,"box":{"x":70,"y":770,"width":825,"height":11}},{"id":"992a3eac-53c0-4149-aaf2-1f087782403e","block_type":"box","text":"certain transaction costs, and typically will invest the cash to purchase additional Municipal Bonds or other","page_number":88,"box":{"x":69,"y":786,"width":764,"height":11}},{"id":"7f3a96d1-1c80-47d0-b940-bcdabeb9d234","block_type":"box","text":"investments permitted by its investment policies. If a Fund ever purchases all or a portion of the TOB Floaters sold by","page_number":88,"box":{"x":70,"y":801,"width":838,"height":11}},{"id":"72b011f9-1076-49b5-aaeb-cd29f195bf7a","block_type":"box","text":"the TOB Trust, it may surrender those TOB Floaters together with a proportionate amount of TOB Residuals to the","page_number":88,"box":{"x":68,"y":816,"width":810,"height":11}},{"id":"4c7b9345-8cc7-4973-b6bf-dd671e80ca3a","block_type":"box","text":"TOB Trust in exchange for a proportionate amount of the Municipal Bonds owned by the TOB Trust.","page_number":88,"box":{"x":68,"y":831,"width":704,"height":11}},{"id":"2d251f9a-939d-4f8c-bc43-c341434da9be","block_type":"box","text":"Other BlackRock-advised funds may contribute Municipal Bonds to a TOB Trust into which a Fund has contributed","page_number":88,"box":{"x":102,"y":853,"width":804,"height":12}},{"id":"e5290b1f-14e0-4ec3-a4b3-9e35488aa874","block_type":"box","text":"Municipal Bonds. If multiple BlackRock-advised funds participate in the same TOB Trust, the economic rights and","page_number":88,"box":{"x":70,"y":869,"width":805,"height":11}},{"id":"00831c8f-b980-4a1a-9a84-daa7c77b0ad8","block_type":"box","text":"obligations under the TOB Residual will generally be shared among the funds ratably in proportion to their","page_number":88,"box":{"x":69,"y":884,"width":752,"height":11}},{"id":"2327e48b-551b-4695-a32c-57ba963caa55","block_type":"box","text":"participation in the TOB Trust.","page_number":88,"box":{"x":70,"y":899,"width":211,"height":11}},{"id":"d152e3a4-5b16-43f0-bdd8-1ffb30fba981","block_type":"box","text":"II-58","page_number":88,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d45a5d4f-ab16-48f4-bb96-b507b9670ac6","block_type":"box","text":"NM1026U-5979889-88/232","page_number":88,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"58f41270-258f-48b1-8918-c93b1c661fb4","block_type":"box","text":"The Municipal Bonds transferred to a TOB Trust typically are high grade Municipal Bonds. In certain cases, when","page_number":89,"box":{"x":101,"y":45,"width":802,"height":11}},{"id":"26741974-4a55-4dde-b62b-3d6bb81d7fc8","block_type":"box","text":"Municipal Bonds transferred are lower grade Municipal Bonds, the TOB Trust transaction includes a credit","page_number":89,"box":{"x":70,"y":60,"width":753,"height":11}},{"id":"0ece523a-606a-4482-b5af-726ccb85a056","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":89,"box":{"x":69,"y":75,"width":829,"height":11}},{"id":"63ebfaaa-cfcc-4c4f-8ac8-1b98ac0c65aa","block_type":"box","text":"a credit enhancement provider. The TOB Trust would be responsible for the payment of the credit enhancement fee","page_number":89,"box":{"x":69,"y":90,"width":819,"height":11}},{"id":"9bf62a22-7fde-4048-a748-c37181e8292b","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":89,"box":{"x":69,"y":105,"width":802,"height":11}},{"id":"a8d02824-ddc5-498a-afcc-34192704c411","block_type":"box","text":"interest made by the credit enhancement provider.","page_number":89,"box":{"x":70,"y":120,"width":357,"height":11}},{"id":"bb71af45-231f-4aba-a29c-70e9ef41c456","block_type":"box","text":"The TOB Residuals held by a Fund generally provide the Fund with the right to cause the holders of a proportional","page_number":89,"box":{"x":101,"y":143,"width":807,"height":11}},{"id":"89459c87-5787-4bc1-85b7-587bc8236c47","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":89,"box":{"x":69,"y":158,"width":810,"height":11}},{"id":"c01a25e1-c613-46ef-8e50-ca5a213d9616","block_type":"box","text":"may withdraw a corresponding share of the Municipal Bonds from the TOB Trust. This transaction, in effect, creates","page_number":89,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"e15b58a5-85d7-4be1-92f9-11d77652d1d8","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":89,"box":{"x":69,"y":188,"width":834,"height":11}},{"id":"2318a8f7-6b39-4d93-befb-edb92e0e7e6b","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":89,"box":{"x":70,"y":203,"width":797,"height":12}},{"id":"c58ed3c3-ebad-4aaa-ba8e-6e31920c934a","block_type":"box","text":"impact of the Municipal Bonds’ return within the Fund (thereby creating leverage). The leverage within a TOB Trust","page_number":89,"box":{"x":70,"y":218,"width":809,"height":12}},{"id":"21685814-55a6-4470-bc3c-10ee46917d21","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":89,"box":{"x":69,"y":234,"width":820,"height":11}},{"id":"8025f4f4-ec05-4c71-8ed6-0468f3ebc6ef","block_type":"box","text":"issues.","page_number":89,"box":{"x":70,"y":249,"width":49,"height":9}},{"id":"9a1b3d87-0392-4bdd-a69c-b21cbb3523b3","block_type":"box","text":"A Fund may invest in highly leveraged TOB Residuals. A TOB Residual generally is considered highly leveraged if","page_number":89,"box":{"x":101,"y":271,"width":795,"height":12}},{"id":"54445287-1664-410a-b52a-8b9f5e42e486","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":89,"box":{"x":68,"y":286,"width":833,"height":12}},{"id":"3740bc87-913c-4862-9add-b99a5451762a","block_type":"box","text":"Municipal Bonds owned by the TOB Trust.","page_number":89,"box":{"x":70,"y":302,"width":293,"height":11}},{"id":"666bbd0d-00c4-4dbb-9025-116f8a9a29b8","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":89,"box":{"x":101,"y":324,"width":802,"height":11}},{"id":"2fb446b2-7268-466e-95b7-b983feef81d4","block_type":"box","text":"events (“TOTEs”) and mandatory termination events (“MTEs”), as defined in the TOB Trust agreements. TOTEs","page_number":89,"box":{"x":69,"y":339,"width":788,"height":12}},{"id":"3e787410-6ea2-49ad-973d-22476f85819c","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":89,"box":{"x":70,"y":355,"width":836,"height":11}},{"id":"7567d860-e093-43a4-a4ea-b87036fcd3bb","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":89,"box":{"x":70,"y":370,"width":819,"height":11}},{"id":"03635182-53f3-4956-b73b-caa6efefcdbe","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":89,"box":{"x":70,"y":385,"width":833,"height":11}},{"id":"e45ebf32-0bc3-43f4-8f94-5cd39d1fee60","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":89,"box":{"x":68,"y":400,"width":834,"height":11}},{"id":"d2a51905-776e-4b51-83c3-94867d11073d","block_type":"box","text":"inability of the TOB Trust to obtain renewal of the liquidity support agreement, and a substantial decline in the market","page_number":89,"box":{"x":70,"y":415,"width":838,"height":11}},{"id":"281042f1-3780-4915-9c4c-740cc3dea8ec","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":89,"box":{"x":68,"y":430,"width":831,"height":11}},{"id":"b2861728-514f-4528-8f18-0b49596977d0","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":89,"box":{"x":70,"y":445,"width":823,"height":12}},{"id":"569c3cfd-3e75-4ef2-9de6-a819ee316575","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":89,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"cb996bfb-80a3-4862-b9b1-4d74e671709f","block_type":"box","text":"the holders of the TOB Floaters would be paid senior to the TOB Residual holders (","page_number":89,"box":{"x":68,"y":475,"width":589,"height":12}},{"id":"afa3a8cc-1932-47b6-90d4-6ce98f866979","block_type":"box","text":"i.e.","page_number":89,"box":{"x":659,"y":476,"width":21,"height":8}},{"id":"6744fe51-97bc-4ccb-b3aa-e7bdd9428277","block_type":"box","text":", the Fund). In contrast, in the","page_number":89,"box":{"x":682,"y":476,"width":211,"height":11}},{"id":"29ce698f-4633-4ce4-9a04-2af47d8e48c8","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":89,"box":{"x":69,"y":491,"width":822,"height":11}},{"id":"a21942c6-5e48-43e4-afa4-7894b3eae22a","block_type":"box","text":"rata in proportion to the respective face values of their certificates.","page_number":89,"box":{"x":69,"y":506,"width":479,"height":11}},{"id":"c8b418f7-dc3e-4500-9dfb-f2357182fe88","block_type":"box","text":"A Fund may invest in a TOB Trust on either a non-recourse or recourse basis. TOB Trusts are typically supported","page_number":89,"box":{"x":101,"y":529,"width":797,"height":11}},{"id":"3ce9afce-c78f-4399-9a93-3a41c8572ff9","block_type":"box","text":"by a liquidity facility provided by a third-party bank or other financial institution (the “Liquidity Provider”) that allows","page_number":89,"box":{"x":69,"y":543,"width":815,"height":12}},{"id":"13b6a809-3588-4008-acdc-d4e80a00e049","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":89,"box":{"x":68,"y":559,"width":828,"height":11}},{"id":"2604b2c9-2347-46a2-b92f-f4417f432f80","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":89,"box":{"x":69,"y":574,"width":828,"height":11}},{"id":"b2f122f7-64bc-4623-b920-29140d64ae73","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":89,"box":{"x":68,"y":589,"width":815,"height":11}},{"id":"1711fb99-cbb0-4131-ae81-950b48f582b7","block_type":"box","text":"the Liquidity Provider to purchase the tendered TOB Floaters.","page_number":89,"box":{"x":68,"y":604,"width":434,"height":11}},{"id":"434091bf-3fab-407f-8602-48af5178ed4d","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":89,"box":{"x":101,"y":627,"width":772,"height":11}},{"id":"34ab9031-e478-4dfa-b78f-cf4f4b139fd4","block_type":"box","text":"payment under the liquidity facility, the Liquidity Provider will typically liquidate all or a portion of the Municipal Bonds","page_number":89,"box":{"x":70,"y":642,"width":831,"height":11}},{"id":"6665ada8-43fc-4f91-b62b-43728ef5e409","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":89,"box":{"x":69,"y":657,"width":785,"height":11}},{"id":"b6ada4c9-2e7c-4015-a77b-28a7b4c55f7a","block_type":"box","text":"liquidation proceeds (the “Liquidation Shortfall”). If a Fund invests in a TOB Trust on a recourse basis, it will typically","page_number":89,"box":{"x":70,"y":672,"width":831,"height":11}},{"id":"24a7daca-c864-4b2b-bc4d-2ef742334f8a","block_type":"box","text":"enter into a reimbursement agreement with the Liquidity Provider pursuant to which the Fund is required to reimburse","page_number":89,"box":{"x":69,"y":687,"width":836,"height":11}},{"id":"d4ada30c-cbb5-4c1f-8b05-ca70df4e171e","block_type":"box","text":"the Liquidity Provider the amount of any Liquidation Shortfall. As a result, if the Fund invests in a recourse TOB Trust,","page_number":89,"box":{"x":68,"y":702,"width":836,"height":11}},{"id":"3490c48e-78f1-4800-87c8-4f30f0ae3157","block_type":"box","text":"the Fund will bear the risk of loss with respect to any Liquidation Shortfall. If multiple BlackRock-advised funds","page_number":89,"box":{"x":68,"y":717,"width":788,"height":12}},{"id":"9aec2547-2c84-4f3a-8928-331cf3e8101b","block_type":"box","text":"participate in any such TOB Trust, these losses will be shared ratably, in proportion to their participation in the TOB","page_number":89,"box":{"x":70,"y":733,"width":823,"height":11}},{"id":"d093c132-f52c-436e-ace1-82546fc6087d","block_type":"box","text":"Trust.","page_number":89,"box":{"x":68,"y":748,"width":39,"height":9}},{"id":"ca5683c2-2272-4568-9fe7-b21ebf0c1419","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":89,"box":{"x":102,"y":770,"width":784,"height":12}},{"id":"8fca6211-7ae5-428a-a4f2-7b636e4612ca","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":89,"box":{"x":70,"y":785,"width":830,"height":12}},{"id":"1a6570cb-7c78-4f38-af30-88db5fc79987","block_type":"box","text":"are presented as liabilities in the Fund’s Statement of Assets and Liabilities. Interest income from the underlying","page_number":89,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"503a6a4c-f48c-4924-8220-9a5fd0a22821","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":89,"box":{"x":70,"y":816,"width":831,"height":11}},{"id":"06688d92-596b-42b4-b2c7-94c4ab138eb7","block_type":"box","text":"expenses related to remarketing, administration, trustee and other services to a TOB Trust are reported as expenses","page_number":89,"box":{"x":69,"y":831,"width":837,"height":11}},{"id":"9542e8c2-ea9f-4551-b6a8-9336abe188ed","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":89,"box":{"x":69,"y":846,"width":832,"height":11}},{"id":"bb58d274-c7d8-40fb-b76e-afdac1e6435e","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":89,"box":{"x":70,"y":861,"width":728,"height":9}},{"id":"4f7ebafd-7b40-47d3-a5dc-41fd96091006","block_type":"box","text":"For TOB Floaters, generally, the interest rate earned will be based upon the market rates for Municipal Bonds","page_number":89,"box":{"x":102,"y":884,"width":776,"height":11}},{"id":"fd4dc647-2976-4569-b8c9-dd96848b95b8","block_type":"box","text":"with maturities or remarketing provisions that are comparable in duration to the periodic interval of the tender option.","page_number":89,"box":{"x":68,"y":899,"width":837,"height":11}},{"id":"6cef9858-de98-4d69-9f75-5f9d1f00c903","block_type":"box","text":"II-59","page_number":89,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f730f64f-32bd-4cc3-a85e-6779e798e200","block_type":"box","text":"NM1026U-5979889-89/232","page_number":89,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d802749a-a236-4813-84f5-fea5f4aa6e41","block_type":"box","text":"Since the tender option feature has a shorter term than the final maturity or first call date of the underlying Municipal","page_number":90,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"0c7d6367-323e-4539-959c-128d1a28a4fa","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":90,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"84aee82f-7304-4420-ad75-cd252f315cae","block_type":"box","text":"financial institution furnishing the liquidity facility as well as the credit strength of that institution. The risk associated","page_number":90,"box":{"x":68,"y":75,"width":836,"height":11}},{"id":"1d1722ae-6bdb-4f94-956b-8a61abdf357c","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":90,"box":{"x":68,"y":90,"width":835,"height":11}},{"id":"b09e519f-7c54-4052-ae70-4e4b0e3feb90","block_type":"box","text":"the credit ratings, and thus the perceived reliability and creditworthiness, of many major financial institutions, some","page_number":90,"box":{"x":68,"y":105,"width":827,"height":11}},{"id":"1fb1bdcb-45b3-4269-89a8-47c851a4022b","block_type":"box","text":"of which sponsor and/or provide liquidity support to TOB Trusts. This in turn may reduce the desirability of TOB","page_number":90,"box":{"x":69,"y":120,"width":790,"height":11}},{"id":"4a54c292-b9c9-469e-beb8-d30eae60bee6","block_type":"box","text":"Floaters as investments, which could impair the viability or availability of TOB Trusts.","page_number":90,"box":{"x":70,"y":135,"width":599,"height":11}},{"id":"64d82df5-3484-4028-ae71-d05c2f85f677","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into TOB Trust transactions, reverse","page_number":90,"box":{"x":102,"y":158,"width":762,"height":11}},{"id":"aa94656a-4661-43db-b3b4-5a352f3ebedf","block_type":"box","text":"repurchase agreements and similar financing transactions (e.g., borrowed bonds) notwithstanding the limitation on","page_number":90,"box":{"x":69,"y":173,"width":818,"height":11}},{"id":"130f7c26-dff3-4f84-8e91-b106ec31664f","block_type":"box","text":"the issuance of senior securities in Section 18 of the Investment Company Act, provided that the Fund either","page_number":90,"box":{"x":68,"y":188,"width":778,"height":11}},{"id":"49a580a3-19c0-47ac-a32d-347c181d1922","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":90,"box":{"x":69,"y":203,"width":811,"height":12}},{"id":"d6d04a55-39f9-4fc6-a54b-a136a1e3bd2c","block_type":"box","text":"aggregate, or (ii) treats such transactions as Derivatives Transactions under Rule 18f-4. See “—Derivatives —","page_number":90,"box":{"x":69,"y":218,"width":786,"height":12}},{"id":"28fc7370-c81d-4ab7-bb22-5e0532c3a872","block_type":"box","text":"Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":90,"box":{"x":70,"y":234,"width":588,"height":11}},{"id":"a67db9a9-db18-4fdb-829a-fd0e7c7e281e","block_type":"box","text":"Developments in the TOB Trust Market.","page_number":90,"box":{"x":102,"y":256,"width":279,"height":11}},{"id":"3f89d37c-09df-4a03-99ec-a97309d1dac5","block_type":"box","text":"In response to the restrictions imposed by section 619 of the Dodd-Frank Wall Street Reform and Consumer","page_number":90,"box":{"x":102,"y":279,"width":771,"height":11}},{"id":"78df69c6-37be-4ea2-b586-5d339375e453","block_type":"box","text":"Protection Act (the “Volcker Rule”), market participants have developed a structure for TOB Trusts designed to","page_number":90,"box":{"x":69,"y":294,"width":786,"height":11}},{"id":"e060b497-2324-4177-8122-56dc058bf833","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":90,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"1f313393-2cdb-4a81-bcaa-30318be64cb9","block_type":"box","text":"establish, structure and “sponsor” the TOB Trusts in which it holds TOB Residuals. In such a structure, certain","page_number":90,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"ff2a42a0-5eb2-482a-87bb-e4ccd56fa033","block_type":"box","text":"responsibilities that previously belonged to the sponsor bank will be performed by, or on behalf of, a Fund. A Fund","page_number":90,"box":{"x":69,"y":339,"width":812,"height":12}},{"id":"5949acbc-934b-4e56-927d-92812cbfb0f7","block_type":"box","text":"may utilize service providers in meeting these responsibilities. It is possible that regulators could take positions that","page_number":90,"box":{"x":69,"y":355,"width":832,"height":11}},{"id":"5140130f-a70a-4922-a0f8-306bfc605ad2","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":90,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"42529aa8-02c7-49fd-b22b-c4a7288cae88","block_type":"box","text":"this TOB Trust structure, a Fund has certain additional duties and responsibilities, which may give rise to certain","page_number":90,"box":{"x":68,"y":385,"width":803,"height":11}},{"id":"20651b5b-3697-48cc-aa83-6053b3f97fe4","block_type":"box","text":"additional risks including, but not limited to, compliance, securities law and operational risks.","page_number":90,"box":{"x":69,"y":400,"width":665,"height":11}},{"id":"1d3b5348-9caa-4732-be3d-8a3a6fc18b58","block_type":"box","text":"Under this structure, service providers to a TOB Trust, such as administrators, liquidity providers, trustees, and","page_number":90,"box":{"x":102,"y":423,"width":793,"height":11}},{"id":"9938aa75-33b3-4902-83c2-02c086f16fe8","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":90,"box":{"x":69,"y":438,"width":783,"height":11}},{"id":"cd93b4ed-9a86-4244-8a1a-e5b254fca693","block_type":"box","text":"traditional tender option bond structure, a Fund deposits Municipal Bonds into the TOB Trust in exchange for TOB","page_number":90,"box":{"x":68,"y":453,"width":808,"height":11}},{"id":"b13c5a17-3b9a-430c-8c43-2f8b5119b8e7","block_type":"box","text":"Residuals, the TOB Trust then issues and sells TOB Floaters to third-party investors, and the proceeds of the sale of","page_number":90,"box":{"x":70,"y":468,"width":830,"height":11}},{"id":"5500d896-7034-408c-a6a4-b51803792a46","block_type":"box","text":"the TOB Floaters is distributed to such TOB Residual holders (","page_number":90,"box":{"x":68,"y":483,"width":442,"height":11}},{"id":"ae9da070-dda1-4644-aba3-0d3ec5cbb8e4","block_type":"box","text":"i.e.","page_number":90,"box":{"x":512,"y":483,"width":20,"height":9}},{"id":"85cc3fa9-9306-4591-a066-d5aca70022bb","block_type":"box","text":", the Fund). Tendered TOB Floaters continue to be","page_number":90,"box":{"x":535,"y":483,"width":352,"height":11}},{"id":"8b1ed40d-f9b2-4345-ab79-8760c70d8212","block_type":"box","text":"supported by a remarketing agent and a liquidity facility. However, the remarketing agent does not purchase tendered","page_number":90,"box":{"x":69,"y":498,"width":836,"height":11}},{"id":"b079e2d4-9319-4e70-ac29-b083b7cf6118","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":90,"box":{"x":68,"y":513,"width":816,"height":12}},{"id":"03ae033d-76f8-48b6-a95e-1a51389942d9","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":90,"box":{"x":68,"y":528,"width":835,"height":11}},{"id":"b75fa2b7-7680-4063-a096-76f09cc53adf","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":90,"box":{"x":69,"y":543,"width":822,"height":12}},{"id":"b7b8a44e-faa0-4cfe-90d6-9ac6ec45f562","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":90,"box":{"x":69,"y":559,"width":777,"height":11}},{"id":"040988da-b137-45d7-8491-3f29ce63a63f","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":90,"box":{"x":69,"y":574,"width":800,"height":11}},{"id":"2c728453-bf53-4ba2-942a-8d0779024782","block_type":"box","text":"made by a Liquidity Provider will be secured by the purchased TOB Floaters held by the TOB Trust.","page_number":90,"box":{"x":69,"y":589,"width":696,"height":11}},{"id":"add2ed0a-f03f-468b-bcb1-f74141222bed","block_type":"box","text":"Similar to the traditional structure for TOB Trusts, a Fund may hold either non-recourse TOB Residuals or","page_number":90,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"0d027317-cea3-4f0f-bb2c-82b329b7e8f8","block_type":"box","text":"recourse TOB Residuals under this structure. In the event of a Liquidation Shortfall, there would generally be no","page_number":90,"box":{"x":69,"y":627,"width":797,"height":11}},{"id":"91e2e669-4310-4815-b001-06c2633e1b83","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":90,"box":{"x":69,"y":642,"width":803,"height":10}},{"id":"5911fde8-a10d-4f74-a2b3-fcacc0c7e80d","block_type":"box","text":"above, a Fund would bear the risk of loss with respect to any Liquidation Shortfall if it holds a recourse TOB Residual.","page_number":90,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"1d9dfd74-633e-448a-81ec-b8d15252d467","block_type":"box","text":"The SEC and various federal banking and housing agencies adopted credit risk retention rules for securitizations","page_number":90,"box":{"x":101,"y":680,"width":801,"height":11}},{"id":"7030be7e-5194-4e41-98a3-1f549bced53b","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":90,"box":{"x":69,"y":695,"width":838,"height":11}},{"id":"bce13562-e3eb-4c77-9532-86528c58ea9e","block_type":"box","text":"TOB Trust to retain at least 5% of the credit risk of the underlying assets supporting the TOB Trust’s Municipal","page_number":90,"box":{"x":68,"y":710,"width":787,"height":11}},{"id":"a1d351a4-d820-4972-9491-9e6914fa9344","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":90,"box":{"x":70,"y":725,"width":791,"height":11}},{"id":"92ae3f03-c234-441b-88c8-141dc8712d74","block_type":"box","text":"increase the costs of such transactions in certain circumstances.","page_number":90,"box":{"x":70,"y":740,"width":466,"height":9}},{"id":"cbf91a1e-bc83-496f-88a5-a832726e10f7","block_type":"box","text":"TOB Trust transactions constitute an important component of the municipal bond market. Accordingly,","page_number":90,"box":{"x":101,"y":763,"width":726,"height":11}},{"id":"a3dc88bb-23e8-4fea-867e-3bc85f3dc6c7","block_type":"box","text":"implementation of the Volcker Rule may adversely impact the municipal market, including through reduced demand","page_number":90,"box":{"x":70,"y":778,"width":816,"height":11}},{"id":"6708ca86-b065-4d86-a09f-d4edfc6a9e5d","block_type":"box","text":"for and liquidity of municipal bonds and increased financing costs for municipal issuers. Any such developments","page_number":90,"box":{"x":68,"y":793,"width":799,"height":11}},{"id":"7ffc303b-0bcb-4df6-9c6d-5947aa8ecb4a","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":90,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"f6ca2acc-bf94-47b9-b06b-793574767a2c","block_type":"box","text":"market is not yet certain.","page_number":90,"box":{"x":69,"y":823,"width":178,"height":11}},{"id":"88b9b0c6-c0be-41ec-a824-382b6d3a51f8","block_type":"box","text":"Yields.","page_number":90,"box":{"x":103,"y":846,"width":45,"height":9}},{"id":"e8714a07-bcd2-4ebd-9c92-c859a6dfab7c","block_type":"box","text":"Yields on Municipal Bonds are dependent on a variety of factors, including the general condition of the","page_number":90,"box":{"x":154,"y":846,"width":730,"height":11}},{"id":"48081f41-e06b-4265-a76c-fb2ffa442843","block_type":"box","text":"money market and of the municipal bond market, the size of a particular offering, the financial condition of the","page_number":90,"box":{"x":69,"y":861,"width":788,"height":11}},{"id":"d3bb4877-8bfd-4b9d-a7ae-9e627a7c3b8a","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":90,"box":{"x":70,"y":876,"width":787,"height":11}},{"id":"e78b7637-23c2-49ed-a0e8-674ad0c618ee","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":90,"box":{"x":69,"y":891,"width":838,"height":12}},{"id":"dec6f484-8083-49b7-a89e-a073ddaa0e23","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":90,"box":{"x":68,"y":906,"width":794,"height":12}},{"id":"a1dc4d96-14ab-4e97-8d76-ba6c71e4fca4","block_type":"box","text":"II-60","page_number":90,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"050983b7-e555-4d6f-baaf-f60cf3e35247","block_type":"box","text":"NM1026U-5979889-90/232","page_number":90,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"0f3c7dd8-065a-496e-b6b3-d93fbaf222a3","block_type":"box","text":"holding Municipal Bonds, both within a particular classification and between classifications, depending on numerous","page_number":91,"box":{"x":69,"y":45,"width":831,"height":11}},{"id":"6870cac7-2d9e-4fd3-83e3-957799e0dca7","block_type":"box","text":"factors. Furthermore, the rights of owners of Municipal Bonds and the obligations of the issuer of such Municipal","page_number":91,"box":{"x":68,"y":60,"width":806,"height":11}},{"id":"193bf18a-14db-4ae6-9e4a-9e93a5ae13a1","block_type":"box","text":"Bonds may be subject to applicable bankruptcy, insolvency and similar laws and court decisions affecting the rights","page_number":91,"box":{"x":70,"y":75,"width":823,"height":11}},{"id":"b3b31868-46f3-47f6-96e4-1fadb5de4d2a","block_type":"box","text":"of creditors generally and to general equitable principles, which may limit the enforcement of certain remedies.","page_number":91,"box":{"x":69,"y":90,"width":790,"height":11}},{"id":"71ea4359-92e6-4535-bc6c-4430b9469188","block_type":"box","text":"Variable Rate Demand Obligations (“VRDOs”).","page_number":91,"box":{"x":103,"y":113,"width":323,"height":11}},{"id":"ab585d2d-d07e-43bd-93a6-c74df5af4e62","block_type":"box","text":"VRDOs are tax-exempt obligations that contain a floating or","page_number":91,"box":{"x":432,"y":113,"width":422,"height":11}},{"id":"79c3ea9f-559a-4074-8069-3a037e767eea","block_type":"box","text":"variable interest rate adjustment formula and a right of demand on the part of the holder thereof to receive payment","page_number":91,"box":{"x":68,"y":128,"width":830,"height":11}},{"id":"48057494-36d3-4974-bf29-45b0ca025c5d","block_type":"box","text":"of the unpaid principal balance plus accrued interest upon a short notice period not to exceed seven days.","page_number":91,"box":{"x":69,"y":143,"width":759,"height":11}},{"id":"95c22954-3570-4238-93d3-058900fb1c9f","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":91,"box":{"x":101,"y":166,"width":798,"height":11}},{"id":"5bdee17b-4ba8-4db6-aa93-2154c7128f72","block_type":"box","text":"The interest rates are adjustable at periodic intervals to some prevailing market rate for similar investments, such","page_number":91,"box":{"x":68,"y":181,"width":815,"height":11}},{"id":"3d4b33e4-c760-4b7f-b045-fb1c3c2e1c8f","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":91,"box":{"x":69,"y":196,"width":826,"height":11}},{"id":"df15dde0-9d2a-4a50-89b9-07bc53b0ed5f","block_type":"box","text":"VRDOs on the adjustment date. The adjustments typically are based upon the Securities Industry and Financial","page_number":91,"box":{"x":68,"y":211,"width":791,"height":11}},{"id":"f58ac227-7eb9-47e4-b750-f30fbd34694a","block_type":"box","text":"Markets Association (“SIFMA”) Index.","page_number":91,"box":{"x":70,"y":226,"width":264,"height":11}},{"id":"3b231123-ea55-46d0-a7ba-f0a67f428a39","block_type":"box","text":"Because of the interest rate adjustment formula on VRDOs, VRDOs are not comparable to fixed rate securities.","page_number":91,"box":{"x":102,"y":249,"width":791,"height":11}},{"id":"bbdbaa9a-283d-43cc-ac9f-44379445a567","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":91,"box":{"x":70,"y":264,"width":833,"height":11}},{"id":"5553b0a8-9a57-4764-a79e-890546fdfab4","block_type":"box","text":"opportunity for capital appreciation. During periods of rising interest rates, however, a Fund’s yield on a VRDO will","page_number":91,"box":{"x":69,"y":279,"width":808,"height":11}},{"id":"86fc0e7f-9f52-47e3-82de-4ec4d22f726e","block_type":"box","text":"increase and the Fund’s shareholders will have a reduced risk of capital depreciation.","page_number":91,"box":{"x":70,"y":294,"width":608,"height":11}},{"id":"8e6d1b2f-11d1-4e2f-a79d-08bdce5fc6ef","block_type":"box","text":"Transactions in Financial Futures Contracts on Municipal Indexes.","page_number":91,"box":{"x":103,"y":317,"width":465,"height":11}},{"id":"812fe4cc-2827-44ee-8348-b9b89ebcd414","block_type":"box","text":"The Municipal Funds and certain other funds","page_number":91,"box":{"x":574,"y":317,"width":318,"height":11}},{"id":"289e3916-b9ab-4b66-801b-84d0784aca31","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":91,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"1bd51a55-de26-4fe8-8ef1-f8f29ec9278d","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":91,"box":{"x":68,"y":347,"width":825,"height":11}},{"id":"ae0a8e5e-cfdf-4179-a8a7-31f03d495dae","block_type":"box","text":"term, actively traded tax-exempt municipal revenue and general obligation bonds. Each bond included in the Municipal","page_number":91,"box":{"x":68,"y":362,"width":840,"height":11}},{"id":"a067438d-83d1-46e5-9038-acf9160d0150","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":91,"box":{"x":70,"y":377,"width":815,"height":12}},{"id":"499adc8f-5fe5-4f5e-b495-f383a49882a4","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":91,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"84847219-d48e-41ca-b321-eea376243ef8","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":91,"box":{"x":69,"y":407,"width":796,"height":12}},{"id":"a520490e-40dc-469c-8bc8-26eda3180efa","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":91,"box":{"x":68,"y":423,"width":816,"height":11}},{"id":"56fe6134-1417-4f4d-a2c1-594beafc3265","block_type":"box","text":"The Municipal Bond Index futures contract is traded only on the CBT. Like other contract markets, the CBT","page_number":91,"box":{"x":101,"y":445,"width":756,"height":11}},{"id":"e421e8e8-f9d0-4917-90a8-fb20674f59e3","block_type":"box","text":"assures performance under futures contracts through a clearing corporation, a nonprofit organization managed by the","page_number":91,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"d6f2e8f1-6005-426b-bc00-3fdc397bf47b","block_type":"box","text":"exchange membership that is also responsible for handling daily accounting of deposits or withdrawals of margin.","page_number":91,"box":{"x":69,"y":475,"width":808,"height":12}},{"id":"9ca3ce0a-6499-4719-a97c-28fcc26b33d1","block_type":"box","text":"The particular municipal bonds comprising the index underlying the Municipal Bond Index financial futures","page_number":91,"box":{"x":101,"y":498,"width":753,"height":11}},{"id":"569e74d5-221d-49c8-8404-4d9399c6662b","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":91,"box":{"x":69,"y":513,"width":764,"height":12}},{"id":"0606430a-c34c-4437-b079-5fff89d36702","block_type":"box","text":"effectively all or a portion of the value of its Municipal Bonds through the use of such financial futures contracts will","page_number":91,"box":{"x":69,"y":528,"width":826,"height":12}},{"id":"93903741-0e82-48d6-9170-5ae7dcc8a01a","block_type":"box","text":"depend in part on the degree to which price movements in the index underlying the financial futures contract","page_number":91,"box":{"x":69,"y":543,"width":774,"height":12}},{"id":"1377ce29-fcdd-4a92-904d-1534e19675cb","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":91,"box":{"x":69,"y":559,"width":801,"height":11}},{"id":"c696ea94-c9dc-4af5-87e6-45f07531c0c8","block_type":"box","text":"disparities in the average maturity, ratings, geographical mix or structure of a Municipal Fund’s investments as","page_number":91,"box":{"x":69,"y":574,"width":788,"height":11}},{"id":"5a9be7b4-29b6-4b26-a6b1-c93abe85a672","block_type":"box","text":"compared to those comprising the Municipal Bond Index and general economic or political factors. In addition, the","page_number":91,"box":{"x":69,"y":589,"width":812,"height":11}},{"id":"c962e31b-bc51-4ad7-abc9-82a26fefdfc3","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":91,"box":{"x":69,"y":604,"width":799,"height":11}},{"id":"19ca22e8-1fe9-4af3-acf0-3875a91b3399","block_type":"box","text":"additions to and deletions from the Municipal Bond Index alter its structure. The correlation between futures","page_number":91,"box":{"x":69,"y":619,"width":772,"height":11}},{"id":"ef4bfe84-e382-43d8-a27c-3dcacad15691","block_type":"box","text":"contracts on U.S. Government Securities and the Municipal Bonds held by a Municipal Fund may be adversely","page_number":91,"box":{"x":69,"y":634,"width":782,"height":11}},{"id":"8f2d755e-af30-4e61-9eec-dce0c8387f06","block_type":"box","text":"affected by similar factors and the risk of imperfect correlation between movements in the prices of such futures","page_number":91,"box":{"x":69,"y":649,"width":806,"height":12}},{"id":"edf0a076-085f-47bd-8fd8-e26dace9c16e","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":91,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"3171c936-5d60-4f36-9b3d-430b8078f087","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":91,"box":{"x":69,"y":680,"width":837,"height":11}},{"id":"1df6c479-db65-4725-8180-a5460eee20a3","block_type":"box","text":"in other futures contracts. The trading of futures contracts also is subject to certain market risks, such as inadequate","page_number":91,"box":{"x":70,"y":695,"width":839,"height":11}},{"id":"a30d8e27-eed8-49e5-9dc0-5243c307465b","block_type":"box","text":"trading activity, which could at times make it difficult or impossible to liquidate existing positions.","page_number":91,"box":{"x":68,"y":710,"width":693,"height":11}},{"id":"92bdc717-1a14-44cb-b904-b82e9bbc440e","block_type":"box","text":"Call Rights.","page_number":91,"box":{"x":102,"y":733,"width":79,"height":11}},{"id":"cc3b6dec-35dd-4fdc-936a-0e0184e1418e","block_type":"box","text":"A Fund may purchase a Municipal Bond issuer’s right to call all or a portion of such Municipal Bond","page_number":91,"box":{"x":187,"y":732,"width":708,"height":12}},{"id":"1eab099d-81cd-4de2-ae44-19ffcf6b2eef","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":91,"box":{"x":68,"y":748,"width":790,"height":11}},{"id":"b3d40a47-2f1d-4daf-991f-25c442d2bba6","block_type":"box","text":"mandatory tender for the purchase of related Municipal Bonds, subject to certain conditions. A Call Right that is not","page_number":91,"box":{"x":69,"y":763,"width":827,"height":11}},{"id":"858279c5-8f71-466b-8aba-9b606e2f67ad","block_type":"box","text":"exercised prior to maturity of the related Municipal Bond will expire without value. The economic effect of holding","page_number":91,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"bc47fc6e-7e9f-4d7c-945e-6cfd595f43e4","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":91,"box":{"x":69,"y":793,"width":833,"height":11}},{"id":"21d7b9c3-911a-48cb-a6cd-05f979ccadd1","block_type":"box","text":"Certain investments in such obligations may be illiquid.","page_number":91,"box":{"x":69,"y":808,"width":393,"height":11}},{"id":"500b751f-f19d-4189-a9b8-a94c8b9ae7ba","block_type":"box","text":"Municipal Interest Rate Swap Transactions.","page_number":91,"box":{"x":102,"y":831,"width":307,"height":11}},{"id":"5188f96e-93e0-4144-adcf-ec6af063a3f0","block_type":"box","text":"In order to hedge the value of a Fund against interest rate","page_number":91,"box":{"x":417,"y":831,"width":411,"height":11}},{"id":"5ed68ba4-5b4a-4b06-a278-ae584e668f6c","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":91,"box":{"x":68,"y":846,"width":835,"height":11}},{"id":"27f97b35-60af-4a15-be07-612be41e4863","block_type":"box","text":"Market Data AAA Cash Curve swaps (“MMD Swaps”) or Securities Industry and Financial Markets Association","page_number":91,"box":{"x":70,"y":861,"width":781,"height":11}},{"id":"07d9f15b-95b0-4203-8e63-dfd72c10520d","block_type":"box","text":"Municipal Swap Index swaps (“SIFMA Swaps”). To the extent that a Fund enters into these transactions, the Fund","page_number":91,"box":{"x":70,"y":876,"width":808,"height":11}},{"id":"28d816e1-aead-415a-8626-1a2634efd10a","block_type":"box","text":"expects to do so primarily to preserve a return or spread on a particular investment or portion of its portfolio or to","page_number":91,"box":{"x":69,"y":891,"width":814,"height":11}},{"id":"4a85d756-364c-4b13-83c2-bcb5d51448d4","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":91,"box":{"x":70,"y":906,"width":832,"height":12}},{"id":"d788a706-7a62-4cbc-aa37-1e7bb98c8bea","block_type":"box","text":"II-61","page_number":91,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0e31be91-295b-4859-bd74-4346c8cdcec3","block_type":"box","text":"NM1026U-5979889-91/232","page_number":91,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"99c37562-1e51-41f7-93af-4eb09a5409cc","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":92,"box":{"x":68,"y":45,"width":817,"height":11}},{"id":"10fdd115-8094-43a0-844f-5ba4dbdcf158","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":92,"box":{"x":70,"y":60,"width":797,"height":11}},{"id":"d17ddd4d-6bfb-4be3-a9f3-3b2d44dc25a0","block_type":"box","text":"during periods of steep interest rate yield curves (","page_number":92,"box":{"x":69,"y":75,"width":356,"height":11}},{"id":"17ee2b13-5a4d-4c6d-ac22-719e39ed2747","block_type":"box","text":"i.e.","page_number":92,"box":{"x":427,"y":75,"width":20,"height":9}},{"id":"796bbbdf-a7dc-476e-b672-824529029244","block_type":"box","text":", wide differences between short-term and long-term interest","page_number":92,"box":{"x":449,"y":75,"width":433,"height":11}},{"id":"25198cc5-ec5c-4c8e-baa4-4763ac44c294","block_type":"box","text":"rates).","page_number":92,"box":{"x":69,"y":90,"width":44,"height":11}},{"id":"174fff6c-11f5-45f0-8184-8edbd503b657","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":92,"box":{"x":101,"y":113,"width":807,"height":11}},{"id":"c1f75516-b610-430c-bb27-964b6b14345c","block_type":"box","text":"another party their respective commitments to pay or receive interest (","page_number":92,"box":{"x":69,"y":128,"width":503,"height":11}},{"id":"9e183e9a-f717-4df4-8d1a-8aa79782872e","block_type":"box","text":"e.g.","page_number":92,"box":{"x":574,"y":129,"width":25,"height":10}},{"id":"93793323-d21a-49b3-8759-e0fa8f77fab0","block_type":"box","text":", an exchange of fixed rate payments for","page_number":92,"box":{"x":601,"y":128,"width":286,"height":11}},{"id":"0915b1fa-8318-485f-8547-e73123a010cb","block_type":"box","text":"floating rate payments linked to the SIFMA Municipal Swap Index). Because the underlying index is a tax-exempt","page_number":92,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"354acbec-fecc-40cb-909a-94e2c7437bdd","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":92,"box":{"x":70,"y":158,"width":778,"height":11}},{"id":"3f24ec0b-d95e-4f8a-8d4e-023d1eb8c2a2","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":92,"box":{"x":69,"y":173,"width":833,"height":11}},{"id":"bae7516f-94ec-4800-8f7b-7622b0d4346b","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":92,"box":{"x":69,"y":188,"width":823,"height":11}},{"id":"161c963a-c713-4b3c-9269-a42619b0d325","block_type":"box","text":"with the same attributes as the swap (","page_number":92,"box":{"x":68,"y":204,"width":275,"height":10}},{"id":"a3a4614d-3389-4ade-b05c-7fb33c0e600c","block_type":"box","text":"e.g.","page_number":92,"box":{"x":345,"y":205,"width":24,"height":10}},{"id":"ab2b7920-d5e3-45f6-b073-3514a91aeb81","block_type":"box","text":", coupon, maturity, call feature).","page_number":92,"box":{"x":372,"y":203,"width":224,"height":12}},{"id":"700f4deb-a5b6-4bf4-aee5-984f8d075742","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":92,"box":{"x":101,"y":226,"width":797,"height":11}},{"id":"04de3c5d-00b6-4126-8cf8-a97311af921f","block_type":"box","text":"to lock in a specified municipal interest rate for a portion of its portfolio to preserve a return on a particular","page_number":92,"box":{"x":68,"y":241,"width":770,"height":11}},{"id":"05a9abfa-cb5e-4d42-b0b2-7ebdb11985c8","block_type":"box","text":"investment or a portion of its portfolio as a duration management technique or to protect against any increase in the","page_number":92,"box":{"x":70,"y":256,"width":832,"height":12}},{"id":"d148f3c4-45ad-4d55-8c7f-8ddf93852eb6","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":92,"box":{"x":70,"y":271,"width":805,"height":12}},{"id":"8c21ad24-c31d-4d95-a6ca-4b8d83ab5fd9","block_type":"box","text":"short position, allowing the Fund to select the most attractive part of the yield curve. An MMD Swap is a contract","page_number":92,"box":{"x":69,"y":286,"width":808,"height":12}},{"id":"e6f85862-034b-4623-81ae-9a234eddc38b","block_type":"box","text":"between a Fund and an MMD Swap provider pursuant to which the parties agree to make payments to each other on","page_number":92,"box":{"x":69,"y":302,"width":832,"height":11}},{"id":"5e542c26-ca06-4ca9-b557-753b99b43258","block_type":"box","text":"a notional amount, contingent upon whether the Municipal Market Data AAA General Obligation Scale is above or","page_number":92,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"a4babe99-11d2-4bf6-af2b-a396f2ae37dc","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":92,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"8a96a082-f1f0-4211-b3a1-d006d328e3bf","block_type":"box","text":"Municipal Market Data AAA General Obligation Scale is below the specified level on the expiration date, the","page_number":92,"box":{"x":70,"y":347,"width":763,"height":11}},{"id":"a4a4c802-89aa-4c9e-892a-c1097235025b","block_type":"box","text":"counterparty to the contract will make a payment to the Fund equal to the specified level minus the actual level,","page_number":92,"box":{"x":69,"y":362,"width":797,"height":11}},{"id":"6e401ef8-c3ba-468e-aa27-0406b6cc60db","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":92,"box":{"x":69,"y":377,"width":836,"height":12}},{"id":"6ce394f9-e9c5-4588-be7c-07864a316348","block_type":"box","text":"the specified level on the expiration date, a Fund will make a payment to the counterparty equal to the actual level","page_number":92,"box":{"x":68,"y":392,"width":816,"height":12}},{"id":"10410dc1-a3ee-479a-9151-f6113b1cec6e","block_type":"box","text":"minus the specified level, multiplied by the notional amount of the contract.","page_number":92,"box":{"x":69,"y":407,"width":537,"height":12}},{"id":"1b439c3f-724e-4dcf-a119-0564f1eb14e6","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":92,"box":{"x":102,"y":430,"width":788,"height":11}},{"id":"0a256604-b8bc-444c-956b-bedcd1b30411","block_type":"box","text":"opposite direction than anticipated by a Fund, which would cause the Fund to make payments to its counterparty in","page_number":92,"box":{"x":69,"y":446,"width":821,"height":10}},{"id":"3cc17886-5219-42e7-808e-f037c4e7b779","block_type":"box","text":"the transaction that could adversely affect the Fund’s performance.","page_number":92,"box":{"x":68,"y":460,"width":482,"height":12}},{"id":"a117fa02-e4e7-412f-af01-d35e969fc12c","block_type":"box","text":"Insured Municipal Bonds.","page_number":92,"box":{"x":102,"y":483,"width":179,"height":11}},{"id":"aadcdbfb-cf4d-4832-ab52-20d872e39bb8","block_type":"box","text":"Bonds purchased by a Fund may be covered by insurance that guarantees that interest","page_number":92,"box":{"x":288,"y":483,"width":619,"height":11}},{"id":"07eef598-52ce-4f96-bb57-9dedb25dd0ec","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":92,"box":{"x":70,"y":498,"width":835,"height":11}},{"id":"848fd5f4-a8b7-455b-b5f4-dc41f296f2f9","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":92,"box":{"x":69,"y":513,"width":840,"height":12}},{"id":"94d201c5-53c5-486e-b878-7ff1631ff683","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":92,"box":{"x":69,"y":528,"width":818,"height":12}},{"id":"868c1cd4-7e7a-400e-81e5-91f6bb2d4c1e","block_type":"box","text":"shareholders against losses caused by declines in a bond’s market value. Also, the Fund cannot be certain that any","page_number":92,"box":{"x":69,"y":544,"width":829,"height":11}},{"id":"b8ef85c9-9a25-4b24-91b2-86964d2760af","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":92,"box":{"x":70,"y":559,"width":827,"height":11}},{"id":"7b62fe89-e5a2-4ddb-a1bb-8837111b1324","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":92,"box":{"x":70,"y":574,"width":815,"height":11}},{"id":"86ee85ba-a5d2-4d17-afbf-ecb09c2fe6d3","block_type":"box","text":"ability, financial strength, or equivalent ratings of at least investment grade. However, if insurance from insurers with","page_number":92,"box":{"x":69,"y":589,"width":829,"height":11}},{"id":"e44c58e0-2ad0-41f3-975e-732430d0a50e","block_type":"box","text":"these ratings is not available, the Fund may use insurance companies with lower ratings or stop purchasing","page_number":92,"box":{"x":68,"y":604,"width":767,"height":11}},{"id":"7fce8f99-be5f-426c-9977-93c31b2ca8fb","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":92,"box":{"x":70,"y":619,"width":827,"height":11}},{"id":"a8a06a05-f3ce-42d0-8ab5-52d1bd0c6935","block_type":"box","text":"bond could drop.","page_number":92,"box":{"x":69,"y":634,"width":118,"height":11}},{"id":"7933b36e-2255-4bf5-a903-e0768d6b87fe","block_type":"box","text":"Build America Bonds.","page_number":92,"box":{"x":102,"y":657,"width":150,"height":9}},{"id":"fd2fdab2-f639-431f-a5ba-fb4d3854cbd1","block_type":"box","text":"If a Fund holds Build America Bonds, the Fund may be eligible to receive a U.S. federal","page_number":92,"box":{"x":259,"y":657,"width":616,"height":11}},{"id":"6862aaa7-9b8b-489e-950b-ce26ac66042a","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":92,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"4cdb6fb7-e4a1-4340-9be2-5f690160cf62","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":92,"box":{"x":68,"y":687,"width":824,"height":11}},{"id":"a984ef9a-1794-4782-86f3-372a7e3ceb14","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":92,"box":{"x":70,"y":702,"width":833,"height":11}},{"id":"ba777d66-a49d-4367-9fcc-18e03e22559c","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":92,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"972f928c-05b0-479d-aea8-7b4d19dc9a02","block_type":"box","text":"minimum distribution requirement, the Fund may elect for U.S. federal income tax purposes to pass through to","page_number":92,"box":{"x":69,"y":732,"width":788,"height":12}},{"id":"5d0a81d1-0c1d-451d-89a9-804f47820500","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":92,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"6966bd4f-a93a-4119-9e55-b8cf83eb3d47","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":92,"box":{"x":70,"y":763,"width":825,"height":11}},{"id":"0cb8d867-7297-41bb-9375-97868171f357","block_type":"box","text":"clean renewable energy bond, a qualified energy conservation bond, or a qualified zone academy bond, each of which","page_number":92,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"c2cf38c7-926d-4d21-a0a3-e3ad229a6478","block_type":"box","text":"must meet certain requirements specified in the Code), a “Build America Bond” (which includes certain qualified","page_number":92,"box":{"x":69,"y":793,"width":802,"height":11}},{"id":"9b6a99c9-2164-4253-af20-d948f8dfbbc9","block_type":"box","text":"bonds issued before January 1, 2011) or certain other specified bonds. If the Fund were to so elect, a shareholder","page_number":92,"box":{"x":69,"y":808,"width":821,"height":11}},{"id":"ca598b76-2dd1-4ae5-be1b-f9bcfb37636b","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":92,"box":{"x":68,"y":823,"width":760,"height":11}},{"id":"f675a4a9-ba8f-408c-aef0-9530bcf8321b","block_type":"box","text":"proportionate share of such credits, and such amount would be subject to withholding provisions of the Code.","page_number":92,"box":{"x":70,"y":838,"width":782,"height":12}},{"id":"94a05371-2ede-43e0-856a-d5b210d5e16d","block_type":"box","text":"Certain limitations may apply on the extent to which the credit may be claimed.","page_number":92,"box":{"x":69,"y":854,"width":563,"height":11}},{"id":"ee648a29-a225-423b-b4a9-df9765720b7a","block_type":"box","text":"Tax-Exempt Municipal Investments.","page_number":92,"box":{"x":103,"y":876,"width":246,"height":11}},{"id":"86831af0-8bd2-44ed-b251-db15c2f34f23","block_type":"box","text":"Certain Funds may hold tax-exempt municipal investments which may be in","page_number":92,"box":{"x":355,"y":876,"width":534,"height":11}},{"id":"e05ca04c-02fe-41d0-bf0a-00be597ff1cc","block_type":"box","text":"the form of tender option bonds, variable rate demand obligations, participations, beneficial interests in a trust,","page_number":92,"box":{"x":68,"y":891,"width":798,"height":12}},{"id":"6e7e7f25-f287-4f6b-a77c-73cb13a1897b","block_type":"box","text":"partnership interests or other forms. These investments are described in greater detail above in this section. Some","page_number":92,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"9d55f3d9-5801-43cc-b6bf-f844e1aa8e27","block_type":"box","text":"II-62","page_number":92,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"50aeaca5-027a-4ce2-9990-f36c94491e2e","block_type":"box","text":"NM1026U-5979889-92/232","page_number":92,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"cbdd835c-9d0e-473e-b65b-33e66b70ed5d","block_type":"box","text":"of the structures used by certain Funds include interests in long-term fixed-rate municipal debt obligations, held by a","page_number":93,"box":{"x":69,"y":45,"width":830,"height":11}},{"id":"d0db8cec-bc19-4dcd-9c18-837fabcd6878","block_type":"box","text":"trustee or custodian, that are coupled with tender option, demand and other features when the tax-exempt municipal","page_number":93,"box":{"x":68,"y":60,"width":832,"height":11}},{"id":"0eb21bd8-5767-492c-8c32-4872327c5367","block_type":"box","text":"investments are created. Together, these features entitle the holder of the interest to tender (or put) the underlying","page_number":93,"box":{"x":70,"y":75,"width":819,"height":11}},{"id":"56e92314-1fdb-42fc-8cd7-6b17b239e277","block_type":"box","text":"municipal debt obligation to a third party at periodic intervals and to receive the principal amount thereof.","page_number":93,"box":{"x":69,"y":90,"width":752,"height":11}},{"id":"fcc77418-aa87-498f-a1a2-4b03cbc7270d","block_type":"box","text":"In some cases, municipal debt obligations are represented by custodial receipts evidencing rights to receive","page_number":93,"box":{"x":102,"y":113,"width":770,"height":11}},{"id":"af62e2e2-8280-4dda-b56d-3cde33cb6903","block_type":"box","text":"specific future interest payments, principal payments, or both, on the underlying securities held by the custodian.","page_number":93,"box":{"x":69,"y":128,"width":806,"height":11}},{"id":"e73a271c-8eba-4d70-82be-598bfe3bd52b","block_type":"box","text":"Under such arrangements, the holder of the custodial receipt has the option to tender the underlying securities at","page_number":93,"box":{"x":70,"y":143,"width":809,"height":11}},{"id":"cdf6b3ad-d881-4f83-80d1-8829d0f12016","block_type":"box","text":"their face value to the sponsor (","page_number":93,"box":{"x":68,"y":158,"width":228,"height":11}},{"id":"78710aaf-a21d-4817-bfaf-a7830f9bef1c","block_type":"box","text":"e.g.","page_number":93,"box":{"x":297,"y":160,"width":25,"height":9}},{"id":"1d2b8b70-5462-4a95-aa00-da3dbf676ec7","block_type":"box","text":", a Fund, or a bank or broker-dealer or other financial institution), which is paid","page_number":93,"box":{"x":325,"y":158,"width":557,"height":11}},{"id":"395b283c-456e-4f4d-a964-65e3f7d0d90b","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":93,"box":{"x":70,"y":173,"width":803,"height":11}},{"id":"b81d49de-abb9-475b-b6f7-5ab89619db2d","block_type":"box","text":"securities, coupled with the tender option, to trade at par on the date of a rate adjustment.","page_number":93,"box":{"x":69,"y":188,"width":648,"height":11}},{"id":"5f9670eb-a248-4851-afbb-d497e87fc8ca","block_type":"box","text":"A participation interest gives the Fund an undivided interest in a Municipal Bond in the proportion the Fund’s","page_number":93,"box":{"x":101,"y":211,"width":775,"height":11}},{"id":"957aa707-d115-4098-97f7-56b3413c689b","block_type":"box","text":"participation bears to the total principal amount of the Municipal Bond, and typically provides for a repurchase","page_number":93,"box":{"x":70,"y":226,"width":785,"height":11}},{"id":"bed61652-6112-4575-ad7e-c8052596c5dd","block_type":"box","text":"feature for all or any part of the full principal amount of the participation interest, plus accrued interest. Trusts and","page_number":93,"box":{"x":68,"y":241,"width":821,"height":11}},{"id":"8ad713b0-80d3-4945-9119-7093a8bf9749","block_type":"box","text":"partnerships are typically used to convert long-term fixed rate high quality bonds of a single state or municipal issuer","page_number":93,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"118d1cc8-65fb-44e4-b3c7-e0db25efc3ef","block_type":"box","text":"into variable or floating rate demand instruments.","page_number":93,"box":{"x":70,"y":271,"width":351,"height":12}},{"id":"12f613c1-1f5f-4408-a5dd-8cdc551902fa","block_type":"box","text":"The Municipal Bond Funds may hold participation interests and custodial receipts for municipal debt obligations","page_number":93,"box":{"x":101,"y":294,"width":797,"height":11}},{"id":"2893a7db-f80e-42c3-9914-de40e6b039fb","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":93,"box":{"x":68,"y":309,"width":836,"height":11}},{"id":"6f4d5cb3-3b51-4bbc-bb73-953f356c6cf6","block_type":"box","text":"not ruled on whether the interest received on tax-exempt municipal investments in the form of participation interests","page_number":93,"box":{"x":69,"y":324,"width":831,"height":11}},{"id":"bfd1841e-ae68-4f9d-b222-f02e63d0aa9b","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":93,"box":{"x":69,"y":339,"width":809,"height":12}},{"id":"a7664e42-3967-4962-bf3e-c12e94e2941d","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":93,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"b3cc9349-223e-42c9-967d-92a8a712a137","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":93,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"2c34b8d4-4480-42c8-8f93-3b08dc1a405e","block_type":"box","text":"such opinions.","page_number":93,"box":{"x":69,"y":385,"width":102,"height":11}},{"id":"9dc64396-1446-43cd-8624-03273245dc38","block_type":"box","text":"Operational and Technology Risks.","page_number":93,"box":{"x":102,"y":408,"width":250,"height":11}},{"id":"fc412785-eb75-46fa-aa80-7182ccc9949b","block_type":"box","text":"The Fund and the entities with which it interacts directly or indirectly are","page_number":93,"box":{"x":358,"y":408,"width":512,"height":11}},{"id":"b20f45d9-4464-4d2f-b232-bf6a0aac5728","block_type":"box","text":"susceptible to operational and technology risks, including those related to human errors, processing errors,","page_number":93,"box":{"x":69,"y":423,"width":766,"height":11}},{"id":"2384ffb9-da1b-42c4-8f87-24737de2d6bb","block_type":"box","text":"communication errors, systems failures, cybersecurity incidents, and the use of artificial intelligence and machine","page_number":93,"box":{"x":69,"y":438,"width":812,"height":11}},{"id":"99183daa-f98c-4014-a2e8-31dd96974ea2","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":93,"box":{"x":70,"y":453,"width":820,"height":11}},{"id":"899ce5d0-e882-4616-98d3-46c500203c29","block_type":"box","text":"entities include, but are not limited to, the Fund’s adviser, administrator, distributor, other service providers (e.g.,","page_number":93,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"36de454d-ec14-48c5-a118-3c477a16c61a","block_type":"box","text":"index and benchmark providers, accountants, custodians, and transfer agents), financial intermediaries,","page_number":93,"box":{"x":70,"y":483,"width":741,"height":11}},{"id":"912ab274-cbc7-46b0-b1b8-1d775bc33caa","block_type":"box","text":"counterparties, market makers, Authorized Participants, listing exchanges, other financial market operators, and","page_number":93,"box":{"x":69,"y":498,"width":802,"height":11}},{"id":"98cf9bd0-f85e-4ed3-b88c-5d142fcfd0e3","block_type":"box","text":"governmental authorities, as applicable. Operational and technology risks for the issuers in which the Fund invests","page_number":93,"box":{"x":68,"y":513,"width":818,"height":12}},{"id":"b95a0f4b-47eb-4d9e-a411-06daf7b957cd","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":93,"box":{"x":69,"y":528,"width":827,"height":12}},{"id":"82b71ec4-3479-4cc8-b2f6-c27c934fb43e","block_type":"box","text":"issuers to lose value. The Fund may incur substantial costs in order to mitigate operational and technology risks.","page_number":93,"box":{"x":70,"y":544,"width":803,"height":11}},{"id":"99c55e2b-5163-444f-8492-d9959c8eb3ae","block_type":"box","text":"Cybersecurity incidents can result from deliberate attacks or unintentional events against an issuer in which the","page_number":93,"box":{"x":102,"y":566,"width":796,"height":11}},{"id":"5812e749-c89e-43e3-a91f-e23508684a5a","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":93,"box":{"x":70,"y":581,"width":790,"height":12}},{"id":"817af9de-016d-43c4-a396-0f0d26c9155b","block_type":"box","text":"access to systems, misappropriating assets or sensitive information, corrupting or destroying data, and causing","page_number":93,"box":{"x":69,"y":596,"width":800,"height":12}},{"id":"02b8862b-14b8-4d86-8f74-0a9630f89d9c","block_type":"box","text":"operational disruption. Geopolitical tension may increase the scale and sophistication of deliberate attacks,","page_number":93,"box":{"x":69,"y":612,"width":768,"height":11}},{"id":"5c5a3a5c-23fa-4613-b71f-f50a8150e465","block_type":"box","text":"particularly those from nation states or from entities with nation state backing. Cybersecurity incidents may result in","page_number":93,"box":{"x":70,"y":627,"width":827,"height":11}},{"id":"f7468fde-aa4a-4972-b5cc-d1dd094beb39","block_type":"box","text":"any of the following: financial losses; interference with the Fund’s ability to calculate its NAV; disclosure of","page_number":93,"box":{"x":69,"y":642,"width":760,"height":11}},{"id":"08dd2f21-fc40-4029-8f06-b035f4c4c4fe","block_type":"box","text":"confidential information; impediments to trading; submission of erroneous trades by the Fund or erroneous","page_number":93,"box":{"x":69,"y":657,"width":763,"height":11}},{"id":"fa311f0f-4ea4-4067-b4a5-d0d359b04d2f","block_type":"box","text":"subscription or redemption orders; the inability of the Fund or its service providers to transact business; violations of","page_number":93,"box":{"x":69,"y":672,"width":835,"height":11}},{"id":"4a0463cf-caac-42e8-ac6e-db92fd01c903","block_type":"box","text":"applicable privacy and other laws; regulatory fines; penalties; reputational damage; reimbursement or other","page_number":93,"box":{"x":69,"y":687,"width":766,"height":11}},{"id":"98530b4c-9cae-4640-a730-39e1f8e70315","block_type":"box","text":"compensation costs; and other legal and compliance expenses. Furthermore, cybersecurity incidents may render","page_number":93,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"1369b28c-f230-47a3-9153-294edef5c6c7","block_type":"box","text":"records of the Fund, including records relating to its assets and transactions, shareholder ownership of Fund shares,","page_number":93,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"ef0a895e-14c6-405e-b2aa-d12022dc646f","block_type":"box","text":"and other data integral to the Fund’s functioning, inaccessible, inaccurate or incomplete. Power outages, natural","page_number":93,"box":{"x":69,"y":732,"width":800,"height":12}},{"id":"fc39df4f-1612-4076-8da0-452b67c31ffd","block_type":"box","text":"disasters, equipment malfunctions and processing errors that threaten information and technology systems relied","page_number":93,"box":{"x":69,"y":748,"width":812,"height":11}},{"id":"d344027e-b91d-4e34-97af-c05ea3673f63","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":93,"box":{"x":69,"y":763,"width":777,"height":11}},{"id":"c939d01e-5223-4ac1-8173-dea9bcb72cd6","block_type":"box","text":"systems, may also disrupt business operations or impact critical data. Recent advances in AI technology pose risks","page_number":93,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"46b3ac27-0611-4a9f-88c7-e9a573708b27","block_type":"box","text":"to the Fund and its portfolio investments. These advancements could harm the Fund and its portfolio investments by","page_number":93,"box":{"x":68,"y":793,"width":836,"height":11}},{"id":"e3fe3355-aa70-4b87-895b-67c8bd97f9c3","block_type":"box","text":"reducing the demand for both the technology and software offerings of the Fund’s portfolio investments. Additionally,","page_number":93,"box":{"x":69,"y":808,"width":833,"height":11}},{"id":"29c18530-e654-40ba-bade-3216e2b94bfd","block_type":"box","text":"these advancements could significantly disrupt the Fund’s portfolio investments and subject them to increased","page_number":93,"box":{"x":68,"y":823,"width":793,"height":12}},{"id":"e676f6b7-8d6e-4215-850f-f1087dad9e5a","block_type":"box","text":"competition, which could have a material adverse effect on business, financial condition, and results of operations.","page_number":93,"box":{"x":69,"y":838,"width":822,"height":11}},{"id":"3ee17029-2c79-4c3a-ba47-0d81db00aa89","block_type":"box","text":"AI technology advancements, including efficiency improvements, without related increases in the adoption and","page_number":93,"box":{"x":68,"y":853,"width":787,"height":12}},{"id":"7ed14101-50c7-4375-a1d9-f6fa3099eef0","block_type":"box","text":"development of such technologies, could also negatively impact demand for, and the valuation of, digital","page_number":93,"box":{"x":69,"y":869,"width":742,"height":11}},{"id":"c834d28c-615b-4daf-aebe-2441bdbc593a","block_type":"box","text":"infrastructure assets.","page_number":93,"box":{"x":70,"y":884,"width":151,"height":9}},{"id":"349d1d32-9444-438b-9288-fdd2777ad841","block_type":"box","text":"II-63","page_number":93,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"413048ef-21f8-44c5-86d2-404470a8dd14","block_type":"box","text":"NM1026U-5979889-93/232","page_number":93,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"419ce5f8-adcc-4627-8cfc-b9f4ca7c900e","block_type":"box","text":"The Fund and its portfolio investments could be exposed to the risks of AI technology if third-party service","page_number":94,"box":{"x":101,"y":45,"width":755,"height":11}},{"id":"e7926916-6efb-4323-93c8-8beea2b50e51","block_type":"box","text":"providers or any counterparties, whether or not known to the Fund, also use AI technology in their business activities.","page_number":94,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"ebd35878-b2f7-43e0-812c-7cff2fa96933","block_type":"box","text":"The Fund and its service providers may not be in a position to control the use of AI technology in third-party products","page_number":94,"box":{"x":68,"y":75,"width":833,"height":11}},{"id":"cca21ad9-7614-4932-af09-145c13b71696","block_type":"box","text":"or services.","page_number":94,"box":{"x":69,"y":90,"width":82,"height":9}},{"id":"706424b9-ea97-41d5-b5eb-7cd264068b99","block_type":"box","text":"Use of AI technology could include the input of confidential information in contravention of applicable policies,","page_number":94,"box":{"x":102,"y":113,"width":781,"height":11}},{"id":"831e4862-9934-4f33-a2fb-2c952378a5ce","block_type":"box","text":"contractual or other obligations or restrictions, resulting in such confidential information becoming accessible by","page_number":94,"box":{"x":69,"y":128,"width":801,"height":11}},{"id":"f6f59d48-deec-4b9b-a60d-3d742785495c","block_type":"box","text":"other third-party AI technology applications and users.","page_number":94,"box":{"x":69,"y":143,"width":383,"height":11}},{"id":"3bbf10fb-42de-4562-b0e8-57a8e1caa75b","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":94,"box":{"x":102,"y":166,"width":795,"height":11}},{"id":"5cda0303-210b-4b7f-b96c-2c9c1aadce99","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":94,"box":{"x":69,"y":181,"width":813,"height":11}},{"id":"460c1962-39a3-4f64-b5ed-5b345490a136","block_type":"box","text":"relevant data into the models that AI technology utilizes to operate. Certain data in such models will inevitably","page_number":94,"box":{"x":69,"y":196,"width":785,"height":11}},{"id":"f92cb58a-6963-4fa7-93cb-f83ae8054917","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":94,"box":{"x":69,"y":211,"width":782,"height":11}},{"id":"5c246b71-e266-4f90-91e1-7155519e0840","block_type":"box","text":"degrade the effectiveness of AI technology. The output or results of any such AI technologies may therefore be","page_number":94,"box":{"x":69,"y":226,"width":787,"height":11}},{"id":"7ad922d8-b976-43a3-a90a-2648f4118c02","block_type":"box","text":"incomplete, erroneous, distorted, or misleading. Further, AI tools may lack transparency as to how data is utilized","page_number":94,"box":{"x":70,"y":241,"width":809,"height":11}},{"id":"20728aea-7d30-494d-8fd6-dc3ca3386fd4","block_type":"box","text":"and how outputs are generated. AI technologies may also allow the unintended introduction of vulnerabilities into","page_number":94,"box":{"x":69,"y":256,"width":805,"height":12}},{"id":"aef1d256-1ce0-491e-9467-ad22a0970228","block_type":"box","text":"infrastructures and applications. To the extent that the Fund or its portfolio investments are exposed to the risks of","page_number":94,"box":{"x":70,"y":271,"width":822,"height":11}},{"id":"1ab9de81-9359-4ab9-b63d-d8571d4fe585","block_type":"box","text":"AI technology use, any such inaccuracies or errors could have adverse impacts on the Fund or its investments.","page_number":94,"box":{"x":68,"y":287,"width":789,"height":11}},{"id":"37917fbb-05c8-4de5-acaa-9cb03c7a270e","block_type":"box","text":"Regulations related to AI technology could also impose certain obligations and costs related to monitoring and","page_number":94,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"11d10141-582d-4e7c-b12c-c4b0bfde9c98","block_type":"box","text":"compliance. For example, in April 2023, the Federal Trade Commission, U.S. Department of Justice, Consumer","page_number":94,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"024cf0dc-8f34-4dd7-ab8a-cfd5297d2be7","block_type":"box","text":"Financial Protection Bureau, and U.S. Equal Employment Opportunity Commission released a joint statement on","page_number":94,"box":{"x":70,"y":340,"width":796,"height":11}},{"id":"e505b586-61dd-4fd3-9ef9-4752a886ed8d","block_type":"box","text":"artificial intelligence demonstrating interest in monitoring the development and use of automated systems and","page_number":94,"box":{"x":69,"y":355,"width":788,"height":11}},{"id":"3cec35a6-511d-4d1a-8232-44e4337240e6","block_type":"box","text":"enforcement of their respective laws and regulations. In October 2023, an executive order established new standards","page_number":94,"box":{"x":69,"y":370,"width":839,"height":11}},{"id":"c42a9ea2-c0f0-4888-8116-7533bdf5a00b","block_type":"box","text":"for AI safety and security. In addition to the U.S. regulatory framework, in 2024, the EU adopted the Artificial","page_number":94,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"b9bab506-447d-438e-8442-d5b466b15641","block_type":"box","text":"Intelligence Act, which applies to certain AI technology and the data used to train, test, and deploy them, which may","page_number":94,"box":{"x":70,"y":400,"width":826,"height":11}},{"id":"70ff32cb-220b-43a3-998b-dd9b6da31f39","block_type":"box","text":"create additional compliance burdens, higher administrative costs, and significant penalties should the Fund, the","page_number":94,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"ee4931b5-cf42-4bad-9c61-d7cdd70ba6d3","block_type":"box","text":"adviser, or the Fund’s portfolio investments fail to comply.","page_number":94,"box":{"x":69,"y":430,"width":412,"height":11}},{"id":"fcd8d3c3-cd61-4789-8f27-a502e1b815f5","block_type":"box","text":"AI technology and its applications, including in the investment and financial sectors, continue to develop rapidly,","page_number":94,"box":{"x":101,"y":453,"width":797,"height":11}},{"id":"4ada6df4-b105-4ab2-849b-53715bedef33","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":94,"box":{"x":69,"y":468,"width":817,"height":11}},{"id":"9d60dd30-2796-48b0-8bb5-78357fe041ad","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":94,"box":{"x":68,"y":483,"width":824,"height":11}},{"id":"5dbc9fad-1bd3-42e9-831e-fd920089ebeb","block_type":"box","text":"or remediate all of the potential risks, challenges, or impacts of such changes.","page_number":94,"box":{"x":69,"y":498,"width":561,"height":11}},{"id":"9c31867b-b0a5-4e43-99ff-a8bb8e340491","block_type":"box","text":"While the Fund’s service providers are required to have appropriate operational, information security and","page_number":94,"box":{"x":101,"y":521,"width":747,"height":11}},{"id":"3a55ac1d-0548-40c0-a37f-9231aa71d150","block_type":"box","text":"cybersecurity risk management policies and procedures, their methods of risk management may differ from those of","page_number":94,"box":{"x":69,"y":536,"width":830,"height":11}},{"id":"1b32d8a8-de7c-41e3-a909-0c0f7a3cd416","block_type":"box","text":"the Fund in the setting of priorities, the personnel and resources available or the effectiveness of relevant controls.","page_number":94,"box":{"x":68,"y":551,"width":823,"height":11}},{"id":"b236a49d-9bff-434c-ab72-934398bf821e","block_type":"box","text":"The Fund and its adviser seek to reduce these risks through controls, procedures and oversight, including","page_number":94,"box":{"x":68,"y":566,"width":755,"height":11}},{"id":"e52bdf86-8c29-412b-a9e3-121d8b5dfee3","block_type":"box","text":"establishing business continuity plans and risk management systems. However, there are inherent limitations in such","page_number":94,"box":{"x":69,"y":582,"width":838,"height":11}},{"id":"b04cd327-fcc8-4e13-bdb6-682a632e7fbb","block_type":"box","text":"plans and systems, including the possibility that certain risks that may affect the Fund have not been identified or","page_number":94,"box":{"x":70,"y":596,"width":812,"height":12}},{"id":"01e4be21-24b7-470b-8245-95fda7d1d057","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":94,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"694b2d9e-dc13-4ad8-b1b4-82d76f867754","block_type":"box","text":"effects of operational or information security disruptions or failures or of cybersecurity incidents; or that prevention","page_number":94,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"ef64844c-3e7d-4f99-b9b1-83b181e15a2b","block_type":"box","text":"and remediation efforts will not be successful or that incidents will go undetected. The Fund cannot control the","page_number":94,"box":{"x":69,"y":642,"width":792,"height":11}},{"id":"00290211-32b1-40a6-8bcf-c6254ce6d60f","block_type":"box","text":"systems, information security or other cybersecurity of the issuers in which it invests or its service providers,","page_number":94,"box":{"x":69,"y":657,"width":775,"height":11}},{"id":"7fe9b2f7-c893-4192-ad54-fc2b6a8422df","block_type":"box","text":"counterparties, and other third parties whose activities affect the Fund.","page_number":94,"box":{"x":69,"y":672,"width":510,"height":11}},{"id":"62bf6362-a558-4930-bcad-8b788ed56560","block_type":"box","text":"Lastly, the regulatory climate governing cybersecurity and data protection is developing quickly and may vary","page_number":94,"box":{"x":102,"y":695,"width":771,"height":11}},{"id":"e3e3db43-3f00-47f1-aedf-f8cc1a4b1418","block_type":"box","text":"considerably across jurisdictions. Regulators continue to develop new rules and standards related to cybersecurity","page_number":94,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"672ba125-bb47-49a9-b36d-bed539343095","block_type":"box","text":"and data protection. Compliance with evolving regulations can be demanding and costly, requiring substantial","page_number":94,"box":{"x":69,"y":725,"width":778,"height":11}},{"id":"23a9810a-218f-44e0-a59b-727d0409bee1","block_type":"box","text":"resources to monitor and implement required changes.","page_number":94,"box":{"x":69,"y":740,"width":391,"height":11}},{"id":"8cc2be67-72f8-44ea-8975-13a9ee3a4d6a","block_type":"box","text":"Participation Notes.","page_number":94,"box":{"x":102,"y":763,"width":145,"height":11}},{"id":"83d994c7-54a1-4c10-a187-ea6fb0be8d33","block_type":"box","text":"A Fund may buy participation notes from a bank or broker-dealer (“issuer”) that entitle the","page_number":94,"box":{"x":253,"y":763,"width":641,"height":11}},{"id":"082c7805-af85-4a04-99d7-04c80a482b7e","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":94,"box":{"x":70,"y":778,"width":766,"height":11}},{"id":"d3621958-3c08-49b4-a622-db7632a1bc09","block_type":"box","text":"(collectively, the “underlying security”). Participation notes are typically used when a direct investment in the","page_number":94,"box":{"x":69,"y":793,"width":772,"height":11}},{"id":"cb712f8e-f12c-4541-addb-69a2b7030883","block_type":"box","text":"underlying security is restricted due to country-specific regulations.","page_number":94,"box":{"x":69,"y":808,"width":475,"height":11}},{"id":"9b031c28-1bbf-415d-8d14-a0e404f597ad","block_type":"box","text":"The Fund is subject to counterparty risk associated with each issuer. Investment in a participation note is not","page_number":94,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"b5c256f1-8d14-4a58-aa49-af782f3f4b6a","block_type":"box","text":"the same as investment in the constituent shares of the company. A participation note represents only an obligation","page_number":94,"box":{"x":68,"y":846,"width":831,"height":11}},{"id":"26176f57-8a0a-4882-b13c-bd190fc89104","block_type":"box","text":"of the issuer to provide the Fund the economic performance equivalent to holding shares of an underlying security. A","page_number":94,"box":{"x":69,"y":861,"width":831,"height":11}},{"id":"78419d0e-4c52-4fea-a9f4-d0012f3903a3","block_type":"box","text":"participation note does not provide any beneficial or equitable entitlement or interest in the relevant underlying","page_number":94,"box":{"x":70,"y":876,"width":789,"height":11}},{"id":"c5efc169-6a1f-47ce-8ef7-686994f8ae29","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":94,"box":{"x":69,"y":891,"width":791,"height":12}},{"id":"4bf6b014-fc5c-44e4-b729-fb708a671766","block_type":"box","text":"participation note synthetically replicates the economic benefit of holding shares in the underlying security. Because","page_number":94,"box":{"x":70,"y":906,"width":827,"height":12}},{"id":"1e5d6f75-1b28-4197-8cc6-747e9e69e838","block_type":"box","text":"II-64","page_number":94,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"fdd529f2-f245-440a-8440-4f392f208bf2","block_type":"box","text":"NM1026U-5979889-94/232","page_number":94,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"bf25deeb-6404-403a-90d5-4c6202b397d7","block_type":"box","text":"a participation note is an obligation of the issuer, rather than a direct investment in shares of the underlying security,","page_number":95,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"566f7766-af17-45c4-b89f-15a132a7be57","block_type":"box","text":"a Fund may suffer losses potentially equal to the full value of the participation note if the issuer fails to perform its","page_number":95,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"47c4ba02-07e4-4770-b1e8-cff9a792cb74","block_type":"box","text":"obligations. A Fund attempts to mitigate that risk by purchasing only from issuers determined to be creditworthy.","page_number":95,"box":{"x":69,"y":75,"width":801,"height":11}},{"id":"7e6c8aa5-be90-4d16-ae84-97dc63cb5e5d","block_type":"box","text":"The counterparty may, but is not required to, purchase the shares of the underlying security to hedge its","page_number":95,"box":{"x":101,"y":98,"width":743,"height":11}},{"id":"55a1d967-984e-479f-8061-a71b06292f28","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":95,"box":{"x":69,"y":113,"width":826,"height":11}},{"id":"09526a43-3391-463b-8856-c81eb5ff3f33","block_type":"box","text":"participation note expires or a Fund exercises the participation note and closes its position, the Fund receives a","page_number":95,"box":{"x":70,"y":128,"width":799,"height":11}},{"id":"b79ce827-90a1-467b-a34d-829e20d3a40c","block_type":"box","text":"payment that is based upon the then-current value of the underlying security converted into U.S. dollars (less","page_number":95,"box":{"x":70,"y":143,"width":776,"height":11}},{"id":"774fa8a0-f7f4-4a53-a9b9-f39971e1c0e9","block_type":"box","text":"transaction costs). The price, performance and liquidity of a participation note are all linked directly to the underlying","page_number":95,"box":{"x":68,"y":158,"width":834,"height":11}},{"id":"7fd7c2fc-d2e9-453f-9734-bd5ca1739115","block_type":"box","text":"security. A Fund’s ability to redeem or exercise a participation note generally is dependent on the liquidity in the local","page_number":95,"box":{"x":69,"y":173,"width":834,"height":11}},{"id":"8efe5c5f-ec07-4285-8981-cf75b883f9fc","block_type":"box","text":"trading market for the security underlying the participation note.","page_number":95,"box":{"x":68,"y":188,"width":454,"height":12}},{"id":"ea859db6-7bba-4111-a9ac-a66dc6892c92","block_type":"box","text":"Portfolio Turnover Rates.","page_number":95,"box":{"x":102,"y":211,"width":181,"height":9}},{"id":"97df2439-1ced-4233-b46f-a926e8cd1a5e","block_type":"box","text":"A Fund’s annual portfolio turnover rate will not be a factor preventing a sale or","page_number":95,"box":{"x":289,"y":211,"width":558,"height":11}},{"id":"f3ae216e-75f1-4206-b2e0-a23941fd743c","block_type":"box","text":"purchase when the Manager believes investment considerations warrant such sale or purchase. Although certain","page_number":95,"box":{"x":70,"y":226,"width":804,"height":11}},{"id":"f3c9d80e-ffea-4a97-b498-031103fdc106","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":95,"box":{"x":70,"y":241,"width":806,"height":11}},{"id":"0b1b0e5c-cee0-449f-b82d-12c4713117d3","block_type":"box","text":"substantial number of portfolio transactions. With respect to these Funds, the rate of portfolio turnover will be a","page_number":95,"box":{"x":69,"y":256,"width":800,"height":11}},{"id":"9f64d587-2945-49a0-ae8d-a6a31865e51f","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":95,"box":{"x":70,"y":271,"width":818,"height":12}},{"id":"680c15a2-07a4-41d4-a688-457df91fc4d7","block_type":"box","text":"the Manager will consider the impact of transaction costs on a Fund’s tracking error. Portfolio turnover may vary","page_number":95,"box":{"x":68,"y":286,"width":800,"height":12}},{"id":"ee8543c2-1fe1-4c35-ab33-8c0463739bd8","block_type":"box","text":"greatly from year to year as well as within a particular year. High portfolio turnover (","page_number":95,"box":{"x":68,"y":302,"width":595,"height":11}},{"id":"5f288816-4471-4723-ac2b-1eb1641599d2","block_type":"box","text":"i.e.","page_number":95,"box":{"x":665,"y":302,"width":20,"height":9}},{"id":"469ddb9e-1869-4ebf-b424-75eb0d0c7d28","block_type":"box","text":", 100% or more) may result in","page_number":95,"box":{"x":687,"y":302,"width":210,"height":11}},{"id":"5ee4c4d9-709d-445f-a50e-32e51b76aa6c","block_type":"box","text":"increased transaction costs to a Fund, including brokerage commissions, dealer mark-ups and other transaction","page_number":95,"box":{"x":70,"y":317,"width":797,"height":11}},{"id":"485f8348-b2a6-4344-a834-ca782933a249","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":95,"box":{"x":69,"y":332,"width":832,"height":11}},{"id":"69e8007f-86c5-490f-acea-942f070ff4dc","block_type":"box","text":"the recognition of capital gain or loss. Given the frequency of sales, such gain or loss will likely be short-term capital","page_number":95,"box":{"x":68,"y":347,"width":831,"height":11}},{"id":"3917623e-40aa-4e5f-89cf-1ced486d5394","block_type":"box","text":"gain or loss. These effects of higher than normal portfolio turnover may adversely affect a Fund’s performance.","page_number":95,"box":{"x":68,"y":362,"width":795,"height":11}},{"id":"d53f3f50-bda6-4d41-a120-3564808ed6da","block_type":"box","text":"Preferred Stock.","page_number":95,"box":{"x":102,"y":385,"width":118,"height":9}},{"id":"017bbb5b-b15d-4f6e-88f6-394debc93126","block_type":"box","text":"Certain Funds may invest in preferred stocks. Preferred stock has a preference over common","page_number":95,"box":{"x":226,"y":385,"width":665,"height":11}},{"id":"4bc3d477-063c-4afa-b0f3-43b2d66010f2","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":95,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"4bf736a7-3df1-4a44-a7d1-28cb452c4ceb","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":95,"box":{"x":69,"y":415,"width":834,"height":11}},{"id":"68626fc4-0fc6-471d-8ff2-4b75f93cb895","block_type":"box","text":"varies inversely with interest rates and perceived credit risk, while the market price of convertible preferred stock","page_number":95,"box":{"x":68,"y":430,"width":808,"height":11}},{"id":"f301e5c2-5496-412d-9218-badc6f0b8ab3","block_type":"box","text":"generally also reflects some element of conversion value. Because preferred stock is junior to debt securities and","page_number":95,"box":{"x":68,"y":445,"width":813,"height":12}},{"id":"c85a2b02-e364-413d-b0d5-e8a859e8171f","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":95,"box":{"x":69,"y":460,"width":831,"height":12}},{"id":"55eda508-3cd9-439a-9f73-1971e0eca620","block_type":"box","text":"of a preferred stock than in a more senior debt security with similar stated yield characteristics. Unlike interest","page_number":95,"box":{"x":69,"y":475,"width":791,"height":12}},{"id":"8ad72926-1365-4d91-8a32-0023e1350feb","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":95,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"8d4281f9-7c67-4e9d-bf52-5995688c1c4c","block_type":"box","text":"Preferred stock also may be subject to optional or mandatory redemption provisions.","page_number":95,"box":{"x":69,"y":506,"width":604,"height":11}},{"id":"f363a1c3-78e0-457f-8a09-931f5476da83","block_type":"box","text":"Tax-Exempt Preferred Shares.","page_number":95,"box":{"x":103,"y":528,"width":207,"height":11}},{"id":"df961cd6-09b2-4532-b797-d716e8eb00fd","block_type":"box","text":"Certain Funds may invest in preferred interests of other investment funds that pay","page_number":95,"box":{"x":316,"y":528,"width":588,"height":12}},{"id":"42dd8332-ad62-42cb-af93-55309322dda4","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":95,"box":{"x":69,"y":543,"width":806,"height":12}},{"id":"5ad9826b-9483-427e-88cd-458751328426","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":95,"box":{"x":69,"y":559,"width":814,"height":11}},{"id":"662a4a80-b6b5-4df5-adb7-f6312aad5292","block_type":"box","text":"revenue bonds issued by state or local agencies to fund the development of low-income, multi-family housing.","page_number":95,"box":{"x":69,"y":574,"width":780,"height":11}},{"id":"87960d57-be24-45ef-a44c-b5262d50d9e9","block_type":"box","text":"Investment in such tax-exempt preferred shares involves many of the same issues as investing in other investment","page_number":95,"box":{"x":70,"y":589,"width":820,"height":11}},{"id":"69fea2b4-d1a9-4070-8de8-cd8aa02cbece","block_type":"box","text":"companies. These investments also have additional risks, including illiquid investments risk, the absence of","page_number":95,"box":{"x":69,"y":604,"width":772,"height":11}},{"id":"82dbf453-35f7-4143-bc05-22e64ae133b0","block_type":"box","text":"regulation governing investment practices, capital structure and leverage, affiliated transactions and other matters,","page_number":95,"box":{"x":69,"y":619,"width":821,"height":11}},{"id":"7ab9b83e-f2c1-4230-baea-9d3f7a0ab177","block_type":"box","text":"and concentration of investments in particular issuers or industries. The Municipal Bond Funds will treat investments","page_number":95,"box":{"x":69,"y":634,"width":834,"height":11}},{"id":"bee7ee63-ed55-4d8d-9f91-90d6e48b5de3","block_type":"box","text":"in tax-exempt preferred shares as investments in municipal bonds.","page_number":95,"box":{"x":70,"y":649,"width":474,"height":11}},{"id":"768cc76e-d3d4-41a8-9492-8bf964c1919d","block_type":"box","text":"Trust Preferred Securities.","page_number":95,"box":{"x":103,"y":672,"width":184,"height":9}},{"id":"21a4be65-e143-4950-a4ee-9cdfc5020106","block_type":"box","text":"Certain Funds may invest in trust preferred securities. Trust preferred securities are","page_number":95,"box":{"x":294,"y":672,"width":599,"height":11}},{"id":"c5698fec-6452-4138-9e7e-f48d8fd9eddc","block_type":"box","text":"typically issued by corporations, generally in the form of interest bearing notes with preferred securities","page_number":95,"box":{"x":68,"y":687,"width":737,"height":11}},{"id":"1286734c-9b24-47ce-a536-817fc8b18332","block_type":"box","text":"characteristics, or by an affiliated business trust of a corporation, generally in the form of beneficial interests in","page_number":95,"box":{"x":69,"y":702,"width":796,"height":12}},{"id":"2701feb7-b3c5-4a2a-8bfd-e675d203f2e8","block_type":"box","text":"subordinated debentures or similarly structured securities. The trust preferred securities market consists of both","page_number":95,"box":{"x":69,"y":717,"width":805,"height":12}},{"id":"900d4552-24ec-45a9-a191-1c4ef574b76c","block_type":"box","text":"fixed and adjustable coupon rate securities that are either perpetual in nature or have stated maturity dates.","page_number":95,"box":{"x":68,"y":732,"width":773,"height":12}},{"id":"1e31be40-31f2-417c-9f45-abf382d4d9c9","block_type":"box","text":"Trust preferred securities are typically junior and fully subordinated liabilities of an issuer and benefit from a","page_number":95,"box":{"x":101,"y":755,"width":770,"height":11}},{"id":"fbee524e-f07f-45f4-a986-8692ef7e0234","block_type":"box","text":"guarantee that is junior and fully subordinated to the other liabilities of the guarantor. In addition, trust preferred","page_number":95,"box":{"x":68,"y":770,"width":801,"height":12}},{"id":"2213db9b-bd4e-4bb5-9998-b37e72e193a7","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":95,"box":{"x":69,"y":785,"width":830,"height":12}},{"id":"9a4b37d1-9f4d-41ed-9a44-7609f12a8b58","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":95,"box":{"x":69,"y":801,"width":822,"height":11}},{"id":"0f9bd509-6f7c-4a20-8818-cf642f42c2d7","block_type":"box","text":"for extended periods of time without default consequences to the issuer, and certain other features (such as","page_number":95,"box":{"x":68,"y":816,"width":777,"height":11}},{"id":"4475b969-4725-4633-8836-c89625f9979a","block_type":"box","text":"restrictions on common dividend payments by the issuer or ultimate guarantor when full cumulative payments on the","page_number":95,"box":{"x":69,"y":831,"width":831,"height":11}},{"id":"fe05806d-4bf5-4556-a96a-e5c0999e53f6","block_type":"box","text":"trust preferred securities have not been made), these trust preferred securities are often treated as close","page_number":95,"box":{"x":68,"y":846,"width":757,"height":11}},{"id":"e13762af-6ab5-4f99-87b8-fbf871d00467","block_type":"box","text":"substitutes for traditional preferred securities, both by issuers and investors.","page_number":95,"box":{"x":69,"y":861,"width":548,"height":11}},{"id":"50cfa039-94dc-4cf0-8a40-0b28bdebf34f","block_type":"box","text":"Trust preferred securities include but are not limited to trust originated preferred securities (“TOPRS","page_number":95,"box":{"x":101,"y":884,"width":715,"height":11}},{"id":"c0f70252-38fb-49b4-bb6e-99e748950fff","block_type":"box","text":"®","page_number":95,"box":{"x":817,"y":884,"width":5,"height":5}},{"id":"27df8769-c466-4b74-89d7-0d960b158531","block_type":"box","text":"”); monthly","page_number":95,"box":{"x":824,"y":884,"width":77,"height":11}},{"id":"4f575075-536b-489a-8dac-aa5d9d956c6a","block_type":"box","text":"income preferred securities (“MIPS","page_number":95,"box":{"x":70,"y":899,"width":248,"height":11}},{"id":"1117b4e9-7d3d-42be-8da1-b054c5171e10","block_type":"box","text":"®","page_number":95,"box":{"x":319,"y":899,"width":6,"height":5}},{"id":"084ae05d-8578-4f55-98ce-0d062a072b90","block_type":"box","text":"”); quarterly income bond securities (“QUIBS","page_number":95,"box":{"x":326,"y":899,"width":317,"height":11}},{"id":"d6fea14c-a3aa-4223-b949-02d490937405","block_type":"box","text":"®","page_number":95,"box":{"x":644,"y":899,"width":6,"height":5}},{"id":"39247460-7e91-4dfa-8ae0-8024a31a0f85","block_type":"box","text":"” ); quarterly income debt securities","page_number":95,"box":{"x":652,"y":899,"width":255,"height":11}},{"id":"5d8208f0-1236-48a3-bc54-27a4ca04e801","block_type":"box","text":"II-65","page_number":95,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f0c6f0c6-33d4-49e2-adf9-d62183f57e8d","block_type":"box","text":"NM1026U-5979889-95/232","page_number":95,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"df213770-34ba-4081-be9c-23a32f80beb5","block_type":"box","text":"(“QUIDS","page_number":96,"box":{"x":69,"y":45,"width":57,"height":11}},{"id":"444abd6a-e448-429e-9f9b-a416cdc0634c","block_type":"box","text":"®","page_number":96,"box":{"x":127,"y":45,"width":6,"height":4}},{"id":"d777b2d0-8970-41d5-bb6c-ebe3664d4b39","block_type":"box","text":"”); quarterly income preferred securities (“QUIPS","page_number":96,"box":{"x":135,"y":45,"width":346,"height":11}},{"id":"bc09b52a-58ca-49bd-b98f-3ac55484eb6a","block_type":"box","text":"SM","page_number":96,"box":{"x":482,"y":45,"width":11,"height":4}},{"id":"99967d5e-95fb-4c72-a005-d99cfd3a78c9","block_type":"box","text":"”); corporate trust securities (“CORTS","page_number":96,"box":{"x":495,"y":45,"width":267,"height":11}},{"id":"6bf65e31-3dc0-4c1f-8105-c9ac0ac95231","block_type":"box","text":"®","page_number":96,"box":{"x":762,"y":45,"width":6,"height":4}},{"id":"b066f6ba-16f5-4c49-8063-2b0bead2a8fb","block_type":"box","text":"”); public income","page_number":96,"box":{"x":770,"y":45,"width":118,"height":11}},{"id":"5422418b-275c-438e-9b49-4b005617abd2","block_type":"box","text":"notes (“PINES","page_number":96,"box":{"x":69,"y":60,"width":99,"height":11}},{"id":"8811e21d-482a-4fb8-867a-3596f071de97","block_type":"box","text":"®","page_number":96,"box":{"x":169,"y":60,"width":6,"height":5}},{"id":"340bc205-f66a-4765-bb3c-a3c650842842","block_type":"box","text":"”); and other trust preferred securities.","page_number":96,"box":{"x":177,"y":60,"width":275,"height":11}},{"id":"68d19f0f-904f-47c1-b095-a32f2090bd00","block_type":"box","text":"Trust preferred securities are typically issued with a final maturity date, although some are perpetual in nature.","page_number":96,"box":{"x":101,"y":82,"width":790,"height":12}},{"id":"c97a222f-a6a9-414e-ac86-c1b88f0ffb27","block_type":"box","text":"In certain instances, a final maturity date may be extended and/or the final payment of principal may be deferred at","page_number":96,"box":{"x":70,"y":98,"width":825,"height":11}},{"id":"8797883b-e756-427e-a2d5-ab5324a3dcfb","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":96,"box":{"x":68,"y":113,"width":827,"height":11}},{"id":"1febd3eb-e97f-4644-94ba-aed2889b6d42","block_type":"box","text":"payment obligations have been met, although issuers may be able to engage in open-market repurchases without","page_number":96,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"31ec2649-9437-4676-9338-4c0f8c63c1ee","block_type":"box","text":"regard to whether all payments have been paid.","page_number":96,"box":{"x":69,"y":143,"width":338,"height":11}},{"id":"2a5cc892-8b2f-4a80-ab07-c3360665d4ac","block_type":"box","text":"Many trust preferred securities are issued by trusts or other special purpose entities established by operating","page_number":96,"box":{"x":102,"y":166,"width":784,"height":11}},{"id":"403e6d17-8ab3-4bbc-9d69-b89f193f5a35","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":96,"box":{"x":69,"y":181,"width":811,"height":11}},{"id":"5f6b288f-3493-4ed2-ba9a-93074284276c","block_type":"box","text":"sells such preferred securities to investors, it purchases debt of the operating company (with terms comparable to","page_number":96,"box":{"x":69,"y":196,"width":817,"height":11}},{"id":"0d3625f5-29ac-472b-bb52-701a6b428f35","block_type":"box","text":"those of the trust or special purpose entity securities), which enables the operating company to deduct for tax","page_number":96,"box":{"x":68,"y":211,"width":785,"height":11}},{"id":"68192670-9ec7-4e24-9d47-9350e8816b97","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":96,"box":{"x":70,"y":226,"width":830,"height":11}},{"id":"bbb5c01b-122f-48bc-b79d-f2e691de4e44","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":96,"box":{"x":70,"y":241,"width":819,"height":11}},{"id":"9d0501c4-8a52-4ac2-995a-61d1cabab27b","block_type":"box","text":"trust preferred securities are treated as owning beneficial interests in the underlying debt of the operating company.","page_number":96,"box":{"x":68,"y":256,"width":827,"height":12}},{"id":"133cabaf-c939-4570-83f3-6a54ac72060f","block_type":"box","text":"Accordingly, payments on the trust preferred securities are treated as interest rather than dividends for U.S. federal","page_number":96,"box":{"x":68,"y":271,"width":824,"height":12}},{"id":"17e9eae4-accc-4fac-b95d-df44edc5cd02","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":96,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"d42c834f-0cf7-4b69-935f-eae9625faf79","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":96,"box":{"x":69,"y":302,"width":817,"height":11}},{"id":"c38e4430-1518-4fe6-a55a-5d506c3e2a04","block_type":"box","text":"common shareholders, but would typically be subordinated to other classes of the operating company’s debt.","page_number":96,"box":{"x":69,"y":317,"width":778,"height":11}},{"id":"f434e6ac-02aa-4c9c-a395-e754f24cb604","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":96,"box":{"x":68,"y":332,"width":811,"height":11}},{"id":"20f27402-9adc-4f1d-8c4c-2ab59f0ad00a","block_type":"box","text":"debt securities.","page_number":96,"box":{"x":69,"y":347,"width":109,"height":9}},{"id":"0bdabe6e-ae58-4280-8cb0-8a2a23d0958b","block_type":"box","text":"Real Estate Investment Trusts (“REITs”).","page_number":96,"box":{"x":102,"y":370,"width":300,"height":11}},{"id":"551c7451-c65a-4c29-855c-5df7855ef892","block_type":"box","text":"In pursuing its investment strategy, a Fund may invest in shares of","page_number":96,"box":{"x":409,"y":370,"width":473,"height":11}},{"id":"8c948991-5961-4c3b-b9b5-e714bb829aa4","block_type":"box","text":"REITs. REITs possess certain risks which differ from an investment in common stocks. REITs are financial vehicles","page_number":96,"box":{"x":70,"y":385,"width":814,"height":11}},{"id":"5ba0229b-263a-489c-a401-154bb729942c","block_type":"box","text":"that pool investor’s capital to purchase or finance real estate. REITs may concentrate their investments in specific","page_number":96,"box":{"x":68,"y":400,"width":814,"height":11}},{"id":"8ca29c0a-97c3-463d-a2bd-e72aa5e73d1f","block_type":"box","text":"geographic areas or in specific property types,","page_number":96,"box":{"x":68,"y":415,"width":329,"height":11}},{"id":"6b0be0ae-b879-4898-83ab-5f8d327b969a","block_type":"box","text":"i.e.","page_number":96,"box":{"x":405,"y":415,"width":20,"height":9}},{"id":"a2ce5c2e-f788-41a5-8689-7a8811f07c60","block_type":"box","text":", hotels, shopping malls, residential complexes and office","page_number":96,"box":{"x":428,"y":415,"width":411,"height":11}},{"id":"1e3b44df-97f3-40bd-a43c-4f1d6f4e8f7c","block_type":"box","text":"buildings.","page_number":96,"box":{"x":69,"y":430,"width":66,"height":11}},{"id":"b7fb3d96-f42d-485b-ae39-52e5e285c821","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":96,"box":{"x":102,"y":453,"width":768,"height":11}},{"id":"4f23a007-23cd-46d5-b10f-6131718222b3","block_type":"box","text":"proportionate share of the costs of the REITs’ operations. There are three general categories of REITs: Equity REITs,","page_number":96,"box":{"x":70,"y":468,"width":824,"height":11}},{"id":"9d62db99-7246-46ef-906e-554c89b66964","block_type":"box","text":"Mortgage REITs and Hybrid REITs. Equity REITs invest primarily in direct fee ownership or leasehold ownership of real","page_number":96,"box":{"x":70,"y":483,"width":829,"height":11}},{"id":"1483db4e-febd-4d6e-835d-26a09d13bf39","block_type":"box","text":"property, which derive most of their income from rents. Mortgage REITs invest mostly in mortgages on real estate,","page_number":96,"box":{"x":70,"y":498,"width":813,"height":11}},{"id":"ea77901e-f9f5-457f-88fc-523b4a99032a","block_type":"box","text":"which may secure construction, development or long-term loans; the main source of their income is mortgage","page_number":96,"box":{"x":68,"y":513,"width":782,"height":12}},{"id":"228228cf-9995-45b9-9a00-be0fbf58a026","block_type":"box","text":"interest payments. Hybrid REITs hold both ownership and mortgage interests in real estate.","page_number":96,"box":{"x":70,"y":529,"width":649,"height":11}},{"id":"b9056ae1-17dc-44b3-b4c6-370950909a63","block_type":"box","text":"Investing in REITs involves certain unique risks in addition to those risks associated with investing in the real","page_number":96,"box":{"x":102,"y":551,"width":776,"height":11}},{"id":"e5fa1fdd-5476-4b60-9ee6-25c7d9a93962","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":96,"box":{"x":69,"y":566,"width":822,"height":11}},{"id":"5819f989-78e3-4936-85e7-5e0167bc1786","block_type":"box","text":"adversely affected by several factors, including rising interest rates, changes in the national, state and local","page_number":96,"box":{"x":69,"y":581,"width":769,"height":12}},{"id":"54ec825d-c56f-4d21-abaf-02e4736c0583","block_type":"box","text":"economic climate and real estate conditions, occupancy and rental rates, perceptions of prospective tenants of the","page_number":96,"box":{"x":69,"y":596,"width":822,"height":12}},{"id":"94ad9807-990c-4b04-8eb0-72e1de3eff99","block_type":"box","text":"safety, convenience and attractiveness of the properties, the ability of the owners to provide adequate management,","page_number":96,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"ceafc233-26ce-4a04-b555-17915f68f26f","block_type":"box","text":"maintenance and insurance, the cost of complying with the Americans with Disabilities Act, increased competition","page_number":96,"box":{"x":69,"y":627,"width":810,"height":11}},{"id":"360224bc-147a-43ca-8c5c-487eb7653b83","block_type":"box","text":"from new properties, the impact of present or future environmental legislation and compliance with environmental","page_number":96,"box":{"x":68,"y":642,"width":812,"height":11}},{"id":"c092ebb2-5cb1-47eb-8bb9-05d54441cd06","block_type":"box","text":"laws, failing to maintain their exemptions from registration under the Investment Company Act, changes in real estate","page_number":96,"box":{"x":70,"y":657,"width":838,"height":11}},{"id":"5b265eca-1fd0-4839-baff-13a19b3f81ff","block_type":"box","text":"taxes and other operating expenses, adverse changes in governmental rules and fiscal policies, adverse changes in","page_number":96,"box":{"x":68,"y":672,"width":826,"height":11}},{"id":"e7c2a1b4-73bf-42bb-bee3-879165608d7d","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":96,"box":{"x":69,"y":687,"width":817,"height":11}},{"id":"e650321b-72e2-4d29-b110-d37a928692b4","block_type":"box","text":"REIT are concentrated geographically, by property type, or in certain other respects, these risks may be heightened.","page_number":96,"box":{"x":70,"y":703,"width":822,"height":11}},{"id":"3b3dc468-7442-4a86-a7fd-636cae2ff6bb","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":96,"box":{"x":70,"y":717,"width":792,"height":12}},{"id":"ba70534a-39b5-4699-99f2-2813a54a1268","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":96,"box":{"x":69,"y":732,"width":834,"height":12}},{"id":"e7697d5b-1eee-4cf1-bfff-f46c19dfc627","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":96,"box":{"x":69,"y":748,"width":798,"height":11}},{"id":"3c434d11-862a-4140-85b6-c214bfd8f9b9","block_type":"box","text":"Fund’s dividend income received from REIT shares will likely exceed the percentage of the Fund’s portfolio which is","page_number":96,"box":{"x":70,"y":763,"width":818,"height":11}},{"id":"a661832d-8dc6-4413-be87-61ed60b2ea61","block_type":"box","text":"comprised of REIT shares. Ordinary REIT dividends received by the Fund and distributed to the Fund’s shareholders","page_number":96,"box":{"x":69,"y":778,"width":821,"height":11}},{"id":"0b399768-32a0-42db-8902-56d91d0461e4","block_type":"box","text":"will generally be taxable as ordinary income and will not constitute “qualified dividend income.” However, a non","page_number":96,"box":{"x":68,"y":793,"width":797,"height":11}},{"id":"736cbcb8-b425-4da8-b220-5e15ff6c78a6","block_type":"box","text":"corporate taxpayer who is a direct REIT shareholder may claim a 20% “qualified business income” deduction for","page_number":96,"box":{"x":69,"y":808,"width":798,"height":11}},{"id":"a5775026-1cf6-4056-90b3-231e3bd73a28","block_type":"box","text":"ordinary REIT dividends, and a regulated investment company may report dividends as eligible for this deduction to","page_number":96,"box":{"x":69,"y":823,"width":820,"height":12}},{"id":"45099881-6614-41b6-8f45-5812ea018bbf","block_type":"box","text":"the extent the regulated investment company’s income is derived from ordinary REIT dividends (reduced by allocable","page_number":96,"box":{"x":68,"y":838,"width":831,"height":12}},{"id":"c9ff8eff-ee7e-4f54-8757-179ca36e1431","block_type":"box","text":"regulated investment company expenses). A shareholder may treat the dividends as such provided the regulated","page_number":96,"box":{"x":69,"y":854,"width":801,"height":11}},{"id":"56cde61a-f4c6-459d-a397-d74ae3879baa","block_type":"box","text":"investment company and the shareholder satisfy applicable holding period requirements.","page_number":96,"box":{"x":70,"y":869,"width":631,"height":11}},{"id":"3d4501f2-f5db-4142-a9c5-7bf45fa506e2","block_type":"box","text":"REITs (especially mortgage REITs) are also subject to interest rate risk. Rising interest rates may cause REIT","page_number":96,"box":{"x":102,"y":891,"width":772,"height":12}},{"id":"804b3f93-b621-4555-81a4-6b59c5786e76","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":96,"box":{"x":70,"y":906,"width":790,"height":12}},{"id":"79bdc2cc-c931-4526-a4c8-d29d424bb6d0","block_type":"box","text":"II-66","page_number":96,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"a88cb085-7aae-40b3-83ce-6329c37e6d9a","block_type":"box","text":"NM1026U-5979889-96/232","page_number":96,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"77a00c1d-79f7-4a6b-a287-69dba2810d04","block_type":"box","text":"securities issued by a REIT. Rising interest rates also generally increase the costs of obtaining financing, which could","page_number":97,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"7687fd19-17ee-4ab6-ad70-33606a4ef55d","block_type":"box","text":"cause the value of a Fund’s REIT investments to decline. During periods when interest rates are declining, mortgages","page_number":97,"box":{"x":69,"y":60,"width":837,"height":11}},{"id":"7952dfef-f46a-4650-a763-5b6516ab3bfc","block_type":"box","text":"are often refinanced. Refinancing may reduce the yield on investments in mortgage REITs. In addition, since REITs","page_number":97,"box":{"x":69,"y":75,"width":812,"height":11}},{"id":"d2ab0efe-5f0e-4770-ac53-7e91182aa8e6","block_type":"box","text":"depend on payment under their mortgage loans and leases to generate cash to make distributions to their","page_number":97,"box":{"x":69,"y":90,"width":759,"height":11}},{"id":"65730d83-fc24-4ef1-84f7-83796d125ffd","block_type":"box","text":"shareholders, investments in REITs may be adversely affected by defaults on such mortgage loans or leases.","page_number":97,"box":{"x":69,"y":105,"width":778,"height":11}},{"id":"9e317589-cd7f-4f9e-86ef-7e8a7c02ee5c","block_type":"box","text":"Investing in certain REITs, which often have small market capitalizations, may also involve the same risks as","page_number":97,"box":{"x":102,"y":128,"width":773,"height":11}},{"id":"49a0d8f4-22c3-4710-af0a-bb79bacf45d6","block_type":"box","text":"investing in other small capitalization companies. REITs may have limited financial resources and their securities may","page_number":97,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"d948ab0e-b2c7-432b-8540-543f54ff5d31","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":97,"box":{"x":68,"y":158,"width":839,"height":11}},{"id":"e8c5ffab-d049-49c7-afdc-0a06bc83fac7","block_type":"box","text":"company securities. Historically, small capitalization stocks, such as REITs, have been more volatile in price than the","page_number":97,"box":{"x":69,"y":173,"width":832,"height":11}},{"id":"1ffc3337-bb18-47c8-a2bd-915684de9a2b","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":97,"box":{"x":70,"y":188,"width":832,"height":12}},{"id":"b3a7d289-caeb-4ecf-bc97-a57197f42017","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":97,"box":{"x":68,"y":203,"width":815,"height":12}},{"id":"7b9ec281-1c20-43c3-ad9c-76fba65ae3e8","block_type":"box","text":"activities competitive with the REIT. REITs may own properties through joint ventures or in other circumstances in","page_number":97,"box":{"x":69,"y":219,"width":804,"height":11}},{"id":"a9ab81d3-5884-4600-ac5a-d9d4377e702b","block_type":"box","text":"which the REIT may not have control over its investments. REITs may incur significant amounts of leverage.","page_number":97,"box":{"x":68,"y":234,"width":761,"height":11}},{"id":"99e54904-426d-4af2-b2cf-3cb2660244f6","block_type":"box","text":"Market Risks/Recent Market Events.","page_number":97,"box":{"x":102,"y":256,"width":275,"height":11}},{"id":"3c131b83-fea6-4014-9dd1-c7672b7d2e1f","block_type":"box","text":"Securities may decline in value due to factors affecting securities","page_number":97,"box":{"x":383,"y":256,"width":466,"height":12}},{"id":"5040f02e-4585-44df-a511-d58bd92be8e0","block_type":"box","text":"markets generally or particular industries represented in the markets. The value of a security may decline due to","page_number":97,"box":{"x":69,"y":271,"width":801,"height":12}},{"id":"c2004f9c-b42d-477a-9ee5-7956576b48f9","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":97,"box":{"x":68,"y":286,"width":837,"height":12}},{"id":"98491971-fc5c-4dbc-8b1d-91c4865388f7","block_type":"box","text":"affect a particular industry or industries, or factors that affect a particular issuer or issuers, exchange, country,","page_number":97,"box":{"x":69,"y":302,"width":795,"height":11}},{"id":"b11d5f3d-48fa-4eed-be9c-e0d6af851577","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":97,"box":{"x":68,"y":317,"width":796,"height":11}},{"id":"d8bbc4fc-dbb4-4043-adbd-fe4b8d985a85","block_type":"box","text":"activities could be affected by interest rates, availability of credit, inflation rates, economic uncertainty, changes in","page_number":97,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"9c10a3bb-992b-4ed2-a89a-b5fb22cb7579","block_type":"box","text":"laws, trade barriers, economic sanctions, currency exchange controls, and local, regional or global events such as","page_number":97,"box":{"x":70,"y":347,"width":812,"height":11}},{"id":"0308ce34-2813-4ea0-9f8c-1408973357e0","block_type":"box","text":"war, acts of terrorism, natural and environmental disasters, the spread of infectious illness or other public health","page_number":97,"box":{"x":68,"y":362,"width":807,"height":11}},{"id":"3d35c772-789e-4322-81e1-b3fb77f4c567","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":97,"box":{"x":70,"y":377,"width":822,"height":12}},{"id":"06698a50-f031-4ade-935c-3421be615b30","block_type":"box","text":"economic downturn in the securities markets, multiple asset classes may be negatively affected. These factors may","page_number":97,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"5cd40cc9-df90-4892-bea6-587a38bb1bc6","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":97,"box":{"x":69,"y":407,"width":804,"height":12}},{"id":"d696a895-cb5c-4017-aba9-5e0e59200b79","block_type":"box","text":"Fund’s profitability or result in losses. A Fund may maintain substantial trading positions that can be adversely","page_number":97,"box":{"x":70,"y":423,"width":787,"height":11}},{"id":"3435be34-da78-4443-918a-08e1784f440c","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":97,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"54379585-a119-4757-b26d-6677911fc643","block_type":"box","text":"Unpredictable or unstable market conditions may result in reduced opportunities to find suitable investments to","page_number":97,"box":{"x":70,"y":453,"width":796,"height":11}},{"id":"fe10d688-09c1-43e5-9b11-146d448d5f4b","block_type":"box","text":"deploy capital or make it more difficult to exit and realize value from a Fund’s existing investments. It is important to","page_number":97,"box":{"x":69,"y":468,"width":832,"height":11}},{"id":"a2586c03-712d-40d1-83b8-ce98eb9b281c","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":97,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"05131643-dec7-48e2-b037-7704faaeaafa","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":97,"box":{"x":69,"y":498,"width":776,"height":11}},{"id":"dcf338f0-ba81-43c3-acf1-4c8c0196d503","block_type":"box","text":"conditions.","page_number":97,"box":{"x":69,"y":514,"width":76,"height":8}},{"id":"d7071b50-4ce5-4dfa-8a0a-68e4d6c9f25f","block_type":"box","text":"Periods of unusually high volatility in the financial markets and restrictive credit conditions, sometimes limited to","page_number":97,"box":{"x":102,"y":536,"width":802,"height":11}},{"id":"5e50df3f-0edd-4b52-9e74-a822e382df11","block_type":"box","text":"a particular sector or a geography, can occur. Some countries, including the United States, have adopted and/or are","page_number":97,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"aea28a3e-7d90-4e66-ad6e-5e719af231e9","block_type":"box","text":"considering the adoption of more protectionist trade policies, a move away from the tighter financial industry","page_number":97,"box":{"x":69,"y":566,"width":775,"height":11}},{"id":"4b63d5f8-73a9-4281-9bbd-e4178514b939","block_type":"box","text":"regulations that followed the financial crisis of 2008, and/or substantially reducing corporate taxes. The exact shape","page_number":97,"box":{"x":69,"y":581,"width":833,"height":12}},{"id":"6d86635f-7f95-4809-8480-49a84af4ec57","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":97,"box":{"x":69,"y":596,"width":799,"height":12}},{"id":"524951bf-68ba-4dcb-ac63-373d21b0bb00","block_type":"box","text":"change, which could increase volatility, especially if the market’s expectations are not borne out. A rise in","page_number":97,"box":{"x":69,"y":612,"width":751,"height":11}},{"id":"935aeca9-c92b-4e47-ac9a-6159a50d3790","block_type":"box","text":"protectionist trade policies, and the possibility of changes to some international trade agreements, could affect the","page_number":97,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"3e0c1aff-5a5c-4ebf-972f-48c73727a3db","block_type":"box","text":"economies of many nations in ways that cannot necessarily be foreseen at the present time. In addition, geopolitical","page_number":97,"box":{"x":69,"y":642,"width":831,"height":11}},{"id":"5a7bddb4-ad49-484c-8f94-cd62bccd0fbd","block_type":"box","text":"and other risks, including environmental and public health, may add to instability in world economies and markets","page_number":97,"box":{"x":69,"y":657,"width":810,"height":11}},{"id":"92ee0228-72fa-404a-b5e5-413bc98834ad","block_type":"box","text":"generally. Economies and financial markets throughout the world are increasingly interconnected. As a result, whether","page_number":97,"box":{"x":68,"y":672,"width":841,"height":11}},{"id":"b7316622-09fa-4f5d-8685-9193d58fb797","block_type":"box","text":"or not a Fund invests in securities of issuers located in or with significant exposure to countries experiencing","page_number":97,"box":{"x":69,"y":687,"width":775,"height":11}},{"id":"a2e220d0-b847-432f-b121-651abf7c02d9","block_type":"box","text":"economic, political and/or financial difficulties, the value and liquidity of the Fund’s investments may be negatively","page_number":97,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"93700a05-a254-4f62-abb5-8b2ad21950e1","block_type":"box","text":"affected by such events.","page_number":97,"box":{"x":69,"y":717,"width":173,"height":12}},{"id":"3bc94081-a263-414b-bd04-cd1c127f547b","block_type":"box","text":"Governments and regulators may take actions that affect the regulation of the Fund or the instruments in which","page_number":97,"box":{"x":102,"y":740,"width":795,"height":11}},{"id":"8fab581d-a68f-47a3-9522-06e583758f6c","block_type":"box","text":"the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Future legislation or regulation","page_number":97,"box":{"x":68,"y":755,"width":830,"height":11}},{"id":"7c9d8748-f807-432e-8666-4ee138a2d91a","block_type":"box","text":"or other governmental actions could limit or preclude the Fund’s abilities to achieve its investment objectives or","page_number":97,"box":{"x":69,"y":771,"width":796,"height":11}},{"id":"66dacbfe-a86f-4b0a-8750-30aa8ad63448","block_type":"box","text":"otherwise adversely impact an investment in the Fund. Recent policy initiatives undertaken by the U.S. government","page_number":97,"box":{"x":69,"y":786,"width":820,"height":11}},{"id":"8f32974a-cdd0-4594-a1ff-661f92736348","block_type":"box","text":"have the potential to impact international relations, trade agreements and the overall regulatory environment in ways","page_number":97,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"e145a546-a8b1-46ee-8a29-211cdea14569","block_type":"box","text":"that could create uncertainty and instability in domestic and global markets and could adversely affect the","page_number":97,"box":{"x":68,"y":816,"width":759,"height":11}},{"id":"5963f54e-49ba-428a-b13b-1f9d0148bd79","block_type":"box","text":"investment performance of the Fund. In particular, actions taken by the U.S. government in respect of international","page_number":97,"box":{"x":70,"y":831,"width":819,"height":11}},{"id":"c87a9a6b-e7c6-4bf5-802d-58997f5b2cbf","block_type":"box","text":"trade relations could lead to trade wars, increased costs for imported goods, disruptions in supply chains, reduced","page_number":97,"box":{"x":68,"y":846,"width":821,"height":11}},{"id":"31be895e-273b-40b8-a42a-d06ed0232f66","block_type":"box","text":"foreign investment, and instability in regions where the Fund invests. Political and diplomatic events within the United","page_number":97,"box":{"x":68,"y":861,"width":837,"height":11}},{"id":"118bad5d-d1ef-4966-826c-440ee9fc2c6a","block_type":"box","text":"States, including a contentious domestic political environment, changes in political party control of one or more","page_number":97,"box":{"x":69,"y":876,"width":795,"height":11}},{"id":"fd1a69c6-fb59-49c6-8d9b-e6c66e32d59c","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":97,"box":{"x":69,"y":891,"width":836,"height":12}},{"id":"6c1b57f1-ecea-4376-ba9f-508ea14dd9d4","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":97,"box":{"x":69,"y":906,"width":817,"height":12}},{"id":"08249699-5f0e-4396-a6f0-d967072d8a5c","block_type":"box","text":"II-67","page_number":97,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ca5fc5a1-1778-4ca6-ae70-18e9170c9a0d","block_type":"box","text":"NM1026U-5979889-97/232","page_number":97,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"1772918b-2c6b-490a-8abe-6e31c5bb5c03","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":98,"box":{"x":70,"y":45,"width":816,"height":11}},{"id":"cb5ac2dc-5a2b-41b7-add7-d4dfb799e8b4","block_type":"box","text":"investor and consumer confidence and may adversely impact financial markets and the broader economy, perhaps","page_number":98,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"71712fb8-1141-40e7-b766-4bba13341a42","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":98,"box":{"x":69,"y":75,"width":815,"height":11}},{"id":"12601bac-b556-4c11-aa0b-c75907b5ec89","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":98,"box":{"x":69,"y":90,"width":836,"height":11}},{"id":"cd89de99-b864-4256-b8b8-eb9df7911fd8","block_type":"box","text":"economies. For example, concerns about the U.S. Government’s credit quality may cause increased volatility in the","page_number":98,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"8dfa005e-c2a6-4bc5-ae3f-47ec8a28af83","block_type":"box","text":"stock and bond markets, higher interest rates, reduced prices and liquidity of U.S. Treasury securities, and/or","page_number":98,"box":{"x":69,"y":120,"width":785,"height":12}},{"id":"70556e84-3ade-45e9-8057-f734cb1c069a","block_type":"box","text":"increased costs of various kinds of debt. Moreover, although the U.S. Government has honored its credit obligations,","page_number":98,"box":{"x":70,"y":135,"width":832,"height":12}},{"id":"cf0004cb-615b-49d1-befd-c3075687f455","block_type":"box","text":"there remains a possibility that the United States could default on its obligations. The consequences of such an","page_number":98,"box":{"x":68,"y":150,"width":799,"height":12}},{"id":"75ff8672-63fe-48a0-8357-54ea6d533665","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":98,"box":{"x":69,"y":166,"width":802,"height":11}},{"id":"7cec89bd-61bb-478e-8997-cd84eca222d7","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":98,"box":{"x":69,"y":181,"width":746,"height":11}},{"id":"040b0056-4caf-4ce0-a6c4-893c34ca9103","block_type":"box","text":"investments.","page_number":98,"box":{"x":70,"y":196,"width":89,"height":9}},{"id":"ebca9a04-4b64-480b-9368-37a054d893ba","block_type":"box","text":"The COVID-19 pandemic resulted in significant market volatility, exchange suspensions and closures, declines in","page_number":98,"box":{"x":101,"y":218,"width":802,"height":12}},{"id":"241f3b8e-f1b3-4056-8bd7-9166500411ad","block_type":"box","text":"global financial markets, higher default rates, supply chain disruptions, and a substantial economic downturn in","page_number":98,"box":{"x":68,"y":234,"width":796,"height":11}},{"id":"7dddc995-b919-4db4-9574-2ab3eee93d99","block_type":"box","text":"economies throughout the world. The impact of this coronavirus, and other epidemics and pandemics that may arise","page_number":98,"box":{"x":69,"y":249,"width":830,"height":11}},{"id":"025458fc-1300-49c4-8b15-ee8c126361f1","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":98,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"467b56c9-1203-4ddd-9f25-b6a6e4077b63","block_type":"box","text":"that cannot necessarily be foreseen at the present time. These health crises may be short term or long term, and","page_number":98,"box":{"x":68,"y":279,"width":812,"height":11}},{"id":"bc167151-fff4-43f2-bbc1-8a7a4f7ad92f","block_type":"box","text":"may exacerbate other pre-existing political, social and economic risks, disrupt normal market conditions and","page_number":98,"box":{"x":69,"y":294,"width":771,"height":11}},{"id":"b7553ded-54e6-46d2-a1a4-a4673f86ea48","block_type":"box","text":"operations, and negatively impact performance. In addition, the impact of infectious diseases in emerging developing","page_number":98,"box":{"x":69,"y":309,"width":837,"height":11}},{"id":"2c06404d-f547-4e57-94d3-20c73c1e4e87","block_type":"box","text":"or emerging market countries may be greater due to less established health care systems.","page_number":98,"box":{"x":69,"y":325,"width":646,"height":11}},{"id":"dd151c8e-b0da-4d16-825c-1571f9ecce92","block_type":"box","text":"Legal and Regulatory Risks.","page_number":98,"box":{"x":102,"y":347,"width":197,"height":11}},{"id":"dba2ff5d-c4d5-4208-bfa1-fe8f05264229","block_type":"box","text":"The Manager is part of a larger firm with multiple business lines active in multiple","page_number":98,"box":{"x":305,"y":347,"width":583,"height":11}},{"id":"e2cf8cdb-a2a1-421e-afba-4a72ae3497a0","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":98,"box":{"x":67,"y":362,"width":819,"height":11}},{"id":"452755ad-e2ff-4f40-81c9-0b341cd67cd9","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":98,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"bd77c959-4af3-409c-a99b-efdea8fa9d71","block_type":"box","text":"tax and regulatory risks, including changing laws and regulations, developing interpretations of such laws and","page_number":98,"box":{"x":68,"y":392,"width":781,"height":12}},{"id":"3bdda9e8-1da5-48f3-8878-594f3cc0ec42","block_type":"box","text":"regulations, as well as existing laws, and increased scrutiny by regulators and law enforcement authorities.","page_number":98,"box":{"x":69,"y":407,"width":763,"height":12}},{"id":"57a44a85-5196-4881-81c7-5df7ba0ee3ae","block_type":"box","text":"Unexpected economic, political, regulatory and diplomatic events within the United States and abroad can trigger new","page_number":98,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"7dd7ea48-77e3-413d-8ae9-954f92f3ec3c","block_type":"box","text":"and complex regulations that the Manager and/or the Funds may need to comply with. The implementation of","page_number":98,"box":{"x":69,"y":438,"width":781,"height":11}},{"id":"e9bcb59f-97fe-4037-97c1-2d72a381cb7d","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":98,"box":{"x":69,"y":453,"width":807,"height":11}},{"id":"67b83d42-f61b-4e99-aa69-7f2d4ef95d77","block_type":"box","text":"material adverse effect on the Funds (including by imposing material costs on the Funds, reducing profit margins,","page_number":98,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"199bd64a-554e-4b3b-a7e1-f935c15a35ca","block_type":"box","text":"reducing investment opportunities or by otherwise restricting the Funds and/or the Manager).","page_number":98,"box":{"x":69,"y":483,"width":666,"height":11}},{"id":"8f7fb976-49cb-4511-8026-5653a2933e19","block_type":"box","text":"Tariff and Trade Policy Risks.","page_number":98,"box":{"x":103,"y":506,"width":202,"height":11}},{"id":"ccaa96c2-7669-4920-b5bd-8a6702c9192e","block_type":"box","text":"Some countries, including the U.S., have adopted more protectionist trade policies.","page_number":98,"box":{"x":312,"y":506,"width":593,"height":11}},{"id":"061f3fd3-a0e3-4925-9191-aab12ae6bfab","block_type":"box","text":"The U.S. government recently altered its approach to international trade policy, resulting in significant impacts on","page_number":98,"box":{"x":68,"y":521,"width":806,"height":11}},{"id":"e8f05f45-b225-40df-a96e-882daa03a77d","block_type":"box","text":"international trade relations, certain tax and immigration policies, and other aspects of the national and international","page_number":98,"box":{"x":70,"y":536,"width":833,"height":11}},{"id":"735e6bd3-b808-4c74-ad93-f61c951683a2","block_type":"box","text":"political and financial landscape. The rise in protectionist trade policies, slowing economic growth, changes to some","page_number":98,"box":{"x":70,"y":551,"width":827,"height":11}},{"id":"28b0f658-12c5-4fec-b3e9-1c3a2253206b","block_type":"box","text":"major international trade agreements, risks associated with trade agreements between the U.S. and the European","page_number":98,"box":{"x":69,"y":566,"width":814,"height":11}},{"id":"730d5c61-0edc-4da1-9c3c-9468e48ccc66","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":98,"box":{"x":70,"y":581,"width":821,"height":12}},{"id":"72ea7199-3461-4ada-87a8-0cbb5632ec96","block_type":"box","text":"many nations in ways that cannot necessarily be foreseen at the present time.","page_number":98,"box":{"x":69,"y":596,"width":559,"height":12}},{"id":"c781ccd0-7528-41ea-a4fb-a36eb5f9f407","block_type":"box","text":"Global trade disruption, significant introductions of trade barriers, and bilateral trade frictions, together with any","page_number":98,"box":{"x":102,"y":619,"width":796,"height":11}},{"id":"41ea2ad8-d61f-49ae-a56b-6cbafe89bc20","block_type":"box","text":"future downturns in the global economy resulting therefrom, could adversely affect the financial performance of a","page_number":98,"box":{"x":68,"y":634,"width":809,"height":12}},{"id":"1ac4d2a7-99a2-4988-a801-867cbbc21224","block_type":"box","text":"Fund and its investments. Trade policy may be an ongoing source of instability, potentially resulting in significant","page_number":98,"box":{"x":70,"y":649,"width":799,"height":12}},{"id":"c876b50f-877c-4584-b522-793134556df0","block_type":"box","text":"currency fluctuations and/or having other adverse effects on international markets, international trade agreements,","page_number":98,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"83359289-9b1c-4da4-b0aa-4c94f25e741e","block_type":"box","text":"and/or other existing cross-border cooperation arrangements (whether economic, tax, fiscal, legal, regulatory, or","page_number":98,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"b465dce6-be95-4a9c-80b2-e1bdab692a36","block_type":"box","text":"otherwise). To the extent trade disputes escalate globally, there could be additional significant impacts on the","page_number":98,"box":{"x":69,"y":695,"width":783,"height":11}},{"id":"e2b00261-ca1e-46aa-b1a3-4b1f7133ce35","block_type":"box","text":"sectors or industries in which a Fund invests and other adverse impacts on a Fund’s overall performance.","page_number":98,"box":{"x":69,"y":710,"width":753,"height":11}},{"id":"2483b314-41b1-4251-b0cc-4633d5693629","block_type":"box","text":"Geographic Risks","page_number":98,"box":{"x":102,"y":733,"width":123,"height":11}},{"id":"ddd1d73b-2096-4702-b854-02ac41e42a54","block_type":"box","text":". Some of the companies in which the Fund invests may be located in, or otherwise connected","page_number":98,"box":{"x":226,"y":732,"width":671,"height":12}},{"id":"95dee414-36e2-4111-a99d-7a2da285932f","block_type":"box","text":"to, parts of the world affected by natural disasters such as severe heat, earthquakes, tornadoes, volcanic eruptions,","page_number":98,"box":{"x":68,"y":748,"width":835,"height":11}},{"id":"e36a1e95-9958-4a62-b341-4991593d3320","block_type":"box","text":"wildfires, droughts, floods, hurricanes or tsunamis, and are economically sensitive to environmental events. In","page_number":98,"box":{"x":68,"y":763,"width":787,"height":11}},{"id":"dfe121ae-65d6-460e-9a31-df0ff6deec12","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":98,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"37e4b100-dc7b-49a8-b9e3-a316f388ffdb","block_type":"box","text":"types of conflict, terrorism, strained international relations and territorial disputes. Any of these events may adversely","page_number":98,"box":{"x":68,"y":793,"width":840,"height":11}},{"id":"d4f528b5-8026-47e3-8ee6-dc0c4ffe80c6","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":98,"box":{"x":69,"y":808,"width":824,"height":11}},{"id":"17ea5a3c-0818-4e31-b46f-60b8afb6acc6","block_type":"box","text":"Fund.","page_number":98,"box":{"x":70,"y":823,"width":36,"height":9}},{"id":"64efaddf-f9cc-44e5-bd99-96f6e00fe072","block_type":"box","text":"Reference Rate Replacement Risk.","page_number":98,"box":{"x":102,"y":846,"width":255,"height":11}},{"id":"74b411c4-dda8-4bc0-a77d-40d58459b0fd","block_type":"box","text":"A Fund’s investments, payment obligations and financing terms may be","page_number":98,"box":{"x":363,"y":846,"width":508,"height":11}},{"id":"6cab4284-20d8-4cc6-a171-815361354262","block_type":"box","text":"based on floating rates, such as the Secured Overnight Financing Rate (“SOFR”), Sterling Overnight Interbank Average","page_number":98,"box":{"x":69,"y":861,"width":839,"height":11}},{"id":"b3425843-38c1-4c41-abdf-cca6d52698c6","block_type":"box","text":"Rate (“SONIA”), and other similar types of reference rates (“Reference Rates”). The elimination of a Reference Rate","page_number":98,"box":{"x":70,"y":876,"width":825,"height":11}},{"id":"cf0c8470-763e-4df6-ac71-02032f193e09","block_type":"box","text":"or any other changes or reforms to the determination or supervision of a Reference Rate could have an adverse","page_number":98,"box":{"x":69,"y":891,"width":797,"height":12}},{"id":"84cdc9a2-4db6-4169-8f70-ee1aaad65cdd","block_type":"box","text":"impact on the market for, or value of, any instruments (including debt instruments and certain derivative instruments)","page_number":98,"box":{"x":70,"y":906,"width":837,"height":12}},{"id":"7fe002cb-bed8-41d4-849f-f1e5b42d4710","block_type":"box","text":"II-68","page_number":98,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"59adc2c0-329f-4bd3-be3c-fe8de5444eb6","block_type":"box","text":"NM1026U-5979889-98/232","page_number":98,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ff66d4fa-358a-456c-8d52-b0b6696a9408","block_type":"box","text":"or payments linked to those Reference Rates. In addition, any substitute Reference Rate and any pricing adjustments","page_number":99,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"4f53e567-26f5-4d71-91d6-bae437b21387","block_type":"box","text":"imposed by a regulator or by counterparties or otherwise may adversely affect a Fund’s performance and/or net","page_number":99,"box":{"x":70,"y":60,"width":800,"height":11}},{"id":"3a71b30e-1056-4aec-94f0-1aa9f59656b7","block_type":"box","text":"asset value. The London Interbank Offered Rate (“LIBOR”) had historically been used extensively in the U.S. and","page_number":99,"box":{"x":69,"y":75,"width":800,"height":11}},{"id":"05e51ba5-3d5a-421c-a6a0-fabb82e955f0","block_type":"box","text":"globally as a “benchmark” or “reference rate” for various commercial and financial contracts, including corporate and","page_number":99,"box":{"x":68,"y":90,"width":836,"height":11}},{"id":"e6dacf28-044b-45b0-9e61-c065a8ca47e8","block_type":"box","text":"municipal bonds, bank loans, asset-backed and mortgage-related securities, interest rate swaps and other","page_number":99,"box":{"x":69,"y":105,"width":761,"height":11}},{"id":"d21dcfba-3e9a-4e30-810e-0b4bcb8aa71f","block_type":"box","text":"derivatives. Instruments in which a Fund may have historically paid interest at floating rates based on LIBOR or may","page_number":99,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"9e24b3e6-1e06-4a0d-a3f0-c137119e864f","block_type":"box","text":"have been subject to interest caps or floors based on LIBOR. The Funds and issuers of instruments in which a Fund","page_number":99,"box":{"x":69,"y":135,"width":825,"height":11}},{"id":"0d323311-9b1a-4252-a8f3-da22231a687d","block_type":"box","text":"invests may have also historically obtained financing at floating rates based on LIBOR. In connection with the global","page_number":99,"box":{"x":70,"y":150,"width":822,"height":12}},{"id":"1f15509b-daa7-455f-9643-22af7d5ccc9c","block_type":"box","text":"transition away from LIBOR led by regulators and market participants as a result of benchmark reforms, LIBOR was","page_number":99,"box":{"x":68,"y":166,"width":822,"height":11}},{"id":"02831e76-7d57-4ed3-8932-863f784d29e7","block_type":"box","text":"last published on a representative basis at the end of June 2023. Alternative Reference Rates to LIBOR have been","page_number":99,"box":{"x":70,"y":181,"width":817,"height":11}},{"id":"2f921837-139e-45cb-aae6-32c80686506a","block_type":"box","text":"established in most major currencies and markets in these alternative rates are continuing to develop (","page_number":99,"box":{"x":69,"y":196,"width":736,"height":11}},{"id":"21e079f2-ecfe-4852-9941-e5bd583d92fb","block_type":"box","text":"e.g.","page_number":99,"box":{"x":807,"y":197,"width":25,"height":10}},{"id":"629b944d-64b6-4b73-ad94-29a4009a63fd","block_type":"box","text":", SOFR for","page_number":99,"box":{"x":835,"y":196,"width":70,"height":10}},{"id":"ba3a236a-b7ae-4a38-8027-1df1a8e60c61","block_type":"box","text":"USD-LIBOR and SONIA for GBP-LIBOR). While the transition from LIBOR has gone relatively smoothly, residual risks","page_number":99,"box":{"x":70,"y":211,"width":814,"height":11}},{"id":"2e899612-4426-48a8-a742-c247e7a8e355","block_type":"box","text":"associated with the transition may remain that may impact markets or particular investments and, as such, the full","page_number":99,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"fe03b81d-40e1-4ec8-b44c-4390d6b84590","block_type":"box","text":"impact of the transition on the Funds or the financial instruments in which the Funds invest cannot yet be fully","page_number":99,"box":{"x":70,"y":241,"width":784,"height":11}},{"id":"6489107c-aa76-4c37-8d4b-bec0565ebdd3","block_type":"box","text":"determined.","page_number":99,"box":{"x":69,"y":257,"width":84,"height":8}},{"id":"b2216931-15b4-40bd-9a81-18305b047a2c","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":99,"box":{"x":102,"y":279,"width":750,"height":11}},{"id":"31eb693a-7c2a-4042-96a7-40ccc81fe307","block_type":"box","text":"collateralized by U.S. Treasury securities. SOFR is calculated based on transaction-level repo data collected from","page_number":99,"box":{"x":69,"y":294,"width":803,"height":11}},{"id":"4a904f70-ef68-4836-bd45-d4838688ce8c","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":99,"box":{"x":68,"y":309,"width":831,"height":11}},{"id":"51d9b824-3f03-4f1b-8d8b-3a92cb4a95da","block_type":"box","text":"Because SOFR is a financing rate based on overnight secured funding transactions, it differs fundamentally from","page_number":99,"box":{"x":70,"y":324,"width":801,"height":12}},{"id":"e9e26baf-5e1c-4acd-8115-b5634b24ef22","block_type":"box","text":"LIBOR. LIBOR is intended to be an unsecured rate that represents interbank funding costs for different short-term","page_number":99,"box":{"x":70,"y":339,"width":810,"height":12}},{"id":"d79413e6-2339-41d0-a07a-2fb061281c8c","block_type":"box","text":"maturities or tenors. It is a forward-looking rate reflecting expectations regarding interest rates for the applicable","page_number":99,"box":{"x":69,"y":355,"width":803,"height":11}},{"id":"3c2c03e0-ea87-40b9-8b6c-6dfd1c7b7815","block_type":"box","text":"tenor. Thus, LIBOR is intended to be sensitive, in certain respects, to bank credit risk and to term interest rate risk.","page_number":99,"box":{"x":68,"y":370,"width":825,"height":11}},{"id":"50958247-7c36-4781-9b80-9256428cbceb","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":99,"box":{"x":70,"y":385,"width":828,"height":11}},{"id":"fc09295f-d9e9-4694-bb9d-29048696173a","block_type":"box","text":"largely insensitive to credit-risk considerations and to short-term interest rate risks. SOFR is a transaction-based rate,","page_number":99,"box":{"x":70,"y":400,"width":838,"height":11}},{"id":"9973d365-5c43-4342-a0f2-98cd36e15d28","block_type":"box","text":"and it has been more volatile than other benchmark or market rates, such as three-month LIBOR, during certain","page_number":99,"box":{"x":69,"y":415,"width":796,"height":11}},{"id":"fe57e470-ff09-4428-8b8f-7dcee29447ac","block_type":"box","text":"periods. For these reasons, among others, there is no assurance that SOFR, or rates derived from SOFR, will perform","page_number":99,"box":{"x":70,"y":430,"width":836,"height":11}},{"id":"69763bc0-8b9c-4587-95e8-1a2e21a16141","block_type":"box","text":"in the same or similar way as LIBOR would have performed at any time, and there is no assurance that SOFR-based","page_number":99,"box":{"x":70,"y":445,"width":824,"height":11}},{"id":"981d3167-8bf1-4593-97f0-5dda987f33b4","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":99,"box":{"x":69,"y":460,"width":830,"height":12}},{"id":"23f2ea73-4d38-4a33-bc42-159302e5d0a9","block_type":"box","text":"2018. The future performance of SOFR, and SOFR-based Reference Rates, cannot be predicted based on SOFR’s","page_number":99,"box":{"x":69,"y":475,"width":809,"height":11}},{"id":"c5691505-bf72-44a8-aeb3-be63fd711ea6","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":99,"box":{"x":69,"y":491,"width":827,"height":11}},{"id":"655c2aae-8de6-4f47-9c43-289df8e49c22","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":99,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"5305a95f-ef03-4218-9726-40c2be00e9e5","block_type":"box","text":"that is materially adverse to the interests of the Fund.","page_number":99,"box":{"x":68,"y":521,"width":384,"height":11}},{"id":"5d401156-a76c-4afb-9838-8e646b3e2856","block_type":"box","text":"In addition, interest rates or other types of rates and indices which are classified as “benchmarks” have been","page_number":99,"box":{"x":102,"y":543,"width":782,"height":12}},{"id":"2dd72476-8729-4f53-876e-547e298cfaae","block_type":"box","text":"the subject of ongoing national and international regulatory reform, including under the European Union (“EU”)","page_number":99,"box":{"x":68,"y":559,"width":786,"height":11}},{"id":"69d6ecb9-8f01-4825-b09c-3c1fe5071676","block_type":"box","text":"regulation on indices used as benchmarks in financial instruments and financial contracts (known as the","page_number":99,"box":{"x":69,"y":574,"width":746,"height":11}},{"id":"c7eba4ab-6ad8-4f7a-a989-2750c25c1df1","block_type":"box","text":"“Benchmarks Regulation”). The Benchmarks Regulation has been enacted into United Kingdom (“UK”) law by virtue","page_number":99,"box":{"x":70,"y":589,"width":822,"height":11}},{"id":"16c2be6d-9321-4236-848c-df45b419a616","block_type":"box","text":"of the EU (Withdrawal) Act 2018 (as amended), subject to amendments made by the Benchmarks (Amendment and","page_number":99,"box":{"x":69,"y":604,"width":821,"height":11}},{"id":"907947bc-e00d-479a-a002-33d7abf7193e","block_type":"box","text":"Transitional Provision) (EU Exit) Regulations 2019 (SI 2019/657) and other statutory instruments. Following the","page_number":99,"box":{"x":68,"y":619,"width":799,"height":11}},{"id":"7ba02537-d943-4adc-aa01-dcc09a8df44b","block_type":"box","text":"implementation of these reforms, the manner of administration of benchmarks has changed and may further change","page_number":99,"box":{"x":70,"y":634,"width":830,"height":12}},{"id":"efeb21b9-eb63-4ed3-963a-f8dd519120c2","block_type":"box","text":"in the future, with the result that relevant benchmarks may perform differently than in the past, the use of","page_number":99,"box":{"x":70,"y":649,"width":757,"height":12}},{"id":"f96e2fdf-32a9-4c80-9768-ac7db961b6e2","block_type":"box","text":"benchmarks that are not compliant with the new standards by certain supervised entities may be restricted, and","page_number":99,"box":{"x":69,"y":665,"width":802,"height":11}},{"id":"4ae61f91-ef1a-44d5-ae4a-cfc8372f6ddb","block_type":"box","text":"certain benchmarks may be eliminated entirely. Such changes could cause increased market volatility and disruptions","page_number":99,"box":{"x":69,"y":680,"width":840,"height":11}},{"id":"1348c11a-281b-45a4-bb6f-79c193b4f698","block_type":"box","text":"in liquidity for instruments that rely on or are impacted by such benchmarks. Additionally, there could be other","page_number":99,"box":{"x":70,"y":695,"width":782,"height":11}},{"id":"b616a41d-d77a-4bbd-9b48-cc9c13e1ed9a","block_type":"box","text":"consequences which cannot be predicted.","page_number":99,"box":{"x":69,"y":710,"width":298,"height":11}},{"id":"d5f2de17-d410-4056-87bc-fc7c32facb53","block_type":"box","text":"Repurchase Agreements and Purchase and Sale Contracts.","page_number":99,"box":{"x":102,"y":733,"width":432,"height":11}},{"id":"1320d18b-9fb4-425c-bdd4-d9676f1e3541","block_type":"box","text":"Under repurchase agreements and purchase and","page_number":99,"box":{"x":541,"y":733,"width":347,"height":11}},{"id":"2978fef7-57f4-41f6-b96e-8970b8c799a4","block_type":"box","text":"sale contracts, the other party agrees, upon entering into the contract with a Fund, to repurchase a security sold to","page_number":99,"box":{"x":69,"y":748,"width":821,"height":11}},{"id":"42cac7cf-94b8-4e23-b8d3-17d72c32eb0f","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":99,"box":{"x":68,"y":763,"width":815,"height":11}},{"id":"381bd9cc-3863-4e27-a246-60c4e1a10218","block_type":"box","text":"term of the agreement.","page_number":99,"box":{"x":68,"y":778,"width":164,"height":11}},{"id":"68be319c-1f31-4ba5-a0ee-ca61441f2ee5","block_type":"box","text":"A purchase and sale contract differs from a repurchase agreement in that the contract arrangements stipulate","page_number":99,"box":{"x":101,"y":801,"width":788,"height":11}},{"id":"ccd2168f-5c51-42ea-be12-0e5a7ea074f0","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":99,"box":{"x":68,"y":816,"width":831,"height":11}},{"id":"8607aa0f-0518-4d75-a702-90a682932c44","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":99,"box":{"x":70,"y":831,"width":821,"height":11}},{"id":"576e6079-99b0-492c-86e3-03c4c30dcb8e","block_type":"box","text":"on the underlying obligation; whereas, in the case of purchase and sale contracts, the prices take into account","page_number":99,"box":{"x":69,"y":846,"width":790,"height":11}},{"id":"f8819452-9579-4bbe-9e25-86d5fec181c9","block_type":"box","text":"accrued interest. A Fund may enter into “tri-party” repurchase agreements. In “tri-party” repurchase agreements, an","page_number":99,"box":{"x":69,"y":861,"width":827,"height":11}},{"id":"209d37a0-790a-4f5b-be5b-8d94d5d091c1","block_type":"box","text":"unaffiliated third-party custodian maintains accounts to hold collateral for the Fund and its counterparties and,","page_number":99,"box":{"x":69,"y":876,"width":788,"height":11}},{"id":"eff57aaa-835d-4f9c-8fe5-df3ef5d732b2","block_type":"box","text":"therefore, the Fund may be subject to the credit risk of those custodians.","page_number":99,"box":{"x":68,"y":891,"width":522,"height":11}},{"id":"ed1a9d16-005c-4503-b1f8-482c5e993c54","block_type":"box","text":"II-69","page_number":99,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1012d0dd-3493-455e-ad5d-13ef6b0080b5","block_type":"box","text":"NM1026U-5979889-99/232","page_number":99,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"70bf5812-8b27-4f5f-9475-cd7e4da2de6a","block_type":"box","text":"Some repurchase agreements and purchase and sale contracts are structured to result in a fixed rate of return","page_number":100,"box":{"x":102,"y":45,"width":792,"height":11}},{"id":"ad79605b-6b73-4839-9bc8-8eea0d48de6c","block_type":"box","text":"insulated from market fluctuations during the term of the agreement, although such return may be affected by","page_number":100,"box":{"x":70,"y":60,"width":784,"height":11}},{"id":"e7f6eccf-bda1-4f85-98bd-c3f33b1ac995","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":100,"box":{"x":69,"y":75,"width":837,"height":11}},{"id":"3ce14da3-8108-42c7-bcd5-397b4c955306","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":100,"box":{"x":69,"y":90,"width":812,"height":11}},{"id":"227f600f-aed0-453d-bd67-f17a6eaf4c69","block_type":"box","text":"fluctuations of the market values of the securities underlying the contract and the accrued interest on those","page_number":100,"box":{"x":68,"y":105,"width":770,"height":11}},{"id":"35d24868-e1ce-4aba-acf1-5bc9144d1b97","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":100,"box":{"x":69,"y":120,"width":802,"height":12}},{"id":"99626f35-635a-4825-a474-498cdc1f2108","block_type":"box","text":"losses arising from market fluctuations following the default.","page_number":100,"box":{"x":70,"y":135,"width":430,"height":12}},{"id":"aab35c4e-af6e-4e8e-97e2-afe1381b2444","block_type":"box","text":"Both types of agreement usually cover short periods, such as less than one week, although they may have","page_number":100,"box":{"x":102,"y":158,"width":759,"height":11}},{"id":"a74e83b8-b746-4833-9b61-4067b49a959f","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":100,"box":{"x":70,"y":173,"width":765,"height":11}},{"id":"03af01ed-1a52-45cb-8006-b6b51c72672c","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":100,"box":{"x":69,"y":188,"width":835,"height":12}},{"id":"5d35eb85-8090-42e1-95bb-077c64e2e945","block_type":"box","text":"sub-adviser will monitor the creditworthiness of the seller, and a Fund will require the seller to provide additional","page_number":100,"box":{"x":69,"y":203,"width":799,"height":11}},{"id":"28993d3f-53f1-427d-9623-0cad8e8c4f9e","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":100,"box":{"x":69,"y":218,"width":801,"height":12}},{"id":"b2e6c1ab-94df-4e59-a440-a855f36ba0e1","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":100,"box":{"x":69,"y":234,"width":826,"height":11}},{"id":"cfa7bc58-f36e-44eb-824c-1488a925d0ec","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":100,"box":{"x":70,"y":249,"width":831,"height":11}},{"id":"75b56f3e-6fed-480e-8946-fecf7a7afba0","block_type":"box","text":"Securities subject to repurchase agreements (other than tri-party repurchase agreements) and purchase and sale","page_number":100,"box":{"x":69,"y":264,"width":810,"height":11}},{"id":"f4fb065e-97fe-4f9a-b2af-026a7a37f060","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":100,"box":{"x":69,"y":279,"width":829,"height":11}},{"id":"71914f14-1e7d-4858-a6f5-227003c5da1d","block_type":"box","text":"or by another authorized securities depository.","page_number":100,"box":{"x":69,"y":294,"width":329,"height":11}},{"id":"2da78a1e-2292-4d58-bbd9-11cace128393","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":100,"box":{"x":102,"y":317,"width":770,"height":11}},{"id":"a4a980ed-531a-4d86-838c-fe8f33da0144","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":100,"box":{"x":69,"y":332,"width":805,"height":11}},{"id":"c57d2a86-b6fd-4a4e-b5b1-feca18f96f19","block_type":"box","text":"repurchase price. Therefore, the Fund may suffer time delays and incur costs or possible losses in connection with","page_number":100,"box":{"x":69,"y":347,"width":819,"height":11}},{"id":"4114a148-b6f0-44ab-bbf5-6a268cc36b93","block_type":"box","text":"disposition of the collateral. If the seller becomes insolvent and subject to liquidation or reorganization under","page_number":100,"box":{"x":69,"y":362,"width":778,"height":11}},{"id":"098d2102-5858-4662-acc8-2d710903e2d5","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":100,"box":{"x":69,"y":377,"width":832,"height":12}},{"id":"3d8fd8bf-4310-467d-984c-3c8606affa70","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":100,"box":{"x":70,"y":393,"width":810,"height":11}},{"id":"c5b2ad30-cd8f-4c07-b99f-7e04ea31460b","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":100,"box":{"x":69,"y":408,"width":812,"height":11}},{"id":"866852c3-8302-4f08-bb5f-771b2dd91629","block_type":"box","text":"amount at least equal to the repurchase price, including accrued interest. If the seller fails to repurchase the","page_number":100,"box":{"x":69,"y":423,"width":778,"height":11}},{"id":"060e9608-9cef-490f-bd10-3b29f47ddca2","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":100,"box":{"x":69,"y":438,"width":817,"height":11}},{"id":"23498105-bbf3-4328-b522-9cc2a176bf0f","block_type":"box","text":"the repurchase price.","page_number":100,"box":{"x":68,"y":453,"width":151,"height":11}},{"id":"0702ebfd-0e2a-4c5f-aea1-9f9a57b75463","block_type":"box","text":"In any repurchase transaction to which a Fund is a party, collateral for a repurchase agreement may include cash","page_number":100,"box":{"x":102,"y":475,"width":805,"height":12}},{"id":"b3ab7067-c19d-40f8-8ba7-0a9420ea8398","block_type":"box","text":"items and obligations issued by the U.S. Government or its agencies or instrumentalities. For certain Funds, however,","page_number":100,"box":{"x":70,"y":491,"width":837,"height":11}},{"id":"23e8c9db-d56e-4aac-aaa6-45f0650e3830","block_type":"box","text":"collateral may include instruments other than cash items and obligations issued by the U.S. Government or its","page_number":100,"box":{"x":69,"y":506,"width":788,"height":11}},{"id":"fcafd1bd-bd9c-44c7-ba7f-ab2d144f0af5","block_type":"box","text":"agencies or instrumentalities, including securities that the Fund could not hold directly under its investment","page_number":100,"box":{"x":69,"y":521,"width":767,"height":11}},{"id":"77d1fd9d-fce2-4a76-9381-30bdcc2e3f08","block_type":"box","text":"strategies without the repurchase obligation.","page_number":100,"box":{"x":69,"y":536,"width":317,"height":11}},{"id":"1e7bc2ef-a5cc-4e18-9a7f-1dd505ac9f8e","block_type":"box","text":"The type of collateral underlying repurchase agreements may also pose certain risks for a Fund. Lower quality","page_number":100,"box":{"x":101,"y":559,"width":782,"height":11}},{"id":"69e14919-8b45-4eb8-b329-eea77efd6d46","block_type":"box","text":"collateral and collateral with longer maturities may be subject to greater price fluctuations than higher quality","page_number":100,"box":{"x":69,"y":574,"width":776,"height":11}},{"id":"32769f69-e1ca-41d3-ac1b-9729b5ee2447","block_type":"box","text":"collateral and collateral with shorter maturities. If the repurchase agreement counterparty were to default, lower","page_number":100,"box":{"x":69,"y":589,"width":799,"height":11}},{"id":"dac5c717-1584-4029-b8d5-fd750a820342","block_type":"box","text":"quality collateral may be more difficult to liquidate than higher quality collateral. Should the counterparty default and","page_number":100,"box":{"x":69,"y":604,"width":829,"height":11}},{"id":"0a037a30-6cd1-4206-b938-fa17e3928c54","block_type":"box","text":"the amount of collateral not be sufficient to cover the counterparty’s repurchase obligation, a Fund would retain the","page_number":100,"box":{"x":68,"y":619,"width":825,"height":11}},{"id":"8705f7da-fd9c-4a4a-88cc-43c426e15ed8","block_type":"box","text":"status of an unsecured creditor of the counterparty (","page_number":100,"box":{"x":69,"y":634,"width":374,"height":11}},{"id":"b7dd6b7d-837d-4e1a-b81e-5b5bd20b3e91","block_type":"box","text":"i.e.","page_number":100,"box":{"x":445,"y":634,"width":20,"height":9}},{"id":"6b4b2d37-46b5-4a8f-847e-78ed8afa4f37","block_type":"box","text":", the position the Fund would normally be in if it were to hold,","page_number":100,"box":{"x":468,"y":634,"width":434,"height":11}},{"id":"abe268ad-4a30-4500-af41-e4977052e2ea","block_type":"box","text":"pursuant to its investment policies, other unsecured debt securities of the defaulting counterparty) with respect to","page_number":100,"box":{"x":70,"y":649,"width":813,"height":12}},{"id":"0aabb6ca-4469-41c8-b884-59bc04f6b2e0","block_type":"box","text":"the amount of the shortfall. As an unsecured creditor, a Fund would be at risk of losing some or all of the principal","page_number":100,"box":{"x":68,"y":664,"width":816,"height":12}},{"id":"db497204-9270-4bb7-9af7-98a71bd93daa","block_type":"box","text":"and income involved in the transaction.","page_number":100,"box":{"x":69,"y":680,"width":278,"height":9}},{"id":"3b72ca8a-63bb-467a-a268-181e2bfbf827","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and certain of","page_number":100,"box":{"x":102,"y":702,"width":800,"height":12}},{"id":"78f84144-17e4-4d53-a0d1-13c84d3be34d","block_type":"box","text":"their affiliates to include in certain financial contracts, including many repurchase agreements and purchase and sale","page_number":100,"box":{"x":68,"y":717,"width":840,"height":12}},{"id":"e73a936a-f676-4314-aeb6-b404b3101a2c","block_type":"box","text":"contracts, terms that delay or restrict the rights of counterparties, such as a Fund, to terminate such agreements,","page_number":100,"box":{"x":69,"y":732,"width":814,"height":12}},{"id":"ddfae008-d2b9-4b54-a1b0-e36717b40b01","block_type":"box","text":"take foreclosure action, exercise other default rights or restrict transfers of credit support in the event that the","page_number":100,"box":{"x":68,"y":748,"width":790,"height":11}},{"id":"633b62ca-48b8-4ab8-9b64-a8b26ff7691f","block_type":"box","text":"counterparty and/or its affiliates are subject to certain types of resolution or insolvency proceedings. It is possible","page_number":100,"box":{"x":69,"y":763,"width":818,"height":11}},{"id":"8cce6550-4a0b-4d3a-927e-f792686123fb","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":100,"box":{"x":68,"y":778,"width":783,"height":11}},{"id":"ad7072e9-8abd-41d6-a53c-d09230c3a936","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing repurchase agreements and purchase and sale","page_number":100,"box":{"x":69,"y":793,"width":821,"height":11}},{"id":"5d8c2afb-f59a-4067-8368-6cd4a27f9d28","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":100,"box":{"x":69,"y":808,"width":800,"height":11}},{"id":"4d000d8a-5586-47ea-a31a-9f614fcff83c","block_type":"box","text":"require certain transactions involving U.S. Treasuries, including repurchase agreements, to be centrally cleared.","page_number":100,"box":{"x":69,"y":823,"width":796,"height":12}},{"id":"d0a6a0ae-0d81-49cf-8e0e-df6f75f7bd7b","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":100,"box":{"x":69,"y":838,"width":834,"height":12}},{"id":"663aa149-74c3-4d66-a7a4-7e168c059053","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":100,"box":{"x":68,"y":853,"width":824,"height":12}},{"id":"2c1c873b-3aa6-4343-920d-d59ba68fcee2","block_type":"box","text":"adversely affect a Fund’s performance.","page_number":100,"box":{"x":69,"y":869,"width":279,"height":11}},{"id":"e5ac0f6f-e014-4ad9-8ce4-8ef98b88b5af","block_type":"box","text":"Restricted Securities.","page_number":100,"box":{"x":102,"y":891,"width":157,"height":9}},{"id":"9b9466fc-5074-4950-815c-5d6f2dc81a6e","block_type":"box","text":"A Fund may invest in or hold securities that are not registered under the Securities Act","page_number":100,"box":{"x":265,"y":891,"width":617,"height":12}},{"id":"51107b78-20ac-4e3a-82dc-4a6544b4c9c9","block_type":"box","text":"(“restricted securities”), which may include securities in private companies and Rule 144A Securities. Restricted","page_number":100,"box":{"x":69,"y":906,"width":801,"height":12}},{"id":"096b224e-0b31-4cbc-b40f-85d97652259d","block_type":"box","text":"II-70","page_number":100,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"a40c5318-afa2-43e1-a504-795bec9e8aa6","block_type":"box","text":"NM1026U-5979889-100/232","page_number":100,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"992d57f5-80f6-456e-928e-02282c0f5a99","block_type":"box","text":"securities may be sold in private placement transactions between issuers and their purchasers, including through","page_number":101,"box":{"x":69,"y":45,"width":808,"height":11}},{"id":"49b06deb-37b2-4016-af05-a60722bc8593","block_type":"box","text":"private negotiated transactions between the issuer and their purchasers, such as the Funds, and may be neither","page_number":101,"box":{"x":70,"y":60,"width":802,"height":11}},{"id":"49917436-5973-46e2-94cd-bc24f0607133","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":101,"box":{"x":70,"y":75,"width":834,"height":11}},{"id":"8db17649-1a94-4e18-a5f0-42b4f6b51ef9","block_type":"box","text":"freely transferable under the laws of the applicable jurisdiction or due to contractual restrictions on resale. Some of","page_number":101,"box":{"x":68,"y":90,"width":825,"height":11}},{"id":"f4b1d7e7-c55a-4cfb-a2ed-886d05cf5f29","block_type":"box","text":"these securities are new and complex, and trade only among institutions; the markets for these securities are still","page_number":101,"box":{"x":68,"y":105,"width":815,"height":11}},{"id":"48e9b3ef-81e9-4ca3-b73c-0a9209846681","block_type":"box","text":"developing, and may not function as efficiently as established markets. Typically, investments in private companies","page_number":101,"box":{"x":69,"y":120,"width":821,"height":12}},{"id":"afd886c2-6c47-4c0c-97dc-4a0f50d479d2","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":101,"box":{"x":69,"y":136,"width":831,"height":11}},{"id":"c1c3f5fd-6708-47a0-8075-bb069d1e5eae","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":101,"box":{"x":70,"y":150,"width":824,"height":12}},{"id":"116c9d92-54b1-4da1-90a4-c00210f9eb6c","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":101,"box":{"x":69,"y":166,"width":834,"height":11}},{"id":"00eb7920-dde3-4ad4-9146-b07077b6e211","block_type":"box","text":"a result of the absence of a public trading market and the potential bespoke nature on certain transactions,","page_number":101,"box":{"x":69,"y":181,"width":769,"height":11}},{"id":"e00416f4-b8c3-4b17-a504-8e0419e4b6d1","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":101,"box":{"x":69,"y":196,"width":838,"height":11}},{"id":"e86a56a0-4a21-4024-b7d2-7edad2e1cfc9","block_type":"box","text":"value than publicly traded securities. To the extent that restricted securities may be resold in privately negotiated","page_number":101,"box":{"x":68,"y":211,"width":805,"height":11}},{"id":"83b0e6c8-c1b1-446b-b986-d7b28cc84592","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":101,"box":{"x":68,"y":226,"width":840,"height":11}},{"id":"bdfd7697-6e87-4c5c-9156-74cbdf56d397","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":101,"box":{"x":70,"y":241,"width":815,"height":11}},{"id":"cd29f77e-f9df-4684-9a1a-b6883be536cb","block_type":"box","text":"character of the issuer, which party (if any) will bear the expenses of registering the restricted security, and prevailing","page_number":101,"box":{"x":69,"y":256,"width":835,"height":12}},{"id":"7c64e26b-023b-4288-8a41-6cdce246f264","block_type":"box","text":"market conditions. In addition, issuers whose securities are not publicly traded or who are not otherwise publicly","page_number":101,"box":{"x":69,"y":272,"width":803,"height":11}},{"id":"f85421ae-dc49-4323-8a63-e2e845f98895","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":101,"box":{"x":70,"y":286,"width":830,"height":12}},{"id":"099c2d3a-b6d7-4130-9c3c-c2f8d784aeb5","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":101,"box":{"x":69,"y":302,"width":817,"height":11}},{"id":"802e87bf-1262-47dd-b6b0-323da99843d1","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":101,"box":{"x":68,"y":317,"width":825,"height":11}},{"id":"bfa8b648-06cc-46cd-bf5f-1c18e1b29b94","block_type":"box","text":"of registration. Where registration is required for restricted securities, a considerable time period may elapse","page_number":101,"box":{"x":69,"y":332,"width":777,"height":11}},{"id":"945d9bb0-5028-4c00-95ae-3757382aac0a","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":101,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"2cc6b420-62a5-4e4e-afd0-e16dc5d5999f","block_type":"box","text":"an effective registration statement. If during such period, adverse market conditions were to develop, the Fund might","page_number":101,"box":{"x":69,"y":362,"width":834,"height":11}},{"id":"25c9c5ae-4fc0-47d9-b613-299a004b6255","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":101,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"8ad40c9d-258c-428f-bdff-f074ea7f760f","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":101,"box":{"x":69,"y":392,"width":836,"height":12}},{"id":"fd86aa06-20e0-42a2-b520-5c18d0262335","block_type":"box","text":"to purchasers of the restricted securities if the registration statement prepared by the issuer, or the corresponding","page_number":101,"box":{"x":68,"y":407,"width":819,"height":12}},{"id":"44924f76-c039-4f8d-ae3c-ed748a1302f2","block_type":"box","text":"prospectus, is materially inaccurate or misleading. Transactions in restricted securities may entail other transaction","page_number":101,"box":{"x":70,"y":423,"width":822,"height":11}},{"id":"19d31f4b-0509-4dea-b318-af8d1ec81ab0","block_type":"box","text":"costs that are higher than those for transactions in unrestricted securities. Certain of the Fund’s investments in","page_number":101,"box":{"x":69,"y":438,"width":798,"height":11}},{"id":"035afa39-ccd4-4403-9322-a44565614389","block_type":"box","text":"private placements may consist of direct investments and may include investments in smaller, less seasoned","page_number":101,"box":{"x":70,"y":453,"width":780,"height":11}},{"id":"3b04ca73-875b-483e-b11f-31933d3a70d5","block_type":"box","text":"issuers, which may involve greater risks. Issuers of restricted securities may not be subject to SEC reporting","page_number":101,"box":{"x":70,"y":468,"width":773,"height":11}},{"id":"4db841a2-7a05-4fd2-b7ff-bab2b561205c","block_type":"box","text":"requirements, may not be required to maintain their accounting records in accordance with generally accepted","page_number":101,"box":{"x":69,"y":483,"width":784,"height":11}},{"id":"336db229-567b-4c08-ad28-72ee8da3f67a","block_type":"box","text":"accounting principles, and may not be required to maintain effective internal controls over financial reporting. As a","page_number":101,"box":{"x":69,"y":498,"width":816,"height":11}},{"id":"11ec0e9d-e45b-4573-aa49-9479434962fe","block_type":"box","text":"result, BlackRock may not have timely or accurate information about the business, financial condition and results of","page_number":101,"box":{"x":69,"y":513,"width":828,"height":11}},{"id":"10c4bcf5-8452-4dd3-a00f-3b4e6a90a633","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":101,"box":{"x":69,"y":528,"width":831,"height":12}},{"id":"8d67ffce-eacb-46e6-afa6-1a94a8101e17","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":101,"box":{"x":68,"y":543,"width":804,"height":12}},{"id":"9079de01-dac4-462e-a1aa-43ac238ff9ad","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":101,"box":{"x":69,"y":559,"width":647,"height":11}},{"id":"5dedefd2-4d57-439a-9af3-40e082ead3b3","block_type":"box","text":"Certain restricted securities may represent limited investment opportunities and each shareholder’s","page_number":101,"box":{"x":102,"y":581,"width":714,"height":11}},{"id":"3e000533-f4cf-4ab0-a11b-06f1ae40b03f","block_type":"box","text":"proportionate investment exposure to such limited investment opportunities may be reduced proportionately as the","page_number":101,"box":{"x":70,"y":597,"width":823,"height":11}},{"id":"3eb89ef8-3b94-4bbf-9549-696506c630d6","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":101,"box":{"x":70,"y":612,"width":826,"height":11}},{"id":"dcef8950-7eed-4d1d-95de-8c1d2c631d65","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":101,"box":{"x":70,"y":627,"width":830,"height":11}},{"id":"b44af2ad-7021-4c86-85b0-95ec037d2861","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":101,"box":{"x":69,"y":642,"width":812,"height":11}},{"id":"77b357a4-ac64-45fe-8f24-665f11a1587e","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":101,"box":{"x":69,"y":657,"width":787,"height":11}},{"id":"0f11e70b-5b5f-42f9-a6a5-2d9d61018c03","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":101,"box":{"x":69,"y":672,"width":833,"height":11}},{"id":"9154cc77-370b-4c5e-a3b6-8a415fb0e885","block_type":"box","text":"offer other liquidity opportunities to the Fund and other investors will extend the holding period of a Fund’s","page_number":101,"box":{"x":69,"y":687,"width":759,"height":11}},{"id":"a49a5dc4-5192-4153-b39d-f582f1ce2ba6","block_type":"box","text":"investments, potentially indefinitely, and may adversely affect the value of the investments. In making investments in","page_number":101,"box":{"x":70,"y":702,"width":833,"height":12}},{"id":"22f5c3a6-12f7-4c1d-aab5-4b04af8685af","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":101,"box":{"x":69,"y":717,"width":828,"height":12}},{"id":"47143e6c-fb99-407d-ada6-edc44f6a693f","block_type":"box","text":"conduct portfolio transactions in such securities. The activity of identifying, completing, and realizing upon attractive","page_number":101,"box":{"x":69,"y":732,"width":827,"height":12}},{"id":"b506be6a-5904-454a-b435-97146be83b82","block_type":"box","text":"investments in restricted securities is highly competitive and involves a high degree of uncertainty. A Fund will be","page_number":101,"box":{"x":70,"y":748,"width":804,"height":11}},{"id":"3c876e8f-dcb3-4b7a-939f-bde4f1a0fcaf","block_type":"box","text":"competing for investments against other similarly situated investors. It is possible that competition for appropriate","page_number":101,"box":{"x":69,"y":763,"width":816,"height":11}},{"id":"dd8f1a4a-8ec9-4597-b224-6a0afa2950b9","block_type":"box","text":"investment opportunities may increase, thus potentially reducing the number of investment opportunities available to","page_number":101,"box":{"x":70,"y":778,"width":835,"height":11}},{"id":"f496aa26-8165-478f-95c3-6c00e853b2c7","block_type":"box","text":"a Fund and adversely affecting the terms upon which investments can be made. There is no assurance that","page_number":101,"box":{"x":69,"y":793,"width":768,"height":11}},{"id":"026c4a36-c993-4e6a-9859-332c03cc57b8","block_type":"box","text":"investment opportunities for restricted securities will be available at any given time or at a level desired by a Fund,","page_number":101,"box":{"x":70,"y":808,"width":815,"height":11}},{"id":"42c484ac-a0fd-44a6-aaec-2b1e96f6bbd0","block_type":"box","text":"especially as that Fund grows in size.","page_number":101,"box":{"x":69,"y":823,"width":264,"height":12}},{"id":"3b47ae9e-0e11-4448-a243-58cd195f32d7","block_type":"box","text":"There may not be a readily available market value for a Fund’s restricted securities (in particular, restricted","page_number":101,"box":{"x":101,"y":846,"width":762,"height":11}},{"id":"085a507c-c670-40da-98c6-9d15748a68a7","block_type":"box","text":"securities issued by private companies) and thus they may be considered “illiquid”. Each Fund values restricted","page_number":101,"box":{"x":69,"y":861,"width":795,"height":11}},{"id":"e967e621-9c32-4f82-af47-6ca3ac7eaec7","block_type":"box","text":"securities in accordance with BlackRock’s valuation policies and procedures, which are designed to value","page_number":101,"box":{"x":69,"y":876,"width":751,"height":11}},{"id":"efc7dd33-8343-43dd-89c8-60c2060bbe7d","block_type":"box","text":"investments such that they accurately reflect fair value. Due to the inherent uncertainty and subjectivity of","page_number":101,"box":{"x":70,"y":891,"width":755,"height":11}},{"id":"18ee76b1-4603-4958-bae2-ca991d358079","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":101,"box":{"x":69,"y":906,"width":830,"height":12}},{"id":"21613e14-b361-44e7-a186-8c4dd49773f5","block_type":"box","text":"II-71","page_number":101,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d19d79ca-570f-436d-8af0-07625580bed0","block_type":"box","text":"NM1026U-5979889-101/232","page_number":101,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f8858334-9218-41ab-92ee-2e4403784884","block_type":"box","text":"private investments may differ significantly from the values that would have been used had a readily available market","page_number":102,"box":{"x":70,"y":45,"width":835,"height":11}},{"id":"029d776f-1e9b-4760-acef-933dab783348","block_type":"box","text":"value existed for such investments and may differ materially from the amounts the Fund may realize on any","page_number":102,"box":{"x":68,"y":60,"width":766,"height":11}},{"id":"e81cfa38-2cb3-471b-8e3b-b2baa169d71b","block_type":"box","text":"dispositions of such investments. Differences in the value of the Fund’s private investments could result in the","page_number":102,"box":{"x":69,"y":75,"width":792,"height":11}},{"id":"3f1a1651-068a-48a5-a5fd-6ec7098942cd","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":102,"box":{"x":70,"y":90,"width":821,"height":11}},{"id":"189ae3bb-8237-4e09-919b-e47198430ba7","block_type":"box","text":"Fund’s portfolio, potentially resulting in the dilution of shareholder interests and increasing opportunities for","page_number":102,"box":{"x":70,"y":105,"width":771,"height":11}},{"id":"ebf121c9-8b12-4909-99e5-69f0b10dca01","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":102,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"55ff4617-227e-413f-8ef3-32a296fedcec","block_type":"box","text":"by other investment companies and investors to price the same restricted securities. In addition, the impact of","page_number":102,"box":{"x":69,"y":135,"width":790,"height":11}},{"id":"ed290d72-ff59-4d08-a0d8-ff849bc5fc53","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":102,"box":{"x":69,"y":150,"width":828,"height":12}},{"id":"28943b76-d3e3-40c2-8c95-49ed2b037f57","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":102,"box":{"x":69,"y":166,"width":810,"height":11}},{"id":"2b121b55-c731-4dce-96e0-6e72d89e09c3","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":102,"box":{"x":70,"y":181,"width":818,"height":11}},{"id":"f3e98680-654b-4484-a9dd-df9c572d75d0","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":102,"box":{"x":68,"y":196,"width":839,"height":11}},{"id":"6dfad893-9893-4909-b427-6ce5d3ace0d7","block_type":"box","text":"that the Fund ultimately realizes upon the disposal of such investments.","page_number":102,"box":{"x":68,"y":211,"width":514,"height":11}},{"id":"68d686f9-ecab-461e-a578-e830dc26e3c3","block_type":"box","text":"See also risks discussed under “Illiquid Investments.”","page_number":102,"box":{"x":102,"y":234,"width":385,"height":11}},{"id":"d977f3ac-6ba6-477a-bc3c-27aa1756551c","block_type":"box","text":"Reverse Repurchase Agreements.","page_number":102,"box":{"x":102,"y":257,"width":246,"height":10}},{"id":"72aeadbf-c9e6-4949-a7dd-0facfd9a6831","block_type":"box","text":"A Fund may enter into reverse repurchase agreements with the same parties","page_number":102,"box":{"x":354,"y":257,"width":548,"height":11}},{"id":"bee6bbfe-58b5-4b37-bff6-df9fc3a61f3b","block_type":"box","text":"with whom it may enter into repurchase agreements. Under a reverse repurchase agreement, a Fund sells securities","page_number":102,"box":{"x":68,"y":272,"width":830,"height":11}},{"id":"3d71edbc-cd11-44e3-9416-a95346c69889","block_type":"box","text":"to another party and agrees to repurchase them at a particular date and price. A Fund may enter into a reverse","page_number":102,"box":{"x":68,"y":287,"width":793,"height":11}},{"id":"a0d28f3e-c29e-4bd1-8dc6-5d651e0dc134","block_type":"box","text":"repurchase agreement when it is anticipated that the interest income to be earned from the investment of the","page_number":102,"box":{"x":69,"y":302,"width":784,"height":11}},{"id":"7e0b158b-28f7-45f1-8f64-288a6d1a4f01","block_type":"box","text":"proceeds of the transaction is greater than the interest expense of the transaction.","page_number":102,"box":{"x":70,"y":317,"width":591,"height":11}},{"id":"c5eaed98-bc02-42f4-bbef-9a576931337f","block_type":"box","text":"The use of reverse repurchase agreements may be regarded as leveraging and, therefore, speculative.","page_number":102,"box":{"x":101,"y":339,"width":730,"height":12}},{"id":"79becf53-2aa7-4887-bda3-2cd397b1951d","block_type":"box","text":"Furthermore, reverse repurchase agreements involve the risks that (i) the interest income earned in the investment","page_number":102,"box":{"x":70,"y":355,"width":822,"height":11}},{"id":"701c1024-796d-40ca-821b-2a7a639240a4","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":102,"box":{"x":69,"y":370,"width":821,"height":11}},{"id":"145b7adb-2de6-4253-b206-3780a5980698","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":102,"box":{"x":69,"y":385,"width":801,"height":11}},{"id":"ea8db048-8ca1-415b-919c-91d27b9c45c5","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":102,"box":{"x":69,"y":400,"width":830,"height":11}},{"id":"865287d4-bc9e-4cf4-9380-2b4e18bbb33f","block_type":"box","text":"(iv) the securities will not be returned to the Fund.","page_number":102,"box":{"x":69,"y":415,"width":354,"height":11}},{"id":"96e4fb73-d07e-46ce-9588-b3067cbd6a3e","block_type":"box","text":"In addition, if the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes","page_number":102,"box":{"x":102,"y":438,"width":769,"height":11}},{"id":"c3faab35-811a-46f7-bc4b-888b3e4f530a","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":102,"box":{"x":70,"y":453,"width":815,"height":11}},{"id":"11c2dff2-bdf9-430e-8af7-fe9ebb182302","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":102,"box":{"x":70,"y":468,"width":782,"height":11}},{"id":"d444b12c-78f4-407e-951f-d43298703a58","block_type":"box","text":"agreement may effectively be restricted pending such decision.","page_number":102,"box":{"x":69,"y":483,"width":449,"height":11}},{"id":"4420e44d-5290-42cf-b3b1-04d75bdb2fe5","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into reverse repurchase agreements and","page_number":102,"box":{"x":102,"y":506,"width":794,"height":11}},{"id":"b1a81cac-e331-47df-8735-f09d6d029b46","block_type":"box","text":"similar financing transactions (","page_number":102,"box":{"x":69,"y":521,"width":218,"height":11}},{"id":"63821394-b339-4f26-beda-56d4954bd065","block_type":"box","text":"e.g.","page_number":102,"box":{"x":289,"y":522,"width":24,"height":10}},{"id":"475ab157-c43a-42fc-9eef-a9ae33e035ab","block_type":"box","text":", recourse and non-recourse tender option bonds, borrowed bonds) notwithstanding","page_number":102,"box":{"x":316,"y":521,"width":594,"height":11}},{"id":"7fa56b50-a62f-4763-87cd-01fa58465272","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":102,"box":{"x":68,"y":536,"width":813,"height":11}},{"id":"41f4dec5-c3f4-43ba-a5bf-9ad8cfedd98b","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":102,"box":{"x":70,"y":551,"width":789,"height":11}},{"id":"dd6389f5-f20c-4237-a9bf-5b8685341924","block_type":"box","text":"borrowings in the aggregate, or (ii) treats all such transactions as Derivatives Transactions under Rule 18f-4. See “—","page_number":102,"box":{"x":69,"y":566,"width":836,"height":11}},{"id":"5f3eaf1f-b250-4971-9c38-51220fd9c917","block_type":"box","text":"Derivatives — Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above. The SEC has also","page_number":102,"box":{"x":70,"y":581,"width":824,"height":12}},{"id":"973b34a7-0a5e-4de4-bad6-ebdd58b30476","block_type":"box","text":"finalized rules that will require certain transactions involving U.S. Treasuries, including reverse repurchase","page_number":102,"box":{"x":68,"y":596,"width":758,"height":12}},{"id":"c4c23dc7-72df-4e6a-9309-4f64a1e0ce55","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":102,"box":{"x":69,"y":612,"width":822,"height":11}},{"id":"c105ebdb-9bba-46c5-b098-9e487c46253f","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":102,"box":{"x":68,"y":627,"width":838,"height":11}},{"id":"20894228-93dc-44e3-8a9c-130cf622e0e5","block_type":"box","text":"costs of such transactions and may adversely affect a Fund’s performance.","page_number":102,"box":{"x":69,"y":642,"width":538,"height":11}},{"id":"5f706e3d-2cc5-4d6d-a00a-7ff6abe37999","block_type":"box","text":"Additionally, regulations adopted by global prudential regulators require certain bank-regulated counterparties","page_number":102,"box":{"x":101,"y":665,"width":780,"height":11}},{"id":"967f8b3c-0ce2-40f7-8cf1-01679b41fb56","block_type":"box","text":"and certain of their affiliates to include in certain financial contracts, including many reverse repurchase agreements,","page_number":102,"box":{"x":69,"y":680,"width":838,"height":11}},{"id":"c6c81c0d-14fa-4aad-b769-c9eedd74287c","block_type":"box","text":"terms that delay or restrict the rights of counterparties, such as a Fund, to terminate such agreements, take","page_number":102,"box":{"x":68,"y":695,"width":775,"height":11}},{"id":"4394fbe0-07e7-4a7d-a516-8c757f2e6e69","block_type":"box","text":"foreclosure action, exercise other default rights or restrict transfers of credit support in the event that the","page_number":102,"box":{"x":68,"y":710,"width":754,"height":11}},{"id":"4f3f646e-b79d-425a-add0-40c5947d6bd3","block_type":"box","text":"counterparty and/or its affiliates are subject to certain types of resolution or insolvency proceedings. It is possible","page_number":102,"box":{"x":69,"y":725,"width":818,"height":11}},{"id":"f5a19b20-a1ea-4836-b574-7fbb3b6f99ad","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":102,"box":{"x":68,"y":740,"width":783,"height":11}},{"id":"095129d9-434e-4910-b4ef-a4c2191eba7e","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing reverse repurchase agreements or to realize","page_number":102,"box":{"x":69,"y":755,"width":800,"height":11}},{"id":"2a7910a7-1779-4055-9ba6-852d935bc706","block_type":"box","text":"amounts to be received under such agreements.","page_number":102,"box":{"x":69,"y":771,"width":345,"height":11}},{"id":"794f5b70-daa6-45a8-b7f4-97bb299b6cb3","block_type":"box","text":"Rights Offerings and Warrants to Purchase.","page_number":102,"box":{"x":102,"y":793,"width":316,"height":11}},{"id":"f3aca979-55cf-4901-9a90-915d5277410e","block_type":"box","text":"Certain Funds may participate in rights offerings and may purchase","page_number":102,"box":{"x":424,"y":793,"width":481,"height":11}},{"id":"ff0a19ed-6251-4bd0-8474-8b0e465ccbc5","block_type":"box","text":"warrants, which are privileges issued by corporations enabling the owners to subscribe to and purchase a specified","page_number":102,"box":{"x":68,"y":808,"width":822,"height":11}},{"id":"e1cf454b-0556-4a82-a313-dced320881b8","block_type":"box","text":"number of shares of the corporation at a specified price during a specified period of time. Subscription rights","page_number":102,"box":{"x":69,"y":823,"width":776,"height":12}},{"id":"91d94106-7197-4b92-af40-296f51e9c888","block_type":"box","text":"normally have a short life span to expiration. The purchase of rights or warrants involves the risk that a Fund could","page_number":102,"box":{"x":69,"y":838,"width":817,"height":12}},{"id":"a2cfcf9c-1e03-4527-8437-0face61ed423","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":102,"box":{"x":70,"y":853,"width":833,"height":12}},{"id":"926ab1d9-46fb-4c8a-8022-5331538b1e65","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":102,"box":{"x":69,"y":869,"width":835,"height":11}},{"id":"2e03bdf3-fd07-4c71-9257-a612c4bb2eb0","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":102,"box":{"x":70,"y":884,"width":821,"height":11}},{"id":"e0c56d79-93ac-4deb-9560-24d917f0c055","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":102,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"599657b2-101e-4078-9473-dc2ca4e6cd38","block_type":"box","text":"II-72","page_number":102,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"cbf73564-fd11-48a9-9c4c-6f49ce19dbf4","block_type":"box","text":"NM1026U-5979889-102/232","page_number":102,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"fa2d47b2-4d14-4838-aa12-144fd2993017","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":103,"box":{"x":69,"y":45,"width":777,"height":11}},{"id":"e4533a67-d4f4-4e96-bede-1347e5239e3a","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":103,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"b589d186-3d2a-4dfc-a3c4-7e5499e3ed17","block_type":"box","text":"this reason investments in warrants may be more speculative than other equity-based investments.","page_number":103,"box":{"x":68,"y":75,"width":708,"height":11}},{"id":"06922eb4-562a-4ed1-b559-2d8e85352133","block_type":"box","text":"Rule 144A Securities.","page_number":103,"box":{"x":102,"y":98,"width":159,"height":9}},{"id":"5f4dbc00-abdd-4ccb-846f-50b1b49c0eb2","block_type":"box","text":"A Fund may purchase securities that can be offered and sold only to “qualified","page_number":103,"box":{"x":266,"y":98,"width":560,"height":11}},{"id":"4992978d-e133-4646-8954-7cf03e498ed5","block_type":"box","text":"institutional buyers” pursuant to Rule 144A under the Securities Act. See “Restricted Securities” above.","page_number":103,"box":{"x":70,"y":113,"width":741,"height":11}},{"id":"bd62b166-ce82-457d-833d-472a5d988cf8","block_type":"box","text":"Securities Lending.","page_number":103,"box":{"x":101,"y":135,"width":139,"height":11}},{"id":"a7f4fa6f-bcb5-428e-bdf9-91915ebd46bf","block_type":"box","text":"Each Fund may lend portfolio securities to certain borrowers that BlackRock determines to","page_number":103,"box":{"x":247,"y":135,"width":645,"height":11}},{"id":"e3db5a4f-4444-46d3-bc40-1b24694640be","block_type":"box","text":"be creditworthy, including borrowers affiliated with BlackRock. The borrowers provide collateral that is maintained in","page_number":103,"box":{"x":69,"y":150,"width":825,"height":12}},{"id":"09762695-bd82-46c5-9d74-17c740506f95","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":103,"box":{"x":69,"y":166,"width":817,"height":11}},{"id":"99742d30-78d5-45c8-ae34-01cfebaa981b","block_type":"box","text":"behalf of a Fund if, as a result, the aggregate value of all securities loans of the particular Fund exceeds one-third of","page_number":103,"box":{"x":69,"y":181,"width":831,"height":11}},{"id":"14223528-e080-4fdb-b642-3d3215af7b80","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":103,"box":{"x":68,"y":196,"width":827,"height":11}},{"id":"d9d69602-1382-4fa5-82d5-3007b6121cf7","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":103,"box":{"x":69,"y":211,"width":829,"height":11}},{"id":"516ea2c4-7a6d-4671-83bc-76b1220fc5cf","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":103,"box":{"x":69,"y":226,"width":838,"height":11}},{"id":"38215d5d-a338-46bb-8ff7-f56e2bdffd81","block_type":"box","text":"the securities were not on loan.","page_number":103,"box":{"x":68,"y":241,"width":225,"height":9}},{"id":"1c021c32-42e1-45cc-bea2-e9bfaf3d0a1d","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":103,"box":{"x":101,"y":264,"width":799,"height":11}},{"id":"35865897-ac29-481e-9586-7a4c36f9e802","block_type":"box","text":"amount of cash collateral. The Funds are compensated by any positive difference between the amount earned on the","page_number":103,"box":{"x":69,"y":279,"width":835,"height":11}},{"id":"13e89b3f-f7a6-4d11-89a8-d7e91b808091","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":103,"box":{"x":69,"y":294,"width":824,"height":11}},{"id":"27686f03-4bab-4a42-9a5a-ed2159a514ae","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":103,"box":{"x":69,"y":309,"width":821,"height":11}},{"id":"aeb01586-5133-4ae8-9bc1-93754775cc84","block_type":"box","text":"cash collateral received by the Fund for such loans, and uninvested cash, may be reinvested in certain short-term","page_number":103,"box":{"x":69,"y":324,"width":810,"height":11}},{"id":"893d49fb-09c8-4069-a2fa-ef3d946d5f76","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":103,"box":{"x":70,"y":339,"width":789,"height":12}},{"id":"6521f38e-17ef-4edb-ad8b-d2a998d304ec","block_type":"box","text":"including those affiliated with BlackRock; such investments are subject to investment risk.","page_number":103,"box":{"x":70,"y":355,"width":643,"height":11}},{"id":"f7623cfb-6ef6-40de-92f6-6a664a032470","block_type":"box","text":"Securities lending involves exposure to certain risks, including operational risk (","page_number":103,"box":{"x":102,"y":377,"width":568,"height":12}},{"id":"f4cc1093-33ef-4386-b710-5dca77331be7","block_type":"box","text":"i.e.","page_number":103,"box":{"x":672,"y":377,"width":20,"height":9}},{"id":"b4a5f4ab-6f9e-421e-9e2e-f28a61c916db","block_type":"box","text":", the risk of losses resulting","page_number":103,"box":{"x":695,"y":377,"width":198,"height":12}},{"id":"6a32dad6-1828-4c5e-b77e-062bf1da4a33","block_type":"box","text":"from problems in the settlement and accounting process), “gap” risk (","page_number":103,"box":{"x":68,"y":392,"width":501,"height":12}},{"id":"1b5e2751-029e-4f2e-8481-a6f8eeebbf53","block_type":"box","text":"i.e.","page_number":103,"box":{"x":571,"y":393,"width":20,"height":8}},{"id":"8b941e6c-1a36-4117-9245-64ec03859e33","block_type":"box","text":", the risk of a mismatch between the return","page_number":103,"box":{"x":594,"y":392,"width":307,"height":11}},{"id":"1ba39d33-9fc4-45b8-bb82-bc8287c5db6a","block_type":"box","text":"on cash collateral reinvestments and the fees each Fund has agreed to pay a borrower), foreign exchange risk (","page_number":103,"box":{"x":69,"y":407,"width":794,"height":12}},{"id":"6da7882a-bd5b-4c8b-bcbb-3e58973dc86b","block_type":"box","text":"i.e.","page_number":103,"box":{"x":865,"y":408,"width":20,"height":8}},{"id":"40437564-c64f-4f1f-8dbc-531eeeb5af18","block_type":"box","text":",","page_number":103,"box":{"x":888,"y":415,"width":2,"height":3}},{"id":"cf4077e1-10cd-49bc-9c35-12cf50f007a1","block_type":"box","text":"the risk of a shortfall at default when a cash collateral investment is denominated in a currency other than the","page_number":103,"box":{"x":68,"y":423,"width":788,"height":11}},{"id":"0f70e3b7-c35c-4ab0-99a6-5b6607d08e88","block_type":"box","text":"currency of the assets being loaned due to movements in foreign exchange rates), and credit, legal, counterparty and","page_number":103,"box":{"x":69,"y":438,"width":837,"height":11}},{"id":"53f2655c-c253-4fb4-be9a-c4d564028124","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":103,"box":{"x":69,"y":453,"width":822,"height":11}},{"id":"14edc8a8-a812-4d68-beb4-159826c8f70d","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":103,"box":{"x":68,"y":468,"width":811,"height":11}},{"id":"652ad558-2532-474b-b869-3bc66441438e","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":103,"box":{"x":70,"y":483,"width":820,"height":11}},{"id":"346eec21-36ca-4d7b-ab16-8dd58b2420f7","block_type":"box","text":"are subject to a corporate action and commit to the borrower a particular election as determined by the Fund’s","page_number":103,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"51c24d5f-6a6c-45a3-a55b-a65aac41a91e","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":103,"box":{"x":70,"y":513,"width":820,"height":12}},{"id":"8233c09e-5296-4d59-85f8-72e1ee4f99d6","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":103,"box":{"x":70,"y":528,"width":805,"height":12}},{"id":"0341f656-bd14-4eb2-b584-3b138113faf5","block_type":"box","text":"securities lending counterparty were to default, a Fund would be subject to the risk of a possible delay in receiving","page_number":103,"box":{"x":69,"y":543,"width":816,"height":12}},{"id":"1b54edf5-2571-42ff-8db3-54679a0a66ea","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":103,"box":{"x":69,"y":559,"width":775,"height":11}},{"id":"a646dee6-5f9e-4624-864e-1ceadb8b5c76","block_type":"box","text":"borrower does not return a Fund’s securities as agreed, the Fund’s ability to participate in a corporate action event","page_number":103,"box":{"x":69,"y":574,"width":821,"height":11}},{"id":"236b28b1-bade-405b-972f-85233f6ff306","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":103,"box":{"x":69,"y":589,"width":838,"height":11}},{"id":"96353265-960b-4286-9509-495bf9e099f5","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":103,"box":{"x":70,"y":604,"width":837,"height":11}},{"id":"fbdf075e-4031-472f-9d54-e082ac11ef1b","block_type":"box","text":"in purchasing replacement securities. This latter event could trigger adverse tax consequences for a Fund. A Fund","page_number":103,"box":{"x":70,"y":619,"width":808,"height":11}},{"id":"c1f45093-490b-477f-93d6-cdab37dc1188","block_type":"box","text":"could lose money if its short-term investment of the collateral declines in value over the period of the loan. Substitute","page_number":103,"box":{"x":69,"y":634,"width":839,"height":11}},{"id":"ddd39150-a3fb-498f-ba63-9bfbeadebfb5","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":103,"box":{"x":70,"y":650,"width":832,"height":11}},{"id":"5142c5df-c984-4b52-9a57-bad150a5a846","block_type":"box","text":"qualified dividend income, and distributions by the Fund of such substitute payments will not constitute qualified","page_number":103,"box":{"x":69,"y":664,"width":801,"height":12}},{"id":"20f9fad1-a63a-4396-a853-3a54c95b6a5d","block_type":"box","text":"dividend income. Additionally, substitute payments received by a Fund representing qualified REIT dividends paid on","page_number":103,"box":{"x":69,"y":680,"width":823,"height":11}},{"id":"df1bf674-e310-4e3e-8974-520e0b7e5754","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":103,"box":{"x":70,"y":695,"width":823,"height":11}},{"id":"bb8b9dec-75f7-4993-87a8-09ac74d3fab1","block_type":"box","text":"of such substitute payments will not be eligible for a 20% deduction currently available for ordinary REIT dividends","page_number":103,"box":{"x":69,"y":710,"width":812,"height":11}},{"id":"55170639-8512-43d7-ae9f-c5ec1a625c29","block_type":"box","text":"paid to non-corporate shareholders provided certain other requirements are satisfied. The securities lending agent","page_number":103,"box":{"x":70,"y":725,"width":814,"height":11}},{"id":"ef73a234-2867-425a-a146-e5a4bc7d2809","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":103,"box":{"x":68,"y":740,"width":787,"height":11}},{"id":"86cd9e7d-fc63-4c95-a1b8-8f7177fc52d7","block_type":"box","text":"securities lending program. Substitute payments received on tax-exempt securities loaned out will not be tax-exempt","page_number":103,"box":{"x":69,"y":755,"width":828,"height":11}},{"id":"63ed8cd1-be84-4805-94b5-f220769db882","block_type":"box","text":"income. There could also be changes in the status of issuers under applicable laws and regulations, including tax","page_number":103,"box":{"x":70,"y":770,"width":809,"height":12}},{"id":"4add0318-6e5a-4437-a07f-df258c9bc237","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":103,"box":{"x":69,"y":785,"width":821,"height":12}},{"id":"293c6e22-c9bf-439f-bc14-9d6e2c4492c1","block_type":"box","text":"delay in the payment of dividend equivalent payments owed to a Fund (as permitted by applicable law).","page_number":103,"box":{"x":69,"y":801,"width":731,"height":11}},{"id":"a01f82e2-47ce-4b48-b98d-096a688f99b4","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and certain of","page_number":103,"box":{"x":102,"y":823,"width":800,"height":12}},{"id":"9b354bb7-358a-45fd-a726-a868fc3c0405","block_type":"box","text":"their affiliates to include in certain financial contracts, including many securities lending agreements, terms that","page_number":103,"box":{"x":68,"y":838,"width":802,"height":12}},{"id":"e093d6e4-1eef-472a-a77f-e89790610200","block_type":"box","text":"delay or restrict the rights of counterparties, such as the Fund, to terminate such agreements, foreclose upon","page_number":103,"box":{"x":69,"y":853,"width":783,"height":12}},{"id":"e169e1a2-0c14-469d-a88b-7ae83d1cc8e7","block_type":"box","text":"collateral, exercise other default rights or restrict transfers of credit support in the event that the counterparty and/or","page_number":103,"box":{"x":69,"y":869,"width":839,"height":11}},{"id":"73cc62d8-0ec3-418b-b9fe-c6fef9067d0b","block_type":"box","text":"its affiliates are subject to certain types of resolution or insolvency proceedings. It is possible that these","page_number":103,"box":{"x":70,"y":884,"width":747,"height":11}},{"id":"06d2d718-eb0c-4c7b-bb09-8e737facb5c4","block_type":"box","text":"requirements, as well as potential additional government regulation and other developments in the market, could","page_number":103,"box":{"x":69,"y":899,"width":806,"height":11}},{"id":"7beb7b8a-1a04-45af-a80c-17ad21d42636","block_type":"box","text":"II-73","page_number":103,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"36158737-778f-4353-9e17-b6e2fa8e2316","block_type":"box","text":"NM1026U-5979889-103/232","page_number":103,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9269a09f-bbec-45bb-96a2-70cb749c5579","block_type":"box","text":"adversely affect the Fund’s ability to terminate existing securities lending agreements or to realize amounts to be","page_number":104,"box":{"x":69,"y":45,"width":808,"height":11}},{"id":"df4c0a47-3369-466b-9b8a-6d5b00e96183","block_type":"box","text":"received under such agreements. Prudential regulation may also favor lenders that can provide additional protections,","page_number":104,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"a5a39e36-911e-468b-8933-ed60202ecc03","block_type":"box","text":"such as liens that are exercisable in connection with a lender default, to borrowers. Certain Funds expect to provide","page_number":104,"box":{"x":69,"y":75,"width":827,"height":11}},{"id":"ff3dbd2a-e527-436e-a22b-076cf918ff33","block_type":"box","text":"additional protections to borrowers, where permitted pursuant to a Fund’s investment policies and if BlackRock","page_number":104,"box":{"x":69,"y":90,"width":794,"height":11}},{"id":"ba30050c-0ec9-4885-a67c-5034dfe14009","block_type":"box","text":"believes doing so is in the best interest of the Fund.","page_number":104,"box":{"x":69,"y":105,"width":371,"height":11}},{"id":"d05b4f46-8531-4229-b5b6-a95e191ac973","block_type":"box","text":"The SEC has adopted a rule that will require reporting and public disclosure of securities loan transaction","page_number":104,"box":{"x":101,"y":128,"width":753,"height":11}},{"id":"f6f39f47-ee24-401c-9aae-97f9503cf1de","block_type":"box","text":"information (not including party names); this may include, but is not limited to, information about securities loans","page_number":104,"box":{"x":70,"y":143,"width":808,"height":11}},{"id":"18faec92-a35b-4e19-88b6-818e7900556f","block_type":"box","text":"entered into in connection with short sales. Compliance with this rule is expected to be required in late 2028,","page_number":104,"box":{"x":69,"y":158,"width":784,"height":11}},{"id":"13ad03ae-dfb7-4a2b-b4e7-0cdf841d7b95","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":104,"box":{"x":69,"y":173,"width":833,"height":11}},{"id":"fe152f41-27ce-409c-ab1e-9fbcc9fe381d","block_type":"box","text":"the current expected compliance date.","page_number":104,"box":{"x":68,"y":188,"width":273,"height":11}},{"id":"44b319d5-ac3b-4d34-acd7-402714a33922","block_type":"box","text":"Short Sales.","page_number":104,"box":{"x":101,"y":211,"width":89,"height":9}},{"id":"b139c8d6-efae-4340-83dd-f88a706d19b0","block_type":"box","text":"Certain Funds may make short sales of securities, either as a hedge against potential declines in","page_number":104,"box":{"x":196,"y":211,"width":696,"height":11}},{"id":"3754390d-de67-4673-84bb-fde407a94adc","block_type":"box","text":"value of a portfolio security or to realize appreciation when a security that the Fund does not own declines in value.","page_number":104,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"4b900224-7389-4796-9b9d-04429a5e4af7","block_type":"box","text":"Certain Funds have a fundamental investment restriction prohibiting short sales of securities unless they are","page_number":104,"box":{"x":69,"y":241,"width":778,"height":11}},{"id":"6c4da454-9e68-4b17-8de2-a2fef39d18e1","block_type":"box","text":"“against-the-box.” In a short sale “against-the-box,” at the time of the sale, the Fund owns or has the immediate and","page_number":104,"box":{"x":70,"y":256,"width":831,"height":12}},{"id":"f02b1063-d214-4f93-b4ad-6172f2fbae31","block_type":"box","text":"unconditional right to acquire the identical security at no additional cost. When a Fund makes a short sale, it borrows","page_number":104,"box":{"x":69,"y":272,"width":837,"height":11}},{"id":"a3db09c4-3b23-4725-ab8a-677738844036","block_type":"box","text":"the security sold short and delivers it to the broker-dealer through which it made the short sale. A Fund may have to","page_number":104,"box":{"x":68,"y":287,"width":828,"height":11}},{"id":"a7e89b0f-8f0d-4f43-bf1f-809b97382128","block_type":"box","text":"pay a fee to borrow particular securities and is often obligated to turn over any payments received on such borrowed","page_number":104,"box":{"x":70,"y":302,"width":829,"height":11}},{"id":"4042faae-e7a3-4dd6-87a6-c79fde995a5d","block_type":"box","text":"securities to the lender of the securities.","page_number":104,"box":{"x":69,"y":317,"width":289,"height":9}},{"id":"9d91f1d2-acae-4be6-9294-ff59e51eeb61","block_type":"box","text":"A Fund secures its obligation to replace the borrowed security by depositing collateral with the broker-dealer,","page_number":104,"box":{"x":101,"y":340,"width":772,"height":11}},{"id":"ecb1f718-7692-4167-a3b5-9802ecc541a3","block_type":"box","text":"usually in cash, U.S. Government Securities or other liquid securities similar to those borrowed. With respect to","page_number":104,"box":{"x":69,"y":355,"width":795,"height":11}},{"id":"7a75b6b6-7219-4c0d-b3b1-a01216b2597f","block_type":"box","text":"uncovered short positions, a Fund is required to deposit similar collateral with its custodian, if necessary, to the","page_number":104,"box":{"x":69,"y":370,"width":801,"height":11}},{"id":"ebbfda71-7566-45e6-90c5-deb0d2fd2ebc","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":104,"box":{"x":69,"y":385,"width":830,"height":11}},{"id":"46638e17-8a37-4917-9954-4e976dacd170","block_type":"box","text":"market value of the security sold short. Depending on arrangements made with the broker-dealer from which the Fund","page_number":104,"box":{"x":69,"y":400,"width":839,"height":11}},{"id":"bb83eb7c-b28e-4428-b887-c37ec3c009e9","block_type":"box","text":"borrowed the security, regarding payment received by the Fund on such security, a Fund may not receive any","page_number":104,"box":{"x":69,"y":415,"width":770,"height":11}},{"id":"8455179d-5218-4fca-a483-c0192cdc8727","block_type":"box","text":"payments (including interest) on its collateral deposited with such broker-dealer.","page_number":104,"box":{"x":70,"y":430,"width":568,"height":11}},{"id":"9c93a27b-891d-4c75-94e8-1f88e7040d95","block_type":"box","text":"Because making short sales in securities that it does not own exposes a Fund to the risks associated with those","page_number":104,"box":{"x":102,"y":453,"width":806,"height":11}},{"id":"10bc2309-213a-4bbb-bdb5-abf83545177c","block_type":"box","text":"securities, such short sales involve speculative exposure risk. A Fund will incur a loss as a result of a short sale if","page_number":104,"box":{"x":69,"y":468,"width":817,"height":11}},{"id":"c6b47476-1130-4089-977b-ee652e9f99c0","block_type":"box","text":"the price of the security increases between the date of the short sale and the date on which the Fund replaces the","page_number":104,"box":{"x":68,"y":483,"width":819,"height":11}},{"id":"e12247c0-0708-45cc-8b98-a0077bb4c6e7","block_type":"box","text":"borrowed security. As a result, if a Fund makes short sales in securities that increase in value, it will likely","page_number":104,"box":{"x":69,"y":498,"width":758,"height":11}},{"id":"8731be2e-8580-4195-a798-b54f57ffe1f3","block_type":"box","text":"underperform similar mutual funds that do not make short sales in securities. A Fund will realize a gain on a short","page_number":104,"box":{"x":69,"y":513,"width":817,"height":12}},{"id":"643ec23a-b0e8-4bb7-b2f1-4a09d1f5a343","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":104,"box":{"x":69,"y":528,"width":800,"height":12}},{"id":"826fea36-c416-49d0-9f0a-5e18a80e9898","block_type":"box","text":"close out a short sale position at any particular time or at an acceptable price. Although a Fund’s gain is limited to","page_number":104,"box":{"x":69,"y":544,"width":818,"height":11}},{"id":"6474d4b6-003c-499d-b911-dfd8b3d121c1","block_type":"box","text":"the price at which it sold the security short, its potential loss is limited only by the maximum attainable price of the","page_number":104,"box":{"x":68,"y":559,"width":821,"height":11}},{"id":"a102b4ab-815c-42fc-ad94-90ba254ccc04","block_type":"box","text":"security, less the price at which the security was sold and may, theoretically, be unlimited.","page_number":104,"box":{"x":69,"y":574,"width":640,"height":11}},{"id":"7aeca6ce-eb34-4a4f-9792-715b513059a3","block_type":"box","text":"A Fund may also make short sales “against the box” without being subject to such limitations.","page_number":104,"box":{"x":101,"y":597,"width":673,"height":11}},{"id":"78df3ad9-8f4d-4922-92c4-87a9b88ddd6a","block_type":"box","text":"A Fund must comply with Rule 18f-4 under the Investment Company Act with respect to its short sale","page_number":104,"box":{"x":101,"y":619,"width":721,"height":11}},{"id":"93124771-bc6f-41ba-a4c0-0d3b614b8440","block_type":"box","text":"borrowings, which are considered Derivatives Transactions under the Rule. See “—Derivatives — Regulation of","page_number":104,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"23d149fe-5df8-428a-9a68-d741356c71b4","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":104,"box":{"x":70,"y":649,"width":489,"height":12}},{"id":"d729deda-df61-4eb2-be00-e86aea17bb35","block_type":"box","text":"Short sales are also subject to certain SEC regulations and certain European Union and United Kingdom","page_number":104,"box":{"x":102,"y":672,"width":745,"height":11}},{"id":"82924911-4a67-489b-8b42-0b6bba543456","block_type":"box","text":"regulations (under which there are restrictions on net short sales in certain securities). If the SEC or regulatory","page_number":104,"box":{"x":69,"y":687,"width":793,"height":11}},{"id":"005ac6ba-7692-450e-9b27-5d4edeffb686","block_type":"box","text":"authorities in other jurisdictions were to adopt additional restrictions regarding short sales, they could restrict a","page_number":104,"box":{"x":69,"y":703,"width":796,"height":11}},{"id":"5a3b55de-a4e4-46bc-adf1-2738008aa15e","block_type":"box","text":"Fund’s ability to engage in short sales in certain circumstances, and the Fund may be unable to execute its","page_number":104,"box":{"x":70,"y":718,"width":766,"height":11}},{"id":"2c9cb00c-888b-4d26-8d0a-209bb7ec403b","block_type":"box","text":"investment strategy as a result. In response to market events, the SEC and regulatory authorities in other","page_number":104,"box":{"x":70,"y":733,"width":754,"height":11}},{"id":"44bd6448-c425-42f6-acd2-2d8153af4429","block_type":"box","text":"jurisdictions may adopt (and in certain cases, have adopted) bans or other restrictions on short sales of certain","page_number":104,"box":{"x":67,"y":748,"width":800,"height":11}},{"id":"a9a9f0d9-3c7b-4ef8-8783-a59d649ce845","block_type":"box","text":"securities or on derivatives and other hedging instruments used to achieve a similar economic effect. Such bans or","page_number":104,"box":{"x":69,"y":763,"width":823,"height":11}},{"id":"2f477488-f66a-4d77-b709-e574b7b53821","block_type":"box","text":"other restrictions may make it impossible for a Fund to execute certain investment strategies and may have a","page_number":104,"box":{"x":69,"y":778,"width":782,"height":11}},{"id":"0abaa462-5f78-4738-aeae-dbdede9bc0ee","block_type":"box","text":"material adverse effect on the Fund’s ability to generate returns.","page_number":104,"box":{"x":69,"y":793,"width":460,"height":11}},{"id":"04af9dd2-0107-4f18-8a40-a78bac3cbb95","block_type":"box","text":"Special Purpose Acquisition Companies.","page_number":104,"box":{"x":101,"y":816,"width":293,"height":11}},{"id":"2ffd7c38-c899-48ac-a207-6153e1683855","block_type":"box","text":"A Fund may invest in stock, warrants, rights and other interests issued","page_number":104,"box":{"x":400,"y":816,"width":504,"height":11}},{"id":"aa147fd4-2d72-4f2c-8708-b20618dbee22","block_type":"box","text":"by special purpose acquisition companies (“SPACs”) or similar special purpose entities that pool funds to seek","page_number":104,"box":{"x":69,"y":831,"width":791,"height":11}},{"id":"8e7f55f7-5bff-4a4d-a057-5812a9905954","block_type":"box","text":"potential acquisition opportunities, including the “founder’s” shares and warrants described below. A SPAC is a","page_number":104,"box":{"x":70,"y":846,"width":793,"height":11}},{"id":"25717e50-b3ac-43d5-89f9-0b74cf381ddf","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":104,"box":{"x":70,"y":861,"width":824,"height":11}},{"id":"7332ee83-0ccd-4196-8b93-8936b5b5742f","block_type":"box","text":"more operating businesses or assets. In connection with forming a SPAC, the SPAC’s sponsors acquire “founder’s”","page_number":104,"box":{"x":69,"y":876,"width":821,"height":11}},{"id":"f60e8cbd-4666-4607-a9f1-193d35095e99","block_type":"box","text":"shares, generally for nominal consideration, and warrants that will result in the sponsors owning a specified","page_number":104,"box":{"x":69,"y":891,"width":768,"height":12}},{"id":"6be96fbc-42ff-4d9c-b95d-0e7906f23ee3","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":104,"box":{"x":70,"y":906,"width":826,"height":12}},{"id":"7b67ea9f-4fc9-4062-a257-a4107363ece9","block_type":"box","text":"II-74","page_number":104,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8f13fe5b-d711-4c16-8cb4-fb3490bd6780","block_type":"box","text":"NM1026U-5979889-104/232","page_number":104,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"079de3fa-6af7-4abe-bea4-e2898f6bee10","block_type":"box","text":"conducts an IPO, it has selected a management team but has not yet identified a specific acquisition opportunity.","page_number":105,"box":{"x":69,"y":45,"width":809,"height":11}},{"id":"8f95710a-da55-40c3-8051-a694724b1b2d","block_type":"box","text":"Unless and until an acquisition is completed, a SPAC generally invests its assets in U.S. Government securities,","page_number":105,"box":{"x":70,"y":60,"width":797,"height":11}},{"id":"15d5056b-3203-4289-b83e-651c6a27d6f6","block_type":"box","text":"money market securities and cash. If an acquisition that meets the requirements for the SPAC is not completed","page_number":105,"box":{"x":69,"y":75,"width":795,"height":11}},{"id":"3297e777-3761-4359-9286-1f2df0c20e23","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":105,"box":{"x":68,"y":90,"width":788,"height":11}},{"id":"e28e1344-b9bc-4b4d-9fef-740f464dd6d3","block_type":"box","text":"warrants expire, and the “founder’s” shares and such warrants become worthless. Because SPACs and similar","page_number":105,"box":{"x":68,"y":105,"width":794,"height":11}},{"id":"3de06d52-1d84-41cc-88cd-ec426e3aae31","block_type":"box","text":"entities are in essence “blank check” companies without operating histories or ongoing business operations (other","page_number":105,"box":{"x":69,"y":120,"width":820,"height":12}},{"id":"2dfe471c-7c80-4007-a8e0-5000cb705d2a","block_type":"box","text":"than identifying and pursuing acquisitions), the potential for the long-term capital appreciation of their securities is","page_number":105,"box":{"x":68,"y":135,"width":815,"height":12}},{"id":"2480898b-5ef4-4cd2-be90-866b5307b1e8","block_type":"box","text":"particularly dependent on the ability of the SPAC’s management to identify and complete a profitable acquisition.","page_number":105,"box":{"x":70,"y":150,"width":802,"height":12}},{"id":"ead9afe7-8f2d-4519-a8ba-26d977d2f830","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":105,"box":{"x":68,"y":166,"width":812,"height":11}},{"id":"c34421ae-8794-4bb1-8ec8-17f67da50b1c","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":105,"box":{"x":69,"y":181,"width":838,"height":11}},{"id":"9f2ee9e2-4aaf-4ded-8b06-f70f23092394","block_type":"box","text":"certain industries or regions, which may ultimately lead to an increase in the volatility of their prices following the","page_number":105,"box":{"x":69,"y":196,"width":806,"height":11}},{"id":"1053c404-c390-4b03-b922-9f384ae52942","block_type":"box","text":"acquisition. In addition, some of these securities may be considered illiquid and/or subject to restrictions on resale.","page_number":105,"box":{"x":69,"y":211,"width":828,"height":11}},{"id":"931e52b5-287d-4bac-89ff-bfc2a7702308","block_type":"box","text":"Standby Commitment Agreements.","page_number":105,"box":{"x":101,"y":234,"width":255,"height":11}},{"id":"06aae56c-3b8e-4a7e-9334-bf8bc0e61f4c","block_type":"box","text":"Standby commitment agreements commit a Fund, for a stated period of","page_number":105,"box":{"x":362,"y":234,"width":511,"height":11}},{"id":"e44a3f68-34bf-4fd8-a303-c919142d48d3","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":105,"box":{"x":68,"y":249,"width":834,"height":11}},{"id":"b97f33d0-3bc2-4aee-95ee-2a653aa84349","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":105,"box":{"x":68,"y":264,"width":834,"height":11}},{"id":"a0dda536-797d-42cb-bc77-3e5c5582b730","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":105,"box":{"x":70,"y":279,"width":802,"height":11}},{"id":"2e8446fc-faa4-489a-99a2-cd90973c6823","block_type":"box","text":"agreements for the purpose of investing in the security underlying the commitment at a price that is considered","page_number":105,"box":{"x":69,"y":294,"width":793,"height":11}},{"id":"5fae7f27-58f2-4be9-9336-ecdabfc21dda","block_type":"box","text":"advantageous to the Fund.","page_number":105,"box":{"x":69,"y":309,"width":188,"height":11}},{"id":"fa9db0d6-9324-4b29-bcf7-6fc51e796ea2","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":105,"box":{"x":101,"y":332,"width":800,"height":11}},{"id":"3ab03e77-5115-4f7a-ba08-d9811c7688f1","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":105,"box":{"x":68,"y":347,"width":816,"height":11}},{"id":"67b115af-6883-4062-8c57-afd0f9759403","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":105,"box":{"x":69,"y":362,"width":835,"height":11}},{"id":"a94fc1c5-17cc-413c-941c-2049c8cf5c03","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":105,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"7a62f37a-02e2-48e7-afd1-a30bab8db3ff","block_type":"box","text":"The purchase of a security pursuant to a standby commitment agreement and the related commitment fee will","page_number":105,"box":{"x":101,"y":400,"width":785,"height":11}},{"id":"78908263-c93b-4209-a8a7-14108d20fe75","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":105,"box":{"x":69,"y":415,"width":837,"height":11}},{"id":"e525a3b6-8c9a-45cc-835f-86fa75007b87","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":105,"box":{"x":68,"y":430,"width":815,"height":11}},{"id":"f27a82bb-f9c8-46d6-918f-c329482217f7","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":105,"box":{"x":69,"y":445,"width":792,"height":11}},{"id":"dc00839d-125d-4bdb-8da3-b852e187858a","block_type":"box","text":"income on the expiration date of the standby commitment.","page_number":105,"box":{"x":70,"y":460,"width":415,"height":12}},{"id":"492b5cbb-761d-4ca4-8632-09f6ee77f513","block_type":"box","text":"Standby commitments will only be entered into with dealers, banks and broker-dealers which, in the Manager’s","page_number":105,"box":{"x":102,"y":483,"width":789,"height":11}},{"id":"c1cad6f0-c8f6-40eb-9dda-62d3c7f67f83","block_type":"box","text":"or sub-adviser’s opinion, present minimal credit risks. A Fund will acquire standby commitments solely to facilitate","page_number":105,"box":{"x":69,"y":498,"width":814,"height":11}},{"id":"7d0676d1-ee55-4ba1-b800-7e7e6e31cb6b","block_type":"box","text":"portfolio liquidity and not to exercise its rights thereunder for trading purposes. Standby commitments will be valued","page_number":105,"box":{"x":70,"y":513,"width":827,"height":12}},{"id":"b1cfdc84-f0b4-4546-ad93-a9f8f7fc62d3","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":105,"box":{"x":69,"y":528,"width":815,"height":12}},{"id":"76b33c19-56a8-4a57-9adb-52c0e625f6b0","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":105,"box":{"x":68,"y":543,"width":817,"height":12}},{"id":"dcedda37-50bb-4ded-8d9a-c48d33542b0c","block_type":"box","text":"reflected as a realized gain or loss when the commitment is exercised or expires.","page_number":105,"box":{"x":69,"y":559,"width":578,"height":11}},{"id":"b9ea8af9-172a-4a5d-980e-ef623f64982e","block_type":"box","text":"Stripped Securities.","page_number":105,"box":{"x":101,"y":581,"width":143,"height":11}},{"id":"24d7aa77-5062-4a08-85f7-1e45b457b1e1","block_type":"box","text":"Stripped securities are created when the issuer separates the interest and principal","page_number":105,"box":{"x":251,"y":581,"width":596,"height":11}},{"id":"8f5e85e6-2f47-488d-9a31-7571942ef072","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":105,"box":{"x":69,"y":596,"width":839,"height":12}},{"id":"e3ce8c06-d764-414b-b800-fd80b9a6aa0f","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":105,"box":{"x":70,"y":612,"width":818,"height":11}},{"id":"02404308-90dc-40e1-bfc5-4879af00f6ad","block_type":"box","text":"payments (the principal only or “PO” security). Some stripped securities may receive a combination of interest and","page_number":105,"box":{"x":70,"y":627,"width":813,"height":11}},{"id":"d1ac9934-e3f5-4122-9627-54a032dfcb69","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":105,"box":{"x":70,"y":642,"width":777,"height":11}},{"id":"7e7f8dbd-dae9-487e-aa0b-630a55feef50","block_type":"box","text":"principal payments (including prepayments) on the related underlying assets, and principal payments may have a","page_number":105,"box":{"x":70,"y":657,"width":802,"height":11}},{"id":"8e79c9ae-d19b-438e-aa74-dd5f89b1de1f","block_type":"box","text":"material effect on yield to maturity. If the underlying assets experience greater than anticipated prepayments of","page_number":105,"box":{"x":69,"y":672,"width":794,"height":11}},{"id":"7608ae2f-e002-47fc-ad3e-d11663db71c9","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":105,"box":{"x":70,"y":687,"width":837,"height":11}},{"id":"81f74885-96c9-4f43-9fee-39045a6b7eac","block_type":"box","text":"than anticipated prepayments of principal, the yield on POs could be adversely affected. Stripped securities may be","page_number":105,"box":{"x":68,"y":702,"width":823,"height":11}},{"id":"b943bf9f-9826-4dc3-9e4f-44294d625161","block_type":"box","text":"highly sensitive to changes in interest rates and rates of prepayment.","page_number":105,"box":{"x":69,"y":717,"width":494,"height":12}},{"id":"3eaf8128-1729-412e-88bd-ad3c6da7aa51","block_type":"box","text":"Structured Notes.","page_number":105,"box":{"x":101,"y":740,"width":130,"height":9}},{"id":"ae1e8c99-3f4d-478b-a9e5-a73155b26968","block_type":"box","text":"Structured notes and other related instruments purchased by a Fund are generally privately","page_number":105,"box":{"x":237,"y":740,"width":650,"height":11}},{"id":"3db187b9-1f9c-4a2f-b0a8-e5b8323a8f06","block_type":"box","text":"negotiated debt obligations where the principal and/or interest is determined by reference to the performance of a","page_number":105,"box":{"x":69,"y":755,"width":818,"height":11}},{"id":"1acb7fd0-47c3-4d20-b312-51165f3fd3cf","block_type":"box","text":"specific asset, benchmark asset, market or interest rate (“reference measure”). Issuers of structured notes generally","page_number":105,"box":{"x":69,"y":770,"width":839,"height":12}},{"id":"18d507ef-9a9e-4d53-b2b6-c8806a3f62d5","block_type":"box","text":"include corporations and banks. The interest rate or the principal amount payable upon maturity or redemption may","page_number":105,"box":{"x":70,"y":786,"width":821,"height":11}},{"id":"0557466a-142b-499f-8d57-6b280c8abd17","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":105,"box":{"x":70,"y":801,"width":839,"height":11}},{"id":"01432e12-3f64-465e-8b11-628783c8e151","block_type":"box","text":"may provide that, in certain circumstances, no principal is due at maturity and, therefore, may result in a loss of","page_number":105,"box":{"x":69,"y":816,"width":801,"height":11}},{"id":"d1d8169f-91ca-449b-91f2-5191d5c04e87","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":105,"box":{"x":70,"y":831,"width":813,"height":11}},{"id":"1badbe26-6471-4fc0-9261-192ce6bccefa","block_type":"box","text":"vary widely, depending on a variety of factors, including the volatility of the reference measure.","page_number":105,"box":{"x":68,"y":846,"width":673,"height":11}},{"id":"c71d43cd-1453-407f-bb8b-abd2b333c155","block_type":"box","text":"Structured notes may be positively or negatively indexed, so the appreciation of the reference measure may","page_number":105,"box":{"x":102,"y":869,"width":768,"height":11}},{"id":"f425a239-2da2-4618-916f-58810f0675cf","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":105,"box":{"x":70,"y":884,"width":821,"height":11}},{"id":"d194ad3c-1944-4ce0-9f25-88f7135fbc51","block_type":"box","text":"II-75","page_number":105,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bf55fd55-6293-4035-a256-9a7f8e936064","block_type":"box","text":"NM1026U-5979889-105/232","page_number":105,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0974cd96-d0fb-4280-b5ec-2e8e6b4ce8c4","block_type":"box","text":"structured notes may be determined by applying a multiplier to the performance or differential performance of","page_number":106,"box":{"x":69,"y":45,"width":787,"height":11}},{"id":"a5d9013c-3de5-46b0-ade6-39178a7d7a0c","block_type":"box","text":"reference measures. Application of a multiplier involves leverage that will serve to magnify the potential for gain and","page_number":106,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"618359ca-0007-4582-a962-ab6b885c26a9","block_type":"box","text":"the risk of loss.","page_number":106,"box":{"x":68,"y":75,"width":110,"height":9}},{"id":"d4f09689-9693-4401-b27c-22403c3a3c78","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":106,"box":{"x":101,"y":98,"width":759,"height":11}},{"id":"753b3e85-94e4-49df-b3d7-62bd8b8b2cb1","block_type":"box","text":"Structured notes may also be more volatile, less liquid, and more difficult to price accurately than less complex","page_number":106,"box":{"x":69,"y":113,"width":795,"height":11}},{"id":"e30808bf-4f85-4fd6-9187-df444b3fc11b","block_type":"box","text":"securities and instruments or more traditional debt securities. The secondary market for structured notes could be","page_number":106,"box":{"x":69,"y":128,"width":819,"height":11}},{"id":"0818d072-c756-4241-96fd-a84b4323bc25","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":106,"box":{"x":70,"y":143,"width":821,"height":11}},{"id":"6f07ff44-b52f-4f0f-a087-c1da9adf048f","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":106,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"b3c49036-3600-435b-a2b2-a0bbc34262a6","block_type":"box","text":"losses and could make structured notes more difficult for the Fund to value accurately.","page_number":106,"box":{"x":70,"y":173,"width":618,"height":11}},{"id":"07b1dc2b-9640-413d-ac99-fc66970a9090","block_type":"box","text":"Taxability Risk.","page_number":106,"box":{"x":103,"y":196,"width":109,"height":11}},{"id":"04397f56-33a2-4a6d-bbd0-655b80f720e8","block_type":"box","text":"Certain of the Funds intend to minimize the payment of taxable income to shareholders by","page_number":106,"box":{"x":218,"y":196,"width":644,"height":11}},{"id":"440adc5e-5da4-42bf-83bb-6bca7e4e4e40","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":106,"box":{"x":70,"y":211,"width":817,"height":11}},{"id":"c5ad32a5-3071-4f29-80f4-9fcaf5eb34b4","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":106,"box":{"x":68,"y":226,"width":827,"height":11}},{"id":"d34d1338-a786-4c62-b444-3df97d326c4d","block_type":"box","text":"be excludable from gross income for U.S. federal income tax purposes. Such securities, however, may be determined","page_number":106,"box":{"x":69,"y":241,"width":835,"height":11}},{"id":"21da997d-f8ea-49be-99fb-086e367395e6","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":106,"box":{"x":68,"y":256,"width":809,"height":11}},{"id":"4cbe61dd-6c46-4b47-8fae-94c574c03618","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":106,"box":{"x":69,"y":271,"width":832,"height":12}},{"id":"246fe954-4fe8-4607-a182-9400a9177951","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":106,"box":{"x":69,"y":286,"width":816,"height":12}},{"id":"d82d2812-e347-4648-9a3a-8b4fb05917c6","block_type":"box","text":"paid by the Fund as “exempt interest dividends” could be adversely affected, subjecting the Fund’s shareholders to","page_number":106,"box":{"x":70,"y":302,"width":822,"height":11}},{"id":"dedea486-f214-4594-841c-0fc0cfea43d9","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":106,"box":{"x":70,"y":317,"width":818,"height":11}},{"id":"e3ff390a-a79e-4246-8deb-2354e397564d","block_type":"box","text":"Fund is subsequently determined to be taxable, the Fund will dispose of that security as soon as reasonably","page_number":106,"box":{"x":70,"y":332,"width":771,"height":11}},{"id":"d3176700-7aff-4807-9ea8-5cbbf1a6c4d9","block_type":"box","text":"practicable. In addition, future laws, regulations, rulings or court decisions may cause interest on municipal","page_number":106,"box":{"x":70,"y":347,"width":765,"height":11}},{"id":"2623dce2-0eef-483d-8aee-88f764acc1ae","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":106,"box":{"x":69,"y":362,"width":834,"height":11}},{"id":"5398ad45-5626-43b4-9d61-35c68e79e291","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":106,"box":{"x":68,"y":377,"width":807,"height":11}},{"id":"8d6bdfdd-a4e8-4a0a-a00d-ae7001db4b9f","block_type":"box","text":"local intangible personal property tax, or may otherwise prevent the Fund from realizing the full current benefit of the","page_number":106,"box":{"x":70,"y":392,"width":830,"height":12}},{"id":"b13415b8-f341-4504-b300-fe4b3272b794","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":106,"box":{"x":68,"y":407,"width":838,"height":12}},{"id":"cf11c10d-bac5-4e96-b3b3-e2cdeff59327","block_type":"box","text":"the value of an investment in the Fund.","page_number":106,"box":{"x":68,"y":423,"width":278,"height":9}},{"id":"aa775646-fd2f-48f5-9cec-b61058b408c6","block_type":"box","text":"Temporary Defensive Measures.","page_number":106,"box":{"x":103,"y":445,"width":230,"height":11}},{"id":"9cba69ef-53bb-4da4-ba4a-39b3eb60abc1","block_type":"box","text":"As a temporary defensive measure, including to respond to adverse market,","page_number":106,"box":{"x":339,"y":445,"width":542,"height":12}},{"id":"9d34c627-6ad5-4196-aa52-673d4763b785","block_type":"box","text":"economic, political or other conditions, a Fund may depart from its principal investment strategies and may invest","page_number":106,"box":{"x":69,"y":460,"width":811,"height":12}},{"id":"da67f5d2-7be8-4acc-9862-97577fe58f66","block_type":"box","text":"without limitation in cash, high quality money market instruments, or other short term investments. Certain Funds","page_number":106,"box":{"x":68,"y":476,"width":813,"height":11}},{"id":"0083d14c-2936-435a-b0fe-6a682106013d","block_type":"box","text":"may also invest in cash and other such instruments pending investment or to meet anticipated redemption requests.","page_number":106,"box":{"x":69,"y":491,"width":833,"height":11}},{"id":"8e723eda-1343-4986-b6b4-76f60a2272f6","block_type":"box","text":"High quality money market instruments include U.S. Government obligations, U.S. Government agency obligations,","page_number":106,"box":{"x":70,"y":506,"width":813,"height":11}},{"id":"cafe4c74-7ed2-4087-9663-70bb5002f5f6","block_type":"box","text":"dollar denominated obligations of foreign issuers, bank obligations, including U.S. subsidiaries and branches of","page_number":106,"box":{"x":69,"y":521,"width":795,"height":11}},{"id":"47b4eabb-06dc-4aeb-bbb4-620252508f9d","block_type":"box","text":"foreign banks, corporate obligations, commercial paper, repurchase agreements and obligations of supranational","page_number":106,"box":{"x":68,"y":536,"width":806,"height":11}},{"id":"77513313-2b0d-4cfe-836a-b6eecb259e7f","block_type":"box","text":"organizations. Generally, such obligations will mature within one year from the date of settlement but may mature","page_number":106,"box":{"x":69,"y":551,"width":808,"height":11}},{"id":"957e8f2f-52c0-4e02-bdc9-e826d19217f8","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":106,"box":{"x":68,"y":566,"width":820,"height":11}},{"id":"a94eed94-8206-44f4-b46b-98232831dfff","block_type":"box","text":"its investment objective.","page_number":106,"box":{"x":70,"y":582,"width":171,"height":10}},{"id":"5dc8090f-414b-42ff-baa9-6ec4047659cc","block_type":"box","text":"U.S. Government Obligations.","page_number":106,"box":{"x":102,"y":604,"width":213,"height":11}},{"id":"96850fd2-894b-4fc7-ae7b-97b0dfe25a5b","block_type":"box","text":"A Fund may purchase obligations issued or guaranteed by the U.S. Government","page_number":106,"box":{"x":321,"y":604,"width":566,"height":11}},{"id":"3a3c6853-4434-4be3-b9ba-b6a5e6557053","block_type":"box","text":"and U.S. Government agencies and instrumentalities. Obligations of certain agencies and instrumentalities of the","page_number":106,"box":{"x":69,"y":619,"width":810,"height":11}},{"id":"3b1d3508-9978-44fa-b971-1fff017bb454","block_type":"box","text":"U.S. Government are supported by the full faith and credit of the U.S. Treasury. Others are supported by the right of","page_number":106,"box":{"x":70,"y":634,"width":826,"height":12}},{"id":"92ccb5ff-7dd5-4bd6-9366-0b8aa924c4d1","block_type":"box","text":"the issuer to borrow from the U.S. Treasury; and still others are supported only by the credit of the agency or","page_number":106,"box":{"x":68,"y":649,"width":779,"height":12}},{"id":"c5dbc10d-52b0-4b7d-bf80-125bad885558","block_type":"box","text":"instrumentality issuing the obligation. No assurance can be given that the U.S. Government will provide financial","page_number":106,"box":{"x":70,"y":664,"width":798,"height":12}},{"id":"24612714-f2d9-4251-a107-b84748373e1a","block_type":"box","text":"support to U.S. Government-sponsored instrumentalities if it is not obligated to do so by law. Certain U.S. Treasury","page_number":106,"box":{"x":69,"y":680,"width":822,"height":11}},{"id":"6d4cdbea-071c-4d47-be37-67523c87dae2","block_type":"box","text":"and agency securities may be held by trusts that issue participation certificates (such as Treasury income growth","page_number":106,"box":{"x":69,"y":695,"width":809,"height":11}},{"id":"3b2971a6-f3a5-4ebe-b424-be6425b00b9f","block_type":"box","text":"receipts and certificates of accrual on Treasury certificates). These certificates, as well as Treasury receipts and","page_number":106,"box":{"x":69,"y":710,"width":805,"height":11}},{"id":"37c4514e-d558-48e2-bf70-7a7f2bb2daa5","block_type":"box","text":"other stripped securities, represent beneficial ownership interests in either future interest payments or the future","page_number":106,"box":{"x":69,"y":725,"width":807,"height":11}},{"id":"2f24c5bd-46fb-43d0-81a9-46c0f0eb3ca0","block_type":"box","text":"principal payments on U.S. Government obligations. These instruments are issued at a discount to their “face value”","page_number":106,"box":{"x":70,"y":740,"width":832,"height":11}},{"id":"fa69712b-655b-42a3-a965-7ccd06f2adf5","block_type":"box","text":"and may (particularly in the case of stripped mortgage-backed securities) exhibit greater price volatility than ordinary","page_number":106,"box":{"x":69,"y":755,"width":829,"height":11}},{"id":"9ec5a207-bcb2-4bae-a811-d0f027ace049","block_type":"box","text":"debt securities because of the manner in which their principal and interest are returned to investors.","page_number":106,"box":{"x":69,"y":770,"width":716,"height":11}},{"id":"5993a4c2-bfc8-4c17-8fd5-e34c43a1a3bc","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":106,"box":{"x":102,"y":793,"width":800,"height":11}},{"id":"b874845f-4226-4b50-86a5-dfb3a5ed539c","block_type":"box","text":"Treasury Notes and Treasury Bonds and the obligations of the Federal Housing Administration, Farmers Home","page_number":106,"box":{"x":68,"y":808,"width":785,"height":11}},{"id":"fcfca9f0-d9cc-4e70-9123-e954f4ca537b","block_type":"box","text":"Administration, Export-Import Bank of the United States, Small Business Administration, Ginnie Mae, Fannie Mae,","page_number":106,"box":{"x":68,"y":823,"width":813,"height":11}},{"id":"fc46b74f-69ce-446e-b10f-bf9508a907f6","block_type":"box","text":"Federal Financing Bank, General Services Administration, Student Loan Marketing Association, Central Bank for","page_number":106,"box":{"x":70,"y":838,"width":794,"height":12}},{"id":"ffa51b7a-a637-4edb-8e09-596a30cf4e7c","block_type":"box","text":"Cooperatives, Federal Home Loan Banks, Freddie Mac, Federal Intermediate Credit Banks, Federal Land Banks, Farm","page_number":106,"box":{"x":69,"y":854,"width":835,"height":10}},{"id":"28b547f6-3b35-4010-ada2-b900fad9f310","block_type":"box","text":"Credit Banks System, Maritime Administration, Tennessee Valley Authority and Washington D.C. Armory Board. The","page_number":106,"box":{"x":69,"y":869,"width":818,"height":11}},{"id":"aaa6729d-d863-4c0b-83a8-fef9296e5c1f","block_type":"box","text":"Funds may also invest in mortgage-related securities issued or guaranteed by U.S. Government agencies and","page_number":106,"box":{"x":70,"y":884,"width":777,"height":11}},{"id":"8df910d8-2f04-4dd3-94c9-a79664b8d643","block_type":"box","text":"instrumentalities, including such instruments as obligations of Ginnie Mae, Fannie Mae and Freddie Mac.","page_number":106,"box":{"x":70,"y":899,"width":749,"height":11}},{"id":"dd65f3eb-d08e-47d0-b982-d0af754e5a85","block_type":"box","text":"II-76","page_number":106,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"56d780cd-a9b5-429e-9b60-58dfe3d166f8","block_type":"box","text":"NM1026U-5979889-106/232","page_number":106,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"20192e3d-1e50-4e93-af8c-d5fc6ccb5298","block_type":"box","text":"U.S. Treasury Obligations.","page_number":107,"box":{"x":103,"y":45,"width":183,"height":11}},{"id":"1eb1ea95-ec9c-41c9-ae6c-8deecd7436c4","block_type":"box","text":"Treasury obligations may differ in their interest rates, maturities, times of issuance","page_number":107,"box":{"x":292,"y":45,"width":593,"height":11}},{"id":"c2f35793-8204-4beb-8258-515b899dbf5b","block_type":"box","text":"and other characteristics. Obligations of U.S. Government agencies and authorities are supported by varying degrees","page_number":107,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"efc8cfe5-639b-4906-b030-89474e2d6639","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":107,"box":{"x":69,"y":75,"width":827,"height":11}},{"id":"66078232-bd3f-4265-b38c-cceee1da443a","block_type":"box","text":"that the U.S. Government will provide financial support to its agencies and authorities if it is not obligated by law to","page_number":107,"box":{"x":68,"y":90,"width":823,"height":11}},{"id":"7eb1744e-b377-4212-8088-500388f2d38c","block_type":"box","text":"do so.","page_number":107,"box":{"x":69,"y":105,"width":42,"height":9}},{"id":"0420e161-831c-472c-a792-728309e8accd","block_type":"box","text":"U.S. Treasury Rolls","page_number":107,"box":{"x":102,"y":128,"width":139,"height":11}},{"id":"4d45e618-80d4-4c3b-b4a8-7db0b0db2b17","block_type":"box","text":".","page_number":107,"box":{"x":241,"y":135,"width":3,"height":2}},{"id":"6bb89e5a-75db-424d-ba2a-7876b1a23961","block_type":"box","text":"Certain Funds may invest in U.S. Treasury rolls. In a U.S. Treasury roll transaction, the Fund","page_number":107,"box":{"x":250,"y":128,"width":656,"height":11}},{"id":"dddf748b-d0a5-45ec-8f13-ac21fffa822c","block_type":"box","text":"sells a treasury security to a counterparty with a simultaneous agreement to repurchase the same security at an","page_number":107,"box":{"x":69,"y":143,"width":804,"height":11}},{"id":"3deb0b1a-af63-487b-a98a-5230a140ca0f","block_type":"box","text":"agreed upon price and future settlement date. U.S. Treasury roll transactions may incrementally adjust the average","page_number":107,"box":{"x":69,"y":158,"width":820,"height":11}},{"id":"556eb591-f6b4-46e4-bfb9-8e1dc632ce1b","block_type":"box","text":"maturity of a Fund’s portfolio and increase the interest yield on the Fund’s portfolio by extending the average maturity","page_number":107,"box":{"x":69,"y":173,"width":840,"height":11}},{"id":"ace0d2e3-0167-45a4-8db0-3dd14cf914ad","block_type":"box","text":"of the portfolio in a normal yield curve environment. During the period before the settlement date of a U.S. Treasury","page_number":107,"box":{"x":69,"y":188,"width":828,"height":12}},{"id":"d3fdea7b-7ed2-45ca-a5b3-86cb7de61d42","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":107,"box":{"x":69,"y":204,"width":775,"height":11}},{"id":"6591361a-cbfc-44f1-af93-fc7cb51c36d3","block_type":"box","text":"securities it is purchasing until after the settlement date. A Fund could suffer an opportunity loss if the counterparty","page_number":107,"box":{"x":69,"y":218,"width":829,"height":12}},{"id":"9f1ffc3e-4768-4821-92a5-5e653060df91","block_type":"box","text":"to the U.S. Treasury roll transaction failed to perform its obligations on the settlement date.","page_number":107,"box":{"x":68,"y":234,"width":657,"height":11}},{"id":"879ac345-bfad-4b3b-870e-1a6904f2c505","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":107,"box":{"x":101,"y":256,"width":756,"height":12}},{"id":"69e33e66-aa8a-4e80-a1ce-88c3ba062695","block_type":"box","text":"purchase price of those securities. U.S. Treasury rolls are speculative techniques that can be deemed to involve","page_number":107,"box":{"x":70,"y":271,"width":800,"height":12}},{"id":"32bdfb12-7c70-4207-881a-142a826bdb98","block_type":"box","text":"leverage. There is no assurance that U.S. Treasury rolls can be successfully employed.","page_number":107,"box":{"x":70,"y":286,"width":617,"height":12}},{"id":"b18001c9-2a8b-4ae5-bb75-d473e96d4539","block_type":"box","text":"Utility Industries.","page_number":107,"box":{"x":102,"y":309,"width":124,"height":11}},{"id":"0f420ba4-a599-4a76-ab36-5d970c08a9de","block_type":"box","text":"Risks that are intrinsic to the utility industries include difficulty in obtaining an adequate return","page_number":107,"box":{"x":233,"y":309,"width":674,"height":11}},{"id":"0a4566c7-9be0-4c29-a747-e6ce16c697a9","block_type":"box","text":"on invested capital, difficulty in financing large construction programs during an inflationary period, restrictions on","page_number":107,"box":{"x":69,"y":324,"width":812,"height":12}},{"id":"20bd5eec-ff67-4063-bd42-46655e005191","block_type":"box","text":"operations and increased cost and delays attributable to environmental considerations and regulation, difficulty in","page_number":107,"box":{"x":69,"y":339,"width":812,"height":12}},{"id":"1afc0560-f36c-4b14-a62e-094d22031217","block_type":"box","text":"raising capital in adequate amounts on reasonable terms in periods of high inflation and unsettled capital markets,","page_number":107,"box":{"x":69,"y":355,"width":821,"height":11}},{"id":"53579772-4a20-48d0-ab19-38c8dca1f882","block_type":"box","text":"technological innovations that may render existing plants, equipment or products obsolete, the potential impact of","page_number":107,"box":{"x":68,"y":370,"width":815,"height":11}},{"id":"3d3afc10-ce51-41b6-964f-c896e2193372","block_type":"box","text":"natural or man-made disasters, increased costs and reduced availability of certain types of fuel, occasional reduced","page_number":107,"box":{"x":69,"y":385,"width":827,"height":11}},{"id":"4d02c6da-9f26-4cba-a9d2-48173c6effd0","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":107,"box":{"x":69,"y":400,"width":795,"height":11}},{"id":"ec2b9d43-069f-4522-95ec-89ee46cb451e","block_type":"box","text":"energy policy and lengthy delays and greatly increased costs and other problems associated with the design,","page_number":107,"box":{"x":69,"y":415,"width":774,"height":11}},{"id":"e720c024-48db-4c0a-91f8-8791c4ed7d5a","block_type":"box","text":"construction, licensing, regulation and operation of nuclear facilities for electric generation, including, among other","page_number":107,"box":{"x":69,"y":430,"width":817,"height":11}},{"id":"ca978715-3714-48bb-ae9a-f938c58a90a0","block_type":"box","text":"considerations, the problems associated with the use of radioactive materials and the disposal of radioactive wastes.","page_number":107,"box":{"x":69,"y":445,"width":839,"height":11}},{"id":"a88ef053-87ae-491b-ba29-0e8dd6f1f738","block_type":"box","text":"There are substantial differences among the regulatory practices and policies of various jurisdictions, and any given","page_number":107,"box":{"x":68,"y":460,"width":827,"height":12}},{"id":"dbfc052d-2c26-416e-bf16-960988aad2a8","block_type":"box","text":"regulatory agency may make major shifts in policy from time to time. There is no assurance that regulatory","page_number":107,"box":{"x":69,"y":475,"width":761,"height":12}},{"id":"5972f780-6268-40fb-b18d-1de6e2e63bb2","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":107,"box":{"x":69,"y":491,"width":821,"height":11}},{"id":"99578608-5e48-4968-a059-2f1aa412c60c","block_type":"box","text":"dividends on common stocks issued by a utility company. Additionally, existing and possible future regulatory","page_number":107,"box":{"x":69,"y":506,"width":777,"height":11}},{"id":"8f130cb2-d508-4eaa-aabb-cd00e19031a3","block_type":"box","text":"legislation may make it even more difficult for utilities to obtain adequate relief. Certain of the issuers of securities","page_number":107,"box":{"x":70,"y":521,"width":820,"height":11}},{"id":"0047a020-cbf3-40c5-9dad-9d7f49a1b5b9","block_type":"box","text":"held in the Fund’s portfolio may own or operate nuclear generating facilities. Governmental authorities may from time","page_number":107,"box":{"x":69,"y":536,"width":835,"height":11}},{"id":"005264d9-b3d7-4413-a205-a69dc4f8d8ab","block_type":"box","text":"to time review existing policies and impose additional requirements governing the licensing, construction and","page_number":107,"box":{"x":68,"y":551,"width":778,"height":11}},{"id":"eed48243-02aa-43e6-ad4e-ae3b49a79f49","block_type":"box","text":"operation of nuclear power plants. Prolonged changes in climatic conditions can also have a significant impact on","page_number":107,"box":{"x":69,"y":566,"width":808,"height":11}},{"id":"5422a981-8277-4549-9d5c-31c6a86b4b35","block_type":"box","text":"both the revenues of an electric and gas utility as well as the expenses of a utility, particularly a hydro-based electric","page_number":107,"box":{"x":69,"y":581,"width":831,"height":12}},{"id":"8facac67-27d9-4012-92c1-385a866e30be","block_type":"box","text":"utility.","page_number":107,"box":{"x":69,"y":597,"width":39,"height":11}},{"id":"808cd12e-05e2-4756-a33c-84ff56c7420d","block_type":"box","text":"Companies in the utilities sector may be adversely affected by changes in exchange rates, domestic and","page_number":107,"box":{"x":102,"y":619,"width":744,"height":11}},{"id":"f6ca896d-689a-477f-8f49-7b69a9154d94","block_type":"box","text":"international competition, and governmental limitations on rates charged to customers. The value of regulated utility","page_number":107,"box":{"x":70,"y":634,"width":828,"height":12}},{"id":"12f5a854-318e-4b92-965a-fb894b992ff1","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":107,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"96702ac8-2ed4-4132-b626-db26b03337a6","block_type":"box","text":"interest rates and therefore may lead to volatility in performance.","page_number":107,"box":{"x":70,"y":664,"width":464,"height":12}},{"id":"fe0e0c81-8c83-4246-b3e1-595a928be618","block_type":"box","text":"Utility companies in the United States and in foreign countries are generally subject to regulation. In the United","page_number":107,"box":{"x":102,"y":687,"width":789,"height":11}},{"id":"343ca2e5-3b3d-4f26-90ea-95592a7dabd4","block_type":"box","text":"States, most utility companies are regulated by state and/or federal authorities. Such regulation is intended to","page_number":107,"box":{"x":69,"y":702,"width":790,"height":12}},{"id":"f0c0aee0-ecb9-4e43-95b6-c544bc0a83c4","block_type":"box","text":"ensure appropriate standards of service and adequate capacity to meet public demand. Generally, prices are also","page_number":107,"box":{"x":69,"y":717,"width":811,"height":12}},{"id":"2e588fe3-9e6d-4f99-9167-f79815abbd1f","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":107,"box":{"x":69,"y":732,"width":824,"height":12}},{"id":"ddeaef47-4cbe-4baf-adcd-24dc21e9fd18","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":107,"box":{"x":68,"y":748,"width":781,"height":11}},{"id":"514dda8c-69c8-4a00-8e8d-997afb82f6c6","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":107,"box":{"x":69,"y":763,"width":826,"height":11}},{"id":"d1e512b9-7ef1-4084-8af3-abb087cf3390","block_type":"box","text":"continue in the future.","page_number":107,"box":{"x":69,"y":778,"width":156,"height":9}},{"id":"999c49c9-1f03-468d-b028-769daea06cf5","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":107,"box":{"x":101,"y":801,"width":763,"height":11}},{"id":"04f233e7-a20f-470a-ad30-5604811bbf41","block_type":"box","text":"countries. In recent years, changes in regulation in the United States increasingly have allowed utility companies to","page_number":107,"box":{"x":69,"y":816,"width":820,"height":11}},{"id":"67a6a15f-7d92-4cc6-9803-2ba562e028f8","block_type":"box","text":"provide services and products outside their traditional geographic areas and lines of business, creating new areas of","page_number":107,"box":{"x":70,"y":831,"width":834,"height":11}},{"id":"887a1837-25e4-4a44-94cf-c39e03717982","block_type":"box","text":"competition within the industries. In some instances, utility companies are operating on an unregulated basis.","page_number":107,"box":{"x":69,"y":846,"width":784,"height":11}},{"id":"984a19e0-29db-4bde-bd2b-6a696fa28e3d","block_type":"box","text":"Because of trends toward deregulation and the evolution of independent power producers as well as new entrants to","page_number":107,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"ea1f2b18-216e-4d50-8e12-8045c8314f3c","block_type":"box","text":"the field of telecommunications, non-regulated providers of utility services have become a significant part of their","page_number":107,"box":{"x":68,"y":876,"width":809,"height":11}},{"id":"9cb9e22b-9754-4ef9-b117-8d2ab27fd30c","block_type":"box","text":"respective industries. The Manager believes that the emergence of competition and deregulation will result in certain","page_number":107,"box":{"x":69,"y":891,"width":834,"height":12}},{"id":"bd75794d-8131-4515-9def-aa27006579e6","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":107,"box":{"x":69,"y":906,"width":825,"height":12}},{"id":"02d42e47-9a1d-47e0-a02f-3a8950007b1b","block_type":"box","text":"II-77","page_number":107,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3b8ebb85-ccd2-4312-8eca-ea3c8126d20c","block_type":"box","text":"NM1026U-5979889-107/232","page_number":107,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"090fb80c-580b-430a-8c3e-c33a2a5e5c64","block_type":"box","text":"to defend their core business from increased competition and may be less profitable. Reduced profitability, as well as","page_number":108,"box":{"x":68,"y":45,"width":840,"height":11}},{"id":"6fa35774-2a09-456a-a2e7-4ed0c69331a1","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":108,"box":{"x":69,"y":60,"width":796,"height":11}},{"id":"8757555b-c786-47b9-aef6-f082fcd61c0c","block_type":"box","text":"rates. As deregulation allows utility companies to diversify outside of their original geographic regions and their","page_number":108,"box":{"x":69,"y":75,"width":790,"height":11}},{"id":"31c73aa8-487d-4fee-badb-cc35ae7b745a","block_type":"box","text":"traditional lines of business, utility companies may engage in riskier ventures. Therefore, deregulation may eliminate","page_number":108,"box":{"x":68,"y":90,"width":831,"height":11}},{"id":"1bb0531d-e292-42d0-9db1-1e6d38941bcf","block_type":"box","text":"restrictions on the maximum level of profits of certain utility companies, but may also subject these companies to","page_number":108,"box":{"x":69,"y":105,"width":812,"height":11}},{"id":"ddcc4fc3-668a-4188-9348-bf905d1d607d","block_type":"box","text":"greater risk of loss. The Manager seeks to take advantage of favorable investment opportunities that may arise from","page_number":108,"box":{"x":68,"y":120,"width":833,"height":12}},{"id":"c42ac734-d354-4a5b-a25c-77d9c888cafc","block_type":"box","text":"these structural changes. Of course, there can be no assurance that favorable developments will occur in the future.","page_number":108,"box":{"x":68,"y":135,"width":831,"height":12}},{"id":"343c164c-9431-4118-86f6-a38a9cc1cc44","block_type":"box","text":"Foreign utility companies are also subject to regulation, although such regulations may or may not be","page_number":108,"box":{"x":102,"y":158,"width":720,"height":11}},{"id":"9c64d9e7-4e17-403f-ba67-eaa5ed2d58c3","block_type":"box","text":"comparable to those in the United States. Foreign utility companies may be more heavily regulated by their respective","page_number":108,"box":{"x":69,"y":173,"width":838,"height":11}},{"id":"02f26f14-5630-4553-b88c-1134eabb8ee1","block_type":"box","text":"governments than utilities in the United States and, as in the United States, generally are required to seek","page_number":108,"box":{"x":68,"y":188,"width":762,"height":12}},{"id":"145b8ebb-601b-4a81-b43b-965b825ea552","block_type":"box","text":"government approval for rate increases. In addition, many foreign utilities use fuels that may cause more pollution","page_number":108,"box":{"x":68,"y":203,"width":815,"height":12}},{"id":"dbfc8dcd-1d57-4e2b-91c0-b2b78d32a015","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":108,"box":{"x":68,"y":219,"width":801,"height":11}},{"id":"ef070a27-209c-4fff-9450-1e45b34a3238","block_type":"box","text":"meet any proposed pollution restrictions. Foreign regulatory systems vary from country to country and may evolve in","page_number":108,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"0010e915-2b39-401e-b2b0-999b0079e704","block_type":"box","text":"ways different from regulation in the United States.","page_number":108,"box":{"x":68,"y":249,"width":365,"height":11}},{"id":"d3e59476-26dc-41a7-acf0-e63deb9fb882","block_type":"box","text":"A Fund’s investment policies are designed to enable it to capitalize on evolving investment opportunities","page_number":108,"box":{"x":101,"y":272,"width":745,"height":11}},{"id":"b0c1e4ad-8988-48ed-99a3-0432fd736ab9","block_type":"box","text":"throughout the world. For example, the rapid growth of certain foreign economies will necessitate expansion of","page_number":108,"box":{"x":68,"y":286,"width":790,"height":12}},{"id":"8aa7e974-3330-4212-aaf2-6f5fb5432171","block_type":"box","text":"capacity in the utility industries in those countries. Although many foreign utility companies currently are government","page_number":108,"box":{"x":69,"y":302,"width":833,"height":11}},{"id":"9964f9a8-fd10-4d78-b06c-d2ecf77adc24","block_type":"box","text":"owned, thereby limiting current investment opportunities for a Fund, the Manager believes that, in order to attract","page_number":108,"box":{"x":69,"y":317,"width":810,"height":11}},{"id":"99aea84c-9fc2-4473-a630-b0badaaea87f","block_type":"box","text":"significant capital for growth, foreign governments are likely to seek global investors through the privatization of their","page_number":108,"box":{"x":69,"y":332,"width":831,"height":11}},{"id":"5eccdddc-86d5-4ffa-9a1d-b834f4eb27f0","block_type":"box","text":"utility industries. Privatization, which refers to the trend toward investor ownership of assets rather than government","page_number":108,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"565da23d-6d0a-4147-864a-fdb8543c31d8","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":108,"box":{"x":69,"y":362,"width":832,"height":11}},{"id":"bd68a28f-a6e1-4ab8-9d51-fad4d459c49c","block_type":"box","text":"assurance that such favorable developments will occur or that investment opportunities in foreign markets will","page_number":108,"box":{"x":69,"y":377,"width":786,"height":12}},{"id":"eb181f4d-d0bc-4b0f-9581-758f4e0c7ce6","block_type":"box","text":"increase.","page_number":108,"box":{"x":70,"y":393,"width":63,"height":8}},{"id":"4839dd67-5503-4fb2-b4d2-8f4d6fe248b6","block_type":"box","text":"The revenues of domestic and foreign utility companies generally reflect the economic growth and development","page_number":108,"box":{"x":101,"y":415,"width":793,"height":11}},{"id":"8d285947-83b6-4598-8900-494c9c26d32e","block_type":"box","text":"in the geographic areas in which they do business. The Manager will take into account anticipated economic growth","page_number":108,"box":{"x":70,"y":430,"width":821,"height":11}},{"id":"1dc7daad-2269-4cab-a16b-12a7e23b455c","block_type":"box","text":"rates and other economic developments when selecting securities of utility companies.","page_number":108,"box":{"x":69,"y":445,"width":619,"height":12}},{"id":"e1651ad5-762e-4e16-bc36-47aa06f4e9f7","block_type":"box","text":"Electric.","page_number":108,"box":{"x":102,"y":468,"width":54,"height":9}},{"id":"c12bac54-6507-4208-9450-8227ebdf8de5","block_type":"box","text":"The electric utility industry consists of companies that are engaged principally in the generation,","page_number":108,"box":{"x":163,"y":468,"width":684,"height":11}},{"id":"795f8ab6-7f30-4c60-a20a-a19901e7449c","block_type":"box","text":"transmission and sale of electric energy, although many also provide other energy-related services. In the past,","page_number":108,"box":{"x":68,"y":483,"width":793,"height":11}},{"id":"ac5a3d33-d87b-4b92-9e2d-305a4273fe55","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":108,"box":{"x":69,"y":498,"width":814,"height":11}},{"id":"dbe38c3c-e93c-4959-975f-56b0c5de180c","block_type":"box","text":"near completion of major construction programs. In addition, many of these companies have generated cash flows in","page_number":108,"box":{"x":69,"y":513,"width":833,"height":12}},{"id":"c1db929a-a687-47d7-b98c-7cd40ac634a3","block_type":"box","text":"excess of current operating expenses and construction expenditures, permitting some degree of diversification into","page_number":108,"box":{"x":69,"y":528,"width":821,"height":12}},{"id":"190807c6-da61-4d6f-94d5-a63d281d900f","block_type":"box","text":"unregulated businesses. Some electric utilities have also taken advantage of the right to sell power outside of their","page_number":108,"box":{"x":69,"y":543,"width":823,"height":12}},{"id":"39f630d5-b049-46d4-b0d4-aaec84311556","block_type":"box","text":"traditional geographic areas. Electric utility companies have historically been subject to the risks associated with","page_number":108,"box":{"x":68,"y":559,"width":803,"height":11}},{"id":"6dc74a8e-c97d-4b4e-8af4-c52c99ab37d6","block_type":"box","text":"increases in fuel and other operating costs, high interest costs on borrowings needed for capital construction","page_number":108,"box":{"x":70,"y":574,"width":778,"height":11}},{"id":"d9197506-a4eb-44e2-8d5c-bc26b2ca0c6b","block_type":"box","text":"programs, costs associated with compliance with environmental and safety regulations and changes in the regulatory","page_number":108,"box":{"x":70,"y":589,"width":836,"height":11}},{"id":"ef175839-7a73-4644-b3d2-5b53dcd61d9f","block_type":"box","text":"climate. As interest rates declined, many utilities refinanced high cost debt and in doing so improved their fixed","page_number":108,"box":{"x":69,"y":604,"width":793,"height":11}},{"id":"f59ef2f6-f067-480d-a158-43f667cf44b0","block_type":"box","text":"charges coverage. Regulators, however, lowered allowed rates of return as interest rates declined and thereby","page_number":108,"box":{"x":69,"y":619,"width":786,"height":11}},{"id":"838dd862-a75e-4613-91b5-71a37a8bf494","block_type":"box","text":"caused the benefits of the rate declines to be shared wholly or in part with customers. In a period of rising interest","page_number":108,"box":{"x":69,"y":634,"width":819,"height":12}},{"id":"c62a4a42-8590-4a69-8bfa-515bb65c1313","block_type":"box","text":"rates, the allowed rates of return may not keep pace with the utilities’ increased costs. The construction and","page_number":108,"box":{"x":69,"y":649,"width":775,"height":12}},{"id":"c282ac7c-ae80-4bfc-ad88-3b44e51ef41a","block_type":"box","text":"operation of nuclear power facilities are subject to strict scrutiny by, and evolving regulations of, the Nuclear","page_number":108,"box":{"x":69,"y":664,"width":770,"height":12}},{"id":"919bc6a3-abe6-40ff-8a36-60ada8aaf9c8","block_type":"box","text":"Regulatory Commission and state agencies which have comparable jurisdiction. Strict scrutiny might result in higher","page_number":108,"box":{"x":70,"y":680,"width":826,"height":11}},{"id":"5ae29568-09c7-4bce-b8ed-09d57ab2a1db","block_type":"box","text":"operating costs and higher capital expenditures, with the risk that the regulators may disallow inclusion of these","page_number":108,"box":{"x":69,"y":695,"width":800,"height":11}},{"id":"d2567f7b-86a6-4bd2-8bc1-9d5f06ffdb26","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":108,"box":{"x":69,"y":710,"width":836,"height":11}},{"id":"1fe3b437-1b2d-468e-b522-73004653dbc7","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":108,"box":{"x":68,"y":725,"width":826,"height":11}},{"id":"38881c4e-c50b-4286-999f-97598465e8e1","block_type":"box","text":"and for decommissioning such plants.","page_number":108,"box":{"x":69,"y":740,"width":270,"height":11}},{"id":"3ab5d7c1-97b7-48a0-a64e-4fb1de3325b2","block_type":"box","text":"The rating agencies look closely at the business profile of utilities. Ratings for companies are expected to be","page_number":108,"box":{"x":101,"y":763,"width":776,"height":11}},{"id":"bbb9a6f2-9bf4-4f59-80e3-4b20fd263946","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":108,"box":{"x":70,"y":778,"width":802,"height":11}},{"id":"965074b7-134d-493b-85c2-c4fa82ea1b2a","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":108,"box":{"x":69,"y":793,"width":791,"height":11}},{"id":"022d12d3-922d-47f0-9760-bdc0741c563b","block_type":"box","text":"competitive and the least regulated. On the other hand, companies that focus on transmission and distribution, which","page_number":108,"box":{"x":69,"y":808,"width":839,"height":11}},{"id":"81b58a9a-9acd-40fb-a526-f299e8261bbb","block_type":"box","text":"is expected to be the least competitive and the more regulated part of the business, may see higher ratings given the","page_number":108,"box":{"x":70,"y":823,"width":838,"height":12}},{"id":"0e8b7b48-7026-4d14-a947-3fb25747ed3d","block_type":"box","text":"greater predictability of cash flow.","page_number":108,"box":{"x":68,"y":838,"width":239,"height":12}},{"id":"a8ffeb98-a92a-4824-ac6b-0fa93519fcf3","block_type":"box","text":"A number of states are considering or have enacted deregulation proposals. The introduction of competition into","page_number":108,"box":{"x":101,"y":861,"width":801,"height":11}},{"id":"fa0b7580-95a2-4263-8a10-40dd65869625","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":108,"box":{"x":68,"y":876,"width":821,"height":11}},{"id":"3195fa40-fb82-4e6d-9314-73b083b719ed","block_type":"box","text":"default risk, and lower electric utility security prices. Such increased competition may also cause long-term contracts,","page_number":108,"box":{"x":69,"y":891,"width":835,"height":12}},{"id":"ee5b5b0a-c088-4308-8115-8cbc570bf83a","block_type":"box","text":"which electric utilities previously entered into to buy power, to become “stranded assets” which have no economic","page_number":108,"box":{"x":68,"y":907,"width":815,"height":11}},{"id":"517c4911-7d35-48d4-9b38-c37cc2db67dc","block_type":"box","text":"II-78","page_number":108,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b6af5b47-f7b7-4b01-9707-b3f0f8aeb49b","block_type":"box","text":"NM1026U-5979889-108/232","page_number":108,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1b36ffc8-843b-4731-89f8-217e2b645a22","block_type":"box","text":"value. Any loss associated with such contracts must be absorbed by ratepayers and investors. In addition, some","page_number":109,"box":{"x":68,"y":45,"width":803,"height":11}},{"id":"e80bd890-e9cb-4a7d-a64f-dc3c5104fcf3","block_type":"box","text":"electric utilities have acquired electric utilities overseas to diversify, enhance earnings and gain experience in","page_number":109,"box":{"x":69,"y":60,"width":777,"height":11}},{"id":"676ce67f-a38e-487b-b828-7d0646c44edb","block_type":"box","text":"operating in a deregulated environment. In some instances, such acquisitions have involved significant borrowings,","page_number":109,"box":{"x":69,"y":75,"width":819,"height":11}},{"id":"c8f3ecbb-5d5b-4823-ba38-32015f8f22aa","block_type":"box","text":"which have burdened the acquirer’s balance sheet. There is no assurance that current deregulation proposals will be","page_number":109,"box":{"x":68,"y":90,"width":835,"height":11}},{"id":"b8562910-a1af-4190-b91f-5ea3b0329b3d","block_type":"box","text":"adopted. However, deregulation in any form could significantly impact the electric utilities industry.","page_number":109,"box":{"x":69,"y":105,"width":700,"height":11}},{"id":"e0c134f6-7f85-422b-9357-b56a74c227f1","block_type":"box","text":"Telecommunications.","page_number":109,"box":{"x":103,"y":128,"width":147,"height":9}},{"id":"b7ad460d-d058-4aa4-b31d-10ad14cece04","block_type":"box","text":"The telecommunications industry today includes both traditional telephone companies, with","page_number":109,"box":{"x":256,"y":128,"width":652,"height":11}},{"id":"992f0894-71d6-433d-b970-064157910d9d","block_type":"box","text":"a history of broad market coverage and highly regulated businesses, and cable companies, which began as small,","page_number":109,"box":{"x":69,"y":143,"width":813,"height":11}},{"id":"64dd1e9c-5bcb-4c97-a5a0-38cdfa317626","block_type":"box","text":"lightly regulated businesses focused on limited markets. Today these two historically different businesses are","page_number":109,"box":{"x":70,"y":158,"width":782,"height":11}},{"id":"58495b5c-3610-4da7-a244-d86cddaa0869","block_type":"box","text":"converging in an industry that is trending toward larger, competitive national and international markets with an","page_number":109,"box":{"x":69,"y":173,"width":786,"height":11}},{"id":"0c519f0d-1fc7-4760-9cb0-f3ba7b3fcb14","block_type":"box","text":"emphasis on deregulation. Companies that distribute telephone services and provide access to the telephone","page_number":109,"box":{"x":69,"y":188,"width":784,"height":12}},{"id":"e214fdee-daee-4271-878b-6d022738ea4e","block_type":"box","text":"networks still comprise the greatest portion of this segment, but non-regulated activities such as wireless telephone","page_number":109,"box":{"x":69,"y":203,"width":830,"height":12}},{"id":"30b20649-b4a5-44cc-bc28-8f2dd311f5e7","block_type":"box","text":"services, paging, data transmission and processing, equipment retailing, computer software and hardware and","page_number":109,"box":{"x":69,"y":218,"width":790,"height":12}},{"id":"4841c879-5c7f-4383-8861-8574cc0fd7c8","block_type":"box","text":"internet services are becoming increasingly significant components as well. In particular, wireless and internet","page_number":109,"box":{"x":70,"y":234,"width":788,"height":11}},{"id":"ef51acb4-6b03-4fc5-8817-6333b2b89dd7","block_type":"box","text":"telephone services continue to gain market share at the expense of traditional telephone companies. The presence","page_number":109,"box":{"x":68,"y":249,"width":825,"height":11}},{"id":"fee5cc19-c3a5-42b5-abd5-de3042120df0","block_type":"box","text":"of unregulated companies in this industry and the entry of traditional telephone companies into unregulated or less","page_number":109,"box":{"x":69,"y":264,"width":823,"height":11}},{"id":"47eda021-dbe4-4f98-95d7-beee01f05ece","block_type":"box","text":"regulated businesses provide significant investment opportunities with companies that may increase their earnings","page_number":109,"box":{"x":69,"y":279,"width":821,"height":11}},{"id":"34979c81-61d4-43e3-98f2-65ef569072b4","block_type":"box","text":"at faster rates than had been allowed in traditional regulated businesses. Still, increasing competition, technological","page_number":109,"box":{"x":69,"y":294,"width":830,"height":11}},{"id":"b837749f-5a86-4241-84f1-f3991664275d","block_type":"box","text":"innovations and other structural changes could adversely affect the profitability of such utilities and the growth rate","page_number":109,"box":{"x":70,"y":309,"width":821,"height":11}},{"id":"4d1c42b5-e709-4def-8fb3-da1e41e1da64","block_type":"box","text":"of their dividends. Given mergers and proposed legislation and enforcement changes, it is likely that both traditional","page_number":109,"box":{"x":69,"y":324,"width":827,"height":12}},{"id":"caf62905-5150-4ce6-a0d0-69740e22b4e0","block_type":"box","text":"telephone companies and cable companies will continue to provide an expanding range of utility services to both","page_number":109,"box":{"x":68,"y":339,"width":804,"height":12}},{"id":"9f44a64b-6e3b-4bbe-bb87-fedc04ce2afa","block_type":"box","text":"residential, corporate and governmental customers.","page_number":109,"box":{"x":69,"y":355,"width":367,"height":11}},{"id":"86ccfe3e-1d55-4e10-9a04-8c5d0964d200","block_type":"box","text":"Gas.","page_number":109,"box":{"x":102,"y":377,"width":31,"height":9}},{"id":"75e0732d-6be5-4640-a714-046eaa320f18","block_type":"box","text":"Gas transmission companies and gas distribution companies are undergoing significant changes. In the","page_number":109,"box":{"x":139,"y":377,"width":740,"height":12}},{"id":"c3d3bff8-6a37-425f-8a8c-fd70f44b5bb4","block_type":"box","text":"United States, interstate transmission companies are regulated by the Federal Energy Regulatory Commission, which","page_number":109,"box":{"x":70,"y":392,"width":834,"height":12}},{"id":"4b38e0ee-decb-4428-ac80-504073a41198","block_type":"box","text":"is reducing its regulation of the industry. Many companies have diversified into oil and gas exploration and","page_number":109,"box":{"x":70,"y":407,"width":756,"height":12}},{"id":"5cdcceba-b34c-4ad8-9f6b-5b45cce620a8","block_type":"box","text":"development, making returns more sensitive to energy prices. In the recent decade, gas utility companies have been","page_number":109,"box":{"x":69,"y":423,"width":831,"height":11}},{"id":"06dee4af-aaa3-42da-b6ff-ea283de9960f","block_type":"box","text":"adversely affected by disruptions in the oil industry and have also been affected by increased concentration and","page_number":109,"box":{"x":69,"y":438,"width":801,"height":11}},{"id":"ea29a330-40a6-4756-abf8-83df30c3cb15","block_type":"box","text":"competition. In the opinion of the Manager, however, environmental considerations could improve the gas industry","page_number":109,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"f184fbfb-24a7-40ff-afaf-57dcb0950699","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":109,"box":{"x":69,"y":468,"width":782,"height":11}},{"id":"2e4b3ca5-cb1e-463d-9f3a-b7530e5cb245","block_type":"box","text":"incremental shifts in fuel consumption toward natural gas and away from oil and coal, even for electricity generation.","page_number":109,"box":{"x":70,"y":483,"width":829,"height":11}},{"id":"a9844457-2f68-4092-8e82-a9f1de25899a","block_type":"box","text":"However, technological or regulatory changes within the industry may delay or prevent this result.","page_number":109,"box":{"x":70,"y":498,"width":691,"height":11}},{"id":"41722e67-0d13-49fa-9d09-bf8649f23499","block_type":"box","text":"Water.","page_number":109,"box":{"x":103,"y":521,"width":42,"height":9}},{"id":"40a7daa9-4620-40ee-b75f-bc54276b97ea","block_type":"box","text":"Water supply utilities are companies that collect, purify, distribute and sell water. In the United States and","page_number":109,"box":{"x":151,"y":521,"width":754,"height":11}},{"id":"f31302b6-dd16-4d94-84b9-a5b1253a8fb4","block_type":"box","text":"around the world the industry is highly fragmented because most of the supplies are owned by local authorities.","page_number":109,"box":{"x":69,"y":536,"width":796,"height":11}},{"id":"9ac94e96-b11b-4a28-bcd1-3c72d41353c8","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":109,"box":{"x":69,"y":551,"width":806,"height":11}},{"id":"0f4c6440-96b2-473a-86f2-7fd37d721ae1","block_type":"box","text":"opinion of the Manager, there may be opportunities for certain companies to acquire other water utility companies","page_number":109,"box":{"x":69,"y":566,"width":814,"height":11}},{"id":"216b9ad9-c2e3-4063-bf45-9dac6f243b5c","block_type":"box","text":"and for foreign acquisition of domestic companies. The Manager believes that favorable investment opportunities","page_number":109,"box":{"x":69,"y":581,"width":808,"height":12}},{"id":"afdf89be-ee61-4bd2-a04d-6c85b9844a6e","block_type":"box","text":"may result from consolidation of this segment. As with other utilities, however, increased regulation, increased costs","page_number":109,"box":{"x":69,"y":596,"width":832,"height":12}},{"id":"9e939d66-182c-477d-8034-438728b162ac","block_type":"box","text":"and potential disruptions in supply may adversely affect investments in water supply utilities.","page_number":109,"box":{"x":69,"y":612,"width":662,"height":11}},{"id":"1bebcd06-9a23-47d0-8c95-adee51244970","block_type":"box","text":"Utility Industries Generally.","page_number":109,"box":{"x":103,"y":634,"width":186,"height":11}},{"id":"2f9fa6b1-4683-4243-806e-3aeb85e8cae9","block_type":"box","text":"There can be no assurance that the positive developments noted above, including","page_number":109,"box":{"x":296,"y":634,"width":584,"height":12}},{"id":"7cf8ea16-dc8a-4e24-b58e-4938d3541042","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":109,"box":{"x":68,"y":649,"width":837,"height":12}},{"id":"c45e7cae-d0ad-46a5-8e59-cb4ffbede57c","block_type":"box","text":"not develop in the future.","page_number":109,"box":{"x":69,"y":664,"width":178,"height":11}},{"id":"fdf51f3b-4fb0-418d-bcc6-b8c6c36ad7b2","block_type":"box","text":"When-Issued Securities, Delayed Delivery Securities and Forward Commitments.","page_number":109,"box":{"x":103,"y":687,"width":585,"height":11}},{"id":"a855259b-0466-45a2-b653-66d9d6b53111","block_type":"box","text":"A Fund may purchase or sell","page_number":109,"box":{"x":694,"y":687,"width":200,"height":11}},{"id":"1c7a445e-28ec-468d-b916-3189c68d3d38","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":109,"box":{"x":69,"y":703,"width":795,"height":10}},{"id":"12b07ac8-5a0f-4fcc-91d3-a7d7e5caf658","block_type":"box","text":"delayed delivery basis or through a forward commitment (including on a TBA (to be announced) basis). These","page_number":109,"box":{"x":69,"y":717,"width":777,"height":12}},{"id":"d33f999e-f78f-4470-8762-18e58061c5ff","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":109,"box":{"x":68,"y":732,"width":820,"height":12}},{"id":"c235134b-a22c-4262-85ed-c1fa6655a709","block_type":"box","text":"taking place in the future. The Fund enters into these transactions to obtain what is considered an advantageous","page_number":109,"box":{"x":68,"y":748,"width":807,"height":11}},{"id":"f1b9bb54-db27-4507-8cea-3a7370223efc","block_type":"box","text":"price to the Fund at the time of entering into the transaction.","page_number":109,"box":{"x":70,"y":763,"width":430,"height":11}},{"id":"d02734c9-5e63-40bb-af41-1385fe87e77e","block_type":"box","text":"Pursuant to recommendations of the Treasury Market Practices Group, which is sponsored by the Federal","page_number":109,"box":{"x":102,"y":785,"width":750,"height":12}},{"id":"0f6faa2e-7d53-44fa-aaa8-570061f415db","block_type":"box","text":"Reserve Bank of New York, a Fund or its counterparty generally will be required to post collateral when entering into","page_number":109,"box":{"x":70,"y":801,"width":823,"height":11}},{"id":"d2270071-a651-4086-8c8f-619ebd0259b5","block_type":"box","text":"certain forward-settling transactions, including without limitation TBA transactions. FINRA rules have also been","page_number":109,"box":{"x":69,"y":816,"width":788,"height":11}},{"id":"0c1de2b4-85be-4ae8-85b8-cdd0acebc6ca","block_type":"box","text":"implemented that include mandatory margin requirements for the TBA market with limited exceptions. The","page_number":109,"box":{"x":70,"y":831,"width":755,"height":11}},{"id":"4fbf7030-fa3a-45f4-931a-85676ede267a","block_type":"box","text":"collateralization of TBA trades is intended to mitigate counterparty credit risk between trade and settlement, but","page_number":109,"box":{"x":69,"y":846,"width":799,"height":11}},{"id":"7106b7e8-c8e1-493d-bab1-9a84857c5d7d","block_type":"box","text":"could increase the cost of TBA transactions and impose added operational complexity.","page_number":109,"box":{"x":69,"y":861,"width":614,"height":11}},{"id":"8420eaf5-e581-4bbd-ad24-ce9225e55b34","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":109,"box":{"x":101,"y":884,"width":780,"height":11}},{"id":"9d738f22-67d8-4159-b796-9181f1cdeb13","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":109,"box":{"x":70,"y":899,"width":823,"height":11}},{"id":"e3dd7813-158c-472c-aa80-988422edf5bc","block_type":"box","text":"II-79","page_number":109,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"471299b5-fb32-4d56-b552-788695bb3490","block_type":"box","text":"NM1026U-5979889-109/232","page_number":109,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c9699c0a-c357-4bb4-82f4-cd91a78f0ffb","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":110,"box":{"x":69,"y":45,"width":838,"height":11}},{"id":"5c621876-d9f9-48e7-94fa-3276895541b0","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":110,"box":{"x":68,"y":60,"width":839,"height":11}},{"id":"f3116df7-32fe-4720-862e-2c276c0ebf31","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":110,"box":{"x":70,"y":75,"width":824,"height":11}},{"id":"5006c446-312a-4348-86ef-3e03d5994b4c","block_type":"box","text":"If deemed advisable as a matter of investment strategy, a Fund may dispose of or renegotiate a commitment","page_number":110,"box":{"x":102,"y":98,"width":776,"height":11}},{"id":"0f678e2d-e7e1-4382-abab-1ec715c8e584","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":110,"box":{"x":69,"y":113,"width":795,"height":11}},{"id":"452185fb-a3ea-414f-ba89-42ee77b1185a","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":110,"box":{"x":69,"y":128,"width":799,"height":11}},{"id":"5af11204-1c81-4851-afba-1d53b0f34bee","block_type":"box","text":"When a Fund engages in when-issued, TBA or forward commitment transactions, it relies on the other party to","page_number":110,"box":{"x":101,"y":150,"width":784,"height":12}},{"id":"6edb066b-5bfb-461b-abe9-83ce0b1a7c48","block_type":"box","text":"consummate the trade. Failure of such party to do so may result in the Fund’s incurring a loss or missing an","page_number":110,"box":{"x":69,"y":166,"width":772,"height":11}},{"id":"4030bab3-b9ea-4017-9234-c5f03278f504","block_type":"box","text":"opportunity to obtain a price considered to be advantageous.","page_number":110,"box":{"x":69,"y":181,"width":434,"height":11}},{"id":"0ef00070-cb8b-4db2-a619-acbc3b563405","block_type":"box","text":"The market value of the securities underlying a commitment to purchase securities, and any subsequent","page_number":110,"box":{"x":101,"y":203,"width":745,"height":12}},{"id":"78b88b5f-caf8-49ee-8e8b-1dbddb0fbf27","block_type":"box","text":"fluctuations in their market value, is taken into account when determining the market value of a Fund starting on the","page_number":110,"box":{"x":68,"y":218,"width":831,"height":12}},{"id":"e2c293da-d9ee-417e-922e-ffd2b5e15d20","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":110,"box":{"x":69,"y":234,"width":823,"height":11}},{"id":"24e483e2-047a-4393-81b9-3d8780fb10c5","block_type":"box","text":"to purchase until they are paid for and delivered on the settlement date.","page_number":110,"box":{"x":68,"y":249,"width":514,"height":11}},{"id":"e20201a3-8773-40e4-99db-065e0b0091b5","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":110,"box":{"x":102,"y":271,"width":759,"height":12}},{"id":"9cf427ae-9051-494d-aade-a01aa3c4c97e","block_type":"box","text":"securities (","page_number":110,"box":{"x":69,"y":287,"width":78,"height":11}},{"id":"604d2420-bd49-4e35-8f3e-2fc63974f74d","block_type":"box","text":"e.g.","page_number":110,"box":{"x":148,"y":288,"width":25,"height":10}},{"id":"45bff728-c3cf-44db-b30b-eb5fdaa7ef31","block_type":"box","text":", firm and standby commitments, including TBA commitments, and dollar rolls) and non-standard","page_number":110,"box":{"x":176,"y":286,"width":686,"height":12}},{"id":"be57447e-0045-4526-813d-824720e4f7e5","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":110,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"c1ba3942-8ce9-474e-963b-e013a3eedf71","block_type":"box","text":"Investment Company Act, provided that the Fund intends to physically settle the transaction and the transaction will","page_number":110,"box":{"x":70,"y":317,"width":822,"height":11}},{"id":"05638f59-6d53-4fd9-b5f7-de3e330768b8","block_type":"box","text":"settle within 35 days of its trade date (the “Delayed-Settlement Securities Provision”). If a when-issued, forward","page_number":110,"box":{"x":69,"y":332,"width":802,"height":11}},{"id":"5c4ecc1e-3f65-4533-be9c-75a33b4d2716","block_type":"box","text":"settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities Provision, then","page_number":110,"box":{"x":69,"y":347,"width":826,"height":11}},{"id":"791d3c44-7938-4097-b6c9-1c5c496c1fe0","block_type":"box","text":"it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of Derivatives — Rule","page_number":110,"box":{"x":70,"y":362,"width":816,"height":11}},{"id":"959dcd55-c1a4-486e-90e7-fcb02dca4f8d","block_type":"box","text":"18f-4 under the Investment Company Act” above.","page_number":110,"box":{"x":70,"y":377,"width":349,"height":11}},{"id":"52788d83-e59a-46a0-92fd-e4666fe2e4db","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and certain of","page_number":110,"box":{"x":102,"y":400,"width":800,"height":11}},{"id":"ac9ed330-a571-400d-bee2-8ebdc1f153c2","block_type":"box","text":"their affiliates to include in certain financial contracts, including many agreements with respect to when-issued, TBA","page_number":110,"box":{"x":68,"y":415,"width":829,"height":11}},{"id":"d901f3ae-723c-4f4f-af0e-0ee5939eb640","block_type":"box","text":"and forward commitment transactions, terms that delay or restrict the rights of counterparties, such as a Fund, to","page_number":110,"box":{"x":69,"y":430,"width":814,"height":11}},{"id":"37a36565-825c-4ab4-b282-5353aa3ab82e","block_type":"box","text":"terminate such agreements, foreclose upon collateral, exercise other default rights or restrict transfers of credit","page_number":110,"box":{"x":68,"y":445,"width":799,"height":12}},{"id":"383fbe68-e4d9-4b5d-a4b8-774e61a5ef1e","block_type":"box","text":"support in the event that the counterparty and/or its affiliates are subject to certain types of resolution or insolvency","page_number":110,"box":{"x":69,"y":460,"width":836,"height":12}},{"id":"960da885-8821-48a8-be92-cd1acb044744","block_type":"box","text":"proceedings. It is possible that these requirements, as well as potential additional government regulation and other","page_number":110,"box":{"x":70,"y":476,"width":824,"height":11}},{"id":"b48258fa-3387-4ebb-ac56-c8d4a89c8b43","block_type":"box","text":"developments in the market, could adversely affect a Fund’s ability to terminate existing agreements with respect to","page_number":110,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"b1e1f68a-d1a7-468e-9439-05918e373057","block_type":"box","text":"these transactions or to realize amounts to be received under such agreements.","page_number":110,"box":{"x":68,"y":506,"width":573,"height":11}},{"id":"f3fa0c83-39f1-4fba-8b96-672aa7929d46","block_type":"box","text":"Yields and Ratings.","page_number":110,"box":{"x":103,"y":529,"width":139,"height":11}},{"id":"671a79dd-ed7f-4eef-a5ab-452044317d97","block_type":"box","text":"The yields on certain obligations are dependent on a variety of factors, including general","page_number":110,"box":{"x":247,"y":528,"width":628,"height":12}},{"id":"401d9743-02f6-4ae5-84c8-aa7a1a0f49d5","block_type":"box","text":"market conditions, conditions in the particular market for the obligation, the financial condition of the issuer, the size","page_number":110,"box":{"x":69,"y":543,"width":834,"height":12}},{"id":"c8ee77ff-07bd-4e09-9699-f41b92c4434a","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":110,"box":{"x":69,"y":559,"width":799,"height":11}},{"id":"06e5c16f-3417-40e6-87ec-efc4d3525e98","block_type":"box","text":"represent their respective opinions as to the quality of the obligations they undertake to rate. Ratings, however, are","page_number":110,"box":{"x":69,"y":574,"width":824,"height":11}},{"id":"6d70dca0-cfc0-4b29-ad0f-e271754f67ff","block_type":"box","text":"general and are not absolute standards of quality. Consequently, obligations with the same rating, maturity and","page_number":110,"box":{"x":68,"y":589,"width":792,"height":11}},{"id":"f15d91dc-37d1-4621-af42-89c69dedb822","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":110,"box":{"x":70,"y":604,"width":827,"height":11}},{"id":"5698fd9a-6fde-4560-810e-d38cd5ef698e","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":110,"box":{"x":69,"y":619,"width":786,"height":11}},{"id":"d343fd9c-bbec-426c-9aee-ac2b0cde1a69","block_type":"box","text":"continue to hold the security.","page_number":110,"box":{"x":69,"y":634,"width":204,"height":11}},{"id":"06d0d06e-4117-4649-8058-d3374358dace","block_type":"box","text":"Zero Coupon Securities.","page_number":110,"box":{"x":102,"y":657,"width":175,"height":11}},{"id":"634abd58-c7c5-4c97-82d3-9f0b31392ab6","block_type":"box","text":"Zero coupon securities are securities that are sold at a discount to par value and do","page_number":110,"box":{"x":283,"y":657,"width":601,"height":11}},{"id":"08d3e093-afb7-4ec5-8dea-afbb74046b18","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":110,"box":{"x":69,"y":672,"width":837,"height":11}},{"id":"2ee61f72-355d-4261-9a30-05c06d4d3a42","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":110,"box":{"x":69,"y":687,"width":822,"height":11}},{"id":"ee4a8b8f-c450-4fbc-847d-f9f0b0d295ab","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":110,"box":{"x":68,"y":702,"width":814,"height":11}},{"id":"fb986411-415b-4a33-a91e-8a69a8305412","block_type":"box","text":"security.","page_number":110,"box":{"x":69,"y":718,"width":57,"height":11}},{"id":"6be78c0a-2143-4246-a5a9-d5b64f11d9fa","block_type":"box","text":"While interest payments are not made on such securities, holders of such securities are deemed to have","page_number":110,"box":{"x":101,"y":740,"width":749,"height":11}},{"id":"c75d8ca9-dbdd-42f9-8293-944946108f06","block_type":"box","text":"received income (“phantom income”) annually, notwithstanding that cash may not be received currently. The effect of","page_number":110,"box":{"x":69,"y":755,"width":835,"height":11}},{"id":"df97c4af-706e-44c1-a81a-07bcfaa154cf","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":110,"box":{"x":69,"y":770,"width":833,"height":12}},{"id":"8b7a2d75-d857-41b7-808b-9fe295dc63f5","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":110,"box":{"x":70,"y":785,"width":836,"height":12}},{"id":"8a2d248c-6ff4-40c2-8aca-9d3a0e5adc61","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":110,"box":{"x":69,"y":801,"width":804,"height":11}},{"id":"51d46196-4aac-4245-9b36-0a83d8898c29","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":110,"box":{"x":68,"y":816,"width":824,"height":11}},{"id":"e83e87cf-ee44-4fdf-9104-e4e1776f17c8","block_type":"box","text":"future. For this reason, some of these securities may be subject to substantially greater price fluctuations during","page_number":110,"box":{"x":68,"y":831,"width":805,"height":11}},{"id":"551d183b-74da-4689-b9cf-e7408e49d390","block_type":"box","text":"periods of changing market interest rates than are comparable securities that pay interest currently. Longer term zero","page_number":110,"box":{"x":70,"y":846,"width":837,"height":11}},{"id":"0c86bcaf-a00b-4678-8e4f-fa66863a70d5","block_type":"box","text":"coupon bonds are more exposed to interest rate risk than shorter term zero coupon bonds. These investments","page_number":110,"box":{"x":69,"y":861,"width":791,"height":11}},{"id":"d22c5f3e-7ada-4cb1-a887-080bc71ab1a1","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":110,"box":{"x":69,"y":876,"width":800,"height":11}},{"id":"396acef9-efb6-4bde-ac38-a05d6ae459e0","block_type":"box","text":"attract investors who are willing to defer receipt of cash.","page_number":110,"box":{"x":69,"y":891,"width":400,"height":12}},{"id":"f19546eb-f47a-4dc8-9758-34d11db57906","block_type":"box","text":"II-80","page_number":110,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6214b9ad-f27b-4174-bbca-aa2769368213","block_type":"box","text":"NM1026U-5979889-110/232","page_number":110,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a695bfed-472c-4440-9a21-e9dde95e6a53","block_type":"box","text":"A Fund accrues income with respect to these securities for U.S. federal income tax and accounting purposes","page_number":111,"box":{"x":101,"y":45,"width":775,"height":11}},{"id":"310b98b1-14fa-47a3-aeda-af058831b34a","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":111,"box":{"x":70,"y":60,"width":827,"height":11}},{"id":"36bc5d9e-357e-40e9-b4db-0bc2b1bc8ab1","block_type":"box","text":"liquidity in the event of adverse market conditions than comparably rated securities that pay cash interest at regular","page_number":111,"box":{"x":70,"y":75,"width":826,"height":11}},{"id":"6ecc9c38-168e-4a34-bdb1-372c7f59b8c0","block_type":"box","text":"intervals.","page_number":111,"box":{"x":70,"y":90,"width":64,"height":9}},{"id":"c671437b-5294-4b1e-a3ab-b9b2586e6041","block_type":"box","text":"Further, to maintain its qualification for pass-through treatment under the U.S. federal tax laws, a Fund is","page_number":111,"box":{"x":102,"y":113,"width":749,"height":11}},{"id":"426789e1-10cf-47b4-a0c8-080aca66b47d","block_type":"box","text":"required to distribute income to its shareholders and, consequently, may have to dispose of other, more liquid","page_number":111,"box":{"x":69,"y":128,"width":784,"height":11}},{"id":"5519bbb2-9559-4734-a77c-94722322a6e3","block_type":"box","text":"portfolio securities under disadvantageous circumstances or may have to leverage itself by borrowing in order to","page_number":111,"box":{"x":70,"y":143,"width":799,"height":11}},{"id":"d8055724-d3f0-4441-b0e4-7f401a10cff7","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":111,"box":{"x":68,"y":158,"width":799,"height":11}},{"id":"eeb4702f-cc35-48fe-8636-d4976c907dfd","block_type":"box","text":"exposure to zero coupon securities.","page_number":111,"box":{"x":69,"y":173,"width":253,"height":11}},{"id":"aa7636e5-6abc-4af1-9589-8b657ccf76dd","block_type":"box","text":"In addition to the above-described risks, there are certain other risks related to investing in zero coupon","page_number":111,"box":{"x":102,"y":196,"width":740,"height":11}},{"id":"7799856d-5ac2-4f34-9d70-f099b388e669","block_type":"box","text":"securities. During a period of severe market conditions, the market for such securities may become even less liquid.","page_number":111,"box":{"x":69,"y":211,"width":829,"height":11}},{"id":"3e2dd93a-cda2-4299-8e2f-5e57bd379bc3","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":111,"box":{"x":70,"y":226,"width":829,"height":11}},{"id":"8082680f-7cb3-4f3a-83a9-f4af8857ae2b","block_type":"box","text":"risks, including credit risk, will increase during the time these securities are held in the Fund’s portfolio.","page_number":111,"box":{"x":69,"y":241,"width":741,"height":11}},{"id":"1bd2eba1-b76d-4472-82ee-2ea70b54e181","block_type":"box","text":"Suitability. (All Funds)","page_number":111,"box":{"x":101,"y":264,"width":161,"height":11}},{"id":"7c1a68ad-e22a-4a1c-b252-4c367353e376","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":111,"box":{"x":101,"y":286,"width":793,"height":12}},{"id":"f48888bc-7ab1-4feb-b96f-625b20912f0c","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":111,"box":{"x":68,"y":302,"width":811,"height":11}},{"id":"81bafc72-91f1-47cb-8cdd-4a7783a7a91d","block_type":"box","text":"investment program. The suitability for any particular investor of a purchase of shares in a Fund will depend upon,","page_number":111,"box":{"x":70,"y":317,"width":810,"height":11}},{"id":"18397cbd-7790-4130-9d8e-eb7b4c9bc67e","block_type":"box","text":"among other things, such investor’s investment objectives and such investor’s ability to accept the risks associated","page_number":111,"box":{"x":69,"y":332,"width":826,"height":11}},{"id":"6d255fd5-e032-41a3-a307-f6521eb61c95","block_type":"box","text":"with investing in securities, including the risk of loss of principal.","page_number":111,"box":{"x":68,"y":347,"width":460,"height":11}},{"id":"8fbaf199-eaf0-4c39-a252-c2792c24006c","block_type":"box","text":"Investment Restrictions. (All Funds)","page_number":111,"box":{"x":102,"y":370,"width":264,"height":11}},{"id":"b2368ff5-4f7a-4f97-a83d-1f910d367285","block_type":"box","text":"See “Investment Restrictions” or “Investment Policies,” as applicable in each Fund’s SAI for the specific","page_number":111,"box":{"x":102,"y":392,"width":745,"height":11}},{"id":"86a44cd2-5552-4266-a19e-413b1b97f99a","block_type":"box","text":"fundamental and non-fundamental investment restrictions adopted by each Fund. In addition to those investment","page_number":111,"box":{"x":68,"y":407,"width":807,"height":12}},{"id":"ee3b3ef8-c9d9-4f91-9e9d-46384c290a8d","block_type":"box","text":"restrictions, each Fund is also subject to the restrictions discussed below.","page_number":111,"box":{"x":69,"y":423,"width":528,"height":11}},{"id":"4b4da763-b45e-4e75-ba8f-5a8f136ab9fc","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":111,"box":{"x":102,"y":445,"width":735,"height":12}},{"id":"8baa3365-01a7-4172-a151-9e2bc20f1fd2","block_type":"box","text":"company” for purposes of the Code. See “Dividends and Taxes — Taxes” or “Taxes.” To qualify, among other","page_number":111,"box":{"x":69,"y":460,"width":775,"height":12}},{"id":"d8c186b5-91db-410a-bca0-846ebb55a128","block_type":"box","text":"requirements, each Fund will limit its investments so that, at the close of each quarter of the taxable year, (i) at least","page_number":111,"box":{"x":69,"y":475,"width":837,"height":12}},{"id":"904d933a-c92b-4a68-94b4-5004b0a96ad5","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":111,"box":{"x":69,"y":491,"width":799,"height":11}},{"id":"55a93c40-7697-4722-8256-8f4242c54652","block_type":"box","text":"companies, U.S. Government Securities and other securities, with such other securities limited, in respect of any one","page_number":111,"box":{"x":69,"y":506,"width":837,"height":11}},{"id":"738570a4-c8d3-45da-9423-947a9cf5115a","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":111,"box":{"x":70,"y":521,"width":825,"height":11}},{"id":"3b3e80bd-3c1c-44c6-ae0c-ca320945b660","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":111,"box":{"x":68,"y":536,"width":802,"height":11}},{"id":"9783a7d3-1993-4ed7-ab97-6b2509cb08ba","block_type":"box","text":"(other than U.S. Government Securities or securities of other regulated investment companies) of any one issuer, any","page_number":111,"box":{"x":69,"y":551,"width":837,"height":11}},{"id":"c06c5a9c-7c6f-49b1-a047-29fdc8630a7d","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":111,"box":{"x":68,"y":566,"width":819,"height":11}},{"id":"4cac1d0b-be82-498d-94b5-58a2b97ffca7","block_type":"box","text":"businesses or related trades or businesses or in the securities of one or more qualified publicly traded partnerships","page_number":111,"box":{"x":69,"y":581,"width":828,"height":11}},{"id":"5bb599b5-3869-4502-b76b-7a36c8ccdd3b","block_type":"box","text":"(","page_number":111,"box":{"x":69,"y":597,"width":3,"height":10}},{"id":"2b465a49-7cbe-4217-bf59-74779eb18ed1","block_type":"box","text":"i.e.","page_number":111,"box":{"x":74,"y":597,"width":21,"height":8}},{"id":"2da310f7-d51c-428f-97d8-bf3565ff2958","block_type":"box","text":", partnerships that are traded on an established securities market or tradable on a secondary market, other than","page_number":111,"box":{"x":97,"y":597,"width":806,"height":11}},{"id":"24f38ed6-8c4d-4a9d-bbfd-1b06f3ef9eb4","block_type":"box","text":"partnerships that derive 90% of their income from interest, dividends, capital gains and other traditionally permitted","page_number":111,"box":{"x":70,"y":612,"width":824,"height":11}},{"id":"a3e335d7-63c9-4cae-9a21-c20b5c923a38","block_type":"box","text":"mutual fund income). For purposes of this restriction, the Municipal Funds generally will regard each state and each","page_number":111,"box":{"x":69,"y":627,"width":824,"height":11}},{"id":"90a3aeb7-b5da-4bd7-a44c-2a5930ee1874","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":111,"box":{"x":69,"y":642,"width":838,"height":11}},{"id":"b050d65e-9291-4621-8e1f-580d8929cd43","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":111,"box":{"x":69,"y":657,"width":815,"height":11}},{"id":"9531e19a-b51f-406b-8379-2dee9373d519","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":111,"box":{"x":69,"y":672,"width":781,"height":11}},{"id":"cf69ed40-cc3f-462a-972d-b31c8b1a49bc","block_type":"box","text":"government entity, then the entity with the ultimate responsibility for the payment of interest and principal may be","page_number":111,"box":{"x":68,"y":687,"width":810,"height":11}},{"id":"b678b282-d6b5-4895-aba3-9699e412d570","block_type":"box","text":"regarded as the sole issuer.","page_number":111,"box":{"x":69,"y":703,"width":198,"height":11}},{"id":"2252b797-d320-4dca-b956-b35673692960","block_type":"box","text":"Foreign government securities (unlike U.S. Government Securities) are not exempt from the 5%, 10% and 25%","page_number":111,"box":{"x":102,"y":725,"width":784,"height":11}},{"id":"c4ecc45a-05b5-48b1-b8ac-823f9ccab01a","block_type":"box","text":"diversification requirements of the Code discussed above and the securities of each foreign government issuer are","page_number":111,"box":{"x":69,"y":740,"width":819,"height":11}},{"id":"63cdec3c-1851-41dd-b479-4f64c7f0b202","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":111,"box":{"x":69,"y":755,"width":811,"height":11}},{"id":"eef05157-5d02-4d52-8c2e-9030d64546ac","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":111,"box":{"x":70,"y":770,"width":747,"height":12}},{"id":"234f1f74-a376-46d7-b524-88de316fd89e","block_type":"box","text":"“diversified” under the Investment Company Act must satisfy the foregoing 5% and 10% requirements with respect to","page_number":111,"box":{"x":70,"y":785,"width":834,"height":12}},{"id":"db11d36a-01c4-452c-a6d6-2b0a25e1fa96","block_type":"box","text":"75% of its total assets.","page_number":111,"box":{"x":69,"y":801,"width":165,"height":9}},{"id":"cb614847-c1fa-4947-a3c9-87dc54a633be","block_type":"box","text":"II-81","page_number":111,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6739660f-ebfc-45b6-b3de-4a410e1db609","block_type":"box","text":"NM1026U-5979889-111/232","page_number":111,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2ab6deed-eb64-4814-8dc1-fea701db785b","block_type":"box","text":"MANAGEMENT AND OTHER SERVICE ARRANGEMENTS","page_number":112,"box":{"x":268,"y":45,"width":442,"height":10}},{"id":"55fd34a3-f506-45e7-8e89-efb43bd298d4","block_type":"box","text":"Directors and Officers","page_number":112,"box":{"x":69,"y":76,"width":159,"height":8}},{"id":"508e12a2-b164-4b61-b9f2-8d65543eb9a7","block_type":"box","text":"See “Information on Directors and Officers, ‘—Biographical Information,’ ‘— Share Ownership’ and ‘—","page_number":112,"box":{"x":102,"y":98,"width":733,"height":11}},{"id":"907e884d-ad1f-4873-b785-66bd7b023aa7","block_type":"box","text":"Compensation of Directors’” or “Information on Trustees and Officers, ‘—Biographical Information,’ ‘— Share","page_number":112,"box":{"x":69,"y":113,"width":783,"height":12}},{"id":"7da9ab6f-e596-464d-adaa-6d88fc42f551","block_type":"box","text":"Ownership’ and ‘— Compensation of Trustees’,” as applicable, in Part I of each Fund’s SAI for biographical and","page_number":112,"box":{"x":69,"y":128,"width":795,"height":12}},{"id":"83f7f51a-c4f8-4f74-ac32-108556d7544c","block_type":"box","text":"certain other information relating to the Directors and officers of your Fund, including Directors’ compensation.","page_number":112,"box":{"x":69,"y":143,"width":789,"height":12}},{"id":"679445b9-8698-4fe8-8157-3916fe1a5556","block_type":"box","text":"Management Arrangements","page_number":112,"box":{"x":69,"y":174,"width":202,"height":11}},{"id":"110a14b0-1f8e-40bc-9fb7-feca18fd8bc9","block_type":"box","text":"Management Services.","page_number":112,"box":{"x":102,"y":197,"width":162,"height":11}},{"id":"67687d9e-c050-4135-a356-c32ee1dd532b","block_type":"box","text":"The Manager provides each Fund with investment advisory and management services.","page_number":112,"box":{"x":270,"y":197,"width":615,"height":11}},{"id":"c5dea02e-8ca5-4928-a47b-3d6d105e1422","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":112,"box":{"x":69,"y":212,"width":836,"height":11}},{"id":"81637d43-2575-48a9-b3d2-4d9e9474de0b","block_type":"box","text":"portfolio and reviews the Fund’s holdings in light of its own research analysis and that from other relevant sources.","page_number":112,"box":{"x":70,"y":227,"width":820,"height":11}},{"id":"8e98a76b-3bdb-4f3a-8aff-a0994d32a693","block_type":"box","text":"The responsibility for making decisions to buy, sell or hold a particular security rests with the Manager. The Manager","page_number":112,"box":{"x":68,"y":242,"width":832,"height":11}},{"id":"30e8fa1e-1adb-4217-bec1-349693b5c1ef","block_type":"box","text":"performs certain of the other administrative services and provides all the office space, facilities, equipment and","page_number":112,"box":{"x":70,"y":257,"width":801,"height":11}},{"id":"0ed0290a-f002-4a67-a8c5-d6e5e4c8daa3","block_type":"box","text":"necessary personnel for management of each Fund.","page_number":112,"box":{"x":69,"y":272,"width":370,"height":11}},{"id":"d38aa0de-be40-45ea-b0f5-738761bc0dcf","block_type":"box","text":"Each Feeder Fund invests all or a portion of its assets in shares of a Master Portfolio. To the extent a Feeder","page_number":112,"box":{"x":102,"y":295,"width":778,"height":11}},{"id":"8a47dc9c-3cd4-4dc8-a656-303ca3155fbb","block_type":"box","text":"Fund invests all of its assets in a Master Portfolio, it does not invest directly in portfolio securities and does not","page_number":112,"box":{"x":70,"y":310,"width":800,"height":11}},{"id":"28f19e9b-a3df-42e6-8fc0-1352e583e494","block_type":"box","text":"require management services. For such Feeder Funds, portfolio management occurs at the Master Portfolio level.","page_number":112,"box":{"x":69,"y":325,"width":810,"height":11}},{"id":"d3f66dd7-a7ca-4322-9a78-97fee48b77af","block_type":"box","text":"Management Fee.","page_number":112,"box":{"x":102,"y":348,"width":126,"height":11}},{"id":"e3514c69-778e-4153-a5a2-15ce320f525b","block_type":"box","text":"Each Fund has entered into a Management Agreement with the Manager pursuant to which","page_number":112,"box":{"x":235,"y":348,"width":646,"height":11}},{"id":"709968f5-5448-495f-80e0-d3ce04128779","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":112,"box":{"x":68,"y":363,"width":841,"height":11}},{"id":"1f62d391-5667-45c0-8d0e-675cde1825af","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":112,"box":{"x":69,"y":378,"width":833,"height":11}},{"id":"a62f1b50-3af3-451d-b928-91ea65a17e6f","block_type":"box","text":"fiscal years or other applicable periods, see “Management, Advisory and Other Service Arrangements —","page_number":112,"box":{"x":68,"y":393,"width":746,"height":11}},{"id":"7d4d37d0-f7a5-471e-97c2-fc2e83d4f8af","block_type":"box","text":"Management Agreement” or “Management and Advisory Arrangements,” as applicable, in Part I of each Fund’s SAI.","page_number":112,"box":{"x":70,"y":408,"width":825,"height":11}},{"id":"92986e9c-f42d-452c-b438-88d16336053d","block_type":"box","text":"For Funds that do not have an administrator, each Management Agreement obligates the Manager to provide","page_number":112,"box":{"x":102,"y":431,"width":774,"height":11}},{"id":"f6cb76ed-4c89-4689-9618-e4908188737d","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":112,"box":{"x":69,"y":446,"width":826,"height":11}},{"id":"7f266485-fab5-4baa-b4cc-e9b516e6944d","block_type":"box","text":"in connection with investment and economic research, trading and investment management of the Fund, as well as","page_number":112,"box":{"x":70,"y":461,"width":820,"height":11}},{"id":"9baa865a-4c31-401d-959e-66016016be48","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":112,"box":{"x":68,"y":476,"width":797,"height":11}},{"id":"b8276f65-3642-4ccc-a001-be080a3cb0de","block_type":"box","text":"incurred in the operation of that Fund, including among other things: taxes; expenses for legal and auditing services;","page_number":112,"box":{"x":70,"y":491,"width":830,"height":12}},{"id":"2075001e-00f0-4bb9-8f07-c5b1c3723103","block_type":"box","text":"costs of preparing, printing and mailing proxies, shareholder reports, prospectuses and statements of additional","page_number":112,"box":{"x":69,"y":506,"width":802,"height":12}},{"id":"a31179d7-e87d-4777-b854-91d1a8eb9e41","block_type":"box","text":"information, except to the extent paid by BlackRock Investments, LLC (“BRIL” or the “Distributor”); charges of the","page_number":112,"box":{"x":70,"y":521,"width":809,"height":12}},{"id":"3638139e-4d4a-40f3-8a6e-1d1a9110ff78","block_type":"box","text":"custodian and sub-custodian, and the transfer agent; expenses of redemption of shares; Commission fees; expenses","page_number":112,"box":{"x":69,"y":537,"width":838,"height":11}},{"id":"9ceee55d-d3a6-42b0-9403-eb390ad4e297","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":112,"box":{"x":69,"y":552,"width":830,"height":11}},{"id":"2c4bf2e6-b6de-4254-9075-3f1f3f262c73","block_type":"box","text":"persons of a Fund as defined in the Investment Company Act; accounting and pricing costs (including the daily","page_number":112,"box":{"x":70,"y":567,"width":784,"height":11}},{"id":"ed45ec8d-1155-43f7-a6cb-b813096363ce","block_type":"box","text":"calculations of NAV); insurance; interest; brokerage costs; litigation and other extraordinary or non-recurring","page_number":112,"box":{"x":69,"y":582,"width":767,"height":11}},{"id":"cc4e4bbe-7d12-473a-974b-539f7406792c","block_type":"box","text":"expenses; and other expenses properly payable by the Fund. Certain accounting services are provided to each Fund","page_number":112,"box":{"x":69,"y":597,"width":825,"height":11}},{"id":"cb10bdd7-71a5-4d8a-87c2-d80eab1033c1","block_type":"box","text":"by State Street Bank and Trust Company (“State Street”), The Bank of New York Mellon (“BNY Mellon”) or JPMorgan","page_number":112,"box":{"x":69,"y":612,"width":827,"height":11}},{"id":"7c10bc68-2454-46e6-9c1b-7d913102a63a","block_type":"box","text":"Chase Bank, N.A. (“JPM”) pursuant to an agreement between State Street, BNY Mellon or JPM, as applicable, and","page_number":112,"box":{"x":69,"y":627,"width":814,"height":12}},{"id":"1f1bc8f9-9390-480a-a1ca-108d3c2574c5","block_type":"box","text":"each Fund. Each Fund pays a fee for these services. The Distributor pays certain promotional expenses of the Funds","page_number":112,"box":{"x":69,"y":642,"width":832,"height":12}},{"id":"68477a67-7159-4e87-80d7-52cb0ac52b29","block_type":"box","text":"incurred in connection with the offering of shares of the Funds. Certain expenses are financed by each Fund pursuant","page_number":112,"box":{"x":70,"y":658,"width":839,"height":11}},{"id":"516c6d63-2351-4ef6-8f93-66775918d800","block_type":"box","text":"to distribution plans in compliance with Rule 12b-1 under the Investment Company Act. See “Purchase of Shares —","page_number":112,"box":{"x":68,"y":673,"width":828,"height":11}},{"id":"6b5c135f-da12-4529-a1bb-8005692c158a","block_type":"box","text":"Distribution and/or Shareholder Servicing Plans.”","page_number":112,"box":{"x":70,"y":688,"width":350,"height":11}},{"id":"65621fcb-fb58-45cd-90be-4bf4b455e20f","block_type":"box","text":"Sub-Advisory Fee.","page_number":112,"box":{"x":102,"y":711,"width":124,"height":11}},{"id":"833b9af9-33be-4b70-b299-26cfa8d4e935","block_type":"box","text":"The Manager of certain Funds has entered into one or more sub-advisory agreements (the","page_number":112,"box":{"x":232,"y":710,"width":643,"height":12}},{"id":"1b332601-8f1f-47a1-83ce-82e585c207ef","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":112,"box":{"x":70,"y":726,"width":839,"height":11}},{"id":"8293f2ae-d1ff-48f8-9d58-a2a7e6a62c06","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":112,"box":{"x":68,"y":741,"width":830,"height":11}},{"id":"670eab2e-20a1-4316-92e3-c5097cd201fa","block_type":"box","text":"Organization of the Manager.","page_number":112,"box":{"x":102,"y":763,"width":204,"height":12}},{"id":"b363aa42-93b5-4edb-aa3a-542e4d642901","block_type":"box","text":"BlackRock Advisors, LLC is a Delaware limited liability company and BlackRock","page_number":112,"box":{"x":313,"y":763,"width":560,"height":12}},{"id":"604d11a3-a6de-4d2e-9862-1dddfa96c97a","block_type":"box","text":"Fund Advisors is a California corporation. 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Such contract is not assignable","page_number":113,"box":{"x":70,"y":385,"width":810,"height":11}},{"id":"918a3d90-ef6e-4316-8195-ec3f83cf201d","block_type":"box","text":"and may be terminated without penalty on written notice at the option of either party thereto or by the vote of the","page_number":113,"box":{"x":69,"y":400,"width":805,"height":11}},{"id":"40b5db3e-96be-43ac-b296-34e869f0a89e","block_type":"box","text":"shareholders of the Fund.","page_number":113,"box":{"x":69,"y":415,"width":181,"height":9}},{"id":"79aa1799-edc3-4524-bd63-f6cfa922e5af","block_type":"box","text":"Transfer Agency Services.","page_number":113,"box":{"x":103,"y":438,"width":180,"height":11}},{"id":"07f84fad-be1d-4f07-90c6-dc53745abd58","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc. (in this capacity, the “Transfer Agent”), a","page_number":113,"box":{"x":291,"y":438,"width":595,"height":11}},{"id":"39afad41-41cb-41f9-983c-46b694b676db","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":113,"box":{"x":69,"y":453,"width":816,"height":11}},{"id":"c7f2f283-75ba-4617-8c46-172c5a86a10b","block_type":"box","text":"Agency, Dividend Disbursing Agency and Shareholder Servicing Agency Agreement (the “Transfer Agency Agreement”)","page_number":113,"box":{"x":68,"y":468,"width":833,"height":11}},{"id":"457a3b7a-16b1-4df4-8815-b01522da437e","block_type":"box","text":"with the Funds. Pursuant to the Transfer Agency Agreement, the Transfer Agent is responsible for the issuance,","page_number":113,"box":{"x":68,"y":483,"width":792,"height":11}},{"id":"746e9947-65e0-4831-9d7e-40527df54d71","block_type":"box","text":"transfer and redemption of shares and the opening and maintenance of shareholder accounts. Each Fund pays the","page_number":113,"box":{"x":68,"y":498,"width":819,"height":11}},{"id":"4b58f211-2eb5-4f1b-8f65-2eba204da75d","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. 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For","page_number":113,"box":{"x":68,"y":543,"width":813,"height":12}},{"id":"92b53e6f-2d9d-4be9-88c9-aa32e06a4161","block_type":"box","text":"purposes of each Transfer Agency Agreement, the term “account” includes a shareholder account maintained directly","page_number":113,"box":{"x":70,"y":559,"width":836,"height":11}},{"id":"3749b88e-5161-4da7-9cec-0c7442e46ad5","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":113,"box":{"x":69,"y":574,"width":806,"height":11}},{"id":"81b438fc-0be2-4b4e-bb5e-6b5e2e1e2b58","block_type":"box","text":"class on a recordkeeping system.","page_number":113,"box":{"x":69,"y":589,"width":238,"height":11}},{"id":"0feb6233-34b1-4d20-95a0-6a28ea0f2c5c","block_type":"box","text":"Independent Registered Public Accounting Firm.","page_number":113,"box":{"x":102,"y":612,"width":338,"height":11}},{"id":"827293c8-5290-4e53-9761-00433273fb22","block_type":"box","text":"The Audit Committee of each Fund, the members of which are","page_number":113,"box":{"x":446,"y":612,"width":441,"height":10}},{"id":"4c984040-2f2c-40ac-8bf1-5e2ad71d1d0a","block_type":"box","text":"non-interested Directors of the Fund, has selected an independent registered public accounting firm for that Fund that","page_number":113,"box":{"x":69,"y":627,"width":840,"height":11}},{"id":"d89455c0-ee68-45f6-8710-a96948aa97ff","block_type":"box","text":"audits the Fund’s financial statements. Please see the inside back cover page of your Fund’s Prospectus and Part I","page_number":113,"box":{"x":69,"y":642,"width":823,"height":11}},{"id":"e2bbd19b-4331-45d9-be29-c84c3f6ab9b0","block_type":"box","text":"of this SAI for information on your Fund’s independent registered public accounting firm.","page_number":113,"box":{"x":69,"y":657,"width":627,"height":11}},{"id":"62babbe8-f13c-4a39-bd0e-2d35c4e47f90","block_type":"box","text":"Custodian Services.","page_number":113,"box":{"x":102,"y":680,"width":141,"height":9}},{"id":"71a10b59-2fbc-472a-8486-61e20577b766","block_type":"box","text":"The name and address of the custodian (the “Custodian”) of each Fund are provided on the","page_number":113,"box":{"x":249,"y":680,"width":654,"height":11}},{"id":"66503d15-817d-4c91-aa5b-d0e4467995e6","block_type":"box","text":"inside back cover page of the Fund’s Prospectus. The Custodian is responsible for safeguarding and controlling the","page_number":113,"box":{"x":70,"y":695,"width":820,"height":11}},{"id":"e1e5b2a2-97c3-48ec-9f86-c5000d2d9468","block_type":"box","text":"Fund’s cash and securities, handling the receipt and delivery of securities and collecting interest and dividends on","page_number":113,"box":{"x":70,"y":710,"width":814,"height":11}},{"id":"518c5f0f-c050-43b6-8f81-4097f2dd0d0f","block_type":"box","text":"the Fund’s investments. The Custodian is authorized to establish separate accounts in foreign currencies and to","page_number":113,"box":{"x":68,"y":725,"width":802,"height":11}},{"id":"d0999d57-785b-45f0-a5b6-98f2c3b6314f","block_type":"box","text":"cause foreign securities owned by the Fund to be held in its offices outside the United States and with certain foreign","page_number":113,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"b04afc3e-ce7f-4a03-bb34-d99d5c8fbcc5","block_type":"box","text":"banks and securities depositories. A Fund also may use special purpose custodian banks from time to time for","page_number":113,"box":{"x":69,"y":755,"width":792,"height":11}},{"id":"7b6e7f8f-5fce-45df-b333-b680264fd709","block_type":"box","text":"certain assets.","page_number":113,"box":{"x":69,"y":771,"width":106,"height":8}},{"id":"26d6baf3-962f-415d-92b9-cefda5b0b4ef","block_type":"box","text":"For certain Feeder Funds, the Custodian also acts as the custodian of the Master Portfolio’s assets.","page_number":113,"box":{"x":102,"y":793,"width":716,"height":10}},{"id":"a5b7038c-0e07-4d7b-a773-9c1c580e3f5d","block_type":"box","text":"Generally, overdraft charges, if any, are treated as interest expense. With respect to certain Funds, on a monthly","page_number":113,"box":{"x":102,"y":816,"width":803,"height":11}},{"id":"a96c69e0-570f-49e2-9f14-1746d014a53e","block_type":"box","text":"basis the Custodian nets the Fund’s daily positive and negative cash balances and calculates a credit (“custody","page_number":113,"box":{"x":69,"y":831,"width":799,"height":11}},{"id":"4527e339-ac46-43a2-a345-ea053b878a44","block_type":"box","text":"credit”) or a charge based on that net amount. With respect to such Funds, the custodian fees, including the amount","page_number":113,"box":{"x":69,"y":846,"width":834,"height":11}},{"id":"fa3f37fb-765b-4b78-a757-647657eb12f7","block_type":"box","text":"of any overdraft charges, may be reduced by the amount of such custody credits, and any unused credits at the end","page_number":113,"box":{"x":69,"y":861,"width":826,"height":11}},{"id":"cfa9f28c-118d-41fb-bbd8-7ce6b3da97a1","block_type":"box","text":"of a given month may be carried forward to a subsequent month. Any such credits unused by the end of a Fund’s","page_number":113,"box":{"x":69,"y":876,"width":807,"height":11}},{"id":"f627fe23-3555-49bf-a21d-8c8e81c92513","block_type":"box","text":"fiscal year will not expire. Net debits at the end of a given month are added to the Fund’s custody bill and paid by the","page_number":113,"box":{"x":68,"y":891,"width":836,"height":12}},{"id":"c8cd1379-4831-466a-9f6c-eaad7a558b35","block_type":"box","text":"Fund.","page_number":113,"box":{"x":70,"y":907,"width":36,"height":8}},{"id":"5f17cdf8-b999-43d8-87a4-d5adececbe97","block_type":"box","text":"II-83","page_number":113,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5b6bc82e-976a-47b4-99f4-aec23abf9ef3","block_type":"box","text":"NM1026U-5979889-113/232","page_number":113,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e0fc6a51-6725-48a8-8234-039e1708b505","block_type":"box","text":"Accounting Services.","page_number":114,"box":{"x":101,"y":45,"width":148,"height":11}},{"id":"196b7dfe-e241-42ee-abc2-7cbc9534cb90","block_type":"box","text":"Each Fund has entered into an agreement with State Street, BNY Mellon or JPM, pursuant","page_number":114,"box":{"x":256,"y":45,"width":641,"height":11}},{"id":"123e2247-6a81-4dd4-a2b5-6059ed866964","block_type":"box","text":"to which State Street, BNY Mellon or JPM provides certain accounting and administrative services to the Fund. Each","page_number":114,"box":{"x":68,"y":60,"width":829,"height":11}},{"id":"6ce78b69-9670-43bf-a0cb-c503c60ce515","block_type":"box","text":"Fund pays a fee for these services. State Street, BNY Mellon or JPM provides similar accounting services to the","page_number":114,"box":{"x":70,"y":75,"width":797,"height":11}},{"id":"6050fb24-a3b3-473c-af0d-66ed61e8ccde","block_type":"box","text":"Master LLCs.","page_number":114,"box":{"x":70,"y":90,"width":91,"height":9}},{"id":"15aad241-dd36-4ffa-b2da-63e02216862f","block_type":"box","text":"See “Management, Advisory and Other Service Arrangements — Accounting Services” or “Management and","page_number":114,"box":{"x":102,"y":113,"width":771,"height":11}},{"id":"8c0ea2cd-9d4d-48a3-9fc9-cf4ac5a475ed","block_type":"box","text":"Advisory Arrangements — Accounting Services,” as applicable, in Part I of each Fund’s SAI for information on the","page_number":114,"box":{"x":68,"y":128,"width":810,"height":11}},{"id":"9ceb4e7f-0264-4af0-859e-60ae569ee754","block_type":"box","text":"amounts paid by your Fund and, if applicable, Master LLC to State Street, BNY Mellon or JPM and the Manager or, if","page_number":114,"box":{"x":69,"y":143,"width":828,"height":11}},{"id":"5ae1d61f-28d5-46ee-bcde-795017ef9238","block_type":"box","text":"applicable, the Administrator for the periods indicated.","page_number":114,"box":{"x":69,"y":158,"width":386,"height":11}},{"id":"df42fb3b-e0fc-4dc6-a27e-613956fdacae","block_type":"box","text":"Distribution Expenses.","page_number":114,"box":{"x":102,"y":181,"width":158,"height":11}},{"id":"2dbf54b5-7624-41f6-97de-a21baefb850f","block_type":"box","text":"Each Fund has entered into a distribution agreement with the Distributor in connection","page_number":114,"box":{"x":267,"y":181,"width":614,"height":11}},{"id":"5d804898-b79b-4fa0-adb9-fa09f1fba66c","block_type":"box","text":"with the continuous offering of each class of shares of the Fund (the “Distribution Agreements”). 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shareholders, prospective shareholders, consultants,","page_number":118,"box":{"x":69,"y":299,"width":818,"height":11}},{"id":"d286d319-d3bf-4307-84b3-cedd13a11455","block_type":"box","text":"and third-party data providers upon request, as soon as such data is available.","page_number":118,"box":{"x":69,"y":314,"width":562,"height":11}},{"id":"c4b26104-7a4b-4140-b9d7-450d2a2bde81","block_type":"box","text":"Contact Information.","page_number":118,"box":{"x":102,"y":337,"width":144,"height":9}},{"id":"68e86bcb-cfc4-48cf-834d-e490731be0c1","block_type":"box","text":"For information about portfolio holdings and characteristics, BlackRock fund shareholders","page_number":118,"box":{"x":253,"y":337,"width":639,"height":11}},{"id":"f3d65a58-d56e-493a-9259-1f2026d9df02","block_type":"box","text":"and prospective investors should call the number set out on the back cover of the Prospectus.","page_number":118,"box":{"x":69,"y":352,"width":672,"height":11}},{"id":"a42bf6a2-6eb2-40cd-b632-c50cf6cf0409","block_type":"box","text":"Compensation.","page_number":118,"box":{"x":102,"y":375,"width":105,"height":11}},{"id":"a68570e8-aea6-4314-ab7b-11bf778297cb","block_type":"box","text":"Neither a Fund, a service provider nor any of their affiliated persons (as that term is defined in","page_number":118,"box":{"x":215,"y":375,"width":672,"height":11}},{"id":"83a0c308-4f74-4505-9f6b-f3528df12cb0","block_type":"box","text":"the Investment Company Act) shall receive compensation in any form in connection with the disclosure of information","page_number":118,"box":{"x":68,"y":390,"width":837,"height":11}},{"id":"013d5d86-43e2-408b-a2d0-a67761a1d55a","block_type":"box","text":"about such Fund’s Portfolio Holdings or Portfolio 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BlackRock may, in certain cases, elect to implement internal policies and","page_number":120,"box":{"x":69,"y":90,"width":776,"height":11}},{"id":"73c0e734-efd1-4f66-a601-b7c8a1189abf","block_type":"box","text":"procedures designed to limit such consequences, which may cause a Fund to be unable to engage in certain","page_number":120,"box":{"x":70,"y":105,"width":774,"height":11}},{"id":"10447fee-c5b0-4129-9b65-50925f69dd77","block_type":"box","text":"activities, including purchasing or disposing of securities, when it might otherwise be desirable for it to do so.","page_number":120,"box":{"x":69,"y":120,"width":781,"height":12}},{"id":"15678c21-5dcf-4935-80ba-cc499a28a145","block_type":"box","text":"Conflicts may also arise because portfolio decisions regarding a Fund may benefit other accounts managed by","page_number":120,"box":{"x":69,"y":135,"width":787,"height":12}},{"id":"51671ce6-4404-4907-869d-683c15ef012b","block_type":"box","text":"BlackRock. For example, the sale of a long position or establishment of a short position by a Fund may impair the","page_number":120,"box":{"x":70,"y":150,"width":809,"height":12}},{"id":"d298eff8-91ac-4e36-aab7-4383420a64dc","block_type":"box","text":"price of the same security sold short by (and therefore benefit) BlackRock or its other accounts or funds, and the","page_number":120,"box":{"x":70,"y":166,"width":805,"height":11}},{"id":"a89c8889-0baf-4ade-a711-c528a0b4fe81","block_type":"box","text":"purchase of a security or covering of a short position in a security by a Fund may increase the price of the same","page_number":120,"box":{"x":70,"y":181,"width":797,"height":11}},{"id":"d4bef849-6f3b-4f71-be20-efb9af6b27fa","block_type":"box","text":"security held by (and therefore benefit) BlackRock or its other accounts or funds.","page_number":120,"box":{"x":69,"y":196,"width":573,"height":11}},{"id":"109e10e4-ad53-4dab-817e-d2e0b4aea4bb","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":120,"box":{"x":102,"y":218,"width":797,"height":12}},{"id":"bbb28104-2268-4c1d-9eba-603885ba8e7d","block_type":"box","text":"extend credit to different parts of the capital structure of a single issuer. BlackRock may pursue rights, provide","page_number":120,"box":{"x":69,"y":234,"width":791,"height":11}},{"id":"db6f7706-d062-42dd-8826-4c45f66ed4a6","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":120,"box":{"x":69,"y":249,"width":835,"height":11}},{"id":"f300b234-9f70-4297-aeca-f4a208fafc5b","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":120,"box":{"x":69,"y":264,"width":812,"height":11}},{"id":"6a99682f-cac7-468f-9248-ba277f6250a3","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":120,"box":{"x":69,"y":279,"width":803,"height":11}},{"id":"e1b03c0d-7527-4993-b75a-b47d968a5840","block_type":"box","text":"Funds) hold positions in multiple parts of the capital structure of an issuer, BlackRock may not pursue certain","page_number":120,"box":{"x":70,"y":294,"width":783,"height":11}},{"id":"70dcbcba-a40a-46d2-843d-85fdd6f351de","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":120,"box":{"x":69,"y":309,"width":818,"height":11}},{"id":"e16cb920-cbf0-43d3-bca6-05af919ced4b","block_type":"box","text":"BlackRock addresses these and other potential conflicts of interest based on the facts and circumstances of","page_number":120,"box":{"x":70,"y":324,"width":777,"height":11}},{"id":"b3c59377-8fb4-4599-80af-f13c34086fac","block_type":"box","text":"particular situations. For example, BlackRock may determine to rely on information barriers between different","page_number":120,"box":{"x":70,"y":339,"width":780,"height":12}},{"id":"81f6bcfe-b66b-4f8b-b2a2-818f053ba2a7","block_type":"box","text":"business units or portfolio management teams. BlackRock may also determine to rely on the actions of similarly","page_number":120,"box":{"x":69,"y":355,"width":802,"height":11}},{"id":"3768831f-45d0-420d-840c-b9282afbf6d5","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":120,"box":{"x":69,"y":370,"width":817,"height":11}},{"id":"d475f8ca-0f8d-4a79-a9b2-097dc0b521a6","block_type":"box","text":"Funds.","page_number":120,"box":{"x":70,"y":385,"width":44,"height":9}},{"id":"8c8dc2f4-9c88-41d5-97b1-79a41c455cbf","block_type":"box","text":"In addition, to the extent permitted by applicable law, certain Funds may invest their assets in other funds","page_number":120,"box":{"x":102,"y":407,"width":755,"height":12}},{"id":"d4994401-8cc8-480f-92f0-ac45eee23153","block_type":"box","text":"advised by BlackRock, including funds that are managed by one or more of the same portfolio managers, which could","page_number":120,"box":{"x":69,"y":423,"width":836,"height":11}},{"id":"b5c651d5-7f77-42c7-9eb2-52828a28aba5","block_type":"box","text":"result in conflicts of interest relating to asset allocation, timing of Fund purchases and redemptions, and increased","page_number":120,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"70a385ab-aff9-4254-af0c-e3a669ac0510","block_type":"box","text":"remuneration and profitability for BlackRock and/or its personnel, including portfolio managers.","page_number":120,"box":{"x":69,"y":453,"width":679,"height":11}},{"id":"f4d51250-f870-4ee7-a3b1-6bf81f0c9b12","block_type":"box","text":"Third parties, including service providers to BlackRock or the Fund, may sponsor events (including, but not","page_number":120,"box":{"x":101,"y":476,"width":760,"height":11}},{"id":"95864d31-522f-4904-8748-ab1c963562d1","block_type":"box","text":"limited to, marketing and promotional activities and presentations, educational training programs and conferences)","page_number":120,"box":{"x":70,"y":491,"width":818,"height":11}},{"id":"3e90bfad-4e27-49e6-906c-e4bfaeff05d1","block_type":"box","text":"for registered representatives, other professionals and individual investors. 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BlackRock may (but is not required to) effect purchases and sales between","page_number":120,"box":{"x":68,"y":574,"width":817,"height":11}},{"id":"60fc2d3c-051c-4f26-b5a7-b62dc5f45219","block_type":"box","text":"BlackRock clients (“cross trades”), including the Funds, if BlackRock believes such transactions are appropriate","page_number":120,"box":{"x":70,"y":589,"width":797,"height":11}},{"id":"9e44efa8-f8c3-40b2-8bfe-cf57fc0154e5","block_type":"box","text":"based on each party’s investment objectives and guidelines, subject to applicable law and regulation. There may be","page_number":120,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"d5b07158-5f0b-4655-b481-ab8cd0a42856","block_type":"box","text":"potential conflicts of interest or regulatory issues relating to these transactions which could limit BlackRock’s","page_number":120,"box":{"x":70,"y":619,"width":780,"height":11}},{"id":"c84deca2-cacf-4569-9acc-86b5da13b911","block_type":"box","text":"decision to engage in these transactions for the Funds. BlackRock may have a potentially conflicting division of","page_number":120,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"ed438f64-dce2-4bbe-b0fb-6af74d0e6927","block_type":"box","text":"loyalties and responsibilities to the parties in such transactions.","page_number":120,"box":{"x":70,"y":650,"width":457,"height":11}},{"id":"66dbb533-29b3-491d-90b3-5e3a25106c43","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":120,"box":{"x":102,"y":672,"width":784,"height":11}},{"id":"a18f0bf5-1f5b-4610-bc72-cf66e23c632e","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":120,"box":{"x":69,"y":687,"width":840,"height":11}},{"id":"e118559c-8c48-4456-8d4d-5cd463a51637","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":120,"box":{"x":70,"y":702,"width":827,"height":12}},{"id":"2230f489-a9b3-41e9-8cfb-7a37a8e43a13","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":120,"box":{"x":70,"y":717,"width":828,"height":12}},{"id":"b2499abd-6e83-4f2a-af0f-0b775544e9e2","block_type":"box","text":"case.","page_number":120,"box":{"x":69,"y":735,"width":37,"height":7}},{"id":"51656af5-01f8-4346-b8af-2679dd5608e2","block_type":"box","text":"The results of a Fund’s investment activities may differ significantly from the results achieved by BlackRock for","page_number":120,"box":{"x":101,"y":755,"width":791,"height":11}},{"id":"8a55f27a-69d2-475c-a66b-354dc940674f","block_type":"box","text":"its proprietary accounts or other accounts (including investment companies or collective investment vehicles) that it","page_number":120,"box":{"x":70,"y":771,"width":824,"height":11}},{"id":"80eae4fa-5070-4845-9586-64cab315c1bc","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":120,"box":{"x":69,"y":786,"width":798,"height":11}},{"id":"255defbe-9e6e-4650-b908-67b60bdacd28","block_type":"box","text":"accounts will achieve investment results that are substantially more or less favorable than the results achieved by a","page_number":120,"box":{"x":69,"y":801,"width":828,"height":11}},{"id":"e20e4bdf-3e8a-4ad3-80a6-ebd3d3ce12a7","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":120,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"521bbe76-a46c-4a6a-a686-b093d6552471","block_type":"box","text":"accounts managed or advised by BlackRock achieve significant profits. The opposite result is also possible.","page_number":120,"box":{"x":69,"y":831,"width":767,"height":11}},{"id":"ae496bdb-49e9-43ac-8712-2263322946e8","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":120,"box":{"x":102,"y":853,"width":766,"height":12}},{"id":"4053f723-34a9-4ff9-bffc-6c7fe12987c3","block_type":"box","text":"investment activities because of regulatory, legal or contractual requirements applicable to BlackRock or other","page_number":120,"box":{"x":70,"y":869,"width":786,"height":11}},{"id":"44fe4e4f-79e8-432d-ada6-43ec50571e35","block_type":"box","text":"accounts managed or advised by BlackRock, and/or the internal policies of BlackRock designed to comply with such","page_number":120,"box":{"x":69,"y":884,"width":828,"height":11}},{"id":"a671c973-e782-4db3-925d-e28d5977651c","block_type":"box","text":"requirements. As a result, there may be periods, for example, when BlackRock will not initiate or recommend certain","page_number":120,"box":{"x":69,"y":899,"width":831,"height":11}},{"id":"b47535fb-3768-4229-9061-c6a487abf783","block_type":"box","text":"II-90","page_number":120,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"011c218e-d726-4f45-8245-1bfee64374f5","block_type":"box","text":"NM1026U-5979889-120/232","page_number":120,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9b501856-51dd-420e-aeec-f8ea804ffd05","block_type":"box","text":"types of transactions in certain securities or instruments with respect to which BlackRock is performing services or","page_number":121,"box":{"x":68,"y":45,"width":825,"height":11}},{"id":"3dcff062-bda3-41ab-b69e-0c9d056c4a19","block_type":"box","text":"when position limits have been reached. For example, the investment activities of BlackRock for its proprietary","page_number":121,"box":{"x":68,"y":60,"width":790,"height":11}},{"id":"11e3d9b9-15f5-4527-ac06-aee8baeba394","block_type":"box","text":"accounts and accounts under its management may limit the investment opportunities for a Fund in certain emerging","page_number":121,"box":{"x":69,"y":75,"width":830,"height":11}},{"id":"fb5e780d-4d60-41d8-b437-60c84e6c0231","block_type":"box","text":"and other markets in which limitations are imposed upon the amount of investment, in the aggregate or in individual","page_number":121,"box":{"x":69,"y":90,"width":827,"height":11}},{"id":"e0ca4364-52f0-40e9-8247-ea9cb5def07c","block_type":"box","text":"issuers, by affiliated foreign investors.","page_number":121,"box":{"x":70,"y":105,"width":271,"height":11}},{"id":"65488351-c9e4-43c6-b117-c53b51160d29","block_type":"box","text":"In connection with its management of a Fund, BlackRock may have access to certain fundamental analysis and","page_number":121,"box":{"x":102,"y":128,"width":792,"height":11}},{"id":"1969fb65-d42e-4902-adaf-6736359ee13a","block_type":"box","text":"proprietary technical models developed by BlackRock. BlackRock will not be under any obligation, however, to effect","page_number":121,"box":{"x":70,"y":143,"width":826,"height":11}},{"id":"a4a59ee9-2a35-4ac4-9732-42bf05afb3ab","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":121,"box":{"x":68,"y":158,"width":821,"height":11}},{"id":"267f5c73-71a3-433d-a2b0-59c2816a97c1","block_type":"box","text":"any obligation to make available any information regarding its proprietary activities or strategies, or the activities or","page_number":121,"box":{"x":69,"y":173,"width":821,"height":11}},{"id":"5f913c82-6ed7-41c5-beb0-c0ce39f96f5f","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":121,"box":{"x":69,"y":188,"width":793,"height":12}},{"id":"b900c8c9-4da7-425f-9303-4430245c585a","block_type":"box","text":"anticipated that BlackRock will have access to such information for the purpose of managing the Fund. The","page_number":121,"box":{"x":69,"y":203,"width":762,"height":12}},{"id":"0a34ebba-16fa-4170-ae7f-4a7092e35317","block_type":"box","text":"proprietary activities or portfolio strategies of BlackRock, or the activities or strategies used for accounts managed by","page_number":121,"box":{"x":70,"y":218,"width":839,"height":12}},{"id":"752738fe-12c8-4913-9206-f38079cbf1e9","block_type":"box","text":"BlackRock or other client accounts could conflict with the transactions and strategies employed by BlackRock in","page_number":121,"box":{"x":70,"y":234,"width":795,"height":11}},{"id":"c7803531-c1e6-4d04-b61d-7f54883fe9e2","block_type":"box","text":"managing a Fund.","page_number":121,"box":{"x":69,"y":249,"width":124,"height":11}},{"id":"3038f1c2-428a-4726-a845-12fdeda810d8","block_type":"box","text":"The Funds may be included in investment models developed by BlackRock for use by clients and financial","page_number":121,"box":{"x":101,"y":271,"width":751,"height":12}},{"id":"960508a9-81e9-4080-9499-df3d11f3ee6c","block_type":"box","text":"advisors. To the extent clients invest in these investment models and increase the assets under management of the","page_number":121,"box":{"x":69,"y":286,"width":830,"height":12}},{"id":"81a9f0c2-213e-4ff4-94c1-4bd21ab34e5d","block_type":"box","text":"Funds, the investment management fee amounts paid by the Funds to BlackRock may also increase. The net asset","page_number":121,"box":{"x":70,"y":302,"width":820,"height":11}},{"id":"336ce53a-e93c-4ebd-8373-9424041179a1","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":121,"box":{"x":68,"y":317,"width":785,"height":11}},{"id":"298507f4-11c5-4033-8bf1-036bfb4c28be","block_type":"box","text":"portfolios, as well as by BlackRock itself and by its advisory clients.","page_number":121,"box":{"x":70,"y":332,"width":481,"height":11}},{"id":"7a13a1db-329c-41cd-a449-c109888d3710","block_type":"box","text":"In addition, certain principals and certain employees of a Fund’s investment adviser are also principals or","page_number":121,"box":{"x":102,"y":355,"width":754,"height":11}},{"id":"bbf89114-acc6-4e99-b2dd-387ab5bd03e4","block_type":"box","text":"employees of other business units or entities within BlackRock. As a result, these principals and employees may","page_number":121,"box":{"x":69,"y":370,"width":804,"height":11}},{"id":"db0b9592-6da5-434e-ba8b-3a1cd3535e26","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":121,"box":{"x":69,"y":385,"width":831,"height":11}},{"id":"98179142-2ed0-4af7-b4b0-8b7cf4890fb0","block_type":"box","text":"or entities or their clients may be a consideration of which investors in a Fund should be aware.","page_number":121,"box":{"x":69,"y":400,"width":680,"height":11}},{"id":"60cae04d-c0c5-4d42-9cf9-a59569d85458","block_type":"box","text":"BlackRock may enter into transactions and invest in securities, instruments and currencies on behalf of a Fund","page_number":121,"box":{"x":102,"y":423,"width":791,"height":11}},{"id":"1239d356-5b36-4695-922a-a2aac0dfb2a3","block_type":"box","text":"in which clients of BlackRock, or, to the extent permitted by the Commission and applicable law, BlackRock, serves","page_number":121,"box":{"x":70,"y":438,"width":820,"height":11}},{"id":"275e8396-1211-4718-8057-d2416763d01e","block_type":"box","text":"as the counterparty, principal or issuer. In such cases, such party’s interests in the transaction will be adverse to the","page_number":121,"box":{"x":69,"y":453,"width":837,"height":11}},{"id":"1484d9c3-9e5a-4145-8c7d-2df1793a8304","block_type":"box","text":"interests of the Fund, and such party may have no incentive to assure that the Fund obtains the best possible prices","page_number":121,"box":{"x":70,"y":468,"width":832,"height":11}},{"id":"0ed420a7-c361-4124-93ac-2f1dd1a1557c","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":121,"box":{"x":69,"y":483,"width":813,"height":11}},{"id":"0b41902a-f613-420b-8c89-bfdcf735ff77","block_type":"box","text":"Fund may enhance the profitability of BlackRock.","page_number":121,"box":{"x":70,"y":498,"width":344,"height":11}},{"id":"4a227d73-2915-4d5a-bafa-116d7f720ae8","block_type":"box","text":"BlackRock may also create, write or issue derivatives for clients, the underlying securities, currencies or","page_number":121,"box":{"x":102,"y":521,"width":741,"height":11}},{"id":"437d8ff4-de12-4180-8108-63c63f4f19c2","block_type":"box","text":"instruments of which may be those in which a Fund invests or which may be based on the performance of the Fund.","page_number":121,"box":{"x":70,"y":536,"width":824,"height":11}},{"id":"000a1ca5-f0ef-4b13-9959-8d2f764e1762","block_type":"box","text":"Additionally, an affiliate of BlackRock will create, write or issue options, which may be based on the performance of","page_number":121,"box":{"x":68,"y":551,"width":825,"height":11}},{"id":"74c184e7-051b-448b-beba-eea3f076fbae","block_type":"box","text":"certain Funds. BlackRock has entered into an arrangement with Markit Indices Limited, the index provider for","page_number":121,"box":{"x":69,"y":566,"width":777,"height":11}},{"id":"70fbb016-0608-4bdf-9c2d-8f6815ef8d53","block_type":"box","text":"underlying fixed-income indexes used by certain iShares ETFs, related to derivative fixed-income products that are","page_number":121,"box":{"x":69,"y":581,"width":810,"height":12}},{"id":"c4f84a0c-4eb7-477e-9703-21159f48a70c","block_type":"box","text":"based on such iShares ETFs. Trading activity in these derivative products could also potentially lead to greater","page_number":121,"box":{"x":69,"y":597,"width":784,"height":11}},{"id":"a6ebdaf3-5535-4ae7-a36a-67ce587b951c","block_type":"box","text":"liquidity for such products, increased purchase activity with respect to these iShares ETFs and increased assets","page_number":121,"box":{"x":70,"y":612,"width":798,"height":11}},{"id":"d3519dbd-a273-4d44-9c6d-c53fb28834e0","block_type":"box","text":"under management for BlackRock.","page_number":121,"box":{"x":69,"y":627,"width":243,"height":11}},{"id":"25be24e1-5741-4098-a304-351d9ce922a4","block_type":"box","text":"A Fund may, subject to applicable law, purchase investments that are the subject of an underwriting or other","page_number":121,"box":{"x":101,"y":649,"width":773,"height":12}},{"id":"cdb572a3-c4fd-4977-8f81-4fc1c8f55fb1","block_type":"box","text":"distribution by BlackRock and may also enter into transactions with other clients of BlackRock where such other","page_number":121,"box":{"x":69,"y":664,"width":797,"height":12}},{"id":"b6b0ea13-912b-495e-ab93-67411a11c1b4","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":121,"box":{"x":69,"y":680,"width":817,"height":11}},{"id":"5308100f-38b2-41ef-ab5c-746db14db8cd","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":121,"box":{"x":68,"y":695,"width":837,"height":11}},{"id":"791d3136-76d6-482f-ac70-74f948b8f065","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":121,"box":{"x":70,"y":710,"width":781,"height":11}},{"id":"050b708d-bcfb-45bc-8b59-c146c801186c","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":121,"box":{"x":101,"y":733,"width":779,"height":11}},{"id":"eeea164b-0ddb-49ed-9978-4c9045cebe6c","block_type":"box","text":"other commercial capacities for a Fund. It is anticipated that the commissions, mark-ups, mark-downs, financial","page_number":121,"box":{"x":69,"y":748,"width":795,"height":11}},{"id":"75a810de-6e35-4f7e-9821-b57d83dbe5a1","block_type":"box","text":"advisory fees, underwriting and placement fees, sales fees, financing and commitment fees, brokerage fees, other","page_number":121,"box":{"x":69,"y":763,"width":821,"height":11}},{"id":"4209c7c0-9caa-44b2-a222-43dd1bb0ce94","block_type":"box","text":"fees, compensation or profits, rates, terms and conditions charged by BlackRock will be in its view commercially","page_number":121,"box":{"x":68,"y":778,"width":802,"height":11}},{"id":"90c35a4c-ffa3-4e6b-8200-c3bfde750d03","block_type":"box","text":"reasonable, although BlackRock, including its sales personnel, will have an interest in obtaining fees and other","page_number":121,"box":{"x":69,"y":793,"width":792,"height":11}},{"id":"a8c4d8c2-9882-41ac-8d2e-ce98fd742c85","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":121,"box":{"x":69,"y":808,"width":832,"height":11}},{"id":"8fcb40f0-33bf-4002-9ff7-535081c15ada","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":121,"box":{"x":70,"y":823,"width":833,"height":11}},{"id":"e9cd6774-15f7-444c-9c43-0e01cbc30e4a","block_type":"box","text":"that acts as a broker, dealer, agent, lender or in other commercial capacities for a Fund or BlackRock.","page_number":121,"box":{"x":68,"y":838,"width":726,"height":12}},{"id":"6a1e4431-8c4a-437f-ab97-10d42ac994cb","block_type":"box","text":"Subject to applicable law, BlackRock (and its personnel and other distributors) will be entitled to retain fees and","page_number":121,"box":{"x":102,"y":861,"width":796,"height":11}},{"id":"98158f92-32db-44e6-a8d5-76f8a4b6a438","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":121,"box":{"x":69,"y":876,"width":837,"height":11}},{"id":"814d71d8-a71d-4cb7-8745-7750d921a0d1","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":122,"box":{"x":69,"y":136,"width":793,"height":11}},{"id":"2bb63de2-b4f4-4f4c-bb9d-bbb47cc8be0b","block_type":"box","text":"establishment of its business relationships, nor is it expected that the Fund’s counterparties will rely on the credit of","page_number":122,"box":{"x":69,"y":150,"width":835,"height":12}},{"id":"6c97afd2-9231-4d29-bc98-b39934488b39","block_type":"box","text":"BlackRock in evaluating the Fund’s creditworthiness.","page_number":122,"box":{"x":70,"y":166,"width":374,"height":11}},{"id":"b7210730-49aa-400c-a62a-d9eb3e6283be","block_type":"box","text":"BlackRock Investment Management, LLC (“BIM”) or BlackRock Institutional Trust Company, N.A. (“BTC”), as","page_number":122,"box":{"x":102,"y":188,"width":768,"height":12}},{"id":"7164936c-f623-4bf1-b9c4-6ae5a38f2c2f","block_type":"box","text":"applicable, each an affiliate of BlackRock, pursuant to SEC exemptive relief, acts as securities lending agent to, and","page_number":122,"box":{"x":69,"y":203,"width":829,"height":12}},{"id":"9b10b986-8ae0-4d71-b356-1d0bd11379cd","block_type":"box","text":"receives a share of securities lending revenues from, the Funds. BlackRock will also receive compensation for","page_number":122,"box":{"x":69,"y":218,"width":785,"height":12}},{"id":"a214793b-bd20-42a2-8a44-5ffd5a6ef0ac","block_type":"box","text":"managing the reinvestment of the cash collateral from securities lending. There are potential conflicts of interests in","page_number":122,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"def8b985-83c6-44fd-bc8f-1a9ec081dc31","block_type":"box","text":"managing a securities lending program, including but not limited to: (i) BlackRock as securities lending agent may","page_number":122,"box":{"x":69,"y":249,"width":809,"height":11}},{"id":"83c73674-b678-489f-abd1-53d11ad42a8c","block_type":"box","text":"have an incentive to, among other things, increase or decrease the amount of securities on loan or to lend particular","page_number":122,"box":{"x":69,"y":264,"width":833,"height":11}},{"id":"f6b734ec-6ee6-4416-ba18-de507574a669","block_type":"box","text":"securities in order to generate additional risk-adjusted revenue for BlackRock and its affiliates; and (ii) BlackRock as","page_number":122,"box":{"x":69,"y":279,"width":829,"height":11}},{"id":"384db0b5-2a6f-44b4-8e00-6f38b008c610","block_type":"box","text":"securities lending agent may have an incentive to allocate loans to clients that would provide more revenue to","page_number":122,"box":{"x":69,"y":294,"width":783,"height":11}},{"id":"d4e34b1a-16b2-4a12-8b89-bece92cfb09b","block_type":"box","text":"BlackRock. As described further below, BlackRock seeks to mitigate this conflict by providing its securities lending","page_number":122,"box":{"x":70,"y":309,"width":814,"height":11}},{"id":"0d433532-ed0d-4e7d-afa4-7d0ad1d55358","block_type":"box","text":"clients with equal lending opportunities over time in order to approximate pro rata allocation.","page_number":122,"box":{"x":69,"y":325,"width":660,"height":11}},{"id":"1c4f708a-481b-4b02-a111-263dd2456d68","block_type":"box","text":"As part of its securities lending program, BlackRock indemnifies the Funds and certain other clients and/or","page_number":122,"box":{"x":101,"y":347,"width":767,"height":11}},{"id":"3fe1ce92-4793-434a-a69d-00c2d0b9a948","block_type":"box","text":"funds against a shortfall in collateral in the event of borrower default. On a regular basis, BlackRock calculates the","page_number":122,"box":{"x":68,"y":362,"width":820,"height":11}},{"id":"864a53c4-79b6-4c17-8d76-edd876c90944","block_type":"box","text":"potential dollar exposure of collateral shortfall resulting from a borrower default (“shortfall risk”) in the securities","page_number":122,"box":{"x":70,"y":377,"width":806,"height":12}},{"id":"0cfd47bc-70b3-4f49-88c0-e9b54d5f998e","block_type":"box","text":"lending program. BlackRock establishes program-wide borrower limits (“credit limits”) to actively manage borrower","page_number":122,"box":{"x":70,"y":393,"width":816,"height":11}},{"id":"481b1028-d5dd-4bba-9ce2-1085f11db965","block_type":"box","text":"specific credit exposure. BlackRock oversees the risk model that calculates projected collateral shortfall values using","page_number":122,"box":{"x":69,"y":407,"width":838,"height":12}},{"id":"4d8f3402-9e66-4415-a2e8-9a4973de6898","block_type":"box","text":"loan-level factors such as loan and collateral type and market value as well as specific borrower credit","page_number":122,"box":{"x":70,"y":423,"width":727,"height":11}},{"id":"f21d4a83-70d8-40f3-b152-dcac43ebf90a","block_type":"box","text":"characteristics. When necessary, BlackRock may adjust securities lending program attributes by restricting eligible","page_number":122,"box":{"x":69,"y":438,"width":815,"height":11}},{"id":"57c1e376-f24d-44ff-82f5-9c12ffa08aa3","block_type":"box","text":"collateral or reducing borrower credit limits. As a result, the management of program-wide exposure as well as","page_number":122,"box":{"x":69,"y":453,"width":786,"height":11}},{"id":"36d53976-3fd9-491b-b7f5-ba79b9b92886","block_type":"box","text":"BlackRock-specific indemnification exposure may affect the amount of securities lending activity BlackRock may","page_number":122,"box":{"x":70,"y":468,"width":796,"height":11}},{"id":"bd801cb6-bdca-4cd9-9163-05ea1916d999","block_type":"box","text":"conduct at any given point in time by reducing the volume of lending opportunities for certain loans (including by","page_number":122,"box":{"x":69,"y":483,"width":799,"height":11}},{"id":"366b1925-54d9-467d-832c-ccd8722ae2ed","block_type":"box","text":"asset type, collateral type and/or revenue profile).","page_number":122,"box":{"x":69,"y":498,"width":356,"height":11}},{"id":"f6dafaa4-0e54-4200-83fe-cb6b0f794b00","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":122,"box":{"x":102,"y":521,"width":801,"height":11}},{"id":"a177212f-80ea-4f91-954e-75e2cd60d066","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":122,"box":{"x":68,"y":536,"width":817,"height":11}},{"id":"389bf6bb-ea08-4e70-ae1f-a7ead1591a42","block_type":"box","text":"and/or market rules, liquidity considerations, or credit considerations, which may impact Funds by reducing or","page_number":122,"box":{"x":69,"y":551,"width":784,"height":11}},{"id":"ddd1cf09-f6e1-49fd-8587-8471c2c73ce6","block_type":"box","text":"eliminating the volume of lending opportunities for certain types of loans, loans in particular markets, loans of","page_number":122,"box":{"x":69,"y":566,"width":789,"height":11}},{"id":"8d337a38-c215-4ba2-b2b3-b79251cb24c2","block_type":"box","text":"particular securities or types of securities, or for loans overall. In addition, some borrowers may prefer certain","page_number":122,"box":{"x":70,"y":581,"width":783,"height":11}},{"id":"bef2d704-621f-4bb1-8dfe-f0f54e8cc640","block_type":"box","text":"BlackRock lenders that provide additional protections against lender default that are favored by their prudential","page_number":122,"box":{"x":70,"y":596,"width":790,"height":12}},{"id":"41414792-3615-4a57-88a4-b5df7d661f23","block_type":"box","text":"regulation.","page_number":122,"box":{"x":69,"y":612,"width":73,"height":11}},{"id":"a138515c-4598-463b-986e-830114728969","block_type":"box","text":"BlackRock uses a predetermined systematic process in order to approximate pro rata allocation over time. In","page_number":122,"box":{"x":102,"y":634,"width":777,"height":11}},{"id":"4391d8e8-2dfe-4679-aa3a-3713a851ba63","block_type":"box","text":"order to allocate a loan to a portfolio: (i) BlackRock as a whole must have sufficient lending capacity pursuant to the","page_number":122,"box":{"x":69,"y":649,"width":830,"height":12}},{"id":"28105f6e-9110-4c7a-8805-ed79636e764d","block_type":"box","text":"various program limits (","page_number":122,"box":{"x":68,"y":665,"width":168,"height":11}},{"id":"8e686de4-0814-4814-9b19-6e0d4ce2c578","block_type":"box","text":"i.e.","page_number":122,"box":{"x":238,"y":665,"width":20,"height":8}},{"id":"145cd34c-7a2f-4742-ab21-3e5b829737e4","block_type":"box","text":"indemnification exposure limit and borrower credit limits); (ii) the lending portfolio must","page_number":122,"box":{"x":265,"y":664,"width":621,"height":12}},{"id":"288db401-040c-40b6-800d-92b709eab438","block_type":"box","text":"hold the asset at the time a loan opportunity arrives; and (iii) the lending portfolio must also have enough inventory,","page_number":122,"box":{"x":69,"y":680,"width":827,"height":11}},{"id":"da1035a6-7385-43b4-a003-19daa2768fa6","block_type":"box","text":"either on its own or when aggregated with other portfolios into one single market delivery, to satisfy the loan request.","page_number":122,"box":{"x":69,"y":695,"width":836,"height":11}},{"id":"7178cf85-fbb4-4ba4-9c39-203d17573215","block_type":"box","text":"In doing so, BlackRock seeks to provide equal lending opportunities for all portfolios, independent of whether","page_number":122,"box":{"x":70,"y":710,"width":780,"height":11}},{"id":"b350faf6-44d2-422a-980d-c0cbd6f8006a","block_type":"box","text":"BlackRock indemnifies the portfolio. Equal opportunities for lending portfolios does not guarantee equal outcomes.","page_number":122,"box":{"x":70,"y":725,"width":820,"height":11}},{"id":"e440428a-1215-45ce-8896-4e428654d050","block_type":"box","text":"Specifically, short and long-term outcomes for individual clients may vary due to asset mix, asset/liability spreads on","page_number":122,"box":{"x":69,"y":740,"width":834,"height":11}},{"id":"b868ad9c-85ed-479c-9cb8-e732705c3970","block_type":"box","text":"different securities, and the overall limits imposed by the firm.","page_number":122,"box":{"x":69,"y":755,"width":444,"height":11}},{"id":"e6e02301-6988-48ec-9fc0-8f2f11c4f91f","block_type":"box","text":"Purchases and sales of securities and other assets for a Fund may be aggregated with orders for other","page_number":122,"box":{"x":102,"y":778,"width":734,"height":11}},{"id":"b1239c14-ef23-428b-bc01-fec2fe36f407","block_type":"box","text":"BlackRock client accounts, including with accounts that pay different transaction costs solely due to the fact that they","page_number":122,"box":{"x":70,"y":793,"width":840,"height":11}},{"id":"9a42581e-f083-4913-8c6b-b654123aef45","block_type":"box","text":"have different research payment arrangements. BlackRock, however, is not required to aggregate orders if portfolio","page_number":122,"box":{"x":69,"y":808,"width":822,"height":11}},{"id":"598ca631-e0bb-46d8-8d0a-5df7c54eefa2","block_type":"box","text":"management decisions for different accounts are made separately, or if they determine that aggregating is not","page_number":122,"box":{"x":69,"y":823,"width":788,"height":12}},{"id":"e9729bb6-5c0f-40e2-ab27-59fbcc23d80b","block_type":"box","text":"practicable or required, or in cases involving client direction.","page_number":122,"box":{"x":70,"y":839,"width":426,"height":11}},{"id":"7e1034d0-8865-4ea1-9583-843a60404b83","block_type":"box","text":"Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the","page_number":122,"box":{"x":102,"y":861,"width":763,"height":11}},{"id":"f1d38716-ea84-49ca-8c55-709255537958","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":122,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"1ca70d59-378b-4020-b169-eebbcf85d2ba","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":122,"box":{"x":68,"y":891,"width":767,"height":12}},{"id":"5fc9c121-0acd-4643-9f81-199668c19bd5","block_type":"box","text":"II-92","page_number":122,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d7a1ec78-8242-41a2-b037-e82913e0546d","block_type":"box","text":"NM1026U-5979889-122/232","page_number":122,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"839e687b-f054-452d-94db-01e2362a189c","block_type":"box","text":"occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged","page_number":123,"box":{"x":69,"y":45,"width":828,"height":11}},{"id":"4f0d8ad5-7501-4963-9271-4c463339d73f","block_type":"box","text":"the same commission or commission equivalent rates in connection with an aggregated order.","page_number":123,"box":{"x":68,"y":60,"width":672,"height":11}},{"id":"158e3fcc-ea19-4e96-9449-94cd82cafecb","block_type":"box","text":"As discussed in the section below entitled “Portfolio Transactions and Brokerage—Transactions in Portfolio","page_number":123,"box":{"x":101,"y":82,"width":767,"height":12}},{"id":"50d42efc-de14-4ff7-b0b3-28e65cde8d9c","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":123,"box":{"x":69,"y":98,"width":832,"height":11}},{"id":"60f85e72-359c-400b-a668-d9163d5698bb","block_type":"box","text":"commission for effecting a transaction that exceeds the amount another broker or dealer would have charged for","page_number":123,"box":{"x":69,"y":113,"width":805,"height":11}},{"id":"ba53d5ca-0d28-42be-a45d-a8a65143213f","block_type":"box","text":"effecting the same transaction in recognition of the value of brokerage and research services provided by that broker","page_number":123,"box":{"x":69,"y":128,"width":836,"height":11}},{"id":"4aafbce2-0b11-4b77-bf71-cf26279cd42f","block_type":"box","text":"or dealer. Under MiFID II, EU investment managers, including BlackRock International Limited (“BIL”) which acts as a","page_number":123,"box":{"x":69,"y":143,"width":831,"height":11}},{"id":"af522662-8b49-417f-94ed-ed5c2af9e262","block_type":"box","text":"sub-adviser to certain Funds, pay for research from brokers and dealers directly out of their own resources, rather","page_number":123,"box":{"x":69,"y":158,"width":812,"height":11}},{"id":"c1da7dbb-e18c-4cd6-9ac4-0e928ff907de","block_type":"box","text":"than through client commissions.","page_number":123,"box":{"x":68,"y":173,"width":237,"height":11}},{"id":"1bc31f3a-855b-4844-a95e-384e4aeff7ce","block_type":"box","text":"Subject to applicable law, BlackRock may select brokers that furnish BlackRock, the Funds, other BlackRock","page_number":123,"box":{"x":102,"y":196,"width":770,"height":11}},{"id":"7b97e603-27a0-4b50-890a-f0759676c907","block_type":"box","text":"client accounts or personnel, directly or through correspondent relationships, with research or other appropriate","page_number":123,"box":{"x":69,"y":211,"width":797,"height":11}},{"id":"ed802720-5ff2-468a-a18a-f7252aeda084","block_type":"box","text":"services which provide, in BlackRock’s view, appropriate assistance to BlackRock in the investment decision making","page_number":123,"box":{"x":69,"y":226,"width":830,"height":11}},{"id":"5b7aa9f2-99f5-48a0-9609-3e61f606ad38","block_type":"box","text":"process (including with respect to futures, fixed-price offerings and OTC transactions). Such research or other","page_number":123,"box":{"x":70,"y":241,"width":780,"height":11}},{"id":"a5a492d8-37eb-478d-a302-10f1a65e43f3","block_type":"box","text":"services may include, to the extent permitted by law, research reports on companies, industries and securities;","page_number":123,"box":{"x":69,"y":257,"width":795,"height":10}},{"id":"d705193e-f309-43cc-a6c0-ab54c3dceaf9","block_type":"box","text":"economic and financial data; financial publications; proxy analysis; trade industry seminars; computer data bases;","page_number":123,"box":{"x":69,"y":271,"width":815,"height":12}},{"id":"7131a8a6-cc20-45f1-80db-22026537aee8","block_type":"box","text":"research-oriented software and other services and products.","page_number":123,"box":{"x":69,"y":286,"width":430,"height":11}},{"id":"6d94be39-e6e0-4e3b-8f53-06610e367296","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":123,"box":{"x":102,"y":309,"width":785,"height":11}},{"id":"b857fcdd-8c54-47ac-af7a-4e2c992cd3c1","block_type":"box","text":"BlackRock client accounts, including in connection with BlackRock client accounts other than those that pay","page_number":123,"box":{"x":70,"y":325,"width":768,"height":11}},{"id":"61f8eb32-bf08-4c7c-adf1-e1b62c7b43de","block_type":"box","text":"commissions to the broker relating to the research or other service arrangements. Such products and services may","page_number":123,"box":{"x":69,"y":340,"width":826,"height":11}},{"id":"62070188-d64a-412b-bfef-88357ca0f530","block_type":"box","text":"disproportionately benefit other BlackRock client accounts relative to the Funds based on the amount of brokerage","page_number":123,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"5322332b-88c7-4be7-b1bf-0e6080a219da","block_type":"box","text":"commissions paid by the Funds and such other BlackRock client accounts. For example, research or other services","page_number":123,"box":{"x":69,"y":370,"width":821,"height":11}},{"id":"fcbd5588-3521-4db7-a504-33b0117153c3","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":123,"box":{"x":68,"y":385,"width":815,"height":11}},{"id":"531409e7-1fe2-4bf9-9f50-7f67c2128a3d","block_type":"box","text":"other BlackRock client accounts may receive the benefit, including disproportionate benefits, of economies of scale","page_number":123,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"f45f6a30-13e4-4d6c-892e-54bf5f40b818","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":123,"box":{"x":69,"y":415,"width":804,"height":11}},{"id":"3d3f9733-ff2a-48b6-ab01-e7af1aa886af","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":123,"box":{"x":70,"y":430,"width":819,"height":11}},{"id":"2c53fb8b-77b0-4f9c-92b4-359fa3d706ac","block_type":"box","text":"and services itself.","page_number":123,"box":{"x":69,"y":445,"width":134,"height":9}},{"id":"c866938c-4dd4-473e-848d-d0f5204cddc4","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may endeavor to execute trades through brokers who, pursuant","page_number":123,"box":{"x":102,"y":468,"width":793,"height":11}},{"id":"1591f5af-8d81-43ef-801a-2dfec25ac008","block_type":"box","text":"to such arrangements, provide research or other services in order to ensure the continued receipt of research or","page_number":123,"box":{"x":68,"y":483,"width":805,"height":11}},{"id":"8f6cd7dc-a473-4acf-871c-ba54fb90bd25","block_type":"box","text":"other services BlackRock believes are useful in its investment decision-making process. BlackRock may from time to","page_number":123,"box":{"x":69,"y":498,"width":833,"height":11}},{"id":"fc1b1c04-4952-4ac2-8dcd-027e006e5645","block_type":"box","text":"time choose not to engage in the above described arrangements to varying degrees. BlackRock, unless prohibited by","page_number":123,"box":{"x":68,"y":514,"width":836,"height":11}},{"id":"6e063133-d604-4fe5-838e-1909cecf1a99","block_type":"box","text":"applicable law, may also enter into commission sharing arrangements under which BlackRock may execute","page_number":123,"box":{"x":69,"y":529,"width":760,"height":11}},{"id":"df7a6a5a-c31a-4e8e-9355-3f59199f186a","block_type":"box","text":"transactions through a broker-dealer and request that the broker-dealer allocate a portion of the commissions or","page_number":123,"box":{"x":68,"y":543,"width":803,"height":12}},{"id":"f37cbc67-e1e8-43bd-adcf-e8fb08d90ca5","block_type":"box","text":"commission credits to another firm that provides research to BlackRock. To the extent that BlackRock engages in","page_number":123,"box":{"x":69,"y":559,"width":807,"height":11}},{"id":"97fb61d3-67c0-4b1c-b4c6-ed667ad0a581","block_type":"box","text":"commission sharing arrangements, many of the same conflicts related to traditional soft dollars may exist.","page_number":123,"box":{"x":69,"y":574,"width":760,"height":11}},{"id":"41a354f5-9e41-459d-9d1e-bf72c8caa748","block_type":"box","text":"BlackRock may utilize certain electronic crossing networks (“ECNs”) (including, without limitation, ECNs in which","page_number":123,"box":{"x":102,"y":597,"width":799,"height":11}},{"id":"8c495451-1d5e-4714-a1d0-0bda9e0d4630","block_type":"box","text":"BlackRock has an investment or other interest, to the extent permitted by applicable law) in executing client","page_number":123,"box":{"x":70,"y":612,"width":767,"height":11}},{"id":"1fcedfa1-09a3-415e-8fe5-270f56d5e76b","block_type":"box","text":"securities transactions for certain types of securities. These ECNs may charge fees for their services, including","page_number":123,"box":{"x":69,"y":627,"width":794,"height":11}},{"id":"f3f16e98-c68b-409f-9287-cb41c6297457","block_type":"box","text":"access fees and transaction fees. The transaction fees, which are similar to commissions or markups/ markdowns,","page_number":123,"box":{"x":69,"y":642,"width":825,"height":11}},{"id":"d08d4978-670e-496d-b9a3-a226dde179f7","block_type":"box","text":"will generally be charged to clients and, like commissions and markups/markdowns, would generally be included in","page_number":123,"box":{"x":68,"y":657,"width":821,"height":11}},{"id":"f81b3864-edbf-477f-bf08-b61865c1b289","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":123,"box":{"x":68,"y":672,"width":833,"height":11}},{"id":"18cf4cf2-32ff-428d-b301-63609eb6bd15","block_type":"box","text":"executing transactions on behalf of clients, including the Funds. In certain circumstances, ECNs may offer volume","page_number":123,"box":{"x":69,"y":687,"width":812,"height":11}},{"id":"de37cf16-54cc-40d0-ab41-e3b1dd1ec390","block_type":"box","text":"discounts that will reduce the access fees typically paid by BlackRock. BlackRock will only utilize ECNs consistent","page_number":123,"box":{"x":69,"y":702,"width":809,"height":11}},{"id":"93f8814a-1ec0-4a87-8485-38fb389a3f61","block_type":"box","text":"with its obligation to seek to obtain best execution in client transactions.","page_number":123,"box":{"x":68,"y":718,"width":519,"height":11}},{"id":"31cfbd21-f8f7-4250-9a1c-5c27cdc40c30","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":123,"box":{"x":102,"y":740,"width":793,"height":11}},{"id":"3a0472be-b6bc-4d41-8a54-3b9ed6a96a0d","block_type":"box","text":"stock exchange. Transactions for a Fund may be executed on MEMX if third party brokers select MEMX as the","page_number":123,"box":{"x":69,"y":755,"width":782,"height":11}},{"id":"100d4986-5626-4694-8f41-d8858b0d13ea","block_type":"box","text":"appropriate venue for execution of orders placed by BlackRock traders on behalf of client portfolios.","page_number":123,"box":{"x":69,"y":770,"width":710,"height":11}},{"id":"547c469a-eacc-4d07-8687-67f4a2a12243","block_type":"box","text":"BlackRock has adopted policies and procedures designed to prevent conflicts of interest from influencing proxy","page_number":123,"box":{"x":102,"y":793,"width":792,"height":11}},{"id":"fcc1bd8c-9ba0-4436-8b0c-0b3ef9409011","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":123,"box":{"x":68,"y":808,"width":784,"height":11}},{"id":"48798ef6-cc8c-40b3-b48c-814402924b2c","block_type":"box","text":"decisions are made in accordance with BlackRock’s fiduciary obligations to its clients. Nevertheless, notwithstanding","page_number":123,"box":{"x":69,"y":823,"width":837,"height":12}},{"id":"f4e43b9c-5901-4778-bcbe-cf84455490a3","block_type":"box","text":"such proxy voting policies and procedures, actual proxy voting decisions of BlackRock may have the effect of favoring","page_number":123,"box":{"x":69,"y":838,"width":835,"height":12}},{"id":"49645830-0bcc-49fb-85e7-390d3d943f40","block_type":"box","text":"the interests of other clients or businesses of other divisions or units of BlackRock, provided that BlackRock believes","page_number":123,"box":{"x":68,"y":853,"width":837,"height":11}},{"id":"abadcd3a-e875-455e-87ac-89eabb22b278","block_type":"box","text":"such voting decisions to be in accordance with its fiduciary obligations. For a more detailed discussion of these","page_number":123,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"345542d4-3aed-4914-ac7d-4a7d3412f529","block_type":"box","text":"policies and procedures, see “Proxy Voting Policies and Procedures.”","page_number":123,"box":{"x":70,"y":884,"width":490,"height":11}},{"id":"7aecebee-d8b0-454a-8078-91a08c74f4f6","block_type":"box","text":"II-93","page_number":123,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ad61c39e-991e-44a8-918e-c8d40da5c98f","block_type":"box","text":"NM1026U-5979889-123/232","page_number":123,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"048a367f-6f2f-49e6-be83-2bd68a501376","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":124,"box":{"x":102,"y":45,"width":757,"height":11}},{"id":"be2cd05d-2785-4987-82b6-8bae8e0c9714","block_type":"box","text":"separately managed accounts) may, subject to compliance with applicable law, purchase and hold shares of a Fund.","page_number":124,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"1c92efd5-f950-4a03-84db-907224eced7f","block_type":"box","text":"Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of","page_number":124,"box":{"x":70,"y":75,"width":837,"height":11}},{"id":"e9509c99-b37e-43d9-acf7-819604d8a5bd","block_type":"box","text":"scale that tend to reduce the Fund’s expense ratio. BlackRock reserves the right, subject to compliance with","page_number":124,"box":{"x":69,"y":90,"width":774,"height":11}},{"id":"c69365f9-692e-4440-b399-1f6c07d3fbc5","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":124,"box":{"x":69,"y":105,"width":796,"height":11}},{"id":"3b9041df-093e-4530-95b6-f9734eae0646","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":124,"box":{"x":69,"y":120,"width":830,"height":12}},{"id":"dc2f4c41-fa60-4f60-86d7-27c8dd1386b8","block_type":"box","text":"an adverse effect on the Fund’s investment flexibility, portfolio diversification and expense ratio. BlackRock seeks to","page_number":124,"box":{"x":69,"y":135,"width":831,"height":11}},{"id":"7744c195-ab46-41cf-8f90-afea0431b1e7","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":124,"box":{"x":69,"y":150,"width":834,"height":12}},{"id":"0f2bca15-bccd-4406-8dfa-c15fbf8b4dd5","block_type":"box","text":"not obligated to do so and may elect not to do so.","page_number":124,"box":{"x":69,"y":166,"width":355,"height":11}},{"id":"71e6bc70-262e-456a-a43a-1b61d7e7c0e9","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":124,"box":{"x":102,"y":188,"width":742,"height":12}},{"id":"fafe0ec0-41ac-4dc4-9a9b-f471bd58a024","block_type":"box","text":"BlackRock has significant debt or equity investments or other interests. A Fund may also invest in issuances (such as","page_number":124,"box":{"x":70,"y":203,"width":838,"height":12}},{"id":"ab4a9ab8-9b35-429d-8233-ecd12ab9d3a2","block_type":"box","text":"structured notes) by entities for which BlackRock provides and is compensated for cash management services","page_number":124,"box":{"x":69,"y":218,"width":788,"height":12}},{"id":"5fae2429-4045-4c54-98ca-9aff5531f6a5","block_type":"box","text":"relating to the proceeds from the sale of such issuances. In making investment decisions for a Fund, BlackRock is","page_number":124,"box":{"x":69,"y":234,"width":816,"height":11}},{"id":"336f80f5-78dc-42a0-a8a5-8e2dc26f98e5","block_type":"box","text":"not permitted to obtain or use material non-public information acquired by any unit of BlackRock, in the course of","page_number":124,"box":{"x":69,"y":249,"width":806,"height":11}},{"id":"ab5e7646-2368-4a64-991c-a52f3bd393ed","block_type":"box","text":"these activities. In addition, from time to time, the activities of BlackRock may limit a Fund’s flexibility in purchases","page_number":124,"box":{"x":68,"y":264,"width":822,"height":11}},{"id":"1df30e5a-c7b7-4963-a84c-b0ca94374a33","block_type":"box","text":"and sales of securities. As indicated below, BlackRock may engage in transactions with companies in which","page_number":124,"box":{"x":69,"y":279,"width":766,"height":11}},{"id":"93a0df3d-470f-453d-bafa-564191354a28","block_type":"box","text":"BlackRock-advised funds or other clients of BlackRock have an investment.","page_number":124,"box":{"x":70,"y":294,"width":533,"height":9}},{"id":"7760f21c-ac79-4b0e-afae-d23a6f6a0215","block_type":"box","text":"BlackRock and its personnel and other financial service providers may have interests in promoting sales of the","page_number":124,"box":{"x":102,"y":317,"width":789,"height":11}},{"id":"f2efec8d-d68b-497f-ba99-63946f4cbd98","block_type":"box","text":"Funds. With respect to BlackRock and its personnel, the remuneration and profitability relating to services to and","page_number":124,"box":{"x":70,"y":332,"width":805,"height":11}},{"id":"2258845f-6fe0-42a9-81bf-3da9336be2d8","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":124,"box":{"x":69,"y":347,"width":813,"height":11}},{"id":"313bd640-9495-4d00-94a7-a84754b30ffe","block_type":"box","text":"sales of certain funds or other products that might be provided or offered. BlackRock and its sales personnel may","page_number":124,"box":{"x":69,"y":362,"width":814,"height":11}},{"id":"7ada962c-50cc-43d3-a942-ea5853f9cb8f","block_type":"box","text":"directly or indirectly receive a portion of the fees and commissions charged to the Funds or their shareholders.","page_number":124,"box":{"x":69,"y":377,"width":788,"height":12}},{"id":"f9e2f47e-4e64-4dd6-a129-5dc790520b5b","block_type":"box","text":"BlackRock and its advisory or other personnel may also benefit from increased amounts of assets under","page_number":124,"box":{"x":70,"y":392,"width":745,"height":12}},{"id":"0018e129-c543-4a39-ae23-5b05af288522","block_type":"box","text":"management. Fees and commissions may also be higher than for other products or services, and the remuneration","page_number":124,"box":{"x":69,"y":407,"width":822,"height":12}},{"id":"7fb0820b-9e29-490a-ba09-431b62e389ce","block_type":"box","text":"and profitability to BlackRock and such personnel resulting from transactions on behalf of or management of the","page_number":124,"box":{"x":69,"y":423,"width":801,"height":11}},{"id":"a84ac2a2-7386-4281-9263-32006e8d12f6","block_type":"box","text":"Funds may be greater than the remuneration and profitability resulting from other funds or products.","page_number":124,"box":{"x":70,"y":438,"width":711,"height":11}},{"id":"478dd535-8bbd-4c6c-9760-62fe365cb0a0","block_type":"box","text":"BlackRock may provide valuation assistance to certain clients with respect to certain securities or other","page_number":124,"box":{"x":102,"y":461,"width":741,"height":11}},{"id":"e3e97ca4-9bdd-43b5-8d3c-38376592b791","block_type":"box","text":"investments and the valuation recommendations made for such clients’ accounts may differ from the valuations for","page_number":124,"box":{"x":70,"y":475,"width":823,"height":12}},{"id":"d7895cde-2de6-4436-9605-81026d528faf","block_type":"box","text":"the same securities or investments assigned by a Fund’s pricing vendors, especially if such valuations are based on","page_number":124,"box":{"x":68,"y":491,"width":829,"height":11}},{"id":"2987f519-0c9f-4914-9475-b5b8b8bf8d07","block_type":"box","text":"broker-dealer quotes or other data sources unavailable to the Fund’s pricing vendors. While BlackRock will generally","page_number":124,"box":{"x":69,"y":506,"width":825,"height":11}},{"id":"0a23a005-7044-423b-8401-f3a4cf4598b0","block_type":"box","text":"communicate its valuation information or determinations to a Fund’s pricing vendors and/or fund accountants, there","page_number":124,"box":{"x":69,"y":521,"width":830,"height":11}},{"id":"fba84a0c-698e-4c16-b936-f932fe1c5667","block_type":"box","text":"may be instances where the Fund’s pricing vendors or fund accountants assign a different valuation to a security or","page_number":124,"box":{"x":69,"y":536,"width":824,"height":11}},{"id":"fd8651e1-b322-48a5-bb41-03a749f21dc1","block_type":"box","text":"other investment than the valuation for such security or investment determined or recommended by BlackRock.","page_number":124,"box":{"x":69,"y":551,"width":792,"height":11}},{"id":"c7e91d45-08ca-45b8-9029-56d07cd35028","block_type":"box","text":"As disclosed in more detail in “Pricing of Shares—Determination of Net Asset Value” in this SAI, when market","page_number":124,"box":{"x":101,"y":574,"width":784,"height":11}},{"id":"d4cc35c5-6c69-42b5-a926-01c6d4fa6679","block_type":"box","text":"quotations are not readily available or are believed by BlackRock to be unreliable, a Fund’s investments are valued at","page_number":124,"box":{"x":69,"y":589,"width":837,"height":11}},{"id":"452d9a1d-b713-440a-abc8-fe3bafc4c538","block_type":"box","text":"fair value by BlackRock. BlackRock has been designated as the Fund’s valuation designee pursuant to Rule 2a-5","page_number":124,"box":{"x":68,"y":604,"width":803,"height":11}},{"id":"79ff6ef5-d158-49c9-b58c-d8c3e911c272","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":124,"box":{"x":69,"y":619,"width":831,"height":11}},{"id":"4d27a303-56b1-409c-8e3c-8fb3d8ef3778","block_type":"box","text":"assistance from other BlackRock pricing committees and in accordance with BlackRock’s policies and procedures","page_number":124,"box":{"x":69,"y":634,"width":811,"height":12}},{"id":"c4b04592-22ab-4d34-b8cf-c95c7930e635","block_type":"box","text":"(the “Valuation Procedures”). 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While fair value determinations","page_number":124,"box":{"x":69,"y":695,"width":837,"height":11}},{"id":"e0f7d068-2a89-4f12-b833-a97eb78e3a64","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":124,"box":{"x":68,"y":710,"width":829,"height":11}},{"id":"2681b96a-cc70-48cb-af97-55cbaedae155","block_type":"box","text":"based on analytical values determined by BlackRock using proprietary or third party valuation models, fair value","page_number":124,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"c2484e59-9099-4017-9536-385b9101cc36","block_type":"box","text":"represents only a good faith approximation of the value of an asset or liability. 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Similar situations could arise if personnel of BlackRock serve as directors of companies the","page_number":125,"box":{"x":68,"y":491,"width":773,"height":11}},{"id":"36cfbeca-24f0-4a70-9012-210d4e842fc9","block_type":"box","text":"securities of which the Funds wish to purchase or sell. 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Certain","page_number":125,"box":{"x":69,"y":604,"width":819,"height":11}},{"id":"0cd81469-0ca2-4104-bf8e-ed86d3ada7f1","block_type":"box","text":"BlackRock advisory personnel may take views, and make decisions or recommendations, that are different than or","page_number":125,"box":{"x":70,"y":619,"width":817,"height":11}},{"id":"929dd934-7be0-4e9c-895e-00318ac968ad","block_type":"box","text":"opposite those of other BlackRock advisory personnel. Certain portfolio management teams within BlackRock may","page_number":125,"box":{"x":69,"y":634,"width":818,"height":12}},{"id":"c365ccaf-e6e9-40f0-934c-016237398fa7","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":125,"box":{"x":69,"y":649,"width":827,"height":12}},{"id":"1f5140df-982e-4a73-92cc-864f66bc8394","block_type":"box","text":"or adverse to the decisions made or the actions taken (or not taken) by the Funds’ portfolio management teams. The","page_number":125,"box":{"x":69,"y":664,"width":835,"height":12}},{"id":"53d9da64-8337-47a8-a7a0-4ea530f66bea","block_type":"box","text":"various portfolio management teams may not share information with each other, including as a result of certain","page_number":125,"box":{"x":68,"y":680,"width":797,"height":11}},{"id":"0c0c609c-ffd6-4a86-98d9-dbed547b6a3c","block_type":"box","text":"information barriers and other policies, and will not have any obligation or other duty to do so.","page_number":125,"box":{"x":70,"y":695,"width":667,"height":11}},{"id":"8287b11c-46d3-40d9-826f-534cad03aec6","block_type":"box","text":"BlackRock has established certain information barriers and other policies to address the sharing of information","page_number":125,"box":{"x":102,"y":717,"width":794,"height":12}},{"id":"8f0dcaec-1875-41c8-aa1f-dea2e440f4de","block_type":"box","text":"between different businesses within BlackRock, including with respect to personnel responsible with managing","page_number":125,"box":{"x":69,"y":732,"width":791,"height":12}},{"id":"ae2c08c2-4fbb-42d1-8372-de91a172b3bb","block_type":"box","text":"portfolios and voting proxies with respect to certain index equity portfolios versus those responsible for managing","page_number":125,"box":{"x":70,"y":748,"width":812,"height":11}},{"id":"584613eb-a1db-4cb7-b1aa-23172bcae3ef","block_type":"box","text":"portfolios and voting proxies with respect to all other portfolios. 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Therefore, BlackRock may not be able to review potential investments for the Funds","page_number":125,"box":{"x":70,"y":808,"width":824,"height":11}},{"id":"a6e332ce-e5a0-4c3d-9cac-acfa675549d1","block_type":"box","text":"with the benefit of information held by certain areas of BlackRock.","page_number":125,"box":{"x":68,"y":823,"width":472,"height":11}},{"id":"1fbe7fb9-867d-433a-a217-6a93526785e3","block_type":"box","text":"BlackRock may determine to move certain personnel, businesses, or business units from one side of an","page_number":125,"box":{"x":102,"y":846,"width":744,"height":11}},{"id":"c55a3894-1ec2-494b-b3ab-01c80dc493b1","block_type":"box","text":"information barrier to the other side of the information barrier. In connection therewith, BlackRock personnel,","page_number":125,"box":{"x":70,"y":861,"width":775,"height":11}},{"id":"6a7784b7-c5b2-42fa-b4fa-54f315cc964d","block_type":"box","text":"businesses, and business units that were moved will no longer have access to the information and personnel from","page_number":125,"box":{"x":69,"y":876,"width":818,"height":11}},{"id":"92d35b9c-4d97-4ec6-9b0f-58485be28d84","block_type":"box","text":"the side of the information barrier from which they were moved. Information obtained in connection with such","page_number":125,"box":{"x":68,"y":891,"width":779,"height":11}},{"id":"64985be7-afb9-4f77-ba25-c2459b448712","block_type":"box","text":"changes to information barriers may limit or restrict the ability of BlackRock to engage in or otherwise effect","page_number":125,"box":{"x":69,"y":906,"width":771,"height":12}},{"id":"9866be70-8b4b-4983-800b-5058c881edd8","block_type":"box","text":"II-95","page_number":125,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9860ff11-5977-4619-afaa-9b662a4fa9c1","block_type":"box","text":"NM1026U-5979889-125/232","page_number":125,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a5de5a22-6602-406c-b2b3-89f630ed4a72","block_type":"box","text":"transactions on behalf of the Funds (including purchasing or selling securities that BlackRock may otherwise have","page_number":126,"box":{"x":68,"y":45,"width":812,"height":11}},{"id":"919ff1ea-d15d-498c-acf3-5c33bb662cbf","block_type":"box","text":"purchased or sold for a client in the absence of a change to an information barrier). 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In light of certain restrictions, BlackRock may also","page_number":126,"box":{"x":69,"y":324,"width":839,"height":12}},{"id":"bea0df06-4f18-4997-842f-b476e30542fe","block_type":"box","text":"seek to make indirect investments (","page_number":126,"box":{"x":69,"y":340,"width":255,"height":10}},{"id":"c54eba1c-5d6f-4567-8bb6-747d8c04b0f4","block_type":"box","text":"e.g.","page_number":126,"box":{"x":326,"y":341,"width":24,"height":10}},{"id":"e8698cfd-ee7b-4e4f-99b3-4764f5da51e7","block_type":"box","text":", using derivatives) on behalf of its clients to receive exposure to certain","page_number":126,"box":{"x":353,"y":339,"width":514,"height":12}},{"id":"bf39bc43-e369-4989-9c18-7f8f313c2a96","block_type":"box","text":"securities in excess of the applicable ownership restrictions and limitations when legally permitted that will expose","page_number":126,"box":{"x":69,"y":355,"width":817,"height":11}},{"id":"291044d6-a9d5-4d99-bcf7-31042ea31d78","block_type":"box","text":"such clients to additional costs and additional risks, including any risks associated with investing in derivatives.","page_number":126,"box":{"x":69,"y":370,"width":795,"height":11}},{"id":"08a5b067-615c-4b0f-adf1-60683c944eee","block_type":"box","text":"There may be limited availability of derivatives that provide indirect exposure to an impacted security. BlackRock","page_number":126,"box":{"x":68,"y":385,"width":799,"height":11}},{"id":"f0a66b67-fd0e-4a9f-8a61-0ee18820cf2f","block_type":"box","text":"clients can be subject to more than one ownership limitation depending on each client’s holdings, and each","page_number":126,"box":{"x":69,"y":400,"width":767,"height":11}},{"id":"7616c29f-7e52-4889-aaaf-ac624935c73f","block_type":"box","text":"ownership limitation can impact multiple securities held by the client. Certain clients or shareholders may have their","page_number":126,"box":{"x":69,"y":415,"width":829,"height":11}},{"id":"2f295b6a-1919-464f-b560-9d54cf75aaee","block_type":"box","text":"own overlapping obligations to monitor their compliance with ownership limitations across their investments.","page_number":126,"box":{"x":69,"y":430,"width":772,"height":11}},{"id":"2846552b-eb68-41f4-9056-d54c03cb7a40","block_type":"box","text":"If certain aggregate ownership thresholds are reached either through the actions of BlackRock or a BlackRock","page_number":126,"box":{"x":102,"y":453,"width":783,"height":11}},{"id":"7db23c0b-cafb-4885-9ae8-9cdc97368bba","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":126,"box":{"x":69,"y":468,"width":808,"height":11}},{"id":"2e1d6887-4966-4a6b-9e86-009afe6de728","block_type":"box","text":"dispose of investments, or exercise rights (including voting) or undertake business transactions, may be restricted by","page_number":126,"box":{"x":69,"y":483,"width":837,"height":11}},{"id":"ee4d2b13-497b-4a31-871b-a1933453fa71","block_type":"box","text":"law, regulation, rule, or organizational documents or otherwise impaired. For example, to meet the requirements of","page_number":126,"box":{"x":70,"y":498,"width":818,"height":11}},{"id":"c3199c2e-605c-40f8-a197-3ee704bc4b19","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":126,"box":{"x":69,"y":514,"width":821,"height":10}},{"id":"1452c9b4-cecd-4526-b9f2-3044ec957f7a","block_type":"box","text":"otherwise purchase or hold. The limitation or restriction may be based on the holdings of other BlackRock clients","page_number":126,"box":{"x":69,"y":528,"width":806,"height":12}},{"id":"6385ad09-2b41-4bc1-9a71-af4d41751170","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":126,"box":{"x":70,"y":543,"width":839,"height":12}},{"id":"11798a3b-265b-46eb-a89a-3edc822703c5","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":126,"box":{"x":69,"y":559,"width":826,"height":11}},{"id":"d27b116b-acc3-4cbd-8e9d-e5f8069d3aef","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":126,"box":{"x":69,"y":574,"width":807,"height":11}},{"id":"da7f7dff-0906-403b-bf7e-c55b59be125d","block_type":"box","text":"existing investments, utilize indirect investments, utilize information barriers, or otherwise restrict, forgo, or limit the","page_number":126,"box":{"x":69,"y":589,"width":830,"height":11}},{"id":"fd07e0d9-88e3-4a7c-ba67-e423dde4f02d","block_type":"box","text":"exercise of rights (including transferring, outsourcing, or limiting voting rights or forgoing the right to receive","page_number":126,"box":{"x":69,"y":604,"width":765,"height":11}},{"id":"fd207118-34d9-4d1b-873d-580948d815a5","block_type":"box","text":"dividends) when BlackRock, in its sole discretion, deems it appropriate in light of potential regulatory or other","page_number":126,"box":{"x":69,"y":619,"width":781,"height":11}},{"id":"8b434775-c4fb-44a4-902f-aee55c2abcf3","block_type":"box","text":"restrictions on ownership or other consequences resulting from reaching investment thresholds. These types of","page_number":126,"box":{"x":69,"y":634,"width":796,"height":12}},{"id":"05b41da1-194f-43d2-a901-b0b459e0bfbe","block_type":"box","text":"restrictions could negatively impact a client’s performance or ability to meet its investment objective.","page_number":126,"box":{"x":69,"y":649,"width":720,"height":12}},{"id":"54952e53-8d98-4fe4-bacd-6dd884b91d12","block_type":"box","text":"When BlackRock or a BlackRock client is subject to an ownership limitation, BlackRock may in its discretion seek","page_number":126,"box":{"x":101,"y":672,"width":807,"height":11}},{"id":"c933a796-e557-4f60-8002-12c916590023","block_type":"box","text":"permission from the applicable issuers or regulators to exceed the limitation. However, there is no guarantee that","page_number":126,"box":{"x":70,"y":687,"width":810,"height":11}},{"id":"1ca3360a-5e52-46a4-b931-c843f38f0717","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":126,"box":{"x":70,"y":702,"width":829,"height":12}},{"id":"ef1dda69-df76-446a-b00a-a4f9247ca8d4","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":126,"box":{"x":69,"y":717,"width":824,"height":12}},{"id":"ca7b98f5-089c-4544-8ca3-11f4fbe4d62e","block_type":"box","text":"from taking certain actions in connection with the approval, order, consent, relief or non-disapproval, which BlackRock","page_number":126,"box":{"x":68,"y":732,"width":841,"height":12}},{"id":"b6eacbb4-b9fd-4d48-8f13-be32305dec76","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":126,"box":{"x":69,"y":748,"width":770,"height":11}},{"id":"212b4150-0fcf-4408-89d6-32be27dbd1b6","block_type":"box","text":"otherwise would take. In those circumstances where ownership thresholds or limitations must be observed,","page_number":126,"box":{"x":69,"y":763,"width":769,"height":11}},{"id":"e78535ee-8443-47ce-be7d-ee92b5b720ba","block_type":"box","text":"BlackRock seeks to allocate limited investment opportunities equitably among clients, taking into consideration","page_number":126,"box":{"x":70,"y":778,"width":794,"height":11}},{"id":"224d84c8-2ce9-4f1e-beef-df2d48826d8d","block_type":"box","text":"benchmark weight and investment strategy. BlackRock may adopt certain controls designed to prevent the","page_number":126,"box":{"x":69,"y":793,"width":757,"height":11}},{"id":"15dc8474-b3a5-4d7a-9117-a8fac68e71fa","block_type":"box","text":"occurrence of a breach of any applicable ownership threshold or limits, including, for example, when ownership in","page_number":126,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"c3775d6a-5222-4ed5-aff2-ebfc20475f57","block_type":"box","text":"certain securities nears an applicable threshold, BlackRock may limit additional purchases in such securities or, with","page_number":126,"box":{"x":69,"y":823,"width":833,"height":11}},{"id":"7debd3dd-90c5-496a-add2-40c0dff8901c","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":126,"box":{"x":69,"y":838,"width":827,"height":11}},{"id":"abc3da3a-7cd6-4a7a-82cf-2efeb482ce06","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":126,"box":{"x":68,"y":853,"width":803,"height":12}},{"id":"abaf2429-50f8-4414-b420-b42df3604b97","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":126,"box":{"x":70,"y":869,"width":802,"height":11}},{"id":"4d857619-7c7d-40cd-9f41-0cfffccf4927","block_type":"box","text":"reduce these positions to meet the applicable limitations and BlackRock or such client may be subject to regulatory","page_number":126,"box":{"x":69,"y":884,"width":826,"height":11}},{"id":"12c5839f-aff3-4350-93e0-ff68ac29fd5f","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":126,"box":{"x":69,"y":899,"width":834,"height":11}},{"id":"2fbb3971-aa61-4e46-b2d1-91db920605aa","block_type":"box","text":"II-96","page_number":126,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bb2ff54f-665c-42c2-9e55-9c55b3393702","block_type":"box","text":"NM1026U-5979889-126/232","page_number":126,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"3adad075-678f-422d-b447-f06b615db703","block_type":"box","text":"Ownership limitations are highly complex. It is possible that, despite BlackRock’s intent to either comply with or","page_number":127,"box":{"x":102,"y":45,"width":795,"height":11}},{"id":"23aef08f-26a3-4581-80b6-c0ba8bb3f95a","block_type":"box","text":"be granted permission to exceed ownership limitations, it may inadvertently breach a limit or violate the corporate or","page_number":127,"box":{"x":69,"y":60,"width":831,"height":11}},{"id":"1bd4f161-ec6d-4331-aded-055d8786c2fe","block_type":"box","text":"regulatory approval, order, consent, relief or non-disapproval that was obtained.","page_number":127,"box":{"x":69,"y":75,"width":566,"height":11}},{"id":"dc6a1863-aa76-431b-9092-6842e72c3a32","block_type":"box","text":"In addition to the foregoing, other ownership thresholds may trigger reporting requirements to governmental and","page_number":127,"box":{"x":102,"y":98,"width":798,"height":11}},{"id":"e5902b94-6ec6-4865-936a-22c7f88925b2","block_type":"box","text":"regulatory authorities, and such reports may entail the disclosure of the identity of a client or BlackRock’s intended","page_number":127,"box":{"x":69,"y":113,"width":823,"height":11}},{"id":"9e15d223-db9d-4294-b4da-34d790594150","block_type":"box","text":"strategy with respect to such security or asset.","page_number":127,"box":{"x":69,"y":128,"width":333,"height":11}},{"id":"1e7ab280-7cb9-43cc-8c17-155fde0a8c2a","block_type":"box","text":"BlackRock may maintain securities indices. To the extent permitted by applicable laws, the Funds may seek to","page_number":127,"box":{"x":102,"y":151,"width":785,"height":11}},{"id":"8860b7e8-7d48-44f7-a241-0d7f801526f2","block_type":"box","text":"license and use such indices as part of their investment strategy. Index based funds that seek to track the","page_number":127,"box":{"x":70,"y":166,"width":760,"height":11}},{"id":"73bb11ec-1d59-4f35-b2b1-8bf61ee5891c","block_type":"box","text":"performance of securities indices also may use the name of the index or index provider in the fund name. Index","page_number":127,"box":{"x":70,"y":181,"width":796,"height":11}},{"id":"db7fd33a-2ee6-493a-8821-359d9d473e30","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":127,"box":{"x":70,"y":196,"width":830,"height":11}},{"id":"1c2249f7-a83e-4a92-83c7-81934dd9ff84","block_type":"box","text":"index or index name. In instances where BlackRock charges a unitary management fee, BlackRock may have a","page_number":127,"box":{"x":70,"y":211,"width":788,"height":11}},{"id":"2ca3d408-0bd8-4df0-a495-c63f18b963ef","block_type":"box","text":"financial incentive to use a BlackRock index that is less costly to BlackRock than a third party index. BlackRock may","page_number":127,"box":{"x":68,"y":226,"width":829,"height":11}},{"id":"da72399f-fe84-401c-b6f9-75abe17768fd","block_type":"box","text":"benefit from the Funds using BlackRock indices by creating increasing acceptance in the marketplace for such","page_number":127,"box":{"x":69,"y":241,"width":784,"height":11}},{"id":"9e4efed3-62b6-428a-9da9-c392b1422471","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":127,"box":{"x":70,"y":257,"width":797,"height":11}},{"id":"a91dc302-d9a6-48d1-a90d-d13ccaa92ec5","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":127,"box":{"x":70,"y":271,"width":837,"height":12}},{"id":"f0f06d97-349a-4f67-8306-60dbdad45ffa","block_type":"box","text":"index licensing agreement with BlackRock will be as favorable as those terms offered to other licensees.","page_number":127,"box":{"x":70,"y":286,"width":746,"height":12}},{"id":"46919308-372c-47f2-8839-b48fc909d900","block_type":"box","text":"BlackRock may enter into contractual arrangements with third-party service providers to a Fund (","page_number":127,"box":{"x":102,"y":309,"width":686,"height":11}},{"id":"9e6bbd65-e8b5-4309-bea0-a8d13aeae426","block_type":"box","text":"e.g.","page_number":127,"box":{"x":790,"y":311,"width":25,"height":9}},{"id":"0a7e6ca0-547e-454f-8660-aa589ebe59b8","block_type":"box","text":", custodians,","page_number":127,"box":{"x":817,"y":309,"width":90,"height":11}},{"id":"9d7670ae-d041-4434-abb8-8071ea5d156c","block_type":"box","text":"administrators and index providers) pursuant to which BlackRock receives fee discounts or concessions in","page_number":127,"box":{"x":69,"y":324,"width":756,"height":11}},{"id":"0087b20a-ff39-45ce-a203-632b16bee127","block_type":"box","text":"recognition of BlackRock’s overall relationship with such service providers. BlackRock may also enter into contractual","page_number":127,"box":{"x":69,"y":339,"width":836,"height":12}},{"id":"bfaf8349-14b6-4eb0-966f-fe0905d29df0","block_type":"box","text":"arrangements with such service providers pursuant to which BlackRock incurs additional costs if the service","page_number":127,"box":{"x":69,"y":355,"width":772,"height":11}},{"id":"3f341941-0c7b-47ce-a4df-c99e239a3e99","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":127,"box":{"x":70,"y":370,"width":800,"height":11}},{"id":"16f5c589-0638-4162-957a-3ae4af6d9468","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":127,"box":{"x":69,"y":385,"width":771,"height":11}},{"id":"9974dc51-f5b2-426a-a94b-985c7a55c521","block_type":"box","text":"discounts or concessions, or any additional savings, may accrue, in whole or in part, to BlackRock, which could result","page_number":127,"box":{"x":69,"y":400,"width":839,"height":11}},{"id":"a9b11cf7-f168-4aa7-9253-6ba4e749d063","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":127,"box":{"x":70,"y":415,"width":785,"height":11}},{"id":"fa36261e-8829-4181-a414-78e61a5e7b9b","block_type":"box","text":"interest may arise with respect to contractual arrangements with third-party service providers to a Fund, or the","page_number":127,"box":{"x":70,"y":430,"width":786,"height":11}},{"id":"3a7701ed-3a54-49fc-9ff6-e13672b8c13d","block_type":"box","text":"selection of such providers, particularly in circumstances where BlackRock is negotiating on behalf of both funds that","page_number":127,"box":{"x":69,"y":445,"width":837,"height":12}},{"id":"a1700264-cc5f-4426-b2a1-ad486f59f22f","block_type":"box","text":"have a unitary management fee and those that do not or different service providers have different fee structures.","page_number":127,"box":{"x":69,"y":460,"width":809,"height":12}},{"id":"beca6338-0a67-4eae-a796-b2598669e53c","block_type":"box","text":"Conflicts of interest may arise as a result of simultaneous investment management of multiple client accounts","page_number":127,"box":{"x":102,"y":483,"width":788,"height":11}},{"id":"e791ecf1-71aa-4ec3-b306-92e96ea9e950","block_type":"box","text":"by BlackRock’s investment professionals. For example, differences in the advisory fee structure may create the","page_number":127,"box":{"x":69,"y":498,"width":795,"height":11}},{"id":"ff6af6a9-f0f7-4dec-8258-ec96db212d68","block_type":"box","text":"appearance of actual or potential conflicts of interest because such differences could create pecuniary incentives for","page_number":127,"box":{"x":69,"y":513,"width":835,"height":11}},{"id":"d6aff2a3-d09c-4e32-b44e-3e0a789f6d8c","block_type":"box","text":"BlackRock to favor one client account over another.","page_number":127,"box":{"x":70,"y":528,"width":363,"height":9}},{"id":"02c11d2d-d532-46db-8c85-66b24611b1e1","block_type":"box","text":"BlackRock owns or has an ownership interest in certain trading, portfolio management, operations and/or","page_number":127,"box":{"x":102,"y":551,"width":757,"height":11}},{"id":"e35a166f-d039-4c30-9eef-e0419650854a","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":127,"box":{"x":70,"y":566,"width":826,"height":11}},{"id":"e2c87912-e7f0-42fb-bb60-83a3cff6a495","block_type":"box","text":"in connection with the provision of services to accounts managed by BlackRock and funds managed and sponsored","page_number":127,"box":{"x":70,"y":581,"width":822,"height":12}},{"id":"f450f924-ddee-4dbd-aef8-755e61fd6634","block_type":"box","text":"by BlackRock, including the Funds, that engage the service provider (typically the custodian). A Fund’s service","page_number":127,"box":{"x":69,"y":597,"width":782,"height":11}},{"id":"f4092c8a-7f6d-4d0c-a88a-6d8b754215c0","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":127,"box":{"x":70,"y":612,"width":835,"height":11}},{"id":"c8bef4d6-e419-45e5-9934-c05424825ff5","block_type":"box","text":"use of these systems may enhance the profitability of BlackRock.","page_number":127,"box":{"x":69,"y":627,"width":465,"height":11}},{"id":"67ccb2aa-65b4-4398-b798-db9acbead7a8","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":127,"box":{"x":102,"y":649,"width":804,"height":12}},{"id":"e02b8d2f-6c8e-4aed-9dcc-ecfa1fb9a471","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":127,"box":{"x":69,"y":664,"width":840,"height":12}},{"id":"a2617e04-2405-4d84-8266-245160edf72f","block_type":"box","text":"provider.","page_number":127,"box":{"x":70,"y":680,"width":58,"height":11}},{"id":"db0e51ce-d063-4223-8abd-eb35de9bc739","block_type":"box","text":"In recognition of a BlackRock client’s overall relationship with BlackRock, BlackRock may offer special pricing","page_number":127,"box":{"x":102,"y":702,"width":778,"height":12}},{"id":"92c85e06-0cab-49e3-9095-fd7b066a92b7","block_type":"box","text":"arrangements for certain services provided by BlackRock. Any such special pricing arrangements will not affect Fund","page_number":127,"box":{"x":69,"y":717,"width":831,"height":12}},{"id":"4c84ce7b-f3ab-4d75-9eaa-895789cb3772","block_type":"box","text":"fees and expenses applicable to such client’s investment in a Fund.","page_number":127,"box":{"x":68,"y":732,"width":485,"height":11}},{"id":"4ab5ecac-507f-4051-91cc-489c7107c71f","block_type":"box","text":"Present and future activities of BlackRock and its directors, officers and employees, in addition to those","page_number":127,"box":{"x":102,"y":755,"width":742,"height":11}},{"id":"fd6baae7-7e19-498e-9721-6e10166244a2","block_type":"box","text":"described in this section, may give rise to additional conflicts of interest.","page_number":127,"box":{"x":69,"y":770,"width":517,"height":12}},{"id":"2621a1bc-751d-48ff-80bf-9a79f71d6d4c","block_type":"box","text":"PURCHASE OF SHARES","page_number":127,"box":{"x":395,"y":800,"width":188,"height":10}},{"id":"df267ebf-9912-41f8-8fcf-169b772e79cb","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":127,"box":{"x":102,"y":823,"width":800,"height":11}},{"id":"3a31c059-e3b6-4bf4-b6a4-2f4ffaa75932","block_type":"box","text":"under the Investment Company Act. Investor A Shares are sold to investors choosing the initial sales charge","page_number":127,"box":{"x":69,"y":838,"width":771,"height":11}},{"id":"048799b9-d5ef-4905-ac25-bd35aababd03","block_type":"box","text":"alternative, except that Investor A Shares of Index Funds (defined below) and BlackRock Short Obligations Fund are","page_number":127,"box":{"x":69,"y":853,"width":822,"height":11}},{"id":"8a03ede4-5f48-4dc9-9cd4-5e9819d2694e","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":127,"box":{"x":68,"y":868,"width":809,"height":11}},{"id":"6726aa93-fc19-48ba-a428-58e8582b7fad","block_type":"box","text":"sales charge alternative. Investor P Shares are available only to certain investors purchasing shares of Funds","page_number":127,"box":{"x":69,"y":883,"width":781,"height":11}},{"id":"ab484547-89ac-4c14-b3c4-576e02c2a7ac","block_type":"box","text":"through registered representatives of an insurance company’s broker-dealer that has entered into an agreement with","page_number":127,"box":{"x":68,"y":898,"width":833,"height":11}},{"id":"b5faa38e-427e-4d92-9502-0df38b3b6400","block_type":"box","text":"II-97","page_number":127,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8f679849-0f83-496b-a2fa-b8aa801ca5b4","block_type":"box","text":"NM1026U-5979889-127/232","page_number":127,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a5d7489d-50ad-4e64-ba36-bae3db672ede","block_type":"box","text":"the Distributor to offer such shares. Institutional Shares are sold to certain eligible investors without a sales charge.","page_number":128,"box":{"x":68,"y":45,"width":833,"height":11}},{"id":"8b8e03fa-d8ed-4437-8d62-3338fb8b0834","block_type":"box","text":"Certain Funds offer Class R Shares, which are available only to certain employer-sponsored retirement plans and are","page_number":128,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"31d4f460-4da8-49d3-9976-29c699cd1618","block_type":"box","text":"sold without a sales charge. Certain Funds offer Class G Shares, which are available only to investors on eligible","page_number":128,"box":{"x":69,"y":75,"width":804,"height":11}},{"id":"3a4230eb-ab5d-43b6-89a7-d9c6981c015f","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":128,"box":{"x":70,"y":90,"width":816,"height":11}},{"id":"79f3310f-c0e8-4423-9f57-70c88b4673b3","block_type":"box","text":"financial intermediary that meets an initial investment minimum of $2 billion. In addition, certain Funds offer Service","page_number":128,"box":{"x":68,"y":104,"width":835,"height":12}},{"id":"9961436e-ae91-4921-9023-77e5fc7aa5d1","block_type":"box","text":"Shares, BlackRock Shares and/or Class K Shares that are available only to certain eligible investors. Please see the","page_number":128,"box":{"x":69,"y":120,"width":834,"height":12}},{"id":"306a5d03-c4d6-42e3-8850-585637a71086","block_type":"box","text":"appropriate Prospectus for your Fund to determine which classes are offered by your Fund and under what","page_number":128,"box":{"x":69,"y":135,"width":757,"height":11}},{"id":"bab63c5f-2b6f-488c-b0a7-01a6b2753fb5","block_type":"box","text":"circumstances. Each class has different exchange privileges. See “Shareholder Services — Exchange Privilege.”","page_number":128,"box":{"x":69,"y":150,"width":802,"height":12}},{"id":"adde45d9-7b06-4ed6-b7f0-242984c806dc","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":128,"box":{"x":101,"y":173,"width":799,"height":11}},{"id":"78ca9478-131c-4f47-aef9-36fd99553b34","block_type":"box","text":"the purchase order by a dealer or other financial intermediary (“Selling Dealer”) that has been authorized by the","page_number":128,"box":{"x":68,"y":188,"width":798,"height":12}},{"id":"cbfc26b4-5260-4ffa-85a6-16d1b7c61e83","block_type":"box","text":"Distributor by contract to accept such orders. In addition, with respect to the affiliated underlying funds in which","page_number":128,"box":{"x":70,"y":203,"width":795,"height":12}},{"id":"0abfce5f-bc89-40b8-a0ae-3f983fd29a2a","block_type":"box","text":"target date funds advised by BlackRock or its affiliates (“BlackRock Target Date Funds”) invest, the applicable","page_number":128,"box":{"x":68,"y":218,"width":786,"height":12}},{"id":"affc8e72-380a-4600-8df1-05e5c4eeb660","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":128,"box":{"x":69,"y":234,"width":839,"height":11}},{"id":"f9317010-e4f8-49c3-bc2c-c8e67a421efa","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":128,"box":{"x":69,"y":249,"width":795,"height":11}},{"id":"285180a1-aab9-4b0c-941e-e3c94dc26e19","block_type":"box","text":"Target Date Funds that allocate a portion of such purchase order to such affiliated underlying fund. As to purchase","page_number":128,"box":{"x":68,"y":264,"width":819,"height":11}},{"id":"cfdb3915-fde2-47a4-83d1-20cb2db33e86","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":128,"box":{"x":69,"y":279,"width":808,"height":11}},{"id":"2ba74d22-dc53-47d8-87be-a15d48775632","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":128,"box":{"x":69,"y":294,"width":803,"height":11}},{"id":"43f66ee0-1727-48be-9684-6610256c44cd","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":128,"box":{"x":70,"y":309,"width":812,"height":11}},{"id":"49378f38-82cf-4c37-a346-e1ce92cfa303","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":128,"box":{"x":68,"y":324,"width":828,"height":11}},{"id":"4908f826-420f-43a8-a30e-605625d6b093","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":128,"box":{"x":68,"y":339,"width":788,"height":12}},{"id":"baf8b7a3-1a44-4695-b20c-e7a474d56d68","block_type":"box","text":"deemed received on the next business day. It is the responsibility of brokers to transmit purchase orders and","page_number":128,"box":{"x":69,"y":355,"width":779,"height":11}},{"id":"2fefdd5b-9b34-43a6-929c-6e946a4d120b","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":128,"box":{"x":70,"y":370,"width":830,"height":11}},{"id":"f47e871a-14a9-4ebe-84e7-c819c1e9a985","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":128,"box":{"x":69,"y":385,"width":828,"height":11}},{"id":"621869ec-a0eb-45e0-bbdc-81d27ac7676d","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":128,"box":{"x":68,"y":399,"width":762,"height":12}},{"id":"ba8ae31e-45d2-44d6-b742-510df53bc5d4","block_type":"box","text":"The minimum investment for the initial purchase of shares is set forth in the Prospectus for each Fund. The","page_number":128,"box":{"x":101,"y":423,"width":768,"height":11}},{"id":"a321a174-562e-4a73-94c6-5f9f3d1eb436","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":128,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"c445e0b2-f2d1-4f00-b9f9-1fa5abeae1bf","block_type":"box","text":"affiliates is $100, unless payment is made through a payroll deduction program in which case the minimum","page_number":128,"box":{"x":69,"y":452,"width":769,"height":12}},{"id":"8c841e0b-8cc5-4f8c-9b0b-c54885a46038","block_type":"box","text":"investment is $25.","page_number":128,"box":{"x":70,"y":467,"width":132,"height":11}},{"id":"b17208d5-bb33-4c37-a761-ee46fdd411f4","block_type":"box","text":"Each Fund has lower investment minimums for other categories of shareholders eligible to purchase Institutional","page_number":128,"box":{"x":102,"y":491,"width":802,"height":11}},{"id":"a7c299f3-6b58-4836-8c10-b853e2bc5aa9","block_type":"box","text":"Shares, including selected fee-based programs. Each Fund may permit a lower initial investment for certain investors","page_number":128,"box":{"x":69,"y":506,"width":833,"height":11}},{"id":"f58d691a-d9a9-45e9-9dd6-5be9a14c1dfa","block_type":"box","text":"if their purchase, combined with purchases by other investors received together by the Fund, meets the minimum","page_number":128,"box":{"x":70,"y":521,"width":806,"height":11}},{"id":"2f7d4a8f-79b0-4a57-808b-e6c9b8f9c932","block_type":"box","text":"investment requirement. Each Fund may reject any purchase order, modify or waive the minimum initial or","page_number":128,"box":{"x":70,"y":536,"width":751,"height":11}},{"id":"2621c343-e24b-4420-950f-595f437b3eb1","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":128,"box":{"x":69,"y":551,"width":826,"height":11}},{"id":"9457c658-827a-4fff-b8e5-8fc2fa912a1a","block_type":"box","text":"Financial intermediaries may, in connection with a change in account type or otherwise in accordance with a","page_number":128,"box":{"x":102,"y":574,"width":768,"height":11}},{"id":"569bd11b-4a85-411d-a2d5-f20496a76bff","block_type":"box","text":"financial intermediary’s policies and procedures, exchange shares of a Fund from one class of shares to another","page_number":128,"box":{"x":68,"y":589,"width":807,"height":11}},{"id":"4ff3eac7-1ee1-403a-8089-22d4d91b672f","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":128,"box":{"x":69,"y":604,"width":836,"height":11}},{"id":"8800c579-bb46-4bd2-8400-618c03b46df0","block_type":"box","text":"charge (“CDSC”) and that shareholders meet eligibility requirements of the new share class. Please speak to your","page_number":128,"box":{"x":69,"y":619,"width":814,"height":11}},{"id":"bf8a3bb1-1df5-426d-a2f4-7f5dbe73895c","block_type":"box","text":"financial intermediary for information about specific policies and procedures applicable to your account.","page_number":128,"box":{"x":68,"y":634,"width":740,"height":11}},{"id":"b6a212f5-f251-4a5e-980f-4c1b4fdd9d89","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":128,"box":{"x":102,"y":657,"width":795,"height":11}},{"id":"fa249891-9158-45b9-b4eb-e7991f87dbea","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":128,"box":{"x":70,"y":672,"width":813,"height":11}},{"id":"26d8b8dd-01af-4507-9a29-6aac1f7e1946","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":128,"box":{"x":68,"y":687,"width":827,"height":11}},{"id":"58d269fc-8eb4-4332-be8f-dfc931a28346","block_type":"box","text":"financial intermediaries are permitted to withhold placing orders to benefit themselves by a price change.","page_number":128,"box":{"x":68,"y":702,"width":750,"height":12}},{"id":"14fc9528-523f-4736-b39a-978ecbef8ceb","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":128,"box":{"x":101,"y":725,"width":776,"height":11}},{"id":"2f71a888-c2fe-424f-a334-6509da346538","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":128,"box":{"x":69,"y":740,"width":831,"height":11}},{"id":"e3572ddd-f8ea-4752-8ea6-c089cc8d6691","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":128,"box":{"x":69,"y":755,"width":822,"height":11}},{"id":"0ffb8a1f-297f-473c-993d-1e1264ad6e86","block_type":"box","text":"single fiduciary account although more than one beneficiary may be involved. The term “purchase” also includes","page_number":128,"box":{"x":69,"y":770,"width":802,"height":12}},{"id":"3a0eb6c0-1ad6-44dd-9616-d7feb68aa360","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":128,"box":{"x":70,"y":785,"width":839,"height":12}},{"id":"c34b4605-ffc1-45a8-a567-8805a8e02de8","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":128,"box":{"x":69,"y":801,"width":819,"height":11}},{"id":"7612585e-2574-4888-a5b5-5afa0a970cdd","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":128,"box":{"x":68,"y":816,"width":827,"height":11}},{"id":"3a45a41a-4fe9-47b0-b410-613077f9c08e","block_type":"box","text":"group of individuals whose sole organizational nexus is that its participants are credit cardholders of a company,","page_number":128,"box":{"x":68,"y":831,"width":803,"height":11}},{"id":"26831cd5-add2-4160-9596-6780e9b5561d","block_type":"box","text":"policyholders of an insurance company, customers of either a bank or broker-dealer or clients of an investment","page_number":128,"box":{"x":70,"y":846,"width":788,"height":11}},{"id":"3e09f040-82f6-462d-ade4-72668bd7f79f","block_type":"box","text":"adviser.","page_number":128,"box":{"x":69,"y":861,"width":53,"height":9}},{"id":"8aad121e-3bb1-49ea-989b-cec732f327ff","block_type":"box","text":"With certain limited exceptions, the Funds are generally available only to investors residing in the United States","page_number":128,"box":{"x":101,"y":884,"width":795,"height":11}},{"id":"91d815dc-a879-4782-a17a-4be3842986f6","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":128,"box":{"x":69,"y":899,"width":821,"height":11}},{"id":"7b52df69-29ea-47db-8db7-e0abdba8ec7c","block_type":"box","text":"II-98","page_number":128,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5e65853b-25a3-4706-b635-82002300cccb","block_type":"box","text":"NM1026U-5979889-128/232","page_number":128,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"157a0862-55a0-45c5-9f35-642beff1b6b4","block_type":"box","text":"additional investments (including by way of exchange from another Fund) into existing accounts, a Fund generally","page_number":129,"box":{"x":69,"y":45,"width":803,"height":11}},{"id":"aee312d0-1e8b-4343-9504-059318db8420","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":129,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"32343e40-6b9d-488e-a059-69a46592eeb9","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":129,"box":{"x":68,"y":75,"width":747,"height":11}},{"id":"f7f97704-0cf6-4ddd-b008-bf9e3ef2063b","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":129,"box":{"x":70,"y":90,"width":809,"height":11}},{"id":"53351b89-f5a3-40a9-9863-d8cd738477e1","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":129,"box":{"x":69,"y":105,"width":819,"height":11}},{"id":"d856a70e-852b-4e5d-bfc2-7cbf28c96efc","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":129,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"3a729dae-e71d-41c2-9029-e06d21b4caf7","block_type":"box","text":"also be restricted from making additional investments.","page_number":129,"box":{"x":69,"y":135,"width":388,"height":12}},{"id":"49648754-bd4c-4c0a-be0a-29f7486b0da3","block_type":"box","text":"In-Kind Purchases","page_number":129,"box":{"x":102,"y":158,"width":127,"height":9}},{"id":"7d088a27-924c-4100-9ecc-3d86c591aa4b","block_type":"box","text":". Payment for shares of a Fund may, at the discretion of BlackRock, be made in the form of","page_number":129,"box":{"x":230,"y":158,"width":649,"height":11}},{"id":"6d837f57-7992-49b1-af5b-24f5e61619d6","block_type":"box","text":"securities that are permissible investments for the Fund and that meet the investment objective, policies and","page_number":129,"box":{"x":69,"y":173,"width":779,"height":11}},{"id":"9ea88d48-3fb6-48e9-a6f1-1fc8709a8b78","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":129,"box":{"x":70,"y":188,"width":820,"height":11}},{"id":"932b8a9c-ebe1-4cc3-a4ed-0c2934120d60","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":129,"box":{"x":69,"y":203,"width":827,"height":12}},{"id":"5626b961-5995-4839-a077-f62cdeb60d75","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":129,"box":{"x":69,"y":218,"width":831,"height":12}},{"id":"d5d7c265-ddf2-4533-9997-a4ef56c39cde","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":129,"box":{"x":69,"y":234,"width":817,"height":11}},{"id":"3baf7453-26ef-4ce4-84ec-98582ea55dc9","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":129,"box":{"x":68,"y":249,"width":837,"height":11}},{"id":"030b2cfa-8d90-410a-802f-78d52c6d7057","block_type":"box","text":"securities. All dividends, interest, subscription or other rights pertaining to such securities shall become the property","page_number":129,"box":{"x":69,"y":264,"width":835,"height":11}},{"id":"16389e4a-b7db-4e59-a6fc-10102e0e7727","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":129,"box":{"x":69,"y":279,"width":795,"height":11}},{"id":"033ddd6e-6638-4395-b08e-d065e9962319","block_type":"box","text":"receipt from the issuer. Shares purchased in exchange for securities generally cannot be redeemed until the transfer","page_number":129,"box":{"x":69,"y":294,"width":833,"height":11}},{"id":"52c47454-9a9a-4b2c-8c2e-ce653d80d7a8","block_type":"box","text":"has settled.","page_number":129,"box":{"x":69,"y":309,"width":83,"height":9}},{"id":"27022db9-49dc-479f-a3e5-ccf48e4356dd","block_type":"box","text":"Institutional Shares","page_number":129,"box":{"x":69,"y":340,"width":142,"height":8}},{"id":"26ff1551-8069-4372-92e8-f3ed16ef0ee5","block_type":"box","text":"Institutional Shares may be purchased at NAV without a sales charge. Only certain investors are eligible to","page_number":129,"box":{"x":102,"y":362,"width":759,"height":11}},{"id":"4b12962f-b8e9-473a-9a38-71fbcebc0698","block_type":"box","text":"purchase Institutional Shares. Investors who are eligible to purchase Institutional Shares should purchase","page_number":129,"box":{"x":70,"y":377,"width":756,"height":12}},{"id":"8c3ac5d1-1f8c-4489-a8d6-d1276c8651b2","block_type":"box","text":"Institutional Shares because they are not subject to any sales charge and have lower ongoing expenses than","page_number":129,"box":{"x":70,"y":392,"width":775,"height":12}},{"id":"8e6b2831-4852-4ce8-8c20-ecc94d921dbb","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":129,"box":{"x":70,"y":407,"width":839,"height":12}},{"id":"1bc08c9f-6ec4-4fe6-b127-40b15effb9e2","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":129,"box":{"x":69,"y":423,"width":807,"height":11}},{"id":"357d7f17-ab15-461e-b81c-6d4e31ef1392","block_type":"box","text":"sale of shares of any Fund at any time.","page_number":129,"box":{"x":69,"y":438,"width":276,"height":11}},{"id":"2333e6f0-307d-4c9e-ab19-f6b38f9ac933","block_type":"box","text":"Eligible Institutional Share Investors.","page_number":129,"box":{"x":102,"y":460,"width":259,"height":12}},{"id":"d617299a-bb89-4ed2-ba04-593d8ddaf89f","block_type":"box","text":"Institutional Shares of the Funds may be purchased by customers of broker","page_number":129,"box":{"x":369,"y":460,"width":540,"height":12}},{"id":"792cf9bf-e1f3-43ad-957e-82b9b64016ac","block_type":"box","text":"dealers and agents that have established a servicing relationship with the Fund on behalf of their customers. These","page_number":129,"box":{"x":69,"y":475,"width":826,"height":12}},{"id":"d3bdd8d8-5923-45d4-909b-5914ac831794","block_type":"box","text":"broker-dealers and agents may impose additional or different conditions on the purchase or redemption of Fund","page_number":129,"box":{"x":69,"y":491,"width":796,"height":11}},{"id":"af60c5d2-b7e1-47e3-8457-20f6ad0b4083","block_type":"box","text":"shares by their customers and may charge their customers transaction, account or other fees on the purchase and","page_number":129,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"b568a403-d2ac-4c16-9a40-6be3d5d1b370","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":129,"box":{"x":69,"y":521,"width":840,"height":11}},{"id":"84b67a98-0b3e-47ca-98c4-501a306ac30c","block_type":"box","text":"any such fees and information regarding any additional or different conditions regarding purchases and redemptions.","page_number":129,"box":{"x":69,"y":536,"width":833,"height":11}},{"id":"fdb59f1d-421f-4cc4-91e6-081aecb34899","block_type":"box","text":"Shareholders who are customers of such broker-dealers or agents should consult them for information regarding","page_number":129,"box":{"x":69,"y":551,"width":802,"height":11}},{"id":"c5cbb5e3-28de-41b4-8729-acda075d4a48","block_type":"box","text":"these fees and conditions.","page_number":129,"box":{"x":68,"y":566,"width":189,"height":9}},{"id":"7168d1d9-d41a-4e0a-9d3b-0084d4efded7","block_type":"box","text":"Payment for Institutional Shares must normally be made in Federal funds or other funds immediately available by","page_number":129,"box":{"x":102,"y":589,"width":805,"height":11}},{"id":"0ba56134-3cb3-490d-a362-db26a3d153ee","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":129,"box":{"x":69,"y":604,"width":825,"height":11}},{"id":"36d1ccdf-6812-4ddd-9e52-99e7abe6bbbc","block_type":"box","text":"certain Funds, be made in the form of securities that are permissible investments for such Funds. If payment for a","page_number":129,"box":{"x":69,"y":619,"width":817,"height":11}},{"id":"2d88f42f-518f-4f3f-8d66-18f0cfb1d0a0","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":129,"box":{"x":70,"y":634,"width":831,"height":12}},{"id":"4907fb24-9389-4444-b02d-40d8924f2f16","block_type":"box","text":"incurred by the Fund.","page_number":129,"box":{"x":70,"y":650,"width":147,"height":11}},{"id":"6f8d0291-eed2-407a-9955-c413b7ed15d6","block_type":"box","text":"Certain of the Funds offer Institutional Shares as described in each such Fund’s Prospectus. In addition, the","page_number":129,"box":{"x":102,"y":672,"width":774,"height":11}},{"id":"533a7c48-3624-4d44-9014-fa88465c080f","block_type":"box","text":"following investors may purchase Institutional Shares: employees, officers and directors/trustees of BlackRock, Inc.,","page_number":129,"box":{"x":68,"y":687,"width":834,"height":11}},{"id":"c545fd0b-639e-4abb-99d3-ce9955244e4b","block_type":"box","text":"BlackRock Funds, Bank of America Corporation (“BofA Corp.”), Barclays PLC or their respective affiliates and","page_number":129,"box":{"x":70,"y":702,"width":773,"height":11}},{"id":"84a95c64-91e4-4d1d-8ad8-aca1e0d39fdb","block_type":"box","text":"immediate family members of such persons, individuals and “Institutional Investors” with a minimum initial","page_number":129,"box":{"x":70,"y":717,"width":762,"height":12}},{"id":"dc4173cc-7696-4911-b37f-4e39d8112ea1","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":129,"box":{"x":70,"y":732,"width":821,"height":12}},{"id":"c33617d0-4494-4fb5-9b05-b507e4fa9b32","block_type":"box","text":"an agreement with the Distributor to purchase such shares (“Institutional Investors” include, but are not limited to,","page_number":129,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"900b70fe-0ce0-4dac-b605-a5707b2ac905","block_type":"box","text":"endowments, foundations, family offices, local, city, and state governmental institutions, corporations, and insurance","page_number":129,"box":{"x":69,"y":763,"width":836,"height":11}},{"id":"5f4dd543-1d0e-4e8d-b31a-48e7500f72e6","block_type":"box","text":"company separate accounts); employer-sponsored retirement plans (which, for this purpose, do not include SEP IRAs,","page_number":129,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"a4091b39-4447-49e1-aad8-be2e46d823cd","block_type":"box","text":"SIMPLE IRAs or SARSEPs), state sponsored 529 college savings plans, collective trust funds, investment companies","page_number":129,"box":{"x":69,"y":793,"width":832,"height":11}},{"id":"0f97cfa1-6a28-4c32-9a76-e7eb9b3a7c85","block_type":"box","text":"or other pooled investment vehicles, unaffiliated thrifts and unaffiliated banks and trust companies, each of which","page_number":129,"box":{"x":69,"y":808,"width":815,"height":11}},{"id":"8a13cbc1-cc64-4985-8db8-b33c21c5b24c","block_type":"box","text":"may purchase shares of the Fund through a financial intermediary that has entered into an agreement with the","page_number":129,"box":{"x":69,"y":823,"width":789,"height":12}},{"id":"a710df38-0a3b-424e-84df-f76b1d3e4818","block_type":"box","text":"Distributor to purchase such shares; clients investing through a self-directed IRA brokerage account program","page_number":129,"box":{"x":70,"y":838,"width":772,"height":12}},{"id":"ad8afe67-0d0d-4e59-a48c-5a671cdae91d","block_type":"box","text":"sponsored by a retirement plan record-keeper, provided that such program offers only mutual fund options and that","page_number":129,"box":{"x":69,"y":853,"width":822,"height":12}},{"id":"83c2798b-1e73-4f43-a1e7-19abbf82aba4","block_type":"box","text":"the program maintains an account with the Fund on an omnibus basis; clients of financial intermediaries that:","page_number":129,"box":{"x":68,"y":869,"width":783,"height":11}},{"id":"3b7e7be8-b65c-4048-9e43-85dfffccdede","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":129,"box":{"x":69,"y":884,"width":785,"height":11}},{"id":"b8d94dd6-8241-45be-8f24-4544064e6ddf","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares through a no-load program or investment platform, in each","page_number":129,"box":{"x":69,"y":899,"width":838,"height":11}},{"id":"821c20f4-0689-4508-bc68-a57c6d01963c","block_type":"box","text":"II-99","page_number":129,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"21e44eb5-eeef-4871-a884-e452b4c4a9a2","block_type":"box","text":"NM1026U-5979889-129/232","page_number":129,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e7fd6c51-b86e-4136-b6cb-1e0a6ba38c81","block_type":"box","text":"case, with no minimum initial investment; clients investing through financial intermediaries that have entered into an","page_number":130,"box":{"x":69,"y":45,"width":831,"height":11}},{"id":"15ae5ed3-6d18-4218-9396-38303208fa43","block_type":"box","text":"agreement with the Distributor to offer such shares on a platform that charges a transaction based sales","page_number":130,"box":{"x":69,"y":60,"width":751,"height":11}},{"id":"2c77ae56-b993-446c-9dd7-0f2f2803dc88","block_type":"box","text":"commission outside of the Fund, with a minimum initial investment of $1,000; tax-qualified accounts for insurance","page_number":130,"box":{"x":69,"y":74,"width":817,"height":12}},{"id":"278dcc23-c000-4758-af0f-6f8bd00efd29","block_type":"box","text":"agents that are registered representatives of an insurance company’s broker-dealer that has entered into an","page_number":130,"box":{"x":69,"y":90,"width":773,"height":11}},{"id":"c5b0a321-40eb-4ac0-b1b1-104d426d29ff","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares, and the family members of such persons, with a","page_number":130,"box":{"x":69,"y":105,"width":771,"height":11}},{"id":"06d3c482-4d70-4710-a795-f5c2c9fc2d98","block_type":"box","text":"minimum initial investment of $1,000; trust department clients of Bank of America, N.A. and its affiliates for whom","page_number":130,"box":{"x":69,"y":120,"width":822,"height":11}},{"id":"4967a776-110a-4013-8091-1307a9130f91","block_type":"box","text":"they (i) act in a fiduciary capacity (excluding participant directed employee benefit plans), (ii) otherwise have","page_number":130,"box":{"x":68,"y":135,"width":771,"height":12}},{"id":"bf115d08-ba72-4dcd-9de8-4bbf24f902fc","block_type":"box","text":"investment discretion, or (iii) act as custodian for at least $2 million in assets; and holders of certain BofA Corp.","page_number":130,"box":{"x":70,"y":150,"width":801,"height":11}},{"id":"f7882203-a497-42d4-a980-d01af4aafd08","block_type":"box","text":"sponsored unit investment trusts (UITs) who reinvest dividends received from such UITs in shares of a Fund.","page_number":130,"box":{"x":69,"y":166,"width":770,"height":11}},{"id":"a0a8b274-1a29-4068-98d2-99ce696fc000","block_type":"box","text":"Purchase Privileges of Cer tain Persons.","page_number":130,"box":{"x":102,"y":188,"width":280,"height":12}},{"id":"57d1137b-cff6-42de-8f2a-caf7bf2fafc0","block_type":"box","text":"Employees, officers, directors/trustees of BlackRock, Inc., BlackRock","page_number":130,"box":{"x":389,"y":188,"width":496,"height":11}},{"id":"8366cdc8-4032-4634-8c49-fb9e08de6d54","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":130,"box":{"x":70,"y":203,"width":812,"height":12}},{"id":"1c1b01e2-df23-4bde-a534-a52c8c5279c7","block_type":"box","text":"persons may purchase Institutional Shares at lower investment minimums than stated in each Fund’s Prospectus. A","page_number":130,"box":{"x":70,"y":219,"width":828,"height":11}},{"id":"dc62ddd6-5d8a-490f-be9c-6a16eca2c7b2","block_type":"box","text":"Fund realizes economies of scale and reduction of sales-related expenses by virtue of the familiarity of these persons","page_number":130,"box":{"x":70,"y":234,"width":838,"height":11}},{"id":"5b13cde8-7a24-4de0-ad40-2e6eb0082199","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":130,"box":{"x":68,"y":249,"width":826,"height":11}},{"id":"e9718ebc-a120-4535-a181-98ebae5a0a56","block_type":"box","text":"satisfy the Fund’s suitability standards.","page_number":130,"box":{"x":69,"y":264,"width":279,"height":11}},{"id":"05930a97-dabd-4440-a043-e681c7f606ca","block_type":"box","text":"Initial Sales Charge Alternative — Investor A Shares","page_number":130,"box":{"x":69,"y":294,"width":382,"height":11}},{"id":"383fabdd-c740-4331-b69d-3e87e774b8ff","block_type":"box","text":"Investors who prefer an initial sales charge alternative may elect to purchase Investor A Shares. Investor A1","page_number":130,"box":{"x":102,"y":317,"width":770,"height":11}},{"id":"9aef4e97-7045-411b-b91a-4172a33a43f6","block_type":"box","text":"Shares are offered only (i) for purchase by certain employer-sponsored retirement plans and fee-based programs that","page_number":130,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"8aaf7db4-05ae-422f-b951-58dab3088774","block_type":"box","text":"have been previously approved by certain Funds, and (ii) to certain investors who currently hold Investor A1 Shares","page_number":130,"box":{"x":69,"y":347,"width":819,"height":11}},{"id":"b5048f18-4c74-4da5-9eae-9b0e03a30c4c","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":130,"box":{"x":68,"y":362,"width":840,"height":11}},{"id":"e9cd1f59-c9ea-4751-9c78-b42d7ed0cbf2","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":130,"box":{"x":69,"y":377,"width":815,"height":11}},{"id":"07eec000-bff2-4b87-b1c6-a96506ec443c","block_type":"box","text":"sometimes referred to herein as “front-end load shares.” Investor A Shares of Index Funds (defined below) and","page_number":130,"box":{"x":69,"y":392,"width":791,"height":11}},{"id":"623a0e42-0b96-4fa3-9500-f3e4a4fdc602","block_type":"box","text":"BlackRock Short Obligations Fund generally are not subject to an initial sales charge or front-end load.","page_number":130,"box":{"x":70,"y":407,"width":727,"height":12}},{"id":"aca627ea-703b-4a9e-9a27-0e5b741495b6","block_type":"box","text":"Investors qualifying for significantly reduced initial sales charges may find the initial sales charge alternative","page_number":130,"box":{"x":102,"y":430,"width":770,"height":11}},{"id":"ef9c9278-4924-4c4c-ada4-e0e0e639b468","block_type":"box","text":"particularly attractive because similar sales charge reductions are not available with respect to the deferred sales","page_number":130,"box":{"x":70,"y":445,"width":812,"height":12}},{"id":"8a0eafa8-c929-44fa-8754-65682714b8b3","block_type":"box","text":"charges imposed in connection with investments in Investor C Shares (sometimes referred to herein as “CDSC","page_number":130,"box":{"x":69,"y":460,"width":791,"height":12}},{"id":"ecce9b3b-d457-4ec5-b714-6b8172699ab8","block_type":"box","text":"shares”). Investors who do not qualify for reduced initial sales charges and who expect to maintain their investment","page_number":130,"box":{"x":69,"y":475,"width":826,"height":12}},{"id":"93fef5d1-0a97-403d-95d8-f91c1ffa141d","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":130,"box":{"x":68,"y":491,"width":808,"height":11}},{"id":"d56ec684-b6d0-4528-a53e-49b989bd082c","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":130,"box":{"x":69,"y":506,"width":834,"height":11}},{"id":"837f47ec-4193-42b4-b9e9-b1d660bf8ecf","block_type":"box","text":"service fee. Although some investors who previously purchased Institutional Shares may no longer be eligible to","page_number":130,"box":{"x":69,"y":521,"width":798,"height":11}},{"id":"bfce24a6-4238-476a-ae9a-7d6fc4bd1dd5","block_type":"box","text":"purchase Institutional Shares of other Funds, those previously purchased Institutional Shares, together with all","page_number":130,"box":{"x":70,"y":536,"width":789,"height":11}},{"id":"cdbde41e-0347-4d3a-a4f3-7ad265179267","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":130,"box":{"x":70,"y":551,"width":805,"height":11}},{"id":"7e00454d-9205-48d0-8f06-54a0b99ece3a","block_type":"box","text":"investor for a reduced initial sales charge on new initial sales charge purchases. In addition, the ongoing CDSC","page_number":130,"box":{"x":70,"y":566,"width":792,"height":11}},{"id":"ac842f05-795a-4964-a480-6501b6b37174","block_type":"box","text":"shares service and distribution fees will cause CDSC shares to have higher expense ratios, pay lower dividends and","page_number":130,"box":{"x":69,"y":581,"width":826,"height":12}},{"id":"c3745f1a-1f8f-4653-9d09-edde518f0369","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":130,"box":{"x":69,"y":596,"width":802,"height":12}},{"id":"69ac4b04-aa19-4d6b-83df-87dc40a944a8","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":130,"box":{"x":69,"y":612,"width":834,"height":11}},{"id":"0d9df858-a787-4c7a-a577-4663e3901fc2","block_type":"box","text":"have a lower total return than Institutional Shares.","page_number":130,"box":{"x":69,"y":627,"width":358,"height":9}},{"id":"0fd418d7-c878-4959-ada9-7816a5252e39","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":130,"box":{"x":102,"y":649,"width":734,"height":12}},{"id":"4a313f2b-cf08-4f86-8672-0ca38bcff970","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor A and Investor A1 Shares for the","page_number":130,"box":{"x":70,"y":664,"width":785,"height":11}},{"id":"73fc3fe7-3948-4b8a-a841-987af485f3d8","block_type":"box","text":"periods indicated.","page_number":130,"box":{"x":70,"y":680,"width":124,"height":11}},{"id":"8faa7206-bdb7-4d19-a3bc-44c0038c1207","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":130,"box":{"x":101,"y":702,"width":806,"height":11}},{"id":"23861e59-bcd0-49ad-a69b-386236e48102","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":130,"box":{"x":68,"y":718,"width":830,"height":11}},{"id":"b226dacc-65e9-42d2-ace4-791b35da9f1d","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":130,"box":{"x":69,"y":732,"width":832,"height":12}},{"id":"d9ac5148-68af-4463-8462-03d23dc61653","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":130,"box":{"x":69,"y":748,"width":714,"height":11}},{"id":"577888a1-127f-4d55-9244-84e9d014ba0e","block_type":"box","text":"Initial Sales Charge — Investor P Shares","page_number":130,"box":{"x":69,"y":778,"width":297,"height":11}},{"id":"67582ce6-1f22-443f-a67f-d6dfae5c14fa","block_type":"box","text":"Certain Funds offer Investor P Shares as described in each such Fund’s Prospectus, Investor P Shares are","page_number":130,"box":{"x":102,"y":801,"width":761,"height":11}},{"id":"b662feee-2784-4df5-b565-1185a1f697cb","block_type":"box","text":"available for purchase only through registered representatives of an insurance company’s broker-dealer that has","page_number":130,"box":{"x":69,"y":816,"width":800,"height":11}},{"id":"59bb7568-d754-421d-94c0-cefd20ac377a","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":130,"box":{"x":69,"y":831,"width":812,"height":11}},{"id":"ead69006-085c-4718-a06a-63ffff6cd422","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":130,"box":{"x":69,"y":846,"width":813,"height":11}},{"id":"035b256d-81f8-42db-bda5-608b6b3b21e7","block_type":"box","text":"dividends and have a lower total return than Investor A Shares of the same Fund.","page_number":130,"box":{"x":69,"y":861,"width":578,"height":9}},{"id":"c6f41880-009d-4ea9-a5ba-fbf456b96578","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":130,"box":{"x":102,"y":884,"width":734,"height":11}},{"id":"45c2622b-5d62-44f9-a2a8-6c33d80413e7","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor P Shares for the periods indicated.","page_number":130,"box":{"x":70,"y":899,"width":800,"height":11}},{"id":"5e4264a6-6f34-45b8-9511-508bddb07414","block_type":"box","text":"II-100","page_number":130,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"c90eff3b-377d-4af5-83db-adc81077c0f1","block_type":"box","text":"NM1026U-5979889-130/232","page_number":130,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"cc4a5403-0a73-4cc2-801c-c8b536a6e634","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":131,"box":{"x":101,"y":45,"width":806,"height":11}},{"id":"bbc82b69-d88e-43eb-bb53-4a8746214fb2","block_type":"box","text":"the balance over such discounts. At times the Distributor may reallow the entire sales charge to such dealers. Since","page_number":131,"box":{"x":68,"y":60,"width":830,"height":11}},{"id":"2e35c28c-9a9a-4fb7-b0ee-76d8b819bcd0","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":131,"box":{"x":69,"y":75,"width":832,"height":11}},{"id":"4f307b54-212d-4b15-a379-4309f21d3687","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":131,"box":{"x":69,"y":90,"width":714,"height":11}},{"id":"bc16fd18-b4ad-4f8e-86ee-b803603a8a9d","block_type":"box","text":"Reduced Initial Sales Charges","page_number":131,"box":{"x":69,"y":120,"width":219,"height":11}},{"id":"52ab0791-b3fd-4d8e-8d51-62d64cef5808","block_type":"box","text":"Certain investors may be eligible for a reduction in or waiver of a sales load due to the nature of the investors","page_number":131,"box":{"x":102,"y":143,"width":782,"height":11}},{"id":"c211b851-3d05-466a-82b0-435b180fd4e2","block_type":"box","text":"and/or the reduced sales efforts necessary to obtain their investments. Financial intermediaries may, in connection","page_number":131,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"c035ae75-4870-4256-9d0c-702297a845c2","block_type":"box","text":"with a change in account type or otherwise in accordance with a financial intermediary’s policies and procedures,","page_number":131,"box":{"x":68,"y":173,"width":809,"height":11}},{"id":"969a8466-76e2-4c52-bc58-d70a6bab5258","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":131,"box":{"x":69,"y":188,"width":823,"height":12}},{"id":"117a24b6-7bc5-46cd-a596-52de9b2ececb","block_type":"box","text":"exchanged shares are not subject to a contingent deferred sales charge and that shareholders meet the eligibility","page_number":131,"box":{"x":69,"y":203,"width":812,"height":12}},{"id":"4b1391f3-2f01-4895-a692-82a6d6d476c2","block_type":"box","text":"requirements of the new share class. Certain sales load reductions and waivers may be available to customers of","page_number":131,"box":{"x":69,"y":218,"width":813,"height":12}},{"id":"8473447a-5c7c-490f-8fdf-6d537d7b2720","block_type":"box","text":"certain financial intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the","page_number":131,"box":{"x":69,"y":234,"width":793,"height":11}},{"id":"f16cd745-ad88-4458-a35d-2803f723d110","block_type":"box","text":"Fund’s Prospectus. Please speak to your financial intermediary for more information.","page_number":131,"box":{"x":70,"y":249,"width":603,"height":11}},{"id":"ea8092a6-0956-422c-82f0-b637d385930e","block_type":"box","text":"Reinvested Dividends.","page_number":131,"box":{"x":102,"y":272,"width":156,"height":8}},{"id":"351d932b-f61e-4603-b1e8-332eaacf26a3","block_type":"box","text":"No sales charges are imposed upon shares issued as a result of the automatic","page_number":131,"box":{"x":265,"y":271,"width":566,"height":12}},{"id":"f6a72865-cbee-4fa3-9fda-0e542d8ae4be","block_type":"box","text":"reinvestment of dividends.","page_number":131,"box":{"x":69,"y":286,"width":186,"height":10}},{"id":"ed9ecb9f-46a7-411e-97e1-5c7d2d6a4667","block_type":"box","text":"Right of Accumulation.","page_number":131,"box":{"x":102,"y":309,"width":158,"height":11}},{"id":"e23bcbef-a235-42e7-a72e-d2e22af9e761","block_type":"box","text":"Investors have a “right of accumulation” under which any of the following may be","page_number":131,"box":{"x":267,"y":309,"width":574,"height":11}},{"id":"4e42a1fc-31ac-4581-bbe5-ef1a38b60625","block_type":"box","text":"combined with the amount of the current purchase in determining whether an investor qualifies for a breakpoint and","page_number":131,"box":{"x":69,"y":324,"width":826,"height":12}},{"id":"93a8f81b-ddbf-45a1-bec7-5492312db915","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":131,"box":{"x":69,"y":339,"width":810,"height":12}},{"id":"914974fd-6a76-4808-8701-b2636bd47c24","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":131,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"e70eb959-2e6e-48f5-9024-46ca34885a11","block_type":"box","text":"existing shares of certain unlisted closed-end management investment companies sponsored and advised by","page_number":131,"box":{"x":69,"y":370,"width":780,"height":11}},{"id":"86a008e8-3d80-4cef-b915-fb7f0b57fae7","block_type":"box","text":"BlackRock or its affiliates (“Eligible Unlisted BlackRock Closed-End Funds”) and (iii) the investment in the BlackRock","page_number":131,"box":{"x":70,"y":385,"width":828,"height":11}},{"id":"610a413e-6200-4aea-a9b6-6b795d6c7427","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":131,"box":{"x":69,"y":400,"width":804,"height":11}},{"id":"aaffa71d-f5fc-4a56-8d99-9291cb1f9f20","block_type":"box","text":"intermediaries may value current holdings of their customers differently for purposes of determining whether an","page_number":131,"box":{"x":70,"y":415,"width":794,"height":11}},{"id":"dfe655dc-734f-404e-a66c-d5c58ca21915","block_type":"box","text":"investor qualifies for a breakpoint and a reduced front-end sales charge, although customers of the same financial","page_number":131,"box":{"x":70,"y":430,"width":814,"height":11}},{"id":"45458688-35c8-458f-8f87-a38e73462d1b","block_type":"box","text":"intermediary will be treated similarly. In order to use this right, the investor must alert BlackRock to the existence of","page_number":131,"box":{"x":70,"y":445,"width":828,"height":12}},{"id":"8b77ea1a-d25a-4d3d-8bbd-8b1acc5e326d","block_type":"box","text":"any previously purchased shares. Certain funds employ a “passive” management approach and attempt to match the","page_number":131,"box":{"x":69,"y":460,"width":838,"height":12}},{"id":"7ad681db-1a2d-4f96-887f-f20a1e9eb2da","block_type":"box","text":"performance of a target index as closely as possible before the deduction of Fund expenses (“Index Funds”).","page_number":131,"box":{"x":70,"y":475,"width":776,"height":12}},{"id":"3b92ab30-e05c-4068-b85a-3da8cca1c1dd","block_type":"box","text":"Although Investor A Shares of Index Funds and BlackRock Short Obligations Fund generally are not subject to a sales","page_number":131,"box":{"x":68,"y":491,"width":835,"height":11}},{"id":"e022937b-df34-4f53-92c4-ebe2885df199","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":131,"box":{"x":69,"y":506,"width":839,"height":11}},{"id":"7daff3a8-d777-4a1c-b4b7-9a390b79f1cc","block_type":"box","text":"in the Index Funds and BlackRock Short Obligations Fund may be combined with the amount of an investor’s current","page_number":131,"box":{"x":70,"y":521,"width":829,"height":11}},{"id":"851231d3-4040-4200-ba30-fb534956c2bd","block_type":"box","text":"purchase in determining whether an investor qualifies for a breakpoint and a reduced front-end sales charge.","page_number":131,"box":{"x":70,"y":536,"width":774,"height":11}},{"id":"9e222273-681f-4d8e-9baa-919f39047baa","block_type":"box","text":"Letter of Intent.","page_number":131,"box":{"x":102,"y":559,"width":109,"height":9}},{"id":"d5beac18-2032-44b6-b4b1-8e4337aeae5d","block_type":"box","text":"An investor may qualify for a reduced front-end sales charge immediately by signing a “Letter of","page_number":131,"box":{"x":217,"y":559,"width":681,"height":11}},{"id":"dee95bf2-cc83-4082-9761-dfac44213361","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":131,"box":{"x":70,"y":574,"width":820,"height":11}},{"id":"0e46c8ef-d466-46cb-ae40-977b859cc907","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":131,"box":{"x":68,"y":589,"width":792,"height":11}},{"id":"99b89a64-36ce-4c1e-a5e9-bfc627c3f77b","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":131,"box":{"x":70,"y":604,"width":802,"height":11}},{"id":"b6c27c8c-5550-4a4e-b8b3-e419ef81c595","block_type":"box","text":"more Eligible Unlisted BlackRock Closed-End Funds and/or (iii) make an investment through the BlackRock","page_number":131,"box":{"x":69,"y":619,"width":760,"height":11}},{"id":"85a78c2e-8ec9-4466-a019-e8c485b4c1fb","block_type":"box","text":"CollegeAdvantage 529 Program in one or more BlackRock Funds. The initial investment must meet the minimum","page_number":131,"box":{"x":69,"y":634,"width":800,"height":12}},{"id":"9242b685-9cd0-4ae1-b475-18ea71bf1c9c","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":131,"box":{"x":70,"y":649,"width":826,"height":12}},{"id":"edf6a6f1-2e98-46b0-b9c0-f7f886d795fb","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":131,"box":{"x":69,"y":664,"width":822,"height":12}},{"id":"1a180a61-0379-473f-a5bb-514bcbf4e42b","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares, Eligible Unlisted BlackRock Closed-End Funds and the","page_number":131,"box":{"x":70,"y":680,"width":764,"height":11}},{"id":"7222ac6b-d30e-4a9b-aef3-ec95d7249c3b","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program Class A and Class C Units) as of the date of commencement that are","page_number":131,"box":{"x":70,"y":695,"width":800,"height":11}},{"id":"56525b24-1981-4d22-b5b6-3a7666707c43","block_type":"box","text":"eligible under the Right of Accumulation may be counted towards the sales charge reduction. The investor must notify","page_number":131,"box":{"x":69,"y":710,"width":838,"height":11}},{"id":"febbcde1-c8a4-427e-a536-9acf62d180ca","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":131,"box":{"x":68,"y":725,"width":835,"height":11}},{"id":"24810236-9db5-4635-a4e2-ba58c3137bd1","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program that should be counted towards the sales charge reduction and (ii) any","page_number":131,"box":{"x":70,"y":740,"width":811,"height":11}},{"id":"4a499a05-facf-4a2e-b335-f5610d5a2b50","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":131,"box":{"x":69,"y":755,"width":814,"height":11}},{"id":"68fce01c-bc21-40a8-8f49-6ad71e195696","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":131,"box":{"x":68,"y":770,"width":827,"height":12}},{"id":"275ef573-3e85-4296-a502-55f115a5f749","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":131,"box":{"x":69,"y":785,"width":827,"height":12}},{"id":"50b44143-9951-421f-ac57-e7f5edae373f","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":131,"box":{"x":69,"y":801,"width":817,"height":11}},{"id":"93c2bd8b-5303-4328-8dea-4dccfc9b8ece","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":131,"box":{"x":70,"y":816,"width":807,"height":11}},{"id":"b15c43f7-1401-4068-982c-900d2b5e231e","block_type":"box","text":"Shares, as applicable, held in escrow to pay the difference.","page_number":131,"box":{"x":69,"y":831,"width":423,"height":11}},{"id":"b6372f0c-2806-4801-bcf1-93504d37e47b","block_type":"box","text":"Placement Fees.","page_number":131,"box":{"x":102,"y":854,"width":116,"height":8}},{"id":"bb11ac23-a00b-4f30-8816-96cde9e9d195","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":131,"box":{"x":102,"y":876,"width":777,"height":11}},{"id":"3a08e524-a51d-4665-9cdd-61cbfa982b54","block_type":"box","text":"which may depend on the policies, procedures and trading platforms of your financial intermediary.","page_number":131,"box":{"x":68,"y":891,"width":704,"height":12}},{"id":"869cff3e-7177-4736-a273-a8bf063dfe9a","block_type":"box","text":"II-101","page_number":131,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"4bfb860f-5499-4f7d-9208-e33f3433fe14","block_type":"box","text":"NM1026U-5979889-131/232","page_number":131,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"13edd91c-146c-4779-9337-b2ed05c59326","block_type":"box","text":"Except as noted below, these placement fees may be up to the following amounts for Investor A Shares:","page_number":132,"box":{"x":102,"y":45,"width":741,"height":11}},{"id":"fc80ac84-9af4-477d-8390-c85ff697a205","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":72,"width":361,"height":10}},{"id":"2c26998d-549e-42a1-91f0-b0f2b65f34c3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":132,"box":{"x":535,"y":72,"width":288,"height":9}},{"id":"a4cbe653-59db-4dc8-8fa9-3a8eec82e14f","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":87,"width":361,"height":10}},{"id":"a2b3a514-ea47-4b30-a8c0-03b53763be50","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":132,"box":{"x":535,"y":88,"width":288,"height":8}},{"id":"4c6d3bc8-1cdf-4288-b540-c1f8d975705c","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":102,"width":345,"height":10}},{"id":"8153048a-5853-456a-8305-a1948e446221","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":132,"box":{"x":518,"y":103,"width":305,"height":9}},{"id":"a23a69af-9523-42b9-aa98-471f0e2a1450","block_type":"box","text":"With respect to Investor A Shares of BlackRock Global Allocation Fund, Inc., BlackRock Dynamic High Income","page_number":132,"box":{"x":101,"y":126,"width":776,"height":12}},{"id":"5b26e63d-0e66-4165-a923-03666bc7f425","block_type":"box","text":"Portfolio (for shares purchased prior to July 1, 2020) and BlackRock Multi-Asset Income Portfolio (for shares","page_number":132,"box":{"x":69,"y":142,"width":774,"height":11}},{"id":"d78d3bff-e302-4cca-8305-cd1c7e19afd0","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":132,"box":{"x":70,"y":157,"width":824,"height":11}},{"id":"c8720744-a40a-4bef-b86c-a7ff9970c9d9","block_type":"box","text":"and BlackRock Event Driven Equity Fund, the placement fees may be up to the following amounts:","page_number":132,"box":{"x":69,"y":172,"width":695,"height":11}},{"id":"e5ef8d7e-034a-491b-a478-f83a5a18f1f5","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":199,"width":410,"height":11}},{"id":"f39b8ab6-337f-4d03-9047-58a5ed856e48","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":132,"box":{"x":583,"y":200,"width":240,"height":9}},{"id":"437b5b72-46b9-4f64-8b22-f968b3b5efa9","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":214,"width":361,"height":11}},{"id":"1f0f86b7-abc1-40d8-a874-516bf3da12b7","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":132,"box":{"x":535,"y":215,"width":288,"height":9}},{"id":"fb19e701-bbe7-4ed4-bb7d-7cd515aa42df","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":229,"width":345,"height":11}},{"id":"944d233c-2793-4e62-8679-8333745a2e4e","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":132,"box":{"x":518,"y":230,"width":305,"height":9}},{"id":"08e05c1c-5751-4e2c-8d5c-c96f22a0ceda","block_type":"box","text":"With respect to Investor A Shares of BlackRock Systematic Multi-Strategy Fund of BlackRock Funds IV, BlackRock","page_number":132,"box":{"x":101,"y":254,"width":806,"height":11}},{"id":"e15086a5-59f5-4901-80d0-a58c0f27c7c7","block_type":"box","text":"Advantage CoreAlpha Bond Fund of BlackRock Funds VI, BlackRock Tactical Opportunities Fund of BlackRock 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amounts:","page_number":132,"box":{"x":70,"y":314,"width":520,"height":12}},{"id":"6d72c275-79de-4e4f-a151-2ac958eeaf15","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":341,"width":361,"height":11}},{"id":"841bd589-8cc6-48d2-a85f-268712387346","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":132,"box":{"x":535,"y":342,"width":288,"height":9}},{"id":"76a0b509-800c-4d9b-98e8-35674723560f","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":356,"width":361,"height":11}},{"id":"803b8d49-fc56-4c40-9289-592543bbc60f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":132,"box":{"x":535,"y":357,"width":288,"height":9}},{"id":"f8c03e99-619e-4110-b020-8660b87e977e","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":372,"width":345,"height":10}},{"id":"d9cf4069-5999-4c89-946c-2ef1f7442e94","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":132,"box":{"x":518,"y":372,"width":305,"height":9}},{"id":"5bbde95c-c2a0-47a2-81d9-99f167a9bbbc","block_type":"box","text":"With respect to Investor A Shares of BlackRock Mortgage-Backed Securities Fund and BlackRock Impact","page_number":132,"box":{"x":101,"y":396,"width":743,"height":11}},{"id":"7b5f407a-5834-45a9-85d3-b587731f4508","block_type":"box","text":"Mortgage Fund of BlackRock Funds V, the placement fees may be up to the following amounts:","page_number":132,"box":{"x":70,"y":411,"width":674,"height":12}},{"id":"03778e47-72fd-4c07-baa9-4ec8c6f46ec0","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":438,"width":361,"height":11}},{"id":"af88d9dc-77b2-48eb-9149-4babcb070fd6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":132,"box":{"x":535,"y":439,"width":288,"height":9}},{"id":"25d79745-eb98-463c-92ed-c3fc75ca5645","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":453,"width":361,"height":11}},{"id":"9e2ce1f3-7dd5-4337-b7e9-3b88477c21e0","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":132,"box":{"x":535,"y":454,"width":288,"height":9}},{"id":"0876a83d-6e28-4d37-89a3-8d2a9a75e734","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":469,"width":345,"height":10}},{"id":"a3b8e1e9-c65a-452d-852a-923e298da12f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":132,"box":{"x":518,"y":469,"width":305,"height":9}},{"id":"2823611e-4ce3-4d69-b7b6-08488b33c91f","block_type":"box","text":"With respect to Investor A Shares of BlackRock Managed Income Fund of BlackRock Funds II, the placement fees","page_number":132,"box":{"x":101,"y":493,"width":808,"height":11}},{"id":"9d361e7a-6dfa-4333-aaa1-66b715ff5722","block_type":"box","text":"may be up to the following amounts:","page_number":132,"box":{"x":69,"y":508,"width":257,"height":12}},{"id":"0c968a01-292a-4bd2-8650-cd257d6b299b","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":535,"width":410,"height":11}},{"id":"cf9d8997-2800-4fcc-9e47-2bc8fa95c359","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":132,"box":{"x":583,"y":536,"width":240,"height":9}},{"id":"5c958e8e-d3d8-47c8-996a-346fbfe2afae","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":550,"width":361,"height":11}},{"id":"c3f3140a-8040-40a9-953c-6770332f3f34","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":132,"box":{"x":535,"y":551,"width":288,"height":9}},{"id":"84fc48fa-8c06-45bb-bcaf-a41a3c768ee1","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":566,"width":345,"height":10}},{"id":"58034c27-1b96-4607-bb46-7e39bace3150","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":132,"box":{"x":518,"y":566,"width":305,"height":9}},{"id":"6fb28b61-e47f-487c-9c52-92f7f7a3c951","block_type":"box","text":"With respect to Investor A Shares of BlackRock Inflation Protected Bond Portfolio of BlackRock Funds V, the","page_number":132,"box":{"x":101,"y":590,"width":768,"height":11}},{"id":"92d1b9f3-06bc-4913-9d9f-7be6df159d27","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":132,"box":{"x":70,"y":605,"width":371,"height":12}},{"id":"cfe89a0e-6a9f-4650-977d-0988d2be4c13","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":632,"width":361,"height":11}},{"id":"4dde7dbf-facb-42d0-8656-a02a1eaa92d8","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":132,"box":{"x":535,"y":633,"width":288,"height":9}},{"id":"c81d0ea3-fe82-4b4f-985e-92fcd8245386","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":647,"width":361,"height":11}},{"id":"9bfa5959-65bf-4233-aa74-8a544e7f6ccd","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.10%","page_number":132,"box":{"x":535,"y":648,"width":288,"height":9}},{"id":"e4b4db41-01a4-4f24-949e-99ce41c575c7","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":663,"width":345,"height":10}},{"id":"51a8ec9c-ff38-4d73-bb1e-22b7ff4b9709","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.05%","page_number":132,"box":{"x":518,"y":663,"width":305,"height":9}},{"id":"648e5968-92a7-4df5-9416-afff06285285","block_type":"box","text":"With respect to Investor A Shares of BlackRock Low Duration Bond Portfolio, BlackRock Floating Rate Income","page_number":132,"box":{"x":101,"y":687,"width":778,"height":11}},{"id":"9e19c818-195d-4ad6-95cc-6810a9e2313c","block_type":"box","text":"Portfolio, BlackRock Income Fund and BlackRock Strategic Income Opportunities Portfolio of BlackRock Funds V, the","page_number":132,"box":{"x":69,"y":702,"width":830,"height":12}},{"id":"e66df72f-6264-441a-844a-37299f7bbb75","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":132,"box":{"x":70,"y":717,"width":371,"height":12}},{"id":"ee74a7a5-4990-4ea9-b5bf-36f8192d39ce","block_type":"box","text":"$500,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":744,"width":410,"height":12}},{"id":"2b061e17-f7b0-4ebf-b69e-ed426acb86b1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":132,"box":{"x":583,"y":745,"width":240,"height":9}},{"id":"5eaa3d7e-635a-4bad-a24a-555aab31f44c","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":760,"width":361,"height":10}},{"id":"d14654a3-bb4f-4892-9131-cbe1fbac36bd","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":132,"box":{"x":535,"y":760,"width":288,"height":9}},{"id":"864ae1ae-1f2b-4c18-a37d-af4b49a8d845","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":132,"box":{"x":167,"y":775,"width":345,"height":10}},{"id":"202b6bd1-8d8d-4228-8cb8-e48e88f26a3c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":132,"box":{"x":518,"y":775,"width":305,"height":9}},{"id":"5f0a0f12-1624-4adf-a12c-f6464fe55c46","block_type":"box","text":"With respect to Investor A Shares of BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":132,"box":{"x":101,"y":799,"width":779,"height":11}},{"id":"dc1dd4d3-de10-4aaa-8425-90ac8f7fb4b3","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":132,"box":{"x":70,"y":814,"width":780,"height":12}},{"id":"468dda1b-7767-41cd-b6ac-1ffcd76c42c3","block_type":"box","text":"$250,000 and above . . . .","page_number":132,"box":{"x":167,"y":841,"width":182,"height":12}},{"id":"d70ffecc-6098-453a-8141-44718e715b55","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":132,"box":{"x":355,"y":842,"width":468,"height":9}},{"id":"50be484b-3a5f-4445-8722-158bd1accd10","block_type":"box","text":"II-102","page_number":132,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"bbe14f06-630a-4cff-bce5-bfc23098e54e","block_type":"box","text":"NM1026U-5979889-132/232","page_number":132,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"53007b41-e985-44a9-a993-feb0568396ef","block_type":"box","text":"With respect to Investor A Shares of BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":133,"box":{"x":101,"y":45,"width":779,"height":11}},{"id":"c3ac9fa2-dd25-4927-b69b-38064c669129","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":133,"box":{"x":70,"y":60,"width":819,"height":11}},{"id":"0eceef4c-cd85-420c-87de-06ac7c064085","block_type":"box","text":"the following amounts:","page_number":133,"box":{"x":68,"y":75,"width":161,"height":11}},{"id":"be23c50d-b7d4-48ae-adbc-002d59c15747","block_type":"box","text":"$100,000 and above . . . .","page_number":133,"box":{"x":167,"y":102,"width":182,"height":11}},{"id":"11c68166-8b0b-41d5-bca1-2b0e93b59fda","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":355,"y":103,"width":468,"height":9}},{"id":"7559d463-764b-42cf-be18-041d50281b77","block_type":"box","text":"With respect to Investor A Shares of BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":133,"box":{"x":101,"y":126,"width":779,"height":11}},{"id":"c2c992f1-ae5d-491e-81b0-28a155f981f0","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":133,"box":{"x":70,"y":142,"width":775,"height":11}},{"id":"7a599f05-5524-465e-b684-2e34233e3be5","block_type":"box","text":"$250,000 and above . . . .","page_number":133,"box":{"x":167,"y":169,"width":182,"height":11}},{"id":"7621a21c-cf72-4760-afb6-b1f41476c15e","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":355,"y":169,"width":468,"height":9}},{"id":"76b21c2d-c4bd-49e2-8f9c-12a12d1a6f03","block_type":"box","text":"With respect to Investor A Shares of BlackRock Strategic Municipal Opportunities Fund of BlackRock Municipal","page_number":133,"box":{"x":101,"y":193,"width":788,"height":12}},{"id":"4b1e52f1-3dc1-424c-bd5d-a7e2701a4ec0","block_type":"box","text":"Series Trust, BlackRock California Municipal Opportunities Fund of BlackRock California Municipal Series Trust,","page_number":133,"box":{"x":69,"y":208,"width":792,"height":11}},{"id":"a15af18c-4719-401a-b130-412a7ef31e5e","block_type":"box","text":"BlackRock New York Municipal Opportunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":133,"box":{"x":70,"y":224,"width":787,"height":11}},{"id":"b7163318-b1a5-402d-823c-55829f92a5da","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust and BlackRock National Municipal","page_number":133,"box":{"x":69,"y":239,"width":834,"height":11}},{"id":"c2bb8935-df57-48da-bcae-c01e76c248ba","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., the placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":254,"width":729,"height":11}},{"id":"341fc26b-86e2-426e-920d-32f63274c456","block_type":"box","text":"$250,000 but less than $4 million . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":281,"width":410,"height":11}},{"id":"59f29ece-8ad2-4312-8e17-8bdfa20c3ae0","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":133,"box":{"x":583,"y":282,"width":240,"height":8}},{"id":"442640ac-4b36-48e5-b2fb-d9fe0e89dc3c","block_type":"box","text":"$4 million but less than $10 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":296,"width":361,"height":10}},{"id":"f197c326-d1be-4d9c-bf84-c1408b6c8146","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":297,"width":288,"height":9}},{"id":"1f1cb4ae-f56f-4145-a0d9-ab2e4cbf5676","block_type":"box","text":"$10 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":311,"width":345,"height":11}},{"id":"ebbb547b-e246-4522-80b2-93ab2b134bdf","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":312,"width":305,"height":9}},{"id":"2899547a-d99f-4a00-abfa-48b5f64ed536","block_type":"box","text":"With respect to Investor A Shares of BlackRock Dynamic High Income Portfolio (for shares purchased on or after","page_number":133,"box":{"x":101,"y":336,"width":801,"height":11}},{"id":"dc853519-d60c-44d6-b9bd-69d394dd807c","block_type":"box","text":"July 1, 2020) and BlackRock Multi-Asset Income Portfolio (for shares purchased on or after July 1, 2020) of","page_number":133,"box":{"x":69,"y":351,"width":769,"height":11}},{"id":"94c5b77e-6b93-4c6f-ae58-7a2ab6404acf","block_type":"box","text":"BlackRock Funds II, BlackRock Total Return Fund of BlackRock Bond Fund, Inc. and BlackRock Balanced Fund, Inc.,","page_number":133,"box":{"x":70,"y":366,"width":818,"height":10}},{"id":"d777424f-1ffc-4727-a260-ec5893bf4c23","block_type":"box","text":"the placement fees may be up to the following amounts:","page_number":133,"box":{"x":68,"y":381,"width":401,"height":11}},{"id":"8f4a3d5e-03ad-40a6-981b-57d8b7e921b2","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":408,"width":410,"height":11}},{"id":"13a8005d-e5f3-41da-a7fb-62c421ce57fe","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":133,"box":{"x":583,"y":409,"width":240,"height":9}},{"id":"8f32b340-44e5-47dc-b080-23400a574755","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":423,"width":361,"height":11}},{"id":"92f2ff2f-fe56-4c44-8f77-958e54a1c1b9","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":424,"width":288,"height":9}},{"id":"37442dc1-9172-458b-a4b2-e0e476061cfc","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":438,"width":345,"height":11}},{"id":"ec67b467-b3ed-478b-990e-b2dfbc604b63","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":439,"width":305,"height":9}},{"id":"07c1e648-3e49-4e30-ba64-3ec420d23dc4","block_type":"box","text":"With respect to Investor P Shares of BlackRock LifePath","page_number":133,"box":{"x":101,"y":463,"width":398,"height":11}},{"id":"62f9e636-83ed-4fe8-8066-82faf66af5f2","block_type":"box","text":"®","page_number":133,"box":{"x":500,"y":463,"width":6,"height":5}},{"id":"fb479bb0-09b5-4ec0-97d6-3c96d24869c0","block_type":"box","text":"Index 2030 Fund, BlackRock LifePath","page_number":133,"box":{"x":513,"y":463,"width":264,"height":10}},{"id":"4af1986d-03b5-4860-98a2-4aeac78cb9ff","block_type":"box","text":"®","page_number":133,"box":{"x":778,"y":463,"width":6,"height":5}},{"id":"4250ff1c-c395-459f-82e9-adee88c38cab","block_type":"box","text":"Index 2035","page_number":133,"box":{"x":791,"y":463,"width":79,"height":9}},{"id":"fe8592ef-2987-4654-bc25-a94ec5742ec3","block_type":"box","text":"Fund, BlackRock LifePath","page_number":133,"box":{"x":70,"y":478,"width":177,"height":11}},{"id":"9954e871-8cb6-4e8f-a376-09d8416d9647","block_type":"box","text":"®","page_number":133,"box":{"x":249,"y":478,"width":6,"height":5}},{"id":"88fc39dc-63bd-47b1-90a1-cdb90b834737","block_type":"box","text":"Index 2040 Fund, BlackRock 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Small-Cap Index Fund of BlackRock Index Funds, Inc. and iShares S&P 500 Index Fund and iShares","page_number":133,"box":{"x":70,"y":657,"width":808,"height":11}},{"id":"6dc632c0-484d-47e0-9a5e-cf21ecb408d4","block_type":"box","text":"U.S. Aggregate Bond Index Fund of BlackRock Funds III.","page_number":133,"box":{"x":70,"y":672,"width":393,"height":11}},{"id":"aa4d1677-ae80-4a38-a1f2-ac7d69af8b58","block_type":"box","text":"For the tables above, the placement fees indicated will apply up to the indicated breakpoint (so that, for","page_number":133,"box":{"x":102,"y":695,"width":740,"height":11}},{"id":"448a652a-4e16-4576-a722-73f033abe92b","block_type":"box","text":"example, a sale of $4 million worth of Investor A Shares of BlackRock Impact Mortgage Fund of BlackRock Funds V","page_number":133,"box":{"x":69,"y":709,"width":823,"height":12}},{"id":"63e7a505-6d88-4e47-81ee-50b77fa143e7","block_type":"box","text":"will result in a placement fee of up to 0.50% on the first $3 million and 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financial intermediary firms provided the financial intermediary firm has entered into a Class A","page_number":133,"box":{"x":68,"y":853,"width":837,"height":12}},{"id":"d5125538-4762-4b45-9053-4aa679923747","block_type":"box","text":"or Investor P NAV agreement, as applicable, with respect to such program with the Distributor; (c) insurance company","page_number":133,"box":{"x":69,"y":869,"width":836,"height":11}},{"id":"ae101a2c-5be0-4a7e-b167-4b3d7be99aa6","block_type":"box","text":"separate accounts; (d) registered investment advisers, trust companies and bank trust departments exercising","page_number":133,"box":{"x":69,"y":884,"width":793,"height":11}},{"id":"2c385600-f773-464a-8c80-ddb107174335","block_type":"box","text":"discretionary investment authority with respect to amounts to be invested in a Fund; (e) persons participating in a","page_number":133,"box":{"x":69,"y":899,"width":811,"height":11}},{"id":"f89b3189-04c3-4ac1-8a0e-16a1beb0b78b","block_type":"box","text":"II-103","page_number":133,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"9ab11979-62f5-47fd-b16c-b47a025ed89e","block_type":"box","text":"NM1026U-5979889-133/232","page_number":133,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"150e44d3-47fd-4f35-834c-5357b5e9b732","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":134,"box":{"x":68,"y":45,"width":827,"height":11}},{"id":"f23fa790-ba9e-42fd-bdf3-30d8df9ed1de","block_type":"box","text":"institution; (f) financial intermediaries who have entered into an agreement with the Distributor and have been","page_number":134,"box":{"x":70,"y":60,"width":782,"height":11}},{"id":"a51204f3-b0ea-468b-9696-f820d966af04","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":134,"box":{"x":69,"y":75,"width":830,"height":11}},{"id":"258295c0-75c9-40aa-8cda-54aefaa9c625","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":134,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"79ae9611-e13d-44fd-b653-231c174a934e","block_type":"box","text":"IRAs as permitted under the Internal Revenue Code; (h) with respect to Investor A Shares only, accounts opened","page_number":134,"box":{"x":70,"y":105,"width":799,"height":11}},{"id":"34581005-83e6-4e71-b783-143acae0be05","block_type":"box","text":"directly with a Fund that do not have a financial intermediary associated with the account; and (i) persons","page_number":134,"box":{"x":69,"y":120,"width":752,"height":11}},{"id":"93d92c84-18fb-4754-a644-b8cf9d3f106c","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":134,"box":{"x":70,"y":135,"width":836,"height":11}},{"id":"c59de7ec-81a1-4f94-ae97-206152c04d1f","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":134,"box":{"x":69,"y":150,"width":812,"height":12}},{"id":"dfcc544d-37eb-49fe-9a91-c25072f3dd99","block_type":"box","text":"Sub-Advisers, Transfer Agent, Distributor, fund accounting agents, Barclays PLC and their affiliates may buy Investor A","page_number":134,"box":{"x":69,"y":166,"width":840,"height":11}},{"id":"0d410bcf-f795-4c3f-a6a2-cfc4eacb9e33","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":134,"box":{"x":69,"y":181,"width":788,"height":11}},{"id":"8cf03a75-81ae-4095-9d64-28d930cd5a60","block_type":"box","text":"including: (a) officers, directors and partners; (b) employees and retirees; (c) employees or registered representatives","page_number":134,"box":{"x":70,"y":196,"width":838,"height":11}},{"id":"84f6f8fd-3181-4160-a56d-cd3f045d251d","block_type":"box","text":"of firms who have entered into selling agreements to distribute shares of BlackRock-advised funds; (d) immediate","page_number":134,"box":{"x":69,"y":211,"width":810,"height":11}},{"id":"fe8a7b34-6f3c-4d5e-af29-46e4ddf3fc6c","block_type":"box","text":"family members of such persons (“immediate family members” shall be defined as the investor, the investor’s","page_number":134,"box":{"x":68,"y":226,"width":787,"height":11}},{"id":"dd7c347c-73a1-4639-9774-e02e85edb37e","block_type":"box","text":"spouse or domestic partner, children, parents and siblings); and (e) any trust, pension, profit-sharing or other benefit","page_number":134,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"6a9c22f9-0b9b-4fec-a5ad-bab80b3e5ed1","block_type":"box","text":"plan for any of the persons set forth in (a) through (d). Investors who qualify for any of these exemptions from the","page_number":134,"box":{"x":70,"y":256,"width":808,"height":12}},{"id":"a0282ff4-baf1-4b52-8198-006051f76c4a","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":134,"box":{"x":69,"y":271,"width":837,"height":12}},{"id":"009bc8d8-9909-4b9c-948b-9afb6c86e37e","block_type":"box","text":"investors exchanging Investor A Shares of one BlackRock Fund for Investor P Shares of another BlackRock Fund, or","page_number":134,"box":{"x":70,"y":286,"width":820,"height":12}},{"id":"1fd4c08a-5a88-420a-944c-21e1c26883f6","block_type":"box","text":"exchanging Investor P Shares of one BlackRock Fund for Investor A Shares of another BlackRock Fund, through an","page_number":134,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"1f5dba4e-2833-4814-9c58-6cd80253eb57","block_type":"box","text":"intermediary-processed exchange, provided that the investor had previously paid a sales charge with respect to such","page_number":134,"box":{"x":70,"y":317,"width":831,"height":11}},{"id":"c1312177-aa54-4336-a31e-dc25c288e596","block_type":"box","text":"shares. The availability of Investor A or Investor P Shares sales charge waivers may depend upon the policies,","page_number":134,"box":{"x":69,"y":332,"width":783,"height":11}},{"id":"91c4fff4-3be1-4c26-aee3-de6112007353","block_type":"box","text":"procedures and trading platforms of your financial intermediary; consult your financial adviser.","page_number":134,"box":{"x":70,"y":347,"width":668,"height":11}},{"id":"7f007e3d-6e2d-4025-adf6-cf087d745b50","block_type":"box","text":"If you invest $1,000,000 ($250,000 for BlackRock Dynamic High Income Portfolio, BlackRock Multi-Asset","page_number":134,"box":{"x":102,"y":369,"width":754,"height":12}},{"id":"ec05c5c4-10a8-420c-ad1a-021d7e828344","block_type":"box","text":"Income Portfolio and BlackRock Managed Income Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund","page_number":134,"box":{"x":70,"y":385,"width":823,"height":11}},{"id":"845c6ec0-7ac3-4717-9232-40123af30c24","block_type":"box","text":"of BlackRock Funds IV, BlackRock Total Return Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund,","page_number":134,"box":{"x":69,"y":400,"width":833,"height":10}},{"id":"5b8ee803-1dc6-4630-bfa3-8c04aa71f7d4","block_type":"box","text":"Inc., BlackRock National Municipal Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Short Duration Muni","page_number":134,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"52286063-477e-41ff-bf2b-277db1c189ba","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Strategic Municipal Opportunities Fund of BlackRock","page_number":134,"box":{"x":70,"y":430,"width":781,"height":11}},{"id":"731c9751-b7eb-4efb-aa63-c2a158be592e","block_type":"box","text":"Municipal Series Trust, BlackRock California Municipal Opportunities Fund of BlackRock California Municipal Series","page_number":134,"box":{"x":70,"y":445,"width":819,"height":11}},{"id":"c3a8c0a0-540d-42ac-a066-c390a9cf6bfb","block_type":"box","text":"Trust, BlackRock New York Municipal Opportunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":134,"box":{"x":68,"y":460,"width":835,"height":12}},{"id":"e0c4b8d1-eccf-4c14-8bd6-0b3dedd1938a","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity","page_number":134,"box":{"x":69,"y":475,"width":813,"height":12}},{"id":"83080dec-936b-4ca7-9f88-d206e4bea8e6","block_type":"box","text":"Fund and BlackRock Balanced Fund, Inc., and $500,000 for BlackRock Low Duration Bond Portfolio, BlackRock","page_number":134,"box":{"x":70,"y":490,"width":792,"height":11}},{"id":"f8f1c2f6-39ee-4c88-b9f4-57f44fa07bbf","block_type":"box","text":"Floating Rate Income Portfolio, BlackRock Income Fund and BlackRock Strategic Income Opportunities Portfolio of","page_number":134,"box":{"x":70,"y":506,"width":813,"height":11}},{"id":"604618ed-fea3-4959-ba69-c179232b8e43","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":134,"box":{"x":70,"y":521,"width":837,"height":11}},{"id":"1c4e460a-9bdc-40eb-b1c1-eb9cc8097a43","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":134,"box":{"x":70,"y":536,"width":790,"height":11}},{"id":"c7f0e23a-44fc-4e3d-9f5e-afee58a45e0d","block_type":"box","text":"shorter holding period may apply depending on the Fund), you may be charged a deferred sales charge.","page_number":134,"box":{"x":69,"y":551,"width":736,"height":11}},{"id":"fe3b6297-c08e-4b85-a8c4-57fcd54ea101","block_type":"box","text":"A deferred sales charge of up to 1.00% may apply to certain redemptions of Investor A Shares of the Index","page_number":134,"box":{"x":101,"y":574,"width":763,"height":11}},{"id":"1fb5977e-3cc6-49da-8bd0-f5aeda73e82c","block_type":"box","text":"Funds and BlackRock Short Obligations Fund purchased in an exchange transaction for Investor A Shares of a","page_number":134,"box":{"x":70,"y":589,"width":782,"height":11}},{"id":"bb81f7a2-4c5b-4f13-b579-855fed3d390c","block_type":"box","text":"portfolio advised by BlackRock or its affiliates where no initial sales charge was paid at the time of purchase of such","page_number":134,"box":{"x":70,"y":604,"width":832,"height":11}},{"id":"ff4160f8-69e4-468f-bf46-ee7888f6ef4f","block_type":"box","text":"fund (an “Investor A Load-Waived BlackRock Portfolio”) as part of an investment of $1,000,000 (lesser amounts may","page_number":134,"box":{"x":68,"y":618,"width":839,"height":12}},{"id":"b59a7b85-3732-4998-9fff-3dd2b2b7c54a","block_type":"box","text":"apply depending on the Investor A Load-Waived BlackRock Portfolio) or more. The Investor A Shares deferred sales","page_number":134,"box":{"x":69,"y":634,"width":817,"height":12}},{"id":"2ac81b3e-dfad-4b1e-b0c1-ea643b209733","block_type":"box","text":"charge is only charged upon redemptions of Investor A Shares within 18 months after you originally acquired such","page_number":134,"box":{"x":69,"y":649,"width":811,"height":12}},{"id":"30219b9a-f8bc-4909-b359-51acfd90572c","block_type":"box","text":"Investor A Shares of the Investor A Load-Waived BlackRock Portfolio (a shorter holding period may apply depending","page_number":134,"box":{"x":70,"y":664,"width":818,"height":12}},{"id":"2edb55f4-605e-4e3b-a3bb-125e199f9f33","block_type":"box","text":"on the Investor A Load-Waived BlackRock Portfolio), unless you qualify for a waiver. There is no deferred sales charge","page_number":134,"box":{"x":69,"y":680,"width":836,"height":11}},{"id":"b084d171-40f8-4a86-9ad3-b12aa3d79383","block_type":"box","text":"charged on redemptions if you have owned your Investor A Shares for more than 18 months (or for a shorter holding","page_number":134,"box":{"x":69,"y":695,"width":830,"height":11}},{"id":"ca5b1ebd-6eb3-4d6f-9aec-07012c892248","block_type":"box","text":"period, as applicable) (as measured from your original purchase of Investor A Shares that you exchanged into","page_number":134,"box":{"x":70,"y":710,"width":778,"height":11}},{"id":"93bd35c1-d49f-416f-a3b4-6c962ee1602d","block_type":"box","text":"Investor A Shares of the Index Fund or BlackRock Short Obligations Fund).","page_number":134,"box":{"x":70,"y":725,"width":526,"height":11}},{"id":"c4e76b4e-d854-4f50-97d1-bc9ea0f68d7f","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":134,"box":{"x":101,"y":748,"width":788,"height":11}},{"id":"34e49f8d-0399-4f9c-8ba2-52d30648c571","block_type":"box","text":"(a) redemptions of Investor A or Investor P Shares purchased through certain employer-sponsored retirement plans","page_number":134,"box":{"x":69,"y":763,"width":819,"height":11}},{"id":"aad03f9d-34a0-478a-a0b8-1327daf2aeef","block_type":"box","text":"and rollovers of current investments in a Fund through such plans; (b) exchanges described in “Exchange Privilege”","page_number":134,"box":{"x":69,"y":778,"width":820,"height":11}},{"id":"6f212212-e6e8-446c-b8f2-d5bda0842d89","block_type":"box","text":"below; (c) redemptions made in connection with minimum required distributions from IRA and 403(b)(7) accounts due","page_number":134,"box":{"x":69,"y":793,"width":837,"height":11}},{"id":"7a50ca30-a138-4fc0-bab1-afda0775e4f0","block_type":"box","text":"to the shareholder reaching the applicable age triggering such distributions; (d) redemptions made with respect to","page_number":134,"box":{"x":68,"y":808,"width":812,"height":11}},{"id":"178f8c28-b764-4633-8650-1b786d09eb4a","block_type":"box","text":"certain retirement plans sponsored by a Fund, BlackRock or its affiliates; (e) redemptions (i) within one year of a","page_number":134,"box":{"x":69,"y":823,"width":803,"height":11}},{"id":"e6c5e9b0-23da-44b7-8b65-d5274b5cebb5","block_type":"box","text":"shareholder’s death or, if later, the receipt of a certified probate settlement (including in connection with the","page_number":134,"box":{"x":69,"y":838,"width":772,"height":12}},{"id":"2e2a91cf-ec86-4a28-a264-0323b8827134","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":134,"box":{"x":69,"y":853,"width":835,"height":12}},{"id":"e44889f9-56b6-41e5-9aa5-83fa79167c2f","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":134,"box":{"x":69,"y":869,"width":814,"height":11}},{"id":"364c751f-525b-41cf-983f-78d88e6d1f48","block_type":"box","text":"Investor A or Investor P Shares in accounts with low balances; (g) certain redemptions made pursuant to the","page_number":134,"box":{"x":70,"y":884,"width":772,"height":11}},{"id":"8a27016e-a3a2-4aab-a1ed-f97d462e56c4","block_type":"box","text":"Systematic Withdrawal Plan (described below); (h) redemptions related to the payment of BNY Mellon Investment","page_number":134,"box":{"x":69,"y":899,"width":805,"height":11}},{"id":"e8ae88a2-7a69-45c6-a32f-de3937463885","block_type":"box","text":"II-104","page_number":134,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"a239c343-569b-4fe0-9bcb-2f9c69fb2fe1","block_type":"box","text":"NM1026U-5979889-134/232","page_number":134,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7bb22ab0-0859-40ce-8747-95e54d29c7fb","block_type":"box","text":"Servicing Trust Company custodial IRA fees; and (i) redemptions when a shareholder can demonstrate hardship, in","page_number":135,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"acfb7616-b650-4679-8a81-4d1207cc4a4a","block_type":"box","text":"the absolute discretion of a Fund.","page_number":135,"box":{"x":68,"y":60,"width":239,"height":9}},{"id":"aeb95bdc-e5b4-4658-96f2-d1ced0305669","block_type":"box","text":"With respect to certain employer-sponsored retirement plans, if a dealer waives its right to receive a placement","page_number":135,"box":{"x":101,"y":82,"width":794,"height":12}},{"id":"67118b4a-d746-4bf8-a169-ea419d31030d","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":135,"box":{"x":68,"y":97,"width":776,"height":12}},{"id":"155d05e7-b016-47a1-9d8a-e54202e82241","block_type":"box","text":"BlackRock Dynamic High Income Portfolio, BlackRock Multi-Asset Income Portfolio and BlackRock Managed Income","page_number":135,"box":{"x":70,"y":113,"width":821,"height":11}},{"id":"378305d5-dbdd-4cb2-a02e-83280b61484f","block_type":"box","text":"Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund of BlackRock Funds IV, BlackRock Total Return","page_number":135,"box":{"x":70,"y":128,"width":800,"height":10}},{"id":"31ba994e-ff81-4174-b666-201f749632d4","block_type":"box","text":"Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund, Inc., BlackRock National Municipal Fund of","page_number":135,"box":{"x":70,"y":143,"width":806,"height":11}},{"id":"a8f40e50-da16-4b85-aabd-fb4ff82bb1d4","block_type":"box","text":"BlackRock Municipal Bond Fund, Inc., BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund, Inc.,","page_number":135,"box":{"x":70,"y":158,"width":823,"height":11}},{"id":"6c53c7d6-8785-4086-afc3-4d30bf41c4fa","block_type":"box","text":"BlackRock Strategic Municipal Opportunities Fund of BlackRock Municipal Series Trust, BlackRock California","page_number":135,"box":{"x":70,"y":173,"width":770,"height":11}},{"id":"bfc78809-cf85-46fa-a35d-1aac13561033","block_type":"box","text":"Municipal Opportunities Fund of BlackRock California Municipal Series Trust, BlackRock New York Municipal","page_number":135,"box":{"x":70,"y":188,"width":766,"height":11}},{"id":"ab27ab22-7d05-4449-8386-7c0330d03d2e","block_type":"box","text":"Opportunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock Pennsylvania Municipal Bond Fund of","page_number":135,"box":{"x":69,"y":203,"width":837,"height":12}},{"id":"313d3cd1-c84d-4bcf-bb49-6d317a9f413d","block_type":"box","text":"BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity Fund and BlackRock Balanced Fund,","page_number":135,"box":{"x":70,"y":219,"width":805,"height":11}},{"id":"d28c36fc-21a0-4712-bc5c-5154f91ea887","block_type":"box","text":"Inc., and $500,000 for BlackRock Low Duration Bond Portfolio, BlackRock Floating Rate Income Portfolio, BlackRock","page_number":135,"box":{"x":70,"y":233,"width":832,"height":12}},{"id":"b67a0aa0-149f-496a-876a-0b9176892a81","block_type":"box","text":"Income Fund and BlackRock Strategic Income Opportunities Portfolio of BlackRock Funds V) or more of Investor A or","page_number":135,"box":{"x":70,"y":249,"width":828,"height":11}},{"id":"2a3bc11a-f84f-42a7-9eb4-c2cb865e9257","block_type":"box","text":"Investor P Shares. This may depend upon the policies, procedures and trading platforms of your financial","page_number":135,"box":{"x":70,"y":264,"width":746,"height":11}},{"id":"ce33dc69-8cf4-425d-9d64-0bd6b490c36e","block_type":"box","text":"intermediary; consult your financial adviser.","page_number":135,"box":{"x":70,"y":279,"width":307,"height":11}},{"id":"0b99df4b-752d-4e2b-a420-fba0e6210431","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":135,"box":{"x":102,"y":302,"width":799,"height":11}},{"id":"ac1ce0c5-7bf0-41f1-832d-5d738032516d","block_type":"box","text":"to transfer investment positions from a foreign registered investment company advised by BlackRock or its affiliates","page_number":135,"box":{"x":68,"y":317,"width":829,"height":11}},{"id":"55350529-1b62-468d-af81-41dbd0a1ef9d","block_type":"box","text":"to a U.S. registered BlackRock-advised fund.","page_number":135,"box":{"x":68,"y":332,"width":317,"height":11}},{"id":"3c6d0fcf-4abc-484b-a7fc-cce2fc619234","block_type":"box","text":"Acquisition of Cer tain Investment Companies.","page_number":135,"box":{"x":101,"y":355,"width":326,"height":11}},{"id":"ffd8b1cb-2d79-4f3f-ad7e-a83d120a93d0","block_type":"box","text":"Investor A and Investor P Shares may be offered at NAV in","page_number":135,"box":{"x":434,"y":355,"width":413,"height":11}},{"id":"f0c36370-eb4d-4f76-af76-94332230a13e","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":135,"box":{"x":69,"y":370,"width":811,"height":11}},{"id":"cf52ec2c-62b7-47bd-967c-a5f5b5340417","block_type":"box","text":"public or private investment company.","page_number":135,"box":{"x":70,"y":385,"width":266,"height":11}},{"id":"040e65e2-fef5-4cc7-8e76-cd234cc66349","block_type":"box","text":"Purchases Through Cer tain Financial Intermediaries.","page_number":135,"box":{"x":102,"y":408,"width":372,"height":11}},{"id":"fbb7e933-bfc9-489a-b38c-57dc24530ae1","block_type":"box","text":"Reduced sales charges may be applicable for purchases of","page_number":135,"box":{"x":481,"y":407,"width":421,"height":12}},{"id":"e2eb4eb5-0bb9-4f5b-b483-4dca9f3d0a68","block_type":"box","text":"Investor A, Investor A1 or Investor P Shares of a Fund through certain financial advisers, selected securities dealers","page_number":135,"box":{"x":70,"y":423,"width":825,"height":11}},{"id":"2c6b7988-96aa-4e19-a199-2b9a7dce3f47","block_type":"box","text":"and other financial intermediaries that meet and adhere to standards established by the Manager from time to time.","page_number":135,"box":{"x":69,"y":438,"width":830,"height":11}},{"id":"f01750f8-93a2-4a76-a7ea-48462d7aea0d","block_type":"box","text":"Deferred Sales Charge Alternative — Investor C Shares","page_number":135,"box":{"x":69,"y":468,"width":405,"height":11}},{"id":"efe75e43-6e83-4bc2-8d2c-88973650812d","block_type":"box","text":"Investors choosing the deferred sales charge alternative should consider Investor C Shares if they are uncertain","page_number":135,"box":{"x":102,"y":491,"width":799,"height":11}},{"id":"485bdc73-5649-4949-b1a7-12d4fb52b49a","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":135,"box":{"x":69,"y":506,"width":828,"height":11}},{"id":"e06f8c63-c49c-4c5e-a85c-b05e2750261e","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":135,"box":{"x":70,"y":520,"width":778,"height":12}},{"id":"fbe24d48-eb31-4f1e-a7c5-f8d1ead4b636","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":135,"box":{"x":70,"y":536,"width":826,"height":11}},{"id":"3e272fea-4c8a-45b7-9e40-d0d18c1eb654","block_type":"box","text":"set a lower maximum for Investor C Shares.","page_number":135,"box":{"x":69,"y":551,"width":311,"height":9}},{"id":"80d62507-5e31-4dfe-83f2-57f3b65c000c","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":135,"box":{"x":102,"y":574,"width":789,"height":11}},{"id":"989d13e3-bf62-4c8c-8ffc-d340465eeb92","block_type":"box","text":"intermediary associated with the account.","page_number":135,"box":{"x":70,"y":589,"width":297,"height":11}},{"id":"f761ded0-4684-4893-acea-2fa5f7ae217c","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":135,"box":{"x":102,"y":612,"width":669,"height":11}},{"id":"b02977d7-06f6-44f8-8c33-b3f99097248a","block_type":"box","text":"The deferred sales charge alternatives may be particularly appealing to investors who do not qualify for the","page_number":135,"box":{"x":101,"y":634,"width":763,"height":12}},{"id":"c6d25ba1-426a-4dee-9e95-0de4dab72c27","block_type":"box","text":"reduction in initial sales charges. CDSC shares are subject to ongoing service fees and distribution fees; however,","page_number":135,"box":{"x":69,"y":649,"width":815,"height":12}},{"id":"65ca4608-7ed0-4842-b19d-27c98841df94","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":135,"box":{"x":68,"y":664,"width":813,"height":12}},{"id":"b6e5ee74-ec82-4c5d-a166-54cfe6def6c7","block_type":"box","text":"CDSC shares.","page_number":135,"box":{"x":69,"y":680,"width":97,"height":9}},{"id":"e855d474-b8ac-4e29-9ef3-539da6f46645","block_type":"box","text":"BlackRock compensates financial advisers and other financial intermediaries for selling CDSC shares at the time","page_number":135,"box":{"x":102,"y":702,"width":804,"height":12}},{"id":"7624fc0c-3722-4571-9c52-b695b6287a30","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":135,"box":{"x":69,"y":717,"width":827,"height":11}},{"id":"c9d40689-207d-4eaa-ae00-2c9ddf8cace8","block_type":"box","text":"used by the Distributor to defray the expenses of securities dealers or other financial intermediaries related to","page_number":135,"box":{"x":69,"y":732,"width":786,"height":12}},{"id":"d278df4e-ae3b-4615-ab85-07f98ddc8df5","block_type":"box","text":"providing distribution-related services to each Fund in connection with the sale of the CDSC shares. The combination","page_number":135,"box":{"x":70,"y":748,"width":831,"height":11}},{"id":"0df470b5-89bb-4e14-ba1f-f90437acc087","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":135,"box":{"x":69,"y":763,"width":809,"height":11}},{"id":"909cb449-197a-4401-9b5e-42822785339e","block_type":"box","text":"sales charge being deducted at the time of purchase. See “Distribution and/or Shareholder Servicing Plans” below.","page_number":135,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"734f01ba-855d-46f2-b13c-6705b356022f","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":135,"box":{"x":70,"y":793,"width":822,"height":11}},{"id":"5516542d-ef8e-400f-b098-8e0a6fc3926a","block_type":"box","text":"sales charge rule. See “Limitations on the Payment of Deferred Sales Charges” below.","page_number":135,"box":{"x":69,"y":808,"width":618,"height":11}},{"id":"c6c13f6f-cfb6-4d50-a037-17803aabdf5d","block_type":"box","text":"Dealers will generally immediately receive commissions equal to 1.00% of the Investor C Shares sold by them","page_number":135,"box":{"x":102,"y":831,"width":782,"height":11}},{"id":"fd52f728-ac7c-4faa-bd3f-1ebb13f43a32","block_type":"box","text":"plus ongoing fees under the Fund’s Distribution and Service Plan. Dealers may not receive a commission in","page_number":135,"box":{"x":70,"y":846,"width":764,"height":11}},{"id":"04722cc7-8067-4c2d-9637-87ffb0cb23d3","block_type":"box","text":"connection with sales of Investor C Shares to certain employer-sponsored retirement plans sponsored by the Fund,","page_number":135,"box":{"x":69,"y":861,"width":820,"height":11}},{"id":"0c63f40c-d958-4871-afc7-ad0d934f4d5c","block_type":"box","text":"BlackRock or its affiliates, but may receive fees under the Distribution and Service Plan. These commissions and","page_number":135,"box":{"x":70,"y":876,"width":806,"height":11}},{"id":"086c4849-db1a-4a30-b153-0a371cf39718","block_type":"box","text":"payments may be different than the reallowances, placement fees and commissions paid to dealers in connection","page_number":135,"box":{"x":70,"y":891,"width":813,"height":11}},{"id":"6457d250-597b-4eb6-ae1f-4bcace29b4e7","block_type":"box","text":"II-105","page_number":135,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"3e9b92a7-e56c-477b-a49e-e7136e532bab","block_type":"box","text":"NM1026U-5979889-135/232","page_number":135,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4dd34b7d-0b67-4b89-82e3-6a63f88cd53f","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":136,"box":{"x":68,"y":45,"width":811,"height":11}},{"id":"63def567-d726-42af-ae3e-394890e792fe","block_type":"box","text":"trading platforms of your financial intermediary; consult your financial adviser.","page_number":136,"box":{"x":68,"y":60,"width":554,"height":11}},{"id":"504b64ed-adb2-4e26-9e9f-4e4bcfa3a70d","block_type":"box","text":"Each Fund has adopted an automatic conversion feature for Investor C Shares. Effective November 23, 2020,","page_number":136,"box":{"x":102,"y":82,"width":783,"height":11}},{"id":"29679602-1f5d-49c6-8273-9c7a559ada98","block_type":"box","text":"Investor C Shares held for approximately eight years will be converted into Investor A Shares, as set forth in each","page_number":136,"box":{"x":70,"y":98,"width":808,"height":11}},{"id":"6ecfc0d6-e058-4634-b33a-ff6125309fb9","block_type":"box","text":"Fund’s Prospectus. In addition, accounts that do not have a financial intermediary associated with them are not","page_number":136,"box":{"x":70,"y":113,"width":797,"height":11}},{"id":"bfb34848-c1c9-4283-8491-3a312c369219","block_type":"box","text":"eligible to hold Investor C Shares, and any Investor C Shares held in such accounts will be automatically converted to","page_number":136,"box":{"x":69,"y":128,"width":837,"height":11}},{"id":"a246e56e-9582-4140-9919-a3067e64782f","block_type":"box","text":"Investor A Shares.","page_number":136,"box":{"x":70,"y":143,"width":128,"height":9}},{"id":"c646b6c3-98a3-4a41-9e4e-d7e2d40f5aad","block_type":"box","text":"Conversion of Investor C Shares to Investor A Shares","page_number":136,"box":{"x":102,"y":166,"width":378,"height":9}},{"id":"0b8f3f3e-4ab8-45b3-a058-3b2596423017","block_type":"box","text":"Effective November 23, 2020 (the “Effective Date”), approximately eight years after purchase, Investor C Shares","page_number":136,"box":{"x":102,"y":188,"width":804,"height":12}},{"id":"90eed33f-fcac-40d0-86c1-62ee5c5ff2c2","block_type":"box","text":"of each Fund will convert automatically into Investor A Shares of that Fund (the “Investor C 8-Year Conversion”).","page_number":136,"box":{"x":69,"y":203,"width":794,"height":12}},{"id":"080718a0-152b-4026-a956-a0a1cef0c9c5","block_type":"box","text":"Certain funds (the “Predecessor Funds”) were reorganized into new Funds (the “Successor Funds”) pursuant to","page_number":136,"box":{"x":69,"y":218,"width":794,"height":12}},{"id":"e56f2cc8-d1a9-4d12-9705-4eacb681e153","block_type":"box","text":"reorganizations which occurred in September 2018. The holding period for Investor C Shares of Successor Funds","page_number":136,"box":{"x":69,"y":234,"width":806,"height":11}},{"id":"8e50d341-ca12-4427-b1d3-f935707083e9","block_type":"box","text":"includes the period such shares were held in the respective Predecessor Fund. It is the financial intermediary’s","page_number":136,"box":{"x":70,"y":249,"width":793,"height":11}},{"id":"d5cd9580-b87b-4d03-a704-fab488cb88cd","block_type":"box","text":"responsibility to ensure that the shareholder is credited with the proper holding period. As of the Effective Date,","page_number":136,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"939847e3-aa85-4d7b-90c1-8ecc529d5553","block_type":"box","text":"certain financial intermediaries, including group retirement recordkeeping platforms, may not have been tracking","page_number":136,"box":{"x":69,"y":279,"width":802,"height":11}},{"id":"185ba53a-663d-4956-82e9-dcd3a8f00e0a","block_type":"box","text":"such holding periods and therefore may not be able to process such conversions. In such instances, Investor C","page_number":136,"box":{"x":69,"y":294,"width":793,"height":11}},{"id":"7eb13931-03d2-4233-a2f5-91565d32bf31","block_type":"box","text":"Shares held as of the Effective Date will automatically convert to Investor A Shares approximately eight years after","page_number":136,"box":{"x":69,"y":309,"width":817,"height":11}},{"id":"ee3c823d-b674-4acf-b337-e1b413bf8460","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":136,"box":{"x":68,"y":324,"width":814,"height":12}},{"id":"130785e4-4929-445d-be83-de6303f532df","block_type":"box","text":"not implemented systems or procedures to track holding periods commencing from the Effective Date, shareholders","page_number":136,"box":{"x":69,"y":339,"width":828,"height":12}},{"id":"4a59180a-9836-4573-87d1-12cad77971c5","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":136,"box":{"x":69,"y":355,"width":832,"height":11}},{"id":"33f801a4-4ceb-4ff9-bd47-31e28388c2bf","block_type":"box","text":"any such shares will convert to Investor A Shares as soon as reasonably practicable after such date.","page_number":136,"box":{"x":69,"y":370,"width":718,"height":11}},{"id":"18947656-336e-4a2c-b27d-379da71c016b","block_type":"box","text":"In addition, accounts that do not have a financial intermediary associated with them are not eligible to hold","page_number":136,"box":{"x":102,"y":392,"width":764,"height":12}},{"id":"cb7647ff-9be1-4eaa-aa40-6cf8d28f8868","block_type":"box","text":"Investor C Shares, and any Investor C Shares held in such accounts will be automatically converted into Investor A","page_number":136,"box":{"x":70,"y":408,"width":816,"height":11}},{"id":"2470982d-09ad-4499-9f00-83f89a9ca2c7","block_type":"box","text":"Shares (the “Investor C Direct Accounts Conversion” and together with the Investor C 8-Year Conversion, the","page_number":136,"box":{"x":69,"y":423,"width":772,"height":11}},{"id":"d27b3dbf-e727-47ed-b983-6907d4ba1bee","block_type":"box","text":"“Investor C Conversions”).","page_number":136,"box":{"x":70,"y":438,"width":186,"height":11}},{"id":"b0a611e0-5dd0-43e6-96a7-e4a7d97bfbc5","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":136,"box":{"x":101,"y":460,"width":776,"height":11}},{"id":"20956a48-bf72-4216-8156-25cb6a55534a","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":136,"box":{"x":69,"y":475,"width":824,"height":11}},{"id":"10f187e7-5806-4d24-afcb-311386145343","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":136,"box":{"x":70,"y":491,"width":827,"height":11}},{"id":"7bd3e074-55fd-40b7-99e4-b53f3c2595cd","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":136,"box":{"x":69,"y":506,"width":833,"height":11}},{"id":"3e0c4b26-dff6-49c7-907a-4ea9a2d23a04","block_type":"box","text":"Shares will also convert automatically to Investor A Shares, as set forth in each Fund’s Prospectus. The Investor C","page_number":136,"box":{"x":69,"y":521,"width":818,"height":11}},{"id":"3e6a0fca-9f0d-4dd3-bdf4-e3eaa119c998","block_type":"box","text":"Conversion Date for dividend reinvestment shares will be calculated taking into account the length of time the shares","page_number":136,"box":{"x":69,"y":536,"width":836,"height":11}},{"id":"3147c63b-8224-4e58-8f63-69392bdec02a","block_type":"box","text":"underlying the dividend reinvestment shares were outstanding.","page_number":136,"box":{"x":69,"y":551,"width":445,"height":11}},{"id":"7cdb2f0a-c574-4359-a13e-c112f14270c4","block_type":"box","text":"Contingent Deferred Sales Charge — Investor C Shares","page_number":136,"box":{"x":102,"y":574,"width":396,"height":11}},{"id":"8fe26106-bad4-4a1b-8111-676255d51344","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":136,"box":{"x":102,"y":596,"width":804,"height":12}},{"id":"0c50a6a9-c514-4689-b40d-631c6987af1c","block_type":"box","text":"percentage of the dollar amount subject thereto. In determining whether an Investor C Shares CDSC is applicable to","page_number":136,"box":{"x":70,"y":612,"width":826,"height":11}},{"id":"3d21a685-9d86-487d-adb6-19fa559866d8","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":136,"box":{"x":69,"y":627,"width":837,"height":11}},{"id":"ac0714ce-810b-44dc-a5f7-77021410bb57","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":136,"box":{"x":68,"y":642,"width":795,"height":11}},{"id":"9af2ba7f-b14d-4881-b63a-5cf08db2f39c","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":136,"box":{"x":69,"y":657,"width":840,"height":11}},{"id":"ec428514-c616-40a3-ac84-9eec2d3c04d3","block_type":"box","text":"Investor C Shares. In addition, no CDSC will be assessed on Investor C Shares acquired through reinvestment of","page_number":136,"box":{"x":70,"y":672,"width":804,"height":11}},{"id":"f27b4d5b-ce50-4131-92bb-4a8667fb74ab","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":136,"box":{"x":69,"y":687,"width":772,"height":11}},{"id":"08671700-4af0-4f1d-845b-65c2e92e5ea2","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":136,"box":{"x":70,"y":702,"width":790,"height":12}},{"id":"f45cf177-49fe-496c-a187-2868052be692","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":136,"box":{"x":69,"y":717,"width":776,"height":9}},{"id":"a12abd81-7a3f-453b-ac4e-93c866b76dca","block_type":"box","text":"redemption.","page_number":136,"box":{"x":69,"y":733,"width":83,"height":10}},{"id":"7e4f8ee9-16ae-4f36-8dbd-95a5206dab81","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":136,"box":{"x":102,"y":755,"width":734,"height":11}},{"id":"8c97aaf9-637a-47f5-8ac8-6a0d90c2cb12","block_type":"box","text":"information about amounts paid to the Distributor in connection with CDSC shares for the periods indicated.","page_number":136,"box":{"x":70,"y":770,"width":769,"height":11}},{"id":"e4ff2b0e-dfda-46b3-accb-95239dfecd1d","block_type":"box","text":"Investor C Shares — Contingent Deferred Sales Charge Waivers and Reductions","page_number":136,"box":{"x":102,"y":793,"width":572,"height":11}},{"id":"4d43a0e6-18f6-4c76-b87c-d48a610e9ede","block_type":"box","text":"The CDSC on Investor C Shares is not charged in connection with: (1) redemptions of Investor C Shares","page_number":136,"box":{"x":101,"y":816,"width":740,"height":11}},{"id":"d746d40a-b9cc-4686-ac04-49bd17817858","block_type":"box","text":"purchased through certain employer-sponsored retirement plans and fee-based programs previously approved by","page_number":136,"box":{"x":70,"y":831,"width":802,"height":11}},{"id":"273bd801-df00-464d-b14b-f99a88965e06","block_type":"box","text":"certain Funds and rollovers of current investments in the Fund through such plans; (2) exchanges described in","page_number":136,"box":{"x":69,"y":846,"width":786,"height":11}},{"id":"1bf82900-705e-413b-900f-c6ec4ab5fa9d","block_type":"box","text":"“Exchange Privilege” below; (3) redemptions made in connection with minimum required distributions due to the","page_number":136,"box":{"x":70,"y":861,"width":797,"height":11}},{"id":"912a64c7-7d1a-4c75-81f8-a615a9caeb7d","block_type":"box","text":"shareholder reaching age 72 from IRA and 403(b)(7) accounts; (4) redemptions made with respect to certain","page_number":136,"box":{"x":69,"y":876,"width":776,"height":11}},{"id":"6d561fe9-7f95-4c0d-84e7-83fff41c9f4d","block_type":"box","text":"retirement plans sponsored by the Fund, BlackRock or its affiliates; (5) redemptions in connection with a","page_number":136,"box":{"x":69,"y":891,"width":747,"height":11}},{"id":"b8099e59-fba4-4534-9d14-7a35cc775451","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":136,"box":{"x":69,"y":906,"width":822,"height":12}},{"id":"10b28937-9990-44fb-a575-1c098a834aeb","block_type":"box","text":"II-106","page_number":136,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"81bd70e5-3d8d-484a-8043-02705c1a5c8c","block_type":"box","text":"NM1026U-5979889-136/232","page_number":136,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4ec9a840-b5b4-4c2c-92e3-e647e235c6a7","block_type":"box","text":"following completion of probate (including in connection with the distribution of account assets to a beneficiary of the","page_number":137,"box":{"x":68,"y":45,"width":836,"height":11}},{"id":"1b1deb2f-edd0-49ae-a583-459a87351ee3","block_type":"box","text":"decedent) or disability (as defined in the Code) subsequent to the purchase of Investor C Shares; (6) withdrawals","page_number":137,"box":{"x":69,"y":60,"width":806,"height":11}},{"id":"7cfd73aa-e0ab-4330-b217-d919ca442042","block_type":"box","text":"resulting from shareholder disability (as defined in the Code) as long as the disability arose subsequent to the","page_number":137,"box":{"x":69,"y":75,"width":786,"height":11}},{"id":"9059d1d3-f732-4550-9c21-721a577f514b","block_type":"box","text":"purchase of the shares; (7) involuntary redemptions of Investor C Shares in accounts with low balances as described","page_number":137,"box":{"x":70,"y":90,"width":834,"height":11}},{"id":"7f96fb56-6c82-48e7-b2a7-d280a0371ab2","block_type":"box","text":"in “Redemption of Shares” below; (8) redemptions made pursuant to a systematic withdrawal plan, subject to the","page_number":137,"box":{"x":70,"y":105,"width":809,"height":11}},{"id":"a7499094-6dfb-4986-833d-0c50c8dd3a6b","block_type":"box","text":"limitations set forth under “Systematic Withdrawal Plan” below; (9) redemptions related to the payment of BNY","page_number":137,"box":{"x":70,"y":120,"width":791,"height":11}},{"id":"24c13812-0e23-46d8-903b-f41538ae85a0","block_type":"box","text":"Mellon Investment Servicing Trust Company custodial IRA fees; and (10) redemptions when a shareholder can","page_number":137,"box":{"x":70,"y":135,"width":784,"height":12}},{"id":"029441ee-b849-4b41-b9a5-5ff646736a56","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":137,"box":{"x":69,"y":150,"width":824,"height":12}},{"id":"87edea48-9f72-4907-97e1-f65ad078c712","block_type":"box","text":"acquired through the reinvestment of dividends or distributions.","page_number":137,"box":{"x":69,"y":166,"width":451,"height":11}},{"id":"83c3ff8f-f21d-4dfa-9180-2f8dc9ff85bb","block_type":"box","text":"Certain CDSC waivers and reductions on Investor C Shares may be available to customers of certain financial","page_number":137,"box":{"x":102,"y":188,"width":781,"height":11}},{"id":"89a8a123-9ca2-48ac-b81c-09a61b48f1de","block_type":"box","text":"intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the Fund’s Prospectus.","page_number":137,"box":{"x":70,"y":203,"width":813,"height":12}},{"id":"41059be5-5fac-4f50-bd0f-93529a6f3d15","block_type":"box","text":"Please speak to your financial intermediary for more information.","page_number":137,"box":{"x":69,"y":218,"width":462,"height":12}},{"id":"fbab487d-6f0b-4895-bf9d-57d0d2cb8466","block_type":"box","text":"Class R Shares","page_number":137,"box":{"x":69,"y":249,"width":110,"height":9}},{"id":"e08b76bb-29dc-49fa-92e1-2a298721e95b","block_type":"box","text":"Certain of the Funds offer Class R Shares as described in each such Fund’s Prospectus. Class R Shares are","page_number":137,"box":{"x":102,"y":271,"width":775,"height":11}},{"id":"27d7d0b3-2ea7-4810-88da-c319e0f45f58","block_type":"box","text":"available only to certain employer-sponsored retirement plans. Class R Shares are not subject to an initial sales","page_number":137,"box":{"x":69,"y":287,"width":799,"height":11}},{"id":"5966753f-86f4-4664-b08a-16abe68fdf8f","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":137,"box":{"x":69,"y":302,"width":801,"height":11}},{"id":"b5022b1c-5b87-4f36-be75-7d98e8012561","block_type":"box","text":"0.25% per year. Distribution fees are used to support the Fund’s marketing and distribution efforts, such as","page_number":137,"box":{"x":69,"y":317,"width":772,"height":11}},{"id":"034858a1-a883-48da-8b47-e63253906fa5","block_type":"box","text":"compensating financial advisers and other financial intermediaries, advertising and promotion. Service fees are used","page_number":137,"box":{"x":69,"y":332,"width":836,"height":11}},{"id":"6fafa74a-183c-4a5a-a3d6-2997466e76d1","block_type":"box","text":"to compensate securities dealers and other financial intermediaries for service activities.","page_number":137,"box":{"x":68,"y":347,"width":636,"height":11}},{"id":"b7f1a2bc-0d98-4bef-be7c-494ab9a4c5c4","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":137,"box":{"x":102,"y":370,"width":791,"height":11}},{"id":"aaae68a1-cca8-40e2-85e3-8edb873552ca","block_type":"box","text":"have paid as a shareholder of one of the other share classes.","page_number":137,"box":{"x":69,"y":385,"width":440,"height":11}},{"id":"15796e3c-3f69-4c80-aab4-41e09926bb99","block_type":"box","text":"Class K Shares","page_number":137,"box":{"x":69,"y":415,"width":109,"height":9}},{"id":"b051487c-fa52-49d2-bf4f-ad77f019ad74","block_type":"box","text":"Certain Funds offer Class K Shares as described in each such Fund’s Prospectus. Class K Shares are available","page_number":137,"box":{"x":102,"y":438,"width":797,"height":11}},{"id":"cbde493f-9c6e-4871-afdc-aeed107c1f18","block_type":"box","text":"only to (i) certain employee benefit plans, such as health savings accounts, and certain employer-sponsored","page_number":137,"box":{"x":69,"y":453,"width":772,"height":11}},{"id":"29d70d92-f698-46c9-9d7a-25381d698406","block_type":"box","text":"retirement plans (not including SEP IRAs, SIMPLE IRAs and SARSEPs) (collectively, “Employer-Sponsored Retirement","page_number":137,"box":{"x":69,"y":468,"width":827,"height":11}},{"id":"99cd1c91-f743-4480-ab56-246e2ab2abe7","block_type":"box","text":"Plans”), (ii) collective trust funds, investment companies and other pooled investment vehicles, each of which may","page_number":137,"box":{"x":69,"y":483,"width":817,"height":11}},{"id":"a0b7080f-9f77-4ce6-8ae8-999b4ef20706","block_type":"box","text":"purchase shares of the Fund through a financial intermediary that has entered into an agreement with the Distributor","page_number":137,"box":{"x":70,"y":498,"width":834,"height":11}},{"id":"ce5764fb-64eb-45b7-9a01-d88edca13442","block_type":"box","text":"to purchase such shares, (iii) “Institutional Investors,” which include but are not limited to, endowments,","page_number":137,"box":{"x":68,"y":514,"width":748,"height":10}},{"id":"3235c4c3-a071-40f4-8f6f-ec5354856b1f","block_type":"box","text":"foundations, family offices, banks and bank trusts, local, city, and state governmental institutions, corporations and","page_number":137,"box":{"x":68,"y":528,"width":828,"height":12}},{"id":"dd91ce5f-0018-4dbe-8c1b-e8646bf622d9","block_type":"box","text":"insurance company separate accounts, each of which may purchase shares of the Fund through a financial","page_number":137,"box":{"x":70,"y":543,"width":760,"height":12}},{"id":"fd930aa6-945d-4d15-9e86-3ca6b631d092","block_type":"box","text":"intermediary that has entered into an agreement with the Distributor to purchase such shares, (iv) clients of private","page_number":137,"box":{"x":70,"y":559,"width":823,"height":11}},{"id":"05456a8d-30e0-417f-9201-c92de3ce50ca","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":137,"box":{"x":69,"y":574,"width":836,"height":11}},{"id":"04a5f7a5-63c6-4070-be3f-f12c75c52e5d","block_type":"box","text":"Distributor to sell such shares; (v) fee-based advisory platforms of a financial intermediary that (a) has specifically","page_number":137,"box":{"x":70,"y":589,"width":814,"height":11}},{"id":"4d4ef10b-c908-4b81-b1fb-67534b3c5509","block_type":"box","text":"acknowledged in a written agreement with the Distributor and/or its affiliate(s) that the financial intermediary shall","page_number":137,"box":{"x":69,"y":604,"width":817,"height":11}},{"id":"a5a6add9-2d83-4f64-8d71-799baf1e87d9","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":137,"box":{"x":69,"y":619,"width":823,"height":11}},{"id":"09ebaf39-24cd-4d0d-a6ed-79f57353f9be","block_type":"box","text":"Fund’s shares through another intermediary that has executed such an agreement and (vi) any other investors who","page_number":137,"box":{"x":70,"y":634,"width":818,"height":12}},{"id":"3d4dc732-fa5d-4df9-a792-4835a0aa42f9","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":137,"box":{"x":69,"y":649,"width":833,"height":12}},{"id":"ef858408-b2a4-4df5-b797-6c5e3c62e8fb","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":137,"box":{"x":69,"y":664,"width":807,"height":12}},{"id":"80a1b2b7-9814-4719-bc1e-19924a9944a6","block_type":"box","text":"agreement referenced in (iv) above shall appear in a supplemental agreement to any selling, sub-transfer agent, or","page_number":137,"box":{"x":69,"y":680,"width":817,"height":11}},{"id":"60fb6af6-f954-42bb-8ecd-409f18c59c14","block_type":"box","text":"distribution and marketing agreement.","page_number":137,"box":{"x":69,"y":695,"width":270,"height":11}},{"id":"fd2fe0e6-af92-4419-8f20-11465f7c23ed","block_type":"box","text":"Class K Shares are also available to employees, officers and directors/trustees of BlackRock, Inc. and","page_number":137,"box":{"x":102,"y":717,"width":734,"height":12}},{"id":"a356f8b2-57f4-48ee-8d47-af83a8d07f3a","block_type":"box","text":"BlackRock Funds and immediate family members of such persons, if they open an account directly with BlackRock.","page_number":137,"box":{"x":70,"y":732,"width":817,"height":12}},{"id":"a48e423f-8f7b-46d0-8340-4cdc5e58e63b","block_type":"box","text":"Eligible individuals who would like to convert existing holdings to Class K Shares must contact BlackRock.","page_number":137,"box":{"x":70,"y":748,"width":753,"height":11}},{"id":"0573a179-310d-4d5f-9118-75a84a4c8e6f","block_type":"box","text":"Class G Shares","page_number":137,"box":{"x":69,"y":778,"width":110,"height":9}},{"id":"66813bcf-7dcc-4030-b783-3a966852279f","block_type":"box","text":"Certain Funds offer Class G Shares, which are available only to investors on eligible platforms. Eligible platforms","page_number":137,"box":{"x":102,"y":801,"width":804,"height":11}},{"id":"d25870e9-adcc-49cd-849b-0a2d828368ba","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":137,"box":{"x":69,"y":816,"width":826,"height":11}},{"id":"c67a6362-470c-4638-a316-37527d122436","block_type":"box","text":"that meets an initial investment minimum of $2 billion. For clients investing through such eligible platforms, the Fund","page_number":137,"box":{"x":68,"y":830,"width":836,"height":12}},{"id":"45ffe2f4-6eea-405d-ac95-85ee893fc20d","block_type":"box","text":"does not impose investment minimums on any individual investor. Financial intermediaries may impose separate","page_number":137,"box":{"x":69,"y":846,"width":803,"height":11}},{"id":"373a7b3a-8326-4b8f-b1bd-4d6cc0210894","block_type":"box","text":"eligibility requirements.","page_number":137,"box":{"x":69,"y":861,"width":164,"height":11}},{"id":"124931e8-deea-447e-a1db-69c59c4b3f12","block_type":"box","text":"II-107","page_number":137,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"f6c5ff61-10ec-4fc8-9f12-3b110612da42","block_type":"box","text":"NM1026U-5979889-137/232","page_number":137,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"3a119e67-b0e3-4a22-9f73-5cc1e450a75f","block_type":"box","text":"Service Shares","page_number":138,"box":{"x":68,"y":45,"width":109,"height":9}},{"id":"d8353757-0234-4053-af6b-57a6c0d43ca1","block_type":"box","text":"Certain Funds offer Service Shares, which are available only to certain investors, including: (i) certain financial","page_number":138,"box":{"x":102,"y":67,"width":788,"height":12}},{"id":"7de11c20-29e7-4b21-a769-2d4d6ebda7a5","block_type":"box","text":"institutions, such as banks and brokerage firms, acting on behalf of their customers; (ii) certain persons who were","page_number":138,"box":{"x":70,"y":82,"width":815,"height":12}},{"id":"4f82776a-56bd-4277-8b79-97ed69346542","block_type":"box","text":"shareholders of the Compass Capital Group of Funds at the time of its combination with The PNC","page_number":138,"box":{"x":69,"y":98,"width":693,"height":11}},{"id":"6d00e7cd-8eb3-479d-b8d4-3f1e00c91f86","block_type":"box","text":"®","page_number":138,"box":{"x":763,"y":98,"width":6,"height":4}},{"id":"2e12b653-2b28-40c6-a1e3-e79e22021d53","block_type":"box","text":"Fund in 1996; and","page_number":138,"box":{"x":775,"y":98,"width":130,"height":10}},{"id":"92fe399f-7e9f-4a0b-84d6-700c498df984","block_type":"box","text":"(iii) participants in the Capital Directions","page_number":138,"box":{"x":69,"y":113,"width":287,"height":11}},{"id":"4f8a3da7-aefe-4c77-a365-ca79b891ca69","block_type":"box","text":"SM","page_number":138,"box":{"x":357,"y":113,"width":11,"height":5}},{"id":"00335a0d-99a9-4d81-9cff-4d98d8c4dd23","block_type":"box","text":"asset allocation program. Service Shares are not subject to an initial sales","page_number":138,"box":{"x":374,"y":113,"width":534,"height":11}},{"id":"b55ca737-f06d-4ed1-a5cf-c45451bdb2cc","block_type":"box","text":"charge or a CDSC but are subject to an ongoing service fee as set forth in the applicable Fund’s Prospectus.","page_number":138,"box":{"x":69,"y":128,"width":776,"height":11}},{"id":"d43d2f2a-5a94-40fe-839d-d731407fa3ba","block_type":"box","text":"BlackRock Shares","page_number":138,"box":{"x":69,"y":158,"width":133,"height":9}},{"id":"063e6e58-3abf-46dc-bb90-278e23af760c","block_type":"box","text":"Certain Funds offer BlackRock Shares, which are available only to certain investors. BlackRock Shares are","page_number":138,"box":{"x":102,"y":181,"width":760,"height":11}},{"id":"7020022c-4cce-4d1c-9171-ed90bc42c302","block_type":"box","text":"offered without a sales charge to institutional and individual investors, registered investment advisers and certain","page_number":138,"box":{"x":69,"y":196,"width":813,"height":11}},{"id":"ff436c23-4cba-444f-9632-83c1f2329ad4","block_type":"box","text":"fee-based programs.","page_number":138,"box":{"x":68,"y":211,"width":145,"height":11}},{"id":"38006c98-60cd-48b2-a763-d62bd5e7f2c7","block_type":"box","text":"Distribution and/or Shareholder Servicing Plans","page_number":138,"box":{"x":69,"y":241,"width":348,"height":11}},{"id":"25bd6a95-08ac-4141-b905-8d4a07d3e05b","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":138,"box":{"x":102,"y":264,"width":790,"height":11}},{"id":"390b4cb8-1301-480d-8ff1-21793d9358cb","block_type":"box","text":"respect to certain share classes that allows the Fund to pay distribution fees for the sale of its shares and","page_number":138,"box":{"x":69,"y":279,"width":761,"height":11}},{"id":"983d1613-6482-47cf-991e-f03370aff781","block_type":"box","text":"shareholder servicing fees for certain services provided to its shareholders.","page_number":138,"box":{"x":69,"y":294,"width":541,"height":11}},{"id":"ef46ae21-9def-4472-bd60-f5b27b8b63f6","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":138,"box":{"x":102,"y":317,"width":803,"height":11}},{"id":"d343a476-752d-4cf5-ad39-c6abeb733fcb","block_type":"box","text":"BlackRock, fees for distribution and sales support services with respect to Investor A, Investor A1, Investor C,","page_number":138,"box":{"x":70,"y":332,"width":783,"height":11}},{"id":"fdfe1fa2-8a50-4204-a5a7-4adab045b7b8","block_type":"box","text":"Investor P, Service and Class R Shares. Currently, as described further below, only Investor C and Class R Shares","page_number":138,"box":{"x":70,"y":347,"width":809,"height":11}},{"id":"0414d98d-9fa3-4b1a-bf10-d424128dbcd7","block_type":"box","text":"bear the expense of distribution fees under a Plan.","page_number":138,"box":{"x":69,"y":362,"width":360,"height":11}},{"id":"81e4b526-8e57-41b5-a90f-70f2d1be0415","block_type":"box","text":"Each Fund has entered into a distribution agreement with BRIL under which BRIL, as agent, offers shares of","page_number":138,"box":{"x":102,"y":385,"width":770,"height":11}},{"id":"b2b935b7-092e-4367-acae-3cdae31ed956","block_type":"box","text":"each Fund on a continuous basis. BRIL has agreed to use appropriate efforts to effect sales of the shares, but it is","page_number":138,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"22126f42-561b-4c77-8665-a3bcbf804262","block_type":"box","text":"not obligated to sell any particular amount of shares. BRIL’s principal business address is 50 Hudson Yards, New","page_number":138,"box":{"x":69,"y":415,"width":812,"height":11}},{"id":"3deb18be-fd0f-4319-9fe7-d9bb73bb7750","block_type":"box","text":"York, NY 10001. BRIL is an affiliate of BlackRock.","page_number":138,"box":{"x":68,"y":430,"width":355,"height":11}},{"id":"ccedc3ea-31f3-46fc-9e2a-b0220580b529","block_type":"box","text":"Pursuant to the Plans, each Fund may also pay shareholder servicing fees (also referred to as general","page_number":138,"box":{"x":102,"y":453,"width":727,"height":11}},{"id":"25f7c809-8bcd-4c8a-9b8d-1acdb3fbec59","block_type":"box","text":"shareholder liaison services fees) to affiliated and unaffiliated brokers, dealers, financial institutions, insurance","page_number":138,"box":{"x":69,"y":468,"width":799,"height":11}},{"id":"96a0d2ad-d2c6-467c-8527-843e6fc7852d","block_type":"box","text":"companies, retirement plan record-keepers and other financial intermediaries (including BlackRock, BRIL and their","page_number":138,"box":{"x":69,"y":483,"width":813,"height":11}},{"id":"3ca05251-0abb-4d83-a8a6-58747a7e4057","block_type":"box","text":"affiliates) (collectively, “Service Organizations”) for certain support services rendered by Service Organizations to","page_number":138,"box":{"x":69,"y":498,"width":809,"height":11}},{"id":"f0da0100-9e26-40d8-a161-215458fcebf9","block_type":"box","text":"their customers (“Customers”) who are the beneficial owners of Investor A, Investor A1, Investor C, Investor P,","page_number":138,"box":{"x":68,"y":513,"width":786,"height":11}},{"id":"ff1c38c4-c427-4894-b9a9-e9324e656dd0","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":138,"box":{"x":69,"y":528,"width":789,"height":12}},{"id":"6083e3bc-0dd3-427d-afa1-ef4ce6386ee5","block_type":"box","text":"Fund’s Administrators and Transfer Agent to the Fund’s shareholders of record.","page_number":138,"box":{"x":70,"y":543,"width":562,"height":12}},{"id":"0ae07cb0-905f-4ed5-bf0c-10611f44a295","block_type":"box","text":"The support services provided by Service Organizations are general shareholder liaison services, which include,","page_number":138,"box":{"x":101,"y":566,"width":798,"height":11}},{"id":"8834b1cd-c56d-4560-8767-38721cec8c0c","block_type":"box","text":"but are not limited to: (i) answering Customer inquiries regarding account status and history, the manner in which","page_number":138,"box":{"x":69,"y":581,"width":808,"height":12}},{"id":"38793417-f314-4a17-8505-e3e7089409b7","block_type":"box","text":"purchases, exchanges and redemptions or repurchases of shares may be effected and certain other matters","page_number":138,"box":{"x":70,"y":596,"width":776,"height":12}},{"id":"f5cfc5c8-cb6d-4b16-bf12-865bc188c9d3","block_type":"box","text":"pertaining to the Customers’ investments; and (ii) assisting Customers in designating and changing dividend options,","page_number":138,"box":{"x":70,"y":612,"width":835,"height":11}},{"id":"54bf9bd9-5659-440d-814b-7772905ff0b0","block_type":"box","text":"account designations and addresses. The shareholder servicing fees payable pursuant to the Plans are paid to","page_number":138,"box":{"x":69,"y":627,"width":791,"height":11}},{"id":"696d6cbf-ccbe-43e4-be7d-7c1a02ee1540","block_type":"box","text":"compensate Service Organizations for the administration and servicing of shareholder accounts and are not costs","page_number":138,"box":{"x":69,"y":642,"width":813,"height":11}},{"id":"0c5d968f-f28d-4c4b-8d29-d238fcf67d1f","block_type":"box","text":"which are primarily intended to result in the sale of the Fund’s shares.","page_number":138,"box":{"x":68,"y":657,"width":501,"height":11}},{"id":"714a837f-a14c-4d12-9f59-22a5820ebabd","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":138,"box":{"x":102,"y":680,"width":783,"height":11}},{"id":"a38e9101-fabd-4321-ac92-9d0e50ddac42","block_type":"box","text":"the applicable share class regardless of the amount of expenses incurred. As a result, payments under the Plans","page_number":138,"box":{"x":68,"y":695,"width":810,"height":11}},{"id":"ec8d117f-19d6-4462-9ab4-d90e89abdedc","block_type":"box","text":"may be more or less than expenses incurred in connection with providing distribution and/or shareholder services","page_number":138,"box":{"x":69,"y":710,"width":813,"height":11}},{"id":"a93ab131-9b7f-459d-a8ad-5283e189a648","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":138,"box":{"x":68,"y":725,"width":836,"height":11}},{"id":"566e6930-001a-44f4-b322-744698d0650a","block_type":"box","text":"providing services with respect to the related class is presented to the Directors for their consideration quarterly.","page_number":138,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"47cb6807-bec7-432a-beba-c6eecaa52844","block_type":"box","text":"Payments under the Plans consist of the shareholder servicing fees and the distribution fees. Expenses with respect","page_number":138,"box":{"x":69,"y":755,"width":832,"height":11}},{"id":"21cec813-5b93-4010-89cf-a412a4eb0947","block_type":"box","text":"to providing distribution and/or shareholder services with respect to a class may consist of Service Organization","page_number":138,"box":{"x":68,"y":770,"width":803,"height":12}},{"id":"63d52e8d-0b4f-41ec-a8ee-24b6806692b3","block_type":"box","text":"financial adviser compensation, branch office and regional operation center selling and transaction processing","page_number":138,"box":{"x":68,"y":785,"width":788,"height":12}},{"id":"2b991139-7165-4269-a47f-623f8aaa39be","block_type":"box","text":"expenses, advertising, sales promotion and marketing expenses. Payments under the Plans with respect to one","page_number":138,"box":{"x":69,"y":801,"width":798,"height":11}},{"id":"58ebd415-9c85-438d-b14e-3548c5963f55","block_type":"box","text":"class will not be used to finance the expenditures of another class. Sales personnel may receive different","page_number":138,"box":{"x":69,"y":816,"width":755,"height":11}},{"id":"24231d69-50ad-4cf7-967d-fbbdb3ccc8fc","block_type":"box","text":"compensation for selling different classes of shares.","page_number":138,"box":{"x":69,"y":831,"width":375,"height":11}},{"id":"53d1b7b0-639c-4aa6-9272-eed784493a41","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":138,"box":{"x":102,"y":853,"width":803,"height":12}},{"id":"7445f4a8-31c0-491b-94b2-2fc6a31de451","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":138,"box":{"x":69,"y":869,"width":839,"height":11}},{"id":"ec081a86-6c26-4888-b686-a8cc6d55cd10","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":138,"box":{"x":68,"y":884,"width":788,"height":11}},{"id":"2f411fb8-6add-460d-90a6-235d6067a8ce","block_type":"box","text":"interested Directors concluded that there is reasonable likelihood that the Plan will benefit the Fund and its related","page_number":138,"box":{"x":70,"y":899,"width":818,"height":9}},{"id":"e7072947-aa24-4934-a21a-f49a3aef57a4","block_type":"box","text":"II-108","page_number":138,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"019485c0-9053-443a-b3c6-f0fc4f229bc1","block_type":"box","text":"NM1026U-5979889-138/232","page_number":138,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e3484e75-8a64-41ab-8ed7-0d72b59a4e85","block_type":"box","text":"class of shareholders. The Plan provides, among other things, that: (i) the Board of Directors shall receive quarterly","page_number":139,"box":{"x":69,"y":45,"width":824,"height":11}},{"id":"f3bf975c-693b-4aa5-82f5-43b03ba00391","block_type":"box","text":"reports regarding the amounts expended under the Plan and the purposes for which such expenditures were made;","page_number":139,"box":{"x":69,"y":60,"width":821,"height":11}},{"id":"20e3a9a7-6d5c-40b6-bf90-66631b9031ea","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":139,"box":{"x":69,"y":75,"width":778,"height":11}},{"id":"da048828-43ee-4187-b7d8-71de4b0d64ff","block_type":"box","text":"Directors, including the directors who are not “interested persons” of the Fund (as defined in the Investment","page_number":139,"box":{"x":70,"y":90,"width":773,"height":11}},{"id":"f170adaa-a393-4a7f-8267-64cb0474c608","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":139,"box":{"x":69,"y":105,"width":796,"height":11}},{"id":"dfac8426-7f0c-4be6-bbea-ce070e910da6","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":139,"box":{"x":69,"y":120,"width":837,"height":12}},{"id":"bf99057f-5b82-46bd-9864-e3105f15cfbb","block_type":"box","text":"in accordance with Rule 12b-1 under the Investment Company Act; (iii) any material amendment thereto must be","page_number":139,"box":{"x":70,"y":135,"width":801,"height":11}},{"id":"4a5a4808-1260-45c6-9cf5-0a52176294dd","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":139,"box":{"x":69,"y":150,"width":787,"height":12}},{"id":"86cc04e5-139a-46d8-a81d-8bd5ad510ca4","block_type":"box","text":"purpose; (iv) any amendment to increase materially the costs which any class of shares may bear for distribution","page_number":139,"box":{"x":70,"y":166,"width":802,"height":11}},{"id":"20d3b6c3-b0ca-471f-9582-e4331968b63c","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":139,"box":{"x":69,"y":181,"width":826,"height":11}},{"id":"6c34ad3e-2cd2-4aef-8757-658ff15ea608","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":139,"box":{"x":69,"y":196,"width":836,"height":11}},{"id":"a7686c53-37c0-4fe1-a5bb-bdaa89b2ab9e","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":139,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"0c356848-ae0e-4b2e-a0ea-532f034974c6","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":139,"box":{"x":68,"y":226,"width":792,"height":11}},{"id":"91ced36a-4590-46ba-88b4-970c207ed22b","block_type":"box","text":"Directors. Rule 12b-1 further requires that each Fund preserve copies of each Plan and any report made pursuant to","page_number":139,"box":{"x":70,"y":241,"width":831,"height":11}},{"id":"0ce9d2ce-a74f-466c-a790-83a666c0545a","block_type":"box","text":"such Plan for a period of not less than six years from the date of the Plan or such report, the first two years in an","page_number":139,"box":{"x":69,"y":256,"width":807,"height":11}},{"id":"062bff0e-6306-434b-a1a8-e9f041bf52c6","block_type":"box","text":"easily accessible place.","page_number":139,"box":{"x":69,"y":272,"width":167,"height":11}},{"id":"c9952f92-4938-4132-bae0-3ed12544093e","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":139,"box":{"x":102,"y":294,"width":804,"height":11}},{"id":"697181bc-12a6-4e31-b9db-f8ff51ae8370","block_type":"box","text":"Directors, or by vote of the holders of a majority of the shares of such class.","page_number":139,"box":{"x":70,"y":309,"width":542,"height":11}},{"id":"894b6be5-fa81-4b4f-9a8d-014cb36e9bda","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":139,"box":{"x":102,"y":332,"width":734,"height":11}},{"id":"e4971fc4-fafd-4f4d-8ada-f180b0d58b9a","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":139,"box":{"x":70,"y":347,"width":814,"height":11}},{"id":"e6977788-1b1b-4ffd-a896-de1d26bb9f75","block_type":"box","text":"fiscal year.","page_number":139,"box":{"x":68,"y":362,"width":75,"height":11}},{"id":"0bc351b8-bcee-4ffe-a222-2a19cbba811d","block_type":"box","text":"Limitations on the Payment of Deferred Sales Charges","page_number":139,"box":{"x":69,"y":392,"width":396,"height":11}},{"id":"de1a588b-a30d-4304-b182-6b8f4284b369","block_type":"box","text":"The maximum sales charge rule in the Conduct Rules of the Financial Industry Regulatory Authority (“FINRA”)","page_number":139,"box":{"x":101,"y":415,"width":777,"height":11}},{"id":"3d4908fa-b64b-4a5e-a106-fc7fcc90319a","block_type":"box","text":"imposes a limitation on certain asset-based sales charges such as the distribution fee borne by Class R Shares, and","page_number":139,"box":{"x":70,"y":430,"width":835,"height":11}},{"id":"4565ddcf-1275-4be5-9d1c-e8fb2a7edcd4","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":139,"box":{"x":68,"y":445,"width":822,"height":11}},{"id":"f0938b99-bfa9-473b-9674-f2225f31d768","block_type":"box","text":"servicing fee. The maximum sales charge rule is applied separately to each class and limits the aggregate of","page_number":139,"box":{"x":69,"y":460,"width":778,"height":12}},{"id":"8dd1978a-c6c2-4699-b310-019ce5180774","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":139,"box":{"x":69,"y":475,"width":840,"height":12}},{"id":"06c9a4d6-c2c3-45c0-8d8b-f95e8f09a933","block_type":"box","text":"Shares, computed separately (excluding shares issued pursuant to dividend reinvestments and exchanges), plus","page_number":139,"box":{"x":69,"y":491,"width":803,"height":11}},{"id":"faa87dce-b619-4f47-a151-9f7e415b955e","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":139,"box":{"x":69,"y":506,"width":794,"height":11}},{"id":"e438df37-c0fa-4295-92dd-3ac0099e2f6e","block_type":"box","text":"unpaid balance being the maximum amount payable minus amounts received from the payment of the distribution fee","page_number":139,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"5124eecf-8408-40c3-a969-e98691413e90","block_type":"box","text":"and the CDSC). See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI","page_number":139,"box":{"x":69,"y":536,"width":824,"height":11}},{"id":"521c5817-9573-42a3-bcd9-ca8af36b1d43","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":139,"box":{"x":68,"y":551,"width":839,"height":11}},{"id":"320594b1-ac43-4c5b-a259-bab6a0aafb9a","block_type":"box","text":"and Class R Shares of your Fund.","page_number":139,"box":{"x":69,"y":566,"width":236,"height":11}},{"id":"0f0b394f-7c1b-45b2-9bee-785daa72ded3","block_type":"box","text":"Other Payments by the Fund","page_number":139,"box":{"x":69,"y":597,"width":206,"height":11}},{"id":"dc47ace6-c725-4e34-b589-65a6208204bd","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":139,"box":{"x":102,"y":619,"width":800,"height":11}},{"id":"63d8811c-4aca-4102-9993-175a47dbc6f2","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":139,"box":{"x":68,"y":634,"width":816,"height":12}},{"id":"eae14cc7-8e5e-48a5-8f6c-c72cf2e787d2","block_type":"box","text":"Service Organizations pursuant to which the Fund will pay a Service Organization for administrative, networking,","page_number":139,"box":{"x":69,"y":649,"width":794,"height":12}},{"id":"9f5fec15-0320-48d9-b6ea-451bc779bbd6","block_type":"box","text":"recordkeeping, sub-transfer agency, sub-accounting and/or shareholder services. These non-Plan payments are","page_number":139,"box":{"x":69,"y":664,"width":792,"height":12}},{"id":"2e5c06ae-4a0c-4617-95d9-635a30dd1608","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":139,"box":{"x":68,"y":680,"width":841,"height":11}},{"id":"a5173683-a7d3-4b16-96ed-6112bf4bcd03","block_type":"box","text":"Organization or (2) a fixed dollar amount for each account serviced by a Service Organization. The aggregate amount","page_number":139,"box":{"x":69,"y":695,"width":831,"height":11}},{"id":"d0d4e976-4e3c-4bc3-91fd-1a5f45379d30","block_type":"box","text":"of these payments may be substantial.","page_number":139,"box":{"x":69,"y":710,"width":276,"height":11}},{"id":"91d71626-3568-4b6e-a51c-6ac14fb009e6","block_type":"box","text":"Additional Payments by BlackRock","page_number":139,"box":{"x":68,"y":740,"width":256,"height":11}},{"id":"7a460244-01fd-43d2-ad35-348092a7b43d","block_type":"box","text":"From time to time, BlackRock, BRIL and/or their affiliates (referred to in this section collectively as “BlackRock”)","page_number":139,"box":{"x":102,"y":763,"width":803,"height":11}},{"id":"fe6fdc1c-30fd-4be0-9642-fa04e204b106","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":139,"box":{"x":69,"y":778,"width":823,"height":11}},{"id":"f89188b2-802c-49d0-be54-67c1b4ac0057","block_type":"box","text":"its shareholders and/or for data provision or technology support. A Service Organization may perform these","page_number":139,"box":{"x":70,"y":793,"width":768,"height":11}},{"id":"14c92e43-004b-4d79-bedc-ed6b6f9f0f83","block_type":"box","text":"obligations itself or may arrange for a third party to perform them. These payments, which are not made pursuant to","page_number":139,"box":{"x":69,"y":808,"width":830,"height":11}},{"id":"cbf447a0-752e-4360-a558-5188680c0891","block_type":"box","text":"a Plan or otherwise paid by a Fund, are referred to as “Additional Payments” herein.","page_number":139,"box":{"x":69,"y":823,"width":599,"height":11}},{"id":"67f8262f-72ae-4762-bfb3-10cd8659ef18","block_type":"box","text":"Additional Payments are made from BlackRock’s own assets (which may come directly or indirectly from fees","page_number":139,"box":{"x":101,"y":846,"width":776,"height":11}},{"id":"93b7b238-c8d6-48fb-86b7-9166f5e0002c","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":139,"box":{"x":70,"y":861,"width":832,"height":11}},{"id":"3df6ed93-e233-4dd2-8631-d1e7f4949cd4","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":139,"box":{"x":69,"y":876,"width":833,"height":11}},{"id":"051c2345-8b29-4a26-91cc-a3be090663c2","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":139,"box":{"x":69,"y":891,"width":802,"height":11}},{"id":"c75f4e80-7067-49ff-a39a-b309bbf3ccab","block_type":"box","text":"Service Organizations are in addition to any distribution or shareholder servicing fees paid under any Plan of any","page_number":139,"box":{"x":69,"y":906,"width":802,"height":12}},{"id":"4c3c5e27-bbfa-4106-a16a-e397b35e2fe5","block_type":"box","text":"II-109","page_number":139,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"7f71a833-5d06-4d8b-83b5-ea37ffed7d3d","block_type":"box","text":"NM1026U-5979889-139/232","page_number":139,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ef16a063-9d5c-41db-ac39-5bda3be598db","block_type":"box","text":"Fund, any sales charges, commissions or other concessions described in the Prospectuses or this SAI, and any","page_number":140,"box":{"x":70,"y":45,"width":796,"height":11}},{"id":"a3028904-094f-4dc9-99d6-d152b0d92b5d","block_type":"box","text":"administrative, networking, recordkeeping, sub-transfer agency or sub-accounting fees payable by a Fund. Pursuant to","page_number":140,"box":{"x":69,"y":60,"width":836,"height":11}},{"id":"3aadb584-3fd2-48d6-82ad-8a81f000e3da","block_type":"box","text":"applicable FINRA regulations, the details of certain of these payments, including the Service Organizations receiving","page_number":140,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"ac6249f7-e098-4e7d-955a-43fa8142989a","block_type":"box","text":"such payments in connection with the sale and distribution of Fund shares, are required to be disclosed. While FINRA","page_number":140,"box":{"x":69,"y":90,"width":837,"height":11}},{"id":"2437a131-b3c7-49df-b6f5-6e6400d00230","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":140,"box":{"x":69,"y":105,"width":818,"height":11}},{"id":"4c2f3d6a-f889-4897-aa80-a0778ffffca7","block_type":"box","text":"BlackRock may pay out of its own assets.","page_number":140,"box":{"x":70,"y":120,"width":294,"height":11}},{"id":"56085ba4-fe3d-4f4b-8117-62a77de320d8","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":140,"box":{"x":101,"y":143,"width":803,"height":11}},{"id":"ebe05f2a-1af2-4db4-a7c4-5bb1bda7506e","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":140,"box":{"x":69,"y":158,"width":792,"height":11}},{"id":"92e30c9f-674e-4aa3-a596-906bf9116f6b","block_type":"box","text":"Customers of the Service Organization involved, or may be calculated on another basis.","page_number":140,"box":{"x":69,"y":173,"width":623,"height":11}},{"id":"034ef056-9811-446a-82a2-578702785d2d","block_type":"box","text":"BlackRock negotiates Additional Payments with each Service Organization on an individual basis. Additional","page_number":140,"box":{"x":102,"y":196,"width":765,"height":11}},{"id":"3fdfd572-fee9-460d-9cf8-e222ca44fb29","block_type":"box","text":"Payments may be different for different Service Organizations, and some Service Organizations may be paid pursuant","page_number":140,"box":{"x":69,"y":211,"width":841,"height":11}},{"id":"27abda75-db5a-4b7d-bed8-c2585ae593cd","block_type":"box","text":"to more than one of the calculations described above. Not all Service Organizations receive Additional Payments.","page_number":140,"box":{"x":68,"y":226,"width":806,"height":11}},{"id":"8fa6efe6-8653-4f7d-8171-8f331ecaedc0","block_type":"box","text":"Sales-based payments primarily create incentives to make new sales of shares of the Fund, and asset-based","page_number":140,"box":{"x":69,"y":241,"width":776,"height":11}},{"id":"e57e005e-5c8b-4587-b331-cbea952e5c31","block_type":"box","text":"payments primarily create incentives to retain previously sold shares of the Fund. The level of payments made to","page_number":140,"box":{"x":70,"y":256,"width":802,"height":11}},{"id":"62762383-2f46-48a9-894e-1dd87401d926","block_type":"box","text":"these Service Organizations in any year will vary and may be limited to specific Funds or share classes. In certain","page_number":140,"box":{"x":68,"y":271,"width":811,"height":12}},{"id":"94e40920-57d9-4d28-94a2-66d2cb1fc527","block_type":"box","text":"cases, these payments may be subject to certain minimum payment levels.","page_number":140,"box":{"x":69,"y":287,"width":538,"height":11}},{"id":"45df4ebc-63c5-4483-9fbf-a54a39d11c5a","block_type":"box","text":"The aggregate amount of Additional Payments made by BlackRock may be substantial and may be significant to","page_number":140,"box":{"x":101,"y":309,"width":795,"height":11}},{"id":"0a3ff3e1-00d1-4d5f-88ac-e3445262348f","block_type":"box","text":"certain Service Organizations. The categories of Additional Payments listed below are not mutually exclusive. The","page_number":140,"box":{"x":69,"y":324,"width":807,"height":12}},{"id":"1c239019-6452-4c36-985d-ef4604a1508d","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":140,"box":{"x":69,"y":339,"width":823,"height":12}},{"id":"3ad98b4d-81a3-4ea3-a879-519bc96d938f","block_type":"box","text":"Additional Payments. Such payments may be different for different Service Organizations and for different types of","page_number":140,"box":{"x":68,"y":355,"width":819,"height":11}},{"id":"4f0c2080-ee6e-4dbd-af7e-a79be0947125","block_type":"box","text":"Funds.","page_number":140,"box":{"x":70,"y":370,"width":44,"height":9}},{"id":"6ab12a15-8f48-4a60-b9f9-9b231beab7e1","block_type":"box","text":"A. Distribution and Marketing Suppor t","page_number":140,"box":{"x":101,"y":392,"width":270,"height":12}},{"id":"5f08f370-121d-4f47-8e1b-d6cf94af6872","block_type":"box","text":"Additional Payments may be made by BlackRock for distribution and marketing support activities. These","page_number":140,"box":{"x":101,"y":415,"width":740,"height":11}},{"id":"018acc7e-7842-4a55-97cd-833460f39cca","block_type":"box","text":"payments may take the form of, among other things, “due diligence” payments for a Service Organization’s","page_number":140,"box":{"x":70,"y":430,"width":764,"height":11}},{"id":"7faa6bcb-186b-4f0f-9864-7f793c948974","block_type":"box","text":"examination of a Fund; payments for providing extra employee training and information relating to a Fund; fees for","page_number":140,"box":{"x":69,"y":445,"width":811,"height":12}},{"id":"90e343f9-d279-433c-afdb-1a907a31f35c","block_type":"box","text":"access (in some cases on a preferential basis) to the Service Organization’s registered representatives,","page_number":140,"box":{"x":69,"y":460,"width":742,"height":12}},{"id":"21d8da75-f690-4cfc-94c6-b175bdfc7fca","block_type":"box","text":"salespersons or other personnel, including at sales meetings and conferences; “shelf space” payments for placing","page_number":140,"box":{"x":69,"y":475,"width":820,"height":12}},{"id":"8dd692b3-d80e-42dd-aa48-1634d73991a2","block_type":"box","text":"the Fund on the Service Organization’s platform(s); “listing” fees for the placing of the Fund on a dealer’s list (which","page_number":140,"box":{"x":68,"y":491,"width":829,"height":11}},{"id":"b975a342-64f2-49ba-bd9e-fc50155c9c50","block_type":"box","text":"may be a preferred or recommended list) of mutual funds available for purchase by its Customers or in certain sales","page_number":140,"box":{"x":69,"y":506,"width":830,"height":11}},{"id":"3d603021-2af2-4165-acd0-64673240953b","block_type":"box","text":"programs from time to time; fees for providing assistance in promoting the sale of the Fund’s shares (which may","page_number":140,"box":{"x":70,"y":521,"width":803,"height":11}},{"id":"5c103991-0227-48c0-9143-99af3adf72bf","block_type":"box","text":"include promotions in communications with the Service Organization’s Customers, registered representatives,","page_number":140,"box":{"x":70,"y":536,"width":783,"height":11}},{"id":"6fd8b1c9-da86-43a0-84a0-9f5f6a825814","block_type":"box","text":"salespersons and/or other personnel); payments for the sale of shares and/or the maintenance of share balances;","page_number":140,"box":{"x":69,"y":551,"width":823,"height":11}},{"id":"00df73e7-1da7-48fa-9dd6-5f0cd62ec4fe","block_type":"box","text":"transaction fees (also referred to as “ticket charges”); and payments for infrastructure support. These payments","page_number":140,"box":{"x":68,"y":566,"width":805,"height":11}},{"id":"1a588e64-b4e0-4a3c-befd-72ec06b31c08","block_type":"box","text":"normally will not exceed the sum of (a) 0.25% of such year’s Fund sales by that Service Organization, and (b) 0.21%","page_number":140,"box":{"x":69,"y":581,"width":828,"height":12}},{"id":"8d24139a-e7e3-4a40-b323-ad0ea159e353","block_type":"box","text":"of the assets attributable to that Service Organization invested in a Fund.","page_number":140,"box":{"x":69,"y":596,"width":523,"height":12}},{"id":"13fe286c-2dba-4109-b31f-9c567f2d4b3a","block_type":"box","text":"B. Shareholder Services","page_number":140,"box":{"x":102,"y":619,"width":172,"height":9}},{"id":"7537af48-c6e2-423b-9d00-d02d9d39d27c","block_type":"box","text":"Many Fund shares are owned or held by Service Organizations for the benefit of their Customers. In these","page_number":140,"box":{"x":102,"y":642,"width":754,"height":11}},{"id":"b8b86681-95dc-42ac-8070-b7469a97e948","block_type":"box","text":"situations, a Fund may not maintain accounts in the name of the Customers and Service Organizations may perform","page_number":140,"box":{"x":69,"y":657,"width":830,"height":11}},{"id":"948839d5-624c-4c91-98aa-120b8a2a307f","block_type":"box","text":"some of the functions for these Customers’ accounts that the Transfer Agent would have performed if the accounts","page_number":140,"box":{"x":69,"y":672,"width":823,"height":11}},{"id":"77266afe-ac18-46b4-97a7-a242d3f188ad","block_type":"box","text":"had been in the Customers’ names on the Fund’s books. Such services include sub-accounting services, shareholder","page_number":140,"box":{"x":69,"y":687,"width":839,"height":11}},{"id":"c26f6938-8f12-4930-b90b-341f99ac0483","block_type":"box","text":"servicing and transaction processing services and are sometimes referred to as “recordkeeping,” “sub-transfer","page_number":140,"box":{"x":69,"y":702,"width":796,"height":12}},{"id":"8559514f-c90e-4fad-ac36-6843e1677272","block_type":"box","text":"agency,” “sub-accounting,” “networking” and/or “administrative” services. Additional Payments may exceed amounts","page_number":140,"box":{"x":69,"y":718,"width":837,"height":11}},{"id":"d2b03cf9-5b75-4a70-a2b2-65a2633a7f34","block_type":"box","text":"that would be earned on these assets by the Transfer Agent for the performance of these or similar services. These","page_number":140,"box":{"x":68,"y":732,"width":828,"height":12}},{"id":"e2b43dda-4ea9-46f2-ad57-e04034d5917b","block_type":"box","text":"Additional Payments made by BlackRock are in addition to any transfer agent, shareholder servicing and transaction","page_number":140,"box":{"x":68,"y":748,"width":827,"height":11}},{"id":"d3abc82f-6afb-4905-8759-825bdbc99c8c","block_type":"box","text":"processing fees paid by a Fund, as applicable.","page_number":140,"box":{"x":70,"y":763,"width":328,"height":11}},{"id":"dd8fa52f-2201-48fb-b8ca-1f23936bf9cb","block_type":"box","text":"C. Data Provision and Technology Suppor t","page_number":140,"box":{"x":102,"y":786,"width":299,"height":11}},{"id":"9ab48efe-45d2-4b47-8d3a-5bf901f02979","block_type":"box","text":"BlackRock may make Additional Payments to Service Organizations for the provision of certain analytical or other","page_number":140,"box":{"x":102,"y":808,"width":805,"height":11}},{"id":"f22e0936-f15e-4f53-af38-c4ee1aeb964d","block_type":"box","text":"data services relating to the Funds, such as statistical information regarding sales of the Funds, or technology","page_number":140,"box":{"x":69,"y":823,"width":788,"height":12}},{"id":"55ff212a-e3c1-44b9-b385-ce158859ae4b","block_type":"box","text":"support. Such Additional Payments are generally made as a fixed dollar amount, and not based on assets or sales.","page_number":140,"box":{"x":69,"y":838,"width":821,"height":12}},{"id":"c80fba4e-ef4d-4d4f-b96e-30aa6cb69e99","block_type":"box","text":"D. Service Organizations Receiving Additional Payments","page_number":140,"box":{"x":102,"y":861,"width":397,"height":11}},{"id":"938cb22d-be96-4a3b-85e5-2d4bb8dbdfa2","block_type":"box","text":"As of the date of this SAI, the Service Organizations listed below, and, in some cases, certain of the Service","page_number":140,"box":{"x":101,"y":884,"width":774,"height":11}},{"id":"2fc63ef5-a7d8-4348-9a2f-deb125471dd4","block_type":"box","text":"Organization’s affiliates, may be receiving one or more types of Additional Payments. This list may change over time,","page_number":140,"box":{"x":69,"y":899,"width":831,"height":11}},{"id":"8a78a9f3-13e8-4e9b-8a98-86750a387f9c","block_type":"box","text":"II-110","page_number":140,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"b0ef7b7d-8af0-497f-8c11-55a81aa64527","block_type":"box","text":"NM1026U-5979889-140/232","page_number":140,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0f5318ef-8c9c-4a87-9a47-6791e4711d19","block_type":"box","text":"and BlackRock may pay Service Organizations or their affiliates additional types of Additional Payments in the future.","page_number":141,"box":{"x":69,"y":45,"width":832,"height":11}},{"id":"6d811f33-5a81-4509-aa52-9ca3b0d10d54","block_type":"box","text":"Please contact your Service Organization to determine whether it or its affiliate currently may be receiving such","page_number":141,"box":{"x":69,"y":60,"width":791,"height":11}},{"id":"62cb921d-2c80-4d9b-ac2b-94cc3128b8b7","block_type":"box","text":"payments and to obtain further information regarding any such payments.","page_number":141,"box":{"x":70,"y":75,"width":523,"height":11}},{"id":"006c7d08-4652-4281-8e9f-a5f111a63c77","block_type":"box","text":"&Partners","page_number":141,"box":{"x":69,"y":106,"width":71,"height":9}},{"id":"0e86065d-0b15-43b4-9172-9d97541d545f","block_type":"box","text":"AccuTech Systems Corporation","page_number":141,"box":{"x":68,"y":127,"width":219,"height":11}},{"id":"4adea99d-9505-4bc0-b1d8-e2b88e237217","block_type":"box","text":"ADP Broker-Dealer, Inc.","page_number":141,"box":{"x":68,"y":147,"width":164,"height":10}},{"id":"aed89725-29e0-4461-bf36-b9d492d493b4","block_type":"box","text":"Advisor Credit Exchange, LLC","page_number":141,"box":{"x":68,"y":167,"width":207,"height":11}},{"id":"ffbe6864-0399-467d-be98-3753853f19cd","block_type":"box","text":"Advisor Group, 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The value of shares of each Fund at the time of redemption may be more or less than your cost at the","page_number":145,"box":{"x":69,"y":98,"width":818,"height":11}},{"id":"3a361350-9cb6-4323-bbe0-655ddd3633fc","block_type":"box","text":"time of purchase, depending in part on the market value of the securities held by the Fund at such time. Except for","page_number":145,"box":{"x":68,"y":113,"width":821,"height":11}},{"id":"053532cf-537f-4060-8d8e-566adcce7d0d","block_type":"box","text":"any CDSC that may be applicable, there will be no redemption charge if your redemption request is sent directly to","page_number":145,"box":{"x":69,"y":128,"width":815,"height":11}},{"id":"fbcaa2f2-205e-4858-b8ae-7c6f4c5c7842","block_type":"box","text":"the Transfer Agent. If you are liquidating your holdings you will receive all dividends reinvested through the date of","page_number":145,"box":{"x":68,"y":143,"width":812,"height":11}},{"id":"df6de695-0231-49d4-9237-b29e1c620dc9","block_type":"box","text":"redemption.","page_number":145,"box":{"x":69,"y":158,"width":83,"height":11}},{"id":"7c963685-e6d9-46db-8cee-d931c6629803","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":145,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"58fbc6b3-9eb0-43a7-b2ec-055b320eda97","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":145,"box":{"x":69,"y":196,"width":835,"height":11}},{"id":"47bd2116-aa3e-4c4f-8120-d52c6bfe42f2","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":145,"box":{"x":68,"y":211,"width":811,"height":11}},{"id":"7f11e38c-87cc-41f6-81a2-c17b26e86b3a","block_type":"box","text":"emergency exists, as defined by the Commission, as a result of which disposal of portfolio securities or","page_number":145,"box":{"x":69,"y":226,"width":741,"height":11}},{"id":"73c544f1-976c-4140-ad8d-f7423a846ba5","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":145,"box":{"x":69,"y":241,"width":813,"height":11}},{"id":"42f62185-9569-43e0-9cf7-5a0c1109abc3","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":145,"box":{"x":69,"y":256,"width":787,"height":11}},{"id":"f5a9dd06-b2a2-4e84-a411-cba74c98d8e4","block_type":"box","text":"recordation of the transfer of its shares upon the occurrence of any of the foregoing conditions.)","page_number":145,"box":{"x":69,"y":271,"width":685,"height":12}},{"id":"93e6d02a-d5bd-4c8e-81e0-ad8f9f674e46","block_type":"box","text":"Each Fund, with other investment companies advised by the Manager, has entered into a joint committed line of","page_number":145,"box":{"x":102,"y":294,"width":798,"height":11}},{"id":"836982f2-067d-4ac4-8beb-5500750f8fba","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":145,"box":{"x":69,"y":309,"width":820,"height":11}},{"id":"2e283696-d758-4835-aaf2-dece89aac3ee","block_type":"box","text":"meet redemption requests from shareholders in extraordinary or emergency circumstances.","page_number":145,"box":{"x":69,"y":324,"width":653,"height":12}},{"id":"5c99a7a7-d7d5-43ee-969b-27100579aade","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":145,"box":{"x":102,"y":347,"width":803,"height":11}},{"id":"f74e808f-9a51-4252-84fc-3bbc2bb354ea","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":145,"box":{"x":69,"y":362,"width":827,"height":11}},{"id":"1d072ef0-b64f-4c6b-86c0-d5c8711f32d6","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":145,"box":{"x":68,"y":377,"width":824,"height":12}},{"id":"a2965932-a46b-491d-aba7-ab2aba8b9010","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":145,"box":{"x":70,"y":392,"width":825,"height":12}},{"id":"ea2f7035-8acf-4f71-a4ae-eb8271ccdb2c","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":145,"box":{"x":69,"y":407,"width":825,"height":12}},{"id":"7689c2a7-7de3-470d-91fa-c7060217f5cd","block_type":"box","text":"so redeemed shall have no further right with respect thereto other than to receive payment of the redemption price.","page_number":145,"box":{"x":69,"y":423,"width":823,"height":11}},{"id":"7197f747-8f63-4f6b-8eaf-85a2c81c87e5","block_type":"box","text":"Redemption","page_number":145,"box":{"x":69,"y":453,"width":86,"height":11}},{"id":"ec6eb241-dbfc-45f1-8e51-b8bafae3f466","block_type":"box","text":"Investor A, Investor A1, Investor C, Institutional and Class R Shares","page_number":145,"box":{"x":70,"y":476,"width":481,"height":10}},{"id":"43715522-a1b4-43cd-972f-23bdb29ecce4","block_type":"box","text":"Redeem by Telephone:","page_number":145,"box":{"x":102,"y":498,"width":162,"height":11}},{"id":"ee2110b7-1c59-475c-a14d-06916a919184","block_type":"box","text":"You may sell Investor Shares, excluding Investor P Shares, held at BlackRock by","page_number":145,"box":{"x":270,"y":498,"width":571,"height":11}},{"id":"e493b3ac-f1dd-43bd-b4d7-b39f6d92f5da","block_type":"box","text":"telephone request if certain conditions are met and if the amount being sold is less than (i) $100,000 for payments","page_number":145,"box":{"x":68,"y":513,"width":829,"height":12}},{"id":"f2702407-04d8-4998-a517-33138adf8774","block_type":"box","text":"by check or (ii) $250,000 for payments through the Automated Clearing House Network (“ACH”) or wire transfer.","page_number":145,"box":{"x":69,"y":528,"width":798,"height":12}},{"id":"2f2bb219-f1a6-44a9-9207-c463f3fc25ee","block_type":"box","text":"Certain redemption requests, such as those in excess of these amounts, and those where (i) the Fund does not have","page_number":145,"box":{"x":69,"y":543,"width":838,"height":12}},{"id":"f6ee3ee1-f86e-4711-9a88-ae3b8fb78768","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":145,"box":{"x":68,"y":559,"width":831,"height":11}},{"id":"71ba6b4a-3d7a-4927-a599-a365386e9ed5","block_type":"box","text":"be in writing with a medallion signature guarantee provided by any “eligible guarantor institution” as defined in Rule","page_number":145,"box":{"x":69,"y":574,"width":822,"height":11}},{"id":"ac64d4c9-879a-4636-ba94-37682256a77d","block_type":"box","text":"17Ad-15 under the Securities Exchange Act of 1934 (the “Exchange Act”), whose existence and validity may be","page_number":145,"box":{"x":70,"y":589,"width":791,"height":11}},{"id":"04e85838-9233-4f78-9187-74772ca07b04","block_type":"box","text":"verified by the Transfer Agent through the use of industry publications. For Institutional Shares, certain redemption","page_number":145,"box":{"x":68,"y":604,"width":818,"height":11}},{"id":"07c5c6c4-65de-44fc-ae7e-f479ec320ce3","block_type":"box","text":"requests may require written instructions with a medallion signature guarantee. Call (800) 441-7762 for details. You","page_number":145,"box":{"x":69,"y":619,"width":829,"height":11}},{"id":"3a7c5f76-e421-4bf0-b776-9287fffc050a","block_type":"box","text":"can obtain a medallion signature guarantee stamp from a bank, securities dealer, securities broker, credit union,","page_number":145,"box":{"x":69,"y":634,"width":803,"height":12}},{"id":"229f1533-ce29-482c-bab3-7fbfceaa2762","block_type":"box","text":"savings and loan association, national securities exchange or registered securities association. The three recognized","page_number":145,"box":{"x":69,"y":650,"width":834,"height":11}},{"id":"56ed9fb4-1d56-4a3b-adb2-fbc574a7058b","block_type":"box","text":"medallion programs are Securities Transfer Agent Medallion Program, Stock Exchanges Medallion Program and New","page_number":145,"box":{"x":69,"y":664,"width":825,"height":12}},{"id":"61e87977-280e-4c33-ad5c-741557e04e25","block_type":"box","text":"York Stock Exchange, Inc. Medallion Signature Program. Signature guarantees which are not a part of these programs","page_number":145,"box":{"x":68,"y":680,"width":840,"height":11}},{"id":"b471c487-ea24-46ce-963e-6cf628e90540","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":145,"box":{"x":68,"y":695,"width":835,"height":11}},{"id":"a3d80d69-8f59-4299-87e6-cacba2281757","block_type":"box","text":"required signature guarantee is all that is required for a redemption. In some cases, however, other documents may","page_number":145,"box":{"x":69,"y":710,"width":828,"height":11}},{"id":"e82537ad-782d-47cb-a2b8-c76861aae8b0","block_type":"box","text":"be necessary. Additional documentary evidence of authority is required by the Transfer Agent in the event redemption","page_number":145,"box":{"x":69,"y":725,"width":835,"height":11}},{"id":"2d62f96d-ff1b-48b2-9140-b8d111042260","block_type":"box","text":"is requested by a corporation, partnership, trust, fiduciary, executor or administrator.","page_number":145,"box":{"x":70,"y":740,"width":603,"height":11}},{"id":"14dcf0fa-ca6c-48e3-aff8-c736ceee3311","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":145,"box":{"x":102,"y":763,"width":774,"height":11}},{"id":"64d35f12-16c7-49f0-af28-039188686740","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":145,"box":{"x":69,"y":778,"width":795,"height":11}},{"id":"ef5e37f3-fed6-4de0-b84a-62ff5fa109a5","block_type":"box","text":"Distributor will employ reasonable procedures to confirm that instructions communicated by telephone are genuine.","page_number":145,"box":{"x":70,"y":793,"width":821,"height":11}},{"id":"6f19ca2d-714e-49b7-8a5d-2dac1560e831","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":145,"box":{"x":68,"y":808,"width":823,"height":11}},{"id":"e4b91dd8-8afd-42b2-8d4d-e53394faed49","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":145,"box":{"x":69,"y":823,"width":823,"height":11}},{"id":"6cef52ff-29aa-44c9-8370-c0953ceda5c3","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":145,"box":{"x":69,"y":838,"width":809,"height":11}},{"id":"0b2926e8-036b-4f1e-baee-e9a03adb1c81","block_type":"box","text":"divorced, (vi) the address on the account has changed within the last 30 days or share certificates have been issued","page_number":145,"box":{"x":69,"y":853,"width":833,"height":12}},{"id":"41f9f094-3e45-4161-81fb-4cbe38e419a0","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":145,"box":{"x":69,"y":869,"width":821,"height":11}},{"id":"b81c7db7-9e27-4afd-b09d-dfba682328d6","block_type":"box","text":"address registered on the account and the social security number registered on the account. The Fund and its","page_number":145,"box":{"x":69,"y":884,"width":785,"height":11}},{"id":"86f217d5-c8dc-4e89-bb11-434285c63744","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":145,"box":{"x":69,"y":899,"width":820,"height":11}},{"id":"b6bd764b-b963-440c-9184-b1a2b4c7ce4a","block_type":"box","text":"II-115","page_number":145,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d06defa2-8433-44f6-81a8-1cb6b8bf021d","block_type":"box","text":"NM1026U-5979889-145/232","page_number":145,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d78b0fac-5815-42ea-a308-9bdf471eafe1","block_type":"box","text":"are reasonably believed to be genuine in accordance with such procedures. Before telephone requests will be","page_number":146,"box":{"x":69,"y":45,"width":782,"height":11}},{"id":"e3a6191f-d963-4e7d-b32f-956149d13985","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":146,"box":{"x":69,"y":60,"width":838,"height":11}},{"id":"6d663c41-da67-4d40-bb25-06db2b8b4576","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":146,"box":{"x":68,"y":75,"width":837,"height":11}},{"id":"15ded263-5f69-4018-9c39-4ae3b4b74e53","block_type":"box","text":"change, telephone redemptions may be difficult to complete. Please find below alternative redemption methods.","page_number":146,"box":{"x":69,"y":90,"width":800,"height":11}},{"id":"245ec707-cc45-46d8-9249-7f777ed28c91","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":146,"box":{"x":102,"y":113,"width":776,"height":11}},{"id":"b9b6f9a7-01a9-406f-b0f8-6b87be702475","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":146,"box":{"x":70,"y":128,"width":823,"height":11}},{"id":"9a4bc3a2-3ac4-41d5-9408-feb77e1410cf","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":146,"box":{"x":69,"y":143,"width":820,"height":11}},{"id":"23d8eed5-faea-4f52-b818-ad41182ff570","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":146,"box":{"x":68,"y":158,"width":826,"height":11}},{"id":"6d664b98-efe2-4498-84aa-6a582738a92b","block_type":"box","text":"the redemption order will be accepted and processed the next succeeding business day when the Federal Reserve","page_number":146,"box":{"x":68,"y":173,"width":817,"height":11}},{"id":"a2c0c49f-6298-4283-8cac-4fcecddfad6c","block_type":"box","text":"Bank of Philadelphia is open, provided that the Fund’s custodian is also open for business.","page_number":146,"box":{"x":70,"y":188,"width":648,"height":11}},{"id":"7c78ee28-fe6c-4aeb-acbc-63f2d2f639db","block_type":"box","text":"Redeem by VRU:","page_number":146,"box":{"x":102,"y":211,"width":120,"height":11}},{"id":"d18a9156-9ee6-4da2-9db6-50c17ce1e1ec","block_type":"box","text":"Investor class shares, excluding Investor P Shares, may also be redeemed by use of a Fund’s","page_number":146,"box":{"x":229,"y":211,"width":667,"height":11}},{"id":"0db08e6b-8096-4994-9109-03b36c9ed581","block_type":"box","text":"automated voice response unit service (“VRU”). Payment for Investor class shares redeemed by VRU may be made","page_number":146,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"7f74feba-86d6-4354-87eb-0f19852d13f7","block_type":"box","text":"for non-retirement accounts in amounts up to $25,000, either through check, ACH or wire.","page_number":146,"box":{"x":68,"y":241,"width":644,"height":11}},{"id":"226ad422-3887-4178-82c1-cb8f5db4e333","block_type":"box","text":"Redeem by Internet:","page_number":146,"box":{"x":102,"y":264,"width":147,"height":11}},{"id":"ea943cfa-8ae5-4c0d-a222-6fb81ef0f337","block_type":"box","text":"Certain Investor and Institutional class shares may also be redeemed by logging onto the","page_number":146,"box":{"x":255,"y":264,"width":637,"height":11}},{"id":"1fc65b60-0ec5-4823-82d3-ad8891a3d926","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":146,"box":{"x":70,"y":279,"width":836,"height":11}},{"id":"a7705f52-cb71-4435-bd64-9fbb55f273b9","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":146,"box":{"x":68,"y":294,"width":823,"height":11}},{"id":"ff2d1f70-1e19-41ec-ade4-179d290fd234","block_type":"box","text":"to $100,000 per account per day, either through check, ACH or wire. Different maximums may apply to certain","page_number":146,"box":{"x":68,"y":309,"width":789,"height":11}},{"id":"e78f8c3c-7c7d-40f5-9cdb-23e2df1c4ad2","block_type":"box","text":"institutional investors.","page_number":146,"box":{"x":70,"y":325,"width":155,"height":8}},{"id":"9869b19b-4814-4730-9536-22abc5b89aa3","block_type":"box","text":"Redeem in Writing:","page_number":146,"box":{"x":102,"y":347,"width":137,"height":11}},{"id":"e2f8fa67-be2d-4b08-8954-07eeb44fc454","block_type":"box","text":"If you hold shares with the Transfer Agent you may redeem such shares without charge by","page_number":146,"box":{"x":247,"y":347,"width":639,"height":11}},{"id":"c3bc7cff-a5a8-4cf8-9665-71c2bf78720b","block_type":"box","text":"writing to BlackRock, P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Redemption requests delivered other","page_number":146,"box":{"x":68,"y":362,"width":831,"height":11}},{"id":"2181acb5-9089-4a46-8896-74b48bc0172e","block_type":"box","text":"than by mail should be sent to BlackRock, Attention: 534429, 1350 Penn Avenue Suite 102, Pittsburgh,","page_number":146,"box":{"x":68,"y":377,"width":745,"height":12}},{"id":"087a4749-33ab-4c04-8e29-610b4ebedbae","block_type":"box","text":"Pennsylvania 15222. If you hold share certificates issued by your Fund, the letter must be accompanied by","page_number":146,"box":{"x":69,"y":392,"width":764,"height":12}},{"id":"e4cf4fa1-1570-49c6-b8b3-57c7f434533d","block_type":"box","text":"certificates for the shares. All shareholders on the account must sign the letter. A medallion signature guarantee will","page_number":146,"box":{"x":69,"y":407,"width":831,"height":12}},{"id":"871cbf5f-38be-4501-9f67-1c5517e87ece","block_type":"box","text":"generally be required but may be waived in certain limited circumstances. You can obtain a medallion signature","page_number":146,"box":{"x":68,"y":423,"width":794,"height":11}},{"id":"9312f583-ff8d-4922-afa6-d8e0e28a3f74","block_type":"box","text":"guarantee stamp from a bank, securities dealer, securities broker, credit union, savings and loan association,","page_number":146,"box":{"x":68,"y":438,"width":782,"height":11}},{"id":"81e51a79-d2e8-45ad-9704-281cd6ce01c3","block_type":"box","text":"national securities exchange or registered securities association. A notary public seal will not be acceptable. If you","page_number":146,"box":{"x":69,"y":453,"width":817,"height":11}},{"id":"c071f784-3904-4000-8c99-e9c2129ed0e6","block_type":"box","text":"hold stock certificates, return the certificates with the letter. Proceeds from redemptions may be sent via check, ACH","page_number":146,"box":{"x":69,"y":468,"width":836,"height":11}},{"id":"3a81d641-b1d5-4004-bc46-74287baa92f6","block_type":"box","text":"or wire to the bank account of record.","page_number":146,"box":{"x":69,"y":483,"width":266,"height":9}},{"id":"c651322f-6694-4a35-87eb-fee40efae8b9","block_type":"box","text":"Redemptions of Investor P Shares, Service Shares, Class G Shares, Class K Shares and BlackRock Shares may","page_number":146,"box":{"x":102,"y":506,"width":802,"height":11}},{"id":"4c10c465-c1ca-4447-ab3c-665329c64b16","block_type":"box","text":"be made in the manner and amounts described in the Prospectuses.","page_number":146,"box":{"x":69,"y":521,"width":489,"height":11}},{"id":"18452e3f-801e-4c35-a767-04b70949d278","block_type":"box","text":"The Funds or the Transfer Agent may temporarily suspend telephone transactions at any time.","page_number":146,"box":{"x":101,"y":543,"width":668,"height":12}},{"id":"f2b444f7-cf2c-4320-8fc9-309769532512","block_type":"box","text":"If you redeem shares directly with the Transfer Agent, payments will generally be mailed within one business day","page_number":146,"box":{"x":102,"y":566,"width":800,"height":11}},{"id":"74530cb3-c521-44f0-86e2-bdd52b931f2a","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":146,"box":{"x":69,"y":581,"width":838,"height":12}},{"id":"f63badd0-fdc8-466b-b05f-48df98dae16c","block_type":"box","text":"(that is, cash, Federal funds or certified check drawn on a U.S. bank) has been collected for the purchase of Fund","page_number":146,"box":{"x":69,"y":596,"width":811,"height":11}},{"id":"f9ca6299-e786-4244-bb92-bd2d98848ec6","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":146,"box":{"x":69,"y":612,"width":789,"height":11}},{"id":"c17c7edd-35ce-4d3e-8b75-92f3b2e94557","block_type":"box","text":"contains a fractional share balance following a redemption, the fractional share balance will be automatically","page_number":146,"box":{"x":69,"y":627,"width":775,"height":11}},{"id":"4e59fb2c-243c-458f-9cbd-bce40cbbc66d","block_type":"box","text":"redeemed by the Fund.","page_number":146,"box":{"x":69,"y":642,"width":162,"height":11}},{"id":"bef4433b-fe53-4122-b8ce-e312075a2c2d","block_type":"box","text":"Note on Low Balance Accounts.","page_number":146,"box":{"x":102,"y":665,"width":223,"height":8}},{"id":"66c73236-6ff0-4ff9-98c6-aae38ecfd927","block_type":"box","text":"Because of the high cost of maintaining smaller shareholder accounts,","page_number":146,"box":{"x":332,"y":664,"width":503,"height":12}},{"id":"31f9fa09-041c-462a-a1bb-d5aca9a74d19","block_type":"box","text":"BlackRock has set a minimum balance of $500 in each Fund position you hold within your account (“Fund","page_number":146,"box":{"x":70,"y":679,"width":752,"height":12}},{"id":"4e3ef2da-d976-4533-a45e-71db97775e5a","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":146,"box":{"x":70,"y":694,"width":829,"height":12}},{"id":"22e7f1c6-1a14-4b66-ba5d-a413e30893bd","block_type":"box","text":"for any reason, including market fluctuation.","page_number":146,"box":{"x":68,"y":710,"width":313,"height":11}},{"id":"91133e1f-6057-4ba7-8486-bf07f0e28d42","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":146,"box":{"x":101,"y":732,"width":775,"height":12}},{"id":"ab537190-f9ce-4986-85cc-82029ecb3f84","block_type":"box","text":"involuntary redemption. This notification will provide you with a 90 calendar day period to make an additional","page_number":146,"box":{"x":70,"y":748,"width":773,"height":11}},{"id":"f518e2ec-ecfd-42d6-81bc-17a6c7afef3c","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":146,"box":{"x":70,"y":762,"width":776,"height":12}},{"id":"97720e85-a1cd-40a6-b024-1f6144d1707c","block_type":"box","text":"redemption. This involuntary redemption will not charge any deferred sales charge, and may not apply to accounts of","page_number":146,"box":{"x":69,"y":778,"width":834,"height":11}},{"id":"776f49a1-7f6d-4771-bfd7-1adb3969b998","block_type":"box","text":"certain employer-sponsored retirement plans (not including IRAs), qualified state tuition plan (529 Plan) accounts,","page_number":146,"box":{"x":69,"y":793,"width":811,"height":11}},{"id":"b460f41b-cb75-4b9b-9d9b-4fa81ff2a2b3","block_type":"box","text":"and select fee-based programs at your financial intermediary.","page_number":146,"box":{"x":69,"y":808,"width":435,"height":11}},{"id":"def7e391-7bc7-42a8-a44a-09d8662cc8cc","block_type":"box","text":"Redemptions in Kind:","page_number":146,"box":{"x":102,"y":831,"width":153,"height":11}},{"id":"4aef4dae-6a98-41c2-bafd-054a63ed023e","block_type":"box","text":"Each Fund reserves the right to honor any request for redemption by making payment in","page_number":146,"box":{"x":263,"y":831,"width":624,"height":11}},{"id":"417a6623-567f-49e9-a0ae-5bbd949eb3a7","block_type":"box","text":"whole or in part by delivering securities valued in the same way as they would be valued for purposes of computing a","page_number":146,"box":{"x":68,"y":846,"width":833,"height":11}},{"id":"14937fb9-9aa9-48d9-a05c-9d3bf3f249a9","block_type":"box","text":"Fund’s NAV, except that each Fund is obligated to redeem shares solely in cash up to the lesser of $250,000 or 1%","page_number":146,"box":{"x":70,"y":860,"width":825,"height":12}},{"id":"ac0cb21f-23af-4fad-b957-ea8b73892095","block_type":"box","text":"of the Fund’s NAV during any 90-day period for any one shareholder. Redemptions in excess of those amounts will","page_number":146,"box":{"x":69,"y":876,"width":811,"height":11}},{"id":"49f6829d-b041-40dc-9835-72532fcb45ab","block_type":"box","text":"normally be paid in cash but may be paid wholly or partly by a distribution in kind of securities.","page_number":146,"box":{"x":69,"y":891,"width":672,"height":11}},{"id":"dc4c8c65-a933-43f7-adc1-d1535f354d5a","block_type":"box","text":"II-116","page_number":146,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"af8b479d-ad3e-4582-bd43-fea98933e794","block_type":"box","text":"NM1026U-5979889-146/232","page_number":146,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f0805b15-ade9-4624-9be7-f892fd6fb6b7","block_type":"box","text":"The specific security or securities to be distributed will be determined by the Manager and could include a pro","page_number":147,"box":{"x":101,"y":45,"width":787,"height":11}},{"id":"17c56c2d-ffd7-426a-bf70-89a4d1a28a71","block_type":"box","text":"rata representation of the Fund’s portfolio or a non-pro-rata representation of the Fund’s portfolio depending upon","page_number":147,"box":{"x":69,"y":60,"width":812,"height":11}},{"id":"a96fca94-821c-40b0-b5ca-176ebee0581a","block_type":"box","text":"various circumstances and subject to the Funds’ policies and procedures and any applicable laws or regulations. In","page_number":147,"box":{"x":68,"y":75,"width":822,"height":11}},{"id":"9f043195-5889-4729-8ce1-5e5d6896e23b","block_type":"box","text":"effecting such redemption in kind, the Manager may select securities to distribute to the redeeming shareholder by","page_number":147,"box":{"x":69,"y":90,"width":822,"height":11}},{"id":"51d459da-971e-48fc-9d88-9a009695f2b8","block_type":"box","text":"considering certain factors, including, without limitation, the portfolio management team’s model or optimal portfolio,","page_number":147,"box":{"x":69,"y":105,"width":838,"height":11}},{"id":"c62f653e-5f0e-4a7d-ac26-368ae511fb5a","block_type":"box","text":"risk management considerations, compliance considerations, the active positioning of a Fund post-redemption, the","page_number":147,"box":{"x":69,"y":120,"width":818,"height":12}},{"id":"56bee69e-40bc-4400-87f9-5359500cac17","block_type":"box","text":"liquidity of the securities, and the tax basis of the securities. There is no assurance that BlackRock will select to","page_number":147,"box":{"x":70,"y":135,"width":801,"height":11}},{"id":"a8080dd6-dbb4-43d9-a51d-590937c125d9","block_type":"box","text":"retain those securities that will perform the best. An Index Fund may deviate from pro rata redemptions but will seek","page_number":147,"box":{"x":69,"y":150,"width":832,"height":12}},{"id":"50b3af8f-4cc3-499c-8b51-4bd5fef86f0e","block_type":"box","text":"for the securities and other assets to be distributed to be deemed to be a fair representation of portfolio holdings","page_number":147,"box":{"x":68,"y":166,"width":812,"height":11}},{"id":"e1c0bbfb-31d4-4d7a-a506-66e26dbbb4a9","block_type":"box","text":"and the interests of the remaining shareholders in the Index Fund to not be diluted.","page_number":147,"box":{"x":69,"y":181,"width":594,"height":11}},{"id":"3202fc59-1c82-4f05-a190-61d82951481a","block_type":"box","text":"The Funds may effect redemptions in kind in an effort to, among other considerations: (a) manage the portfolio","page_number":147,"box":{"x":101,"y":203,"width":795,"height":12}},{"id":"572b1b12-02e5-4e8d-9958-52e8ccf51bfb","block_type":"box","text":"efficiently or for any other portfolio management purpose, and (b) externalize certain transaction costs that would","page_number":147,"box":{"x":69,"y":218,"width":810,"height":12}},{"id":"28f95631-88b3-4415-948d-4ef22e287ff4","block_type":"box","text":"otherwise be borne by a Fund in connection with redemption activity or portfolio turnover. Redemptions in kind may","page_number":147,"box":{"x":69,"y":234,"width":820,"height":11}},{"id":"b1666d4a-4602-4ccd-b94a-a88031d396c6","block_type":"box","text":"reduce the need for the Fund to maintain short-term cash reserves, reduce Fund transaction costs, reduce the need","page_number":147,"box":{"x":69,"y":249,"width":828,"height":10}},{"id":"cd456af4-99e9-44aa-86d2-81dec98f63e8","block_type":"box","text":"for the Fund to sell its investments at inopportune times, and lower Fund capital gain recognition, all of which may be","page_number":147,"box":{"x":68,"y":264,"width":838,"height":11}},{"id":"43df8289-82ef-437a-aa6a-de5b627004c9","block_type":"box","text":"considerations when determining whether to effect a redemption in kind. However, there can be no assurance that","page_number":147,"box":{"x":69,"y":279,"width":817,"height":11}},{"id":"2bc0c22b-64e7-4388-8329-2173d37a8f92","block_type":"box","text":"redemptions in kind can or will be effected when they would be beneficial to a Fund, and it may be impractical or","page_number":147,"box":{"x":69,"y":294,"width":802,"height":11}},{"id":"0145dfa4-b3b7-41c2-8a0a-1bc0609224c5","block_type":"box","text":"impossible to effect redemptions in kind with many or substantially all of the Fund’s shareholders because of, among","page_number":147,"box":{"x":70,"y":309,"width":837,"height":11}},{"id":"5ccffa90-b125-459e-8deb-1271a446d2c0","block_type":"box","text":"other things, how they hold their Fund shares or the small value of the redemptions.","page_number":147,"box":{"x":69,"y":324,"width":598,"height":12}},{"id":"5e13f210-6ec4-4215-a340-0eaa75271b9f","block_type":"box","text":"In some circumstances, in order to meet Fund liquidity needs, for optimization of the Fund’s portfolio, or a","page_number":147,"box":{"x":102,"y":347,"width":756,"height":11}},{"id":"2bb579f5-47bf-45a4-9a02-5b5738b5544c","block_type":"box","text":"combination thereof, a Fund, in its discretion, may accept large purchase orders from one or more financial","page_number":147,"box":{"x":69,"y":362,"width":764,"height":11}},{"id":"eeb7ba9b-50ad-4177-b2a5-143c30cfc43d","block_type":"box","text":"institutions that are willing, upon redemption of their investment in the Fund, to receive their redemption proceeds in","page_number":147,"box":{"x":70,"y":377,"width":830,"height":12}},{"id":"7cd2f903-ac7e-4ad6-bb64-2540c66b26cf","block_type":"box","text":"kind rather than in cash. A Fund’s ability to pay these redemption proceeds in kind relieves the Fund of the need of","page_number":147,"box":{"x":69,"y":392,"width":821,"height":12}},{"id":"341e05d6-b0b9-4f11-8d83-132cece9f149","block_type":"box","text":"the Fund to sell the securities that are distributed in kind and incur brokerage and other transaction costs associated","page_number":147,"box":{"x":68,"y":408,"width":837,"height":11}},{"id":"5705c57c-b917-4fae-811b-9952d2cfbf5a","block_type":"box","text":"with such sale, and may have the effect of reducing the amount of taxable gains the Fund would otherwise be","page_number":147,"box":{"x":68,"y":423,"width":784,"height":11}},{"id":"c08c3605-5bb3-4673-89a6-8ab50219a3d9","block_type":"box","text":"required to distribute to shareholders. A Fund’s ability to engage in such transactions is subject to, among other","page_number":147,"box":{"x":69,"y":438,"width":801,"height":11}},{"id":"a86e1568-e5fa-4d91-8c61-f5ec230a91c4","block_type":"box","text":"things, limitations on frequency of redemptions in kind under the Fund’s policies and availability of shareholders able","page_number":147,"box":{"x":68,"y":453,"width":835,"height":11}},{"id":"95e6db2c-c3f5-4921-975c-83b93c112c55","block_type":"box","text":"to transact in kind, and there is no assurance that the Fund can or will effect any redemptions in kind. Financial","page_number":147,"box":{"x":68,"y":468,"width":796,"height":11}},{"id":"756ab911-e270-4489-af03-04576c0b98bc","block_type":"box","text":"institutions that participate in the transactions described in this sub-section do not receive a fee from the Fund for","page_number":147,"box":{"x":70,"y":483,"width":816,"height":11}},{"id":"0f03b8f4-b320-40da-a7e1-e743f495304a","block_type":"box","text":"doing so. The Funds’ short-term trading policy shall not apply to the transactions described in this sub-section.","page_number":147,"box":{"x":69,"y":498,"width":788,"height":11}},{"id":"11a24c27-d6ff-482a-9fef-ea862eded3b4","block_type":"box","text":"If you receive securities through a redemption in kind, and desire to convert them to cash, you may pay taxes","page_number":147,"box":{"x":102,"y":521,"width":779,"height":11}},{"id":"b44e65e5-7314-46fc-a41c-435a2a9313ef","block_type":"box","text":"and brokerage and other transaction costs to dispose of the securities. You may also receive less for the securities","page_number":147,"box":{"x":69,"y":536,"width":823,"height":11}},{"id":"67b24492-cf93-4681-9874-4c1eade93d8a","block_type":"box","text":"than the price at which they were valued for purposes of effecting the redemption. There may also be a risk that","page_number":147,"box":{"x":68,"y":551,"width":800,"height":11}},{"id":"5ca0edd8-13e4-410b-a44e-d9ea0be428dc","block_type":"box","text":"redemption in kind activity could negatively impact the market value of the securities distributed in kind and, in turn,","page_number":147,"box":{"x":69,"y":566,"width":826,"height":11}},{"id":"fe60a7f9-9c6b-43ad-bd01-75a32a2551cc","block_type":"box","text":"the NAV of the corresponding Fund.","page_number":147,"box":{"x":68,"y":581,"width":251,"height":12}},{"id":"112994d8-e439-4ee7-9638-4d40ebebb466","block_type":"box","text":"Repurchase","page_number":147,"box":{"x":69,"y":612,"width":85,"height":11}},{"id":"8e99b6b0-7f94-4925-b9a5-0642929a7a64","block_type":"box","text":"A Fund normally will accept orders to repurchase shares from Selling Dealers for their customers. Shares will be","page_number":147,"box":{"x":101,"y":634,"width":800,"height":12}},{"id":"d24504c0-ef66-4f23-b8d1-3658257c4800","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":147,"box":{"x":70,"y":649,"width":833,"height":12}},{"id":"eec89f72-0b5b-4334-a115-5add5abe42a5","block_type":"box","text":"authorized by the Distributor by contract to accept such orders. As to repurchase orders received by Selling Dealers","page_number":147,"box":{"x":69,"y":665,"width":822,"height":11}},{"id":"0ffff937-39ab-4be3-948c-dce590a5d7a1","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":147,"box":{"x":70,"y":680,"width":809,"height":11}},{"id":"c97a4dce-cf78-4b98-a098-c95d046d117e","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":147,"box":{"x":69,"y":695,"width":831,"height":11}},{"id":"7a372826-773e-4865-ba53-967ef0001f05","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":147,"box":{"x":70,"y":710,"width":796,"height":11}},{"id":"3c3d0d1d-c199-4d3c-a90e-25d5ae8f2237","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":147,"box":{"x":69,"y":725,"width":812,"height":11}},{"id":"faf2b4c9-fb49-4924-a8c4-f9b20e5866e1","block_type":"box","text":"next business day.","page_number":147,"box":{"x":69,"y":740,"width":130,"height":11}},{"id":"ddda6703-eeb4-4f22-bbf6-9f0bc5c51612","block_type":"box","text":"These repurchase arrangements are for your convenience and do not involve a charge by the Fund (other than","page_number":147,"box":{"x":101,"y":763,"width":783,"height":11}},{"id":"49b065fa-2960-4c88-9b85-9d097103a081","block_type":"box","text":"any applicable CDSC or redemption fee). However, Selling Dealers may charge a processing fee in connection with","page_number":147,"box":{"x":69,"y":778,"width":813,"height":11}},{"id":"0e64cc41-b76b-4283-a0bd-4393bb9731ec","block_type":"box","text":"such transactions. In addition, securities firms that do not have selected dealer agreements with the Distributor may","page_number":147,"box":{"x":69,"y":793,"width":832,"height":11}},{"id":"a01bae90-b038-4209-ad48-a99c54ade7d3","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":147,"box":{"x":70,"y":808,"width":814,"height":11}},{"id":"6fae236f-d06c-4508-b3f4-006dd32dc8fe","block_type":"box","text":"reject any order for repurchase. A shareholder whose order for repurchase is rejected by a Fund, however, may","page_number":147,"box":{"x":69,"y":823,"width":788,"height":11}},{"id":"fccc9e2d-63af-4634-93d1-649ce4a8066f","block_type":"box","text":"redeem shares as set out above.","page_number":147,"box":{"x":69,"y":839,"width":235,"height":8}},{"id":"ab01edad-ac9f-40bf-8acf-a96d756f4e4c","block_type":"box","text":"II-117","page_number":147,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"da961880-7373-4b54-89f6-e41aaab9b295","block_type":"box","text":"NM1026U-5979889-147/232","page_number":147,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"69d9b061-9b05-4885-b95c-e48f3a5da841","block_type":"box","text":"Reinstatement Privilege — Investor A and Investor P Shares","page_number":148,"box":{"x":69,"y":45,"width":440,"height":11}},{"id":"275e50ae-1502-4bed-8d57-61558bfa8f0d","block_type":"box","text":"Upon redemption of Investor A, Investor A1, Investor P or Institutional Shares, as applicable, shareholders may","page_number":148,"box":{"x":102,"y":67,"width":791,"height":11}},{"id":"3b813f19-98fb-463d-bc0e-428f37ca9691","block_type":"box","text":"reinvest all or a portion of their redemption proceeds (after paying any applicable CDSC) in Investor A or Investor P","page_number":148,"box":{"x":69,"y":82,"width":815,"height":12}},{"id":"ff321556-e7fe-4d92-a6d5-1cc3157e41d8","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":148,"box":{"x":69,"y":98,"width":822,"height":11}},{"id":"f4891cf7-2c3d-4cc5-8602-0fa6f36aa03d","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":148,"box":{"x":68,"y":113,"width":806,"height":11}},{"id":"733dabc1-e15f-4015-8e7b-637d736308f6","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":148,"box":{"x":69,"y":128,"width":768,"height":11}},{"id":"0d4928a0-ff5a-4e58-9c75-dd3308f4b175","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":148,"box":{"x":70,"y":143,"width":827,"height":11}},{"id":"9185c400-de65-492d-b69c-a295f1f6dc22","block_type":"box","text":"this privilege, the Transfer Agent must receive written notification from the shareholder of record or the registered","page_number":148,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"eb6837a0-f3fa-4cda-b05f-1aefb39741bd","block_type":"box","text":"representative of record, at the time of purchase. Investors should consult a tax advisor concerning the tax","page_number":148,"box":{"x":69,"y":173,"width":764,"height":11}},{"id":"3abb7091-b4a5-47d5-bdee-b9ab2045e074","block_type":"box","text":"consequences of exercising this reinstatement privilege.","page_number":148,"box":{"x":69,"y":188,"width":400,"height":12}},{"id":"9328ea01-e3ed-4c5e-9cbc-07527c208cb6","block_type":"box","text":"SHAREHOLDER SERVICES","page_number":148,"box":{"x":384,"y":218,"width":210,"height":9}},{"id":"3191dc8c-4b32-4579-8589-309a98e22045","block_type":"box","text":"Each Fund offers one or more of the shareholder services described below that are designed to facilitate","page_number":148,"box":{"x":102,"y":241,"width":747,"height":11}},{"id":"7e551801-112e-4c5d-9081-33a3d2d55d69","block_type":"box","text":"investment in its shares. You can obtain more information about these services from each Fund by calling the","page_number":148,"box":{"x":70,"y":256,"width":781,"height":11}},{"id":"d9c1cfce-e05d-402b-bd84-aca196e1378d","block_type":"box","text":"telephone number on the cover page, or from the Distributor, your financial adviser, your selected securities dealer or","page_number":148,"box":{"x":68,"y":271,"width":836,"height":11}},{"id":"4b955e9f-d9ce-41a4-b28a-a81ecc23fb53","block_type":"box","text":"other financial intermediary. Certain of these services are available only to U.S. investors.","page_number":148,"box":{"x":69,"y":286,"width":641,"height":11}},{"id":"9df888dd-4344-461b-91e9-cf8d5b699a5b","block_type":"box","text":"Investment Account","page_number":148,"box":{"x":69,"y":316,"width":146,"height":9}},{"id":"fed59fa8-1fc2-450e-a517-f28f78adb2bb","block_type":"box","text":"If your account is maintained at the Transfer Agent (an “Investment Account”) you will receive statements, at","page_number":148,"box":{"x":102,"y":339,"width":774,"height":11}},{"id":"5641c87f-2cfb-4dd7-ba59-3ca90b6c68c4","block_type":"box","text":"least quarterly, from the Transfer Agent. These statements will serve as confirmations for automatic investment","page_number":148,"box":{"x":70,"y":354,"width":796,"height":11}},{"id":"0a404901-f03c-47ba-b827-0d846ec7ff91","block_type":"box","text":"purchases and the reinvestment of dividends. The statements also will show any other activity in your Investment","page_number":148,"box":{"x":70,"y":369,"width":807,"height":11}},{"id":"3e11a286-ae8d-474a-9d82-b7df75b9bbda","block_type":"box","text":"Account since the last statement. You also will receive separate confirmations for each purchase or sale transaction","page_number":148,"box":{"x":68,"y":384,"width":830,"height":11}},{"id":"6b2c1bea-3a27-485e-91a2-3aab29fe5c26","block_type":"box","text":"other than automatic investment purchases and the reinvestment of dividends. If your Investment Account is held at","page_number":148,"box":{"x":69,"y":399,"width":829,"height":11}},{"id":"8828a446-e29c-41d6-bf9c-735e403490ca","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":148,"box":{"x":68,"y":414,"width":815,"height":12}},{"id":"d3d06cca-c652-46c0-950f-e417668b8331","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":148,"box":{"x":70,"y":429,"width":781,"height":12}},{"id":"86499c58-ba8f-4730-af14-6dd258788a19","block_type":"box","text":"selected securities dealer or other financial intermediary. If you transfer shares out of an account maintained with a","page_number":148,"box":{"x":69,"y":445,"width":825,"height":11}},{"id":"2d54eeb9-bd58-4f5b-8f2c-732323ede264","block_type":"box","text":"selected securities dealer or other financial intermediary, an Investment Account in your name may be opened","page_number":148,"box":{"x":69,"y":460,"width":785,"height":11}},{"id":"b16af782-580b-4de0-9299-cf6cd2654304","block_type":"box","text":"automatically at the Transfer Agent.","page_number":148,"box":{"x":69,"y":475,"width":251,"height":11}},{"id":"0755a4e2-7ff2-48a4-bb62-1a54e0290ca2","block_type":"box","text":"You may transfer Fund shares from a selected securities dealer or other financial intermediary to another","page_number":148,"box":{"x":101,"y":498,"width":750,"height":11}},{"id":"f21501c9-c633-412a-90a9-4dd7773f4806","block_type":"box","text":"securities dealer or other financial intermediary that has entered into an agreement with the Distributor. Certain","page_number":148,"box":{"x":69,"y":513,"width":797,"height":11}},{"id":"6f420abb-183e-46c1-a92f-da1e1244078b","block_type":"box","text":"shareholder services may not be available for the transferred shares. All future trading of these assets must be","page_number":148,"box":{"x":69,"y":528,"width":797,"height":11}},{"id":"28507ac0-261b-4b41-966c-10c048045088","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":148,"box":{"x":69,"y":543,"width":826,"height":11}},{"id":"b5bda884-234a-46bb-ae96-7e16d3849518","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":148,"box":{"x":68,"y":558,"width":792,"height":11}},{"id":"c801990e-8ba5-4b3d-8256-04c547fc897d","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":148,"box":{"x":69,"y":573,"width":824,"height":11}},{"id":"e1f5e61f-cfe0-45ca-8bf1-58b7ab9f9846","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":148,"box":{"x":69,"y":588,"width":820,"height":11}},{"id":"93d3c5bd-c735-40e3-88e0-49f967352d74","block_type":"box","text":"Transfer Agent registered in the name of the securities dealer or other financial intermediary for your benefit whether","page_number":148,"box":{"x":68,"y":603,"width":833,"height":12}},{"id":"f750e7f3-404c-428b-951a-999c624d2f0b","block_type":"box","text":"the securities dealer or other financial intermediary has entered into a selected dealer agreement or not. In the","page_number":148,"box":{"x":68,"y":618,"width":795,"height":12}},{"id":"7deb1995-c3d6-4b8c-b9e8-b71221469770","block_type":"box","text":"interest of economy and convenience and because of the operating procedures of each Fund, share certificates will","page_number":148,"box":{"x":70,"y":634,"width":822,"height":11}},{"id":"a13a638d-02f0-42f2-8bcf-cc368a64972f","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":148,"box":{"x":69,"y":649,"width":814,"height":11}},{"id":"c67cbbb3-1a67-4b52-afd2-384063d7c66a","block_type":"box","text":"the holders thereof will have the same rights and ownership with respect to such shares as if certificates had been","page_number":148,"box":{"x":68,"y":664,"width":822,"height":11}},{"id":"a0679a12-ec6b-4989-9ecf-5abef6c7e35f","block_type":"box","text":"issued.","page_number":148,"box":{"x":70,"y":679,"width":49,"height":9}},{"id":"d716523c-4855-496c-b2d4-52a24ecf0517","block_type":"box","text":"If you are considering transferring a tax-deferred retirement account, such as an individual retirement account,","page_number":148,"box":{"x":102,"y":702,"width":785,"height":11}},{"id":"021c835f-16f6-4d9c-96d2-97fdd4b73a02","block_type":"box","text":"from one selected securities dealer to another securities dealer or other financial intermediary, you should be aware","page_number":148,"box":{"x":68,"y":717,"width":830,"height":11}},{"id":"356c3fc9-afe6-497a-99d8-a4a051489483","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":148,"box":{"x":68,"y":732,"width":790,"height":11}},{"id":"b0e70079-2dfc-4b8a-9020-ceba7f7135de","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":148,"box":{"x":69,"y":747,"width":831,"height":11}},{"id":"7f311e12-05b9-4e20-9094-244b8321514f","block_type":"box","text":"to maintain a retirement account at the original selected securities dealer for those shares.","page_number":148,"box":{"x":68,"y":762,"width":652,"height":11}},{"id":"5464bacb-945a-4a73-b799-9ea007d76965","block_type":"box","text":"Exchange Privilege","page_number":148,"box":{"x":69,"y":792,"width":138,"height":11}},{"id":"26e7bd99-50cf-4917-a03c-db451790ddc2","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":148,"box":{"x":102,"y":815,"width":797,"height":11}},{"id":"f10070a9-f595-4097-a1a0-4d8fe45a89db","block_type":"box","text":"each Fund have an exchange privilege with certain other Funds. However, Investor A1 Shares may only exchange out.","page_number":148,"box":{"x":69,"y":830,"width":832,"height":11}},{"id":"30f4ff11-53d6-4c16-9994-7190350c691c","block_type":"box","text":"The minimum amount for exchanges of Investor class shares is $1,000, although you may exchange less than","page_number":148,"box":{"x":68,"y":845,"width":788,"height":12}},{"id":"fb7b99a8-c68d-4043-9505-439e08097787","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":148,"box":{"x":69,"y":860,"width":796,"height":12}},{"id":"65b6a4dd-08c1-4b87-a714-b96dc1e626e4","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":148,"box":{"x":69,"y":875,"width":824,"height":12}},{"id":"f4568694-48d1-44c7-a22b-2b94c978bfb8","block_type":"box","text":"closed to new investors. Before effecting an exchange, you should obtain a currently effective prospectus of the fund","page_number":148,"box":{"x":69,"y":891,"width":835,"height":11}},{"id":"882b61d9-1249-4c6d-a156-5c26736277da","block_type":"box","text":"II-118","page_number":148,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"e15593ed-1cd6-4797-be83-d53bfe8f634d","block_type":"box","text":"NM1026U-5979889-148/232","page_number":148,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"18707808-cf67-42fb-a65c-3eef5da48bb6","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":149,"box":{"x":70,"y":45,"width":820,"height":11}},{"id":"bcbc7a4c-143a-4930-869c-7f1aa153e696","block_type":"box","text":"shares and a purchase of the acquired shares for U.S. federal income tax purposes.","page_number":149,"box":{"x":69,"y":60,"width":600,"height":11}},{"id":"d9f62277-a052-4c84-860a-fcfdb413a753","block_type":"box","text":"Exchanges of Investor A, Investor A1, Investor P, Class K, Institutional and Class G Shares.","page_number":149,"box":{"x":102,"y":82,"width":648,"height":12}},{"id":"e29ffecc-88fe-46a5-af87-d4866a73e7c6","block_type":"box","text":"Institutional Shares","page_number":149,"box":{"x":757,"y":83,"width":137,"height":8}},{"id":"67536803-f933-49a0-bd54-ea82191bbeff","block_type":"box","text":"are exchangeable with Institutional Shares of other Funds. Investor A and Investor A1 Shares are exchangeable for","page_number":149,"box":{"x":69,"y":98,"width":817,"height":11}},{"id":"ded29f1a-f90e-4be4-9f12-f45820f9ffce","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":149,"box":{"x":70,"y":113,"width":798,"height":11}},{"id":"2f7315cf-0e80-4293-9455-36ef2a27a5e1","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":149,"box":{"x":69,"y":128,"width":838,"height":11}},{"id":"04f029a6-cd39-481a-8d3d-f716fd493031","block_type":"box","text":"intermediary. Class K Shares are exchangeable for Class K Shares of other Funds. Class G Shares are exchangeable","page_number":149,"box":{"x":70,"y":143,"width":834,"height":11}},{"id":"7ee17304-28d9-4fdb-b919-d3369a469e36","block_type":"box","text":"for Class G Shares of other Funds.","page_number":149,"box":{"x":68,"y":158,"width":246,"height":9}},{"id":"af71ac9b-1d94-44eb-8d7a-66981333f105","block_type":"box","text":"Exchanges of Institutional Shares outstanding for Institutional Shares of a second fund or for shares of a money","page_number":149,"box":{"x":102,"y":181,"width":800,"height":11}},{"id":"7cabd98d-83a4-43cc-b813-165d7fa7cc3a","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":149,"box":{"x":69,"y":196,"width":826,"height":11}},{"id":"5915dbed-6b83-4f27-83a4-f5fcd8cb0bad","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":149,"box":{"x":69,"y":211,"width":795,"height":11}},{"id":"316cce9d-fb6b-43b7-8761-65a0dd87120a","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":149,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"3c4ca357-7975-4a7a-9033-1a65093b23ee","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":149,"box":{"x":70,"y":241,"width":814,"height":11}},{"id":"273d2227-cc2a-4539-821e-1fb6ea4885c7","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":149,"box":{"x":69,"y":256,"width":796,"height":12}},{"id":"5c2284f9-44dc-472b-8dba-b2eef1d2623d","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":149,"box":{"x":69,"y":271,"width":828,"height":12}},{"id":"7492829a-9638-4920-8f53-0ca21c405e3d","block_type":"box","text":"G Shares of a second fund are effected on the basis of relative NAV per share.","page_number":149,"box":{"x":69,"y":286,"width":561,"height":11}},{"id":"c661f866-786f-4fe4-bd9e-c7e41fd000d9","block_type":"box","text":"Exchanges of Investor C Shares.","page_number":149,"box":{"x":102,"y":309,"width":229,"height":11}},{"id":"683392b8-4743-4632-9011-496cbdf9e862","block_type":"box","text":"Shareholders of certain Funds with Investor C Shares outstanding (“outstanding","page_number":149,"box":{"x":338,"y":309,"width":570,"height":11}},{"id":"0a1d4cc5-40ce-400c-88e6-ab9f1bcba307","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":149,"box":{"x":70,"y":324,"width":827,"height":12}},{"id":"b5262a42-e37e-482e-a958-d5bf494d996c","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":149,"box":{"x":68,"y":339,"width":839,"height":12}},{"id":"96dcd58b-8047-4495-9fa5-d0c30b896142","block_type":"box","text":"the payment of any CDSC. Certain Funds impose different CDSC schedules. For purposes of computing the CDSC","page_number":149,"box":{"x":68,"y":355,"width":811,"height":11}},{"id":"37c21ec8-5f8a-48cb-a065-456c0d1b9d0a","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":149,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"7998ec53-a798-4b3e-8bab-4bb06075ead3","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":149,"box":{"x":68,"y":385,"width":781,"height":11}},{"id":"d1556256-430c-47bb-aae4-987cd555f0f0","block_type":"box","text":"towards the holding period of the new Investor C Shares or new money market fund Shares.","page_number":149,"box":{"x":68,"y":400,"width":654,"height":11}},{"id":"f99ace7e-adc3-4687-8a54-23d180235cfe","block_type":"box","text":"Exchanges of Service Shares.","page_number":149,"box":{"x":102,"y":423,"width":211,"height":11}},{"id":"0f1eeeda-f11f-4536-bbca-835b6fcff71f","block_type":"box","text":"Service Shares can be exchanged for Service Shares of Funds that are covered by","page_number":149,"box":{"x":319,"y":423,"width":588,"height":11}},{"id":"8e0c4d61-e4fc-4b2c-a44d-243c122e24da","block_type":"box","text":"selected dealer agreements with the Distributor.","page_number":149,"box":{"x":69,"y":438,"width":342,"height":11}},{"id":"57b30290-2e77-4020-9b8b-c25c9afb4819","block_type":"box","text":"Exchanges for Shares of a Money Market Fund.","page_number":149,"box":{"x":102,"y":460,"width":335,"height":12}},{"id":"ef080cf4-a95d-43e5-8444-629100550e58","block_type":"box","text":"You may exchange any class of Investor class shares, excluding","page_number":149,"box":{"x":443,"y":460,"width":455,"height":12}},{"id":"0ae55eca-e43c-4a5b-83fb-bebff2140023","block_type":"box","text":"Investor P Shares, for shares of an affiliated money market fund. If you exchange into BlackRock Summit Cash","page_number":149,"box":{"x":70,"y":475,"width":788,"height":12}},{"id":"4fd9055c-92df-4eb7-be22-71116188bc6b","block_type":"box","text":"Reserves Fund (“Summit”), a series of BlackRock Financial Institutions Series Trust, you will receive one of two","page_number":149,"box":{"x":70,"y":491,"width":793,"height":11}},{"id":"4cfc6bc7-c54e-460e-9d33-2e5cce6e8ba8","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":149,"box":{"x":69,"y":506,"width":802,"height":11}},{"id":"94bd78da-3625-4874-8fdd-15050cfb248e","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":149,"box":{"x":69,"y":521,"width":824,"height":11}},{"id":"0ab32cb2-6843-4745-bfb0-000e9a7e96dd","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":149,"box":{"x":69,"y":536,"width":805,"height":11}},{"id":"97cb57ae-43c0-4a41-8614-2495e8fe8d90","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":149,"box":{"x":69,"y":551,"width":827,"height":11}},{"id":"7c4e4430-8534-415d-a109-f04ac10f1e12","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":149,"box":{"x":69,"y":566,"width":758,"height":11}},{"id":"3ad06f5f-1788-41b1-81ea-45d3d415e9eb","block_type":"box","text":"satisfaction of the holding period requirement for purposes of reducing any CDSC. Investor C Shares of Summit are","page_number":149,"box":{"x":69,"y":581,"width":822,"height":12}},{"id":"d34a01c6-8486-42a7-87ca-02514c7d187e","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":149,"box":{"x":69,"y":596,"width":782,"height":12}},{"id":"d3a42fc4-8005-4b15-80b4-e896e7da57bb","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":149,"box":{"x":70,"y":612,"width":814,"height":11}},{"id":"a8cb2a2f-41bc-493f-854f-82cd3ffabfc1","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":149,"box":{"x":69,"y":627,"width":830,"height":11}},{"id":"86896430-e18c-4f8e-b04e-f74d8e4712fc","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":149,"box":{"x":69,"y":642,"width":821,"height":11}},{"id":"1216f58b-291d-41db-aee3-c14368c06118","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":149,"box":{"x":69,"y":657,"width":823,"height":11}},{"id":"47b4c954-1411-43db-879b-e2b334eeeae5","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":149,"box":{"x":70,"y":672,"width":781,"height":11}},{"id":"5fddebd6-62af-42f8-8053-42bdee7bed8e","block_type":"box","text":"exchange.","page_number":149,"box":{"x":69,"y":687,"width":70,"height":11}},{"id":"882eccab-5669-4f4f-95e3-6383211897bf","block_type":"box","text":"Exchanges by Par ticipants in Cer tain Programs.","page_number":149,"box":{"x":102,"y":710,"width":337,"height":11}},{"id":"e755ae63-9605-4b8d-bdc5-e7161728a41c","block_type":"box","text":"The exchange privilege may be modified with respect to certain","page_number":149,"box":{"x":445,"y":710,"width":448,"height":11}},{"id":"75265381-2ff7-4b5e-8183-8acc8efb885d","block_type":"box","text":"participants in mutual fund advisory programs and other fee-based programs sponsored by the Manager, an affiliate","page_number":149,"box":{"x":70,"y":725,"width":828,"height":11}},{"id":"349185fd-cbc1-4fec-b910-ed3952f1fb09","block_type":"box","text":"of the Manager, or selected securities dealers or other financial intermediaries that have an agreement with the","page_number":149,"box":{"x":69,"y":740,"width":796,"height":11}},{"id":"2412a53a-98b0-4fcc-9e94-fdc92eea18a0","block_type":"box","text":"Distributor. See “Fee-Based Programs” below.","page_number":149,"box":{"x":70,"y":755,"width":324,"height":11}},{"id":"efa311d7-af25-4a78-a4d1-3aeff4ed273e","block_type":"box","text":"Exercise of the Exchange Privilege.","page_number":149,"box":{"x":102,"y":778,"width":245,"height":11}},{"id":"4d6761f9-b167-45d6-afe7-775c253c99c1","block_type":"box","text":"To exercise the exchange privilege, you should contact your financial adviser","page_number":149,"box":{"x":353,"y":778,"width":543,"height":11}},{"id":"398aef56-b91a-48ed-a198-c32b4c646f44","block_type":"box","text":"or the Transfer Agent, who will advise each Fund of the exchange. If you do not hold share certificates, you may","page_number":149,"box":{"x":69,"y":793,"width":794,"height":11}},{"id":"b72e2f00-5860-47ec-bcb7-78165d891e99","block_type":"box","text":"exercise the exchange privilege by wire through your securities dealer or other financial intermediary. Each Fund","page_number":149,"box":{"x":69,"y":808,"width":795,"height":11}},{"id":"8805e46d-9d96-43f9-8f9d-307998818635","block_type":"box","text":"reserves the right to require a properly completed exchange application.","page_number":149,"box":{"x":69,"y":823,"width":512,"height":12}},{"id":"70739777-c8a0-40e2-808a-856c4cecc76a","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":149,"box":{"x":101,"y":846,"width":772,"height":11}},{"id":"55a5bc58-64fb-4fc9-9520-f23333a8e929","block_type":"box","text":"Transfer Agent at the following address: P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Shareholders are","page_number":149,"box":{"x":68,"y":861,"width":824,"height":11}},{"id":"36375239-8885-46b9-8e54-867eb45f59ad","block_type":"box","text":"automatically provided with telephone exchange privileges when opening an account, unless they indicate on the","page_number":149,"box":{"x":69,"y":876,"width":801,"height":11}},{"id":"0e950432-bb97-4743-8d5f-a5b3699a7cb7","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":149,"box":{"x":68,"y":891,"width":817,"height":12}},{"id":"1a36b7c8-b043-4854-aa3c-3c273893c039","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":149,"box":{"x":69,"y":906,"width":826,"height":12}},{"id":"8b65ebef-3268-48f4-8afa-6ae117a19765","block_type":"box","text":"II-119","page_number":149,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"1b258774-3f4b-47bb-8f07-7121ea13e931","block_type":"box","text":"NM1026U-5979889-149/232","page_number":149,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d4702982-8a90-4ef2-a98d-0cac292b7b0c","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":150,"box":{"x":69,"y":45,"width":840,"height":11}},{"id":"a5de96c4-1df6-403e-bc30-96adc0fd5e76","block_type":"box","text":"telephone at (800) 441-7762 to request the exchange. During periods of substantial economic or market change,","page_number":150,"box":{"x":68,"y":60,"width":811,"height":11}},{"id":"d0df9be8-a2e1-4756-85b5-4cae50f5d77b","block_type":"box","text":"telephone exchanges may be difficult to complete and shareholders may have to submit exchange requests to the","page_number":150,"box":{"x":68,"y":75,"width":815,"height":11}},{"id":"446e8c5c-d0fa-4688-9ee5-7b3c0b573af8","block_type":"box","text":"Transfer Agent in writing.","page_number":150,"box":{"x":68,"y":90,"width":175,"height":11}},{"id":"dacd3be4-3acf-4384-a2bd-c43a06918e27","block_type":"box","text":"If the exchanging shareholder does not currently own shares of the investment portfolio whose shares are being","page_number":150,"box":{"x":102,"y":113,"width":800,"height":11}},{"id":"4eb7c201-e534-4dad-a0cb-228f1bdcfc5d","block_type":"box","text":"acquired, a new account will be established with the same registration, dividend and capital gain options and broker","page_number":150,"box":{"x":69,"y":128,"width":828,"height":11}},{"id":"7001e45a-c072-46db-a0dc-e4b0ed5d48f6","block_type":"box","text":"of record as the account from which shares are exchanged, unless otherwise specified in writing by the shareholder","page_number":150,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"d7d79468-fba6-46f8-801e-55df78ff2543","block_type":"box","text":"with all signatures guaranteed by an eligible guarantor institution as defined below. In order to participate in the","page_number":150,"box":{"x":68,"y":158,"width":797,"height":11}},{"id":"534b0b9a-a536-472d-b475-f594dd0d6c0d","block_type":"box","text":"Automatic Investment Program or establish a Systematic Withdrawal Plan for the new account, however, an","page_number":150,"box":{"x":68,"y":173,"width":763,"height":11}},{"id":"4198a491-523a-4062-8731-b63d80935811","block_type":"box","text":"exchanging shareholder must file a specific written request.","page_number":150,"box":{"x":69,"y":188,"width":424,"height":12}},{"id":"4844a34d-7632-4c77-89b7-86221319467c","block_type":"box","text":"Any share exchange must satisfy the requirements relating to the minimum initial investment requirement, and","page_number":150,"box":{"x":101,"y":211,"width":790,"height":11}},{"id":"d8a1f8a4-ff71-4172-9c18-918b75b72001","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":150,"box":{"x":69,"y":226,"width":808,"height":11}},{"id":"498f8005-fb8e-4969-8494-409e4ae551cd","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":150,"box":{"x":69,"y":241,"width":771,"height":11}},{"id":"15d65d00-16d5-4b23-9281-f45daf28b2ad","block_type":"box","text":"exchange request, shareholders should consult a tax or other financial adviser and should consider the investment","page_number":150,"box":{"x":69,"y":256,"width":819,"height":12}},{"id":"b007f164-daa3-4d08-8c83-2bfa423b56f7","block_type":"box","text":"objective, policies and restrictions of the investment portfolio into which the shareholder is making an exchange.","page_number":150,"box":{"x":69,"y":271,"width":802,"height":12}},{"id":"29632b63-02c3-4b49-b505-83980da699ea","block_type":"box","text":"Brokers may charge a fee for handling exchanges.","page_number":150,"box":{"x":70,"y":286,"width":354,"height":12}},{"id":"4d893b2f-2b33-4bcd-99be-07052dcceaeb","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":150,"box":{"x":101,"y":309,"width":782,"height":11}},{"id":"43985859-284f-4a0b-9e58-a5b14ee3ecaf","block_type":"box","text":"given to shareholders of any material modification or termination except where notice is not required. The Funds","page_number":150,"box":{"x":68,"y":324,"width":800,"height":12}},{"id":"f5d996a9-6431-4a7e-8e46-781ad85f67a4","block_type":"box","text":"reserve the right to reject any telephone exchange request. Telephone exchanges may be subject to limitations as to","page_number":150,"box":{"x":69,"y":340,"width":831,"height":11}},{"id":"4c6bc69e-2925-4625-b884-63a94c745bd3","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":150,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"bf1357bb-c385-4d33-8088-6533bb372cc1","block_type":"box","text":"do not operate to the disadvantage of any portfolio or its shareholders.","page_number":150,"box":{"x":69,"y":370,"width":506,"height":11}},{"id":"7ac29046-057c-44b9-ad08-b75db75d81a0","block_type":"box","text":"The Funds, the Administrators and BRIL will employ reasonable procedures to confirm that instructions","page_number":150,"box":{"x":101,"y":392,"width":733,"height":12}},{"id":"7ffe66be-c6ee-43be-b9f5-a92483b59c6b","block_type":"box","text":"communicated by telephone are genuine. The Funds, the Administrators and BRIL will not be liable for any loss,","page_number":150,"box":{"x":69,"y":407,"width":793,"height":12}},{"id":"801c3337-1511-4dac-bb28-c5e9a9a28ace","block_type":"box","text":"liability, cost or expense for acting upon telephone instructions reasonably believed to be genuine in accordance with","page_number":150,"box":{"x":70,"y":423,"width":832,"height":11}},{"id":"7a5e4878-7c61-49cd-b634-17429a3edd09","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":150,"box":{"x":69,"y":438,"width":785,"height":11}},{"id":"876ee774-0cfe-4478-bbbd-f2f52ea3fe4e","block_type":"box","text":"telephonic or written exchange instructions from any person representing himself to be the investor and believed by","page_number":150,"box":{"x":68,"y":453,"width":825,"height":11}},{"id":"192a7929-4aad-4db8-a473-999f0e52bc83","block_type":"box","text":"the Fund’s Transfer Agent to be genuine. The records of the Fund’s Transfer Agent pertaining to such instructions are","page_number":150,"box":{"x":68,"y":468,"width":837,"height":11}},{"id":"b30c30f1-7e79-46af-9432-02b007021ab7","block_type":"box","text":"binding. The exchange privilege may be modified or terminated at any time upon 60 days’ notice to affected","page_number":150,"box":{"x":69,"y":483,"width":767,"height":11}},{"id":"272da6ba-d968-4e81-9676-ca456d512423","block_type":"box","text":"shareholders. The exchange privilege is only available in states where the exchange may legally be made.","page_number":150,"box":{"x":69,"y":498,"width":750,"height":11}},{"id":"910f2bd5-4a63-4223-b448-e95c9e08db7c","block_type":"box","text":"Each Fund reserves the right to limit the number of times an investor may exercise the exchange privilege.","page_number":150,"box":{"x":102,"y":521,"width":757,"height":11}},{"id":"9f9e3e0b-c2d3-42f0-87fb-930b122070e7","block_type":"box","text":"Certain Funds may suspend the continuous offering of their shares to the general public at any time and may resume","page_number":150,"box":{"x":69,"y":536,"width":837,"height":11}},{"id":"b9b59342-a44f-4d52-84ae-310b94ff4ed3","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":150,"box":{"x":69,"y":551,"width":805,"height":11}},{"id":"06674e29-f423-44ec-ba66-1ef93152033a","block_type":"box","text":"exchange legally may be made. The exchange privilege may be applicable to other new mutual funds whose shares","page_number":150,"box":{"x":69,"y":566,"width":817,"height":11}},{"id":"70fda14c-3b12-4bbe-a8e6-97c413856108","block_type":"box","text":"may be distributed by the Distributor.","page_number":150,"box":{"x":69,"y":582,"width":262,"height":10}},{"id":"d91b6734-8c8c-4f8b-ab3e-82489b57a643","block_type":"box","text":"Participation in Fee-Based Programs","page_number":150,"box":{"x":69,"y":612,"width":266,"height":11}},{"id":"b6d3d379-6198-44a4-b187-71dd509cac4c","block_type":"box","text":"If you participate in certain fee-based programs offered by BlackRock or an affiliate of BlackRock, or selected","page_number":150,"box":{"x":102,"y":634,"width":780,"height":12}},{"id":"19bdbba3-cc33-4e40-8107-812e6405861d","block_type":"box","text":"securities dealers or other financial intermediaries that have agreements with the Distributor or in certain fee-based","page_number":150,"box":{"x":69,"y":649,"width":826,"height":12}},{"id":"e9e5c33e-23f6-4c61-8f5a-7dee28907571","block_type":"box","text":"programs in which BlackRock participates, you may be able to buy Institutional Shares, including by exchanges from","page_number":150,"box":{"x":70,"y":664,"width":825,"height":12}},{"id":"61bb9298-5483-4cd9-abae-14e044ffd83f","block_type":"box","text":"other share classes. Sales charges on the shares being exchanged may be reduced or waived under certain","page_number":150,"box":{"x":69,"y":680,"width":770,"height":11}},{"id":"9b9f11b4-a9ae-46fb-a9d4-d5d34bfd0c1c","block_type":"box","text":"circumstances. You generally cannot transfer shares held through a fee-based program into another account. Instead,","page_number":150,"box":{"x":69,"y":695,"width":837,"height":11}},{"id":"7a7fb550-de9f-41d3-a50e-3d600c87e8c2","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":150,"box":{"x":70,"y":710,"width":808,"height":11}},{"id":"3f6f2a88-281e-4eba-b664-47e179cac7c0","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":150,"box":{"x":70,"y":725,"width":838,"height":11}},{"id":"c76224d4-3174-4c76-b362-346d3d09541f","block_type":"box","text":"and you may pay any applicable sales charges or redemption fee. Please speak to your financial intermediary for","page_number":150,"box":{"x":69,"y":740,"width":804,"height":11}},{"id":"584c20f5-e9dc-4722-87af-9cbafc0cb073","block_type":"box","text":"information about specific policies and procedures applicable to your account.","page_number":150,"box":{"x":70,"y":755,"width":555,"height":11}},{"id":"eb18f5d7-c07d-4e88-bfb3-8fc5e877a630","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":150,"box":{"x":102,"y":778,"width":788,"height":11}},{"id":"e8f1e6cf-99e5-4016-8dee-f45f5e9203d0","block_type":"box","text":"an account. In certain circumstances, when a shareholder chooses to continue to hold the shares, whatever share","page_number":150,"box":{"x":69,"y":793,"width":817,"height":10}},{"id":"a942bddc-be2b-4726-a3e0-4b5871ff3914","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":150,"box":{"x":69,"y":808,"width":796,"height":11}},{"id":"e631f243-19a2-43a3-8bd6-f8e5c7f4b352","block_type":"box","text":"periods within the program may be subject to a fee upon redemption. Shareholders that held Investor A or","page_number":150,"box":{"x":70,"y":823,"width":754,"height":12}},{"id":"ff127f83-90bc-45f5-a9c7-6aac863b8395","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":150,"box":{"x":70,"y":838,"width":820,"height":12}},{"id":"89dd1490-8472-4a27-8cb7-467522ae98d8","block_type":"box","text":"Fund, but may be subject to upfront sales charges with respect to Investor A Shares. Additional purchases of","page_number":150,"box":{"x":70,"y":853,"width":777,"height":12}},{"id":"5169a24f-0794-4909-93d1-765cf32b5271","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":150,"box":{"x":70,"y":869,"width":791,"height":11}},{"id":"680f8a6a-7f8a-4dfb-8962-c6c734983799","block_type":"box","text":"eligible to purchase Institutional Shares. Please speak to your financial intermediary for more information.","page_number":150,"box":{"x":69,"y":884,"width":756,"height":11}},{"id":"66258de0-eb3d-49cd-abf4-ddc4b8de4ab6","block_type":"box","text":"II-120","page_number":150,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"da8e7919-4984-4cb5-9f67-797af8f4de09","block_type":"box","text":"NM1026U-5979889-150/232","page_number":150,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e25cd678-48c4-439a-8d08-2c6a4c019d3f","block_type":"box","text":"Certain financial intermediaries may, in connection with a change in account type (for example, due to leaving a","page_number":151,"box":{"x":102,"y":45,"width":793,"height":11}},{"id":"c5a10f08-2463-47de-9f51-571181843628","block_type":"box","text":"fee-based program or upon termination of the fee-based program) or otherwise in accordance with the financial","page_number":151,"box":{"x":68,"y":60,"width":791,"height":11}},{"id":"05be7c3a-3ae8-4422-9d5b-ebb148c6c027","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":151,"box":{"x":70,"y":75,"width":830,"height":11}},{"id":"24e57598-450d-4cb5-9830-2e8b2f6d939c","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":151,"box":{"x":69,"y":90,"width":807,"height":11}},{"id":"c8fad58f-a948-40ad-8c45-4a846b73e479","block_type":"box","text":"eligibility requirements of the new share class. Please speak to your financial intermediary for information about","page_number":151,"box":{"x":69,"y":105,"width":801,"height":11}},{"id":"52315a81-8550-41f2-a2bb-c7b1b9cf71b8","block_type":"box","text":"specific policies and procedures applicable to your account.","page_number":151,"box":{"x":69,"y":120,"width":424,"height":11}},{"id":"24069825-9ff3-4725-8d40-9cfb31619ba8","block_type":"box","text":"Details about the features of each fee-based program and the relevant charges, terms and conditions are","page_number":151,"box":{"x":102,"y":143,"width":752,"height":11}},{"id":"ea289ba3-5aec-4e3a-ae57-86e3f8515135","block_type":"box","text":"included in the client agreement for each fee-based program and are available from your financial professional,","page_number":151,"box":{"x":70,"y":158,"width":789,"height":11}},{"id":"dd6d8631-fb5c-40fa-a4a7-7fac94b414cc","block_type":"box","text":"selected securities dealer or other financial intermediary. Please speak to your financial intermediary for more","page_number":151,"box":{"x":69,"y":173,"width":785,"height":11}},{"id":"81f1f90e-f122-469e-b5a8-2e71f9a225e7","block_type":"box","text":"information.","page_number":151,"box":{"x":70,"y":188,"width":83,"height":9}},{"id":"8e0a9711-377f-4613-a1a9-6a6406e2991d","block_type":"box","text":"Retirement and Education Savings Plans","page_number":151,"box":{"x":69,"y":219,"width":296,"height":11}},{"id":"da710d73-9850-42b7-a15f-c16271cdda20","block_type":"box","text":"Individual retirement accounts and other retirement and education savings plans are available from your financial","page_number":151,"box":{"x":102,"y":241,"width":805,"height":11}},{"id":"62ed182c-e5c4-465d-b43a-5b91ea9e099c","block_type":"box","text":"intermediary. Under these plans, investments may be made in a Fund (other than a Municipal Fund) and certain of","page_number":151,"box":{"x":70,"y":256,"width":815,"height":11}},{"id":"17b46428-d627-4108-b074-5268d065c9d0","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":151,"box":{"x":68,"y":271,"width":819,"height":12}},{"id":"59669ede-ea42-4a27-9ae5-c98a2dc8e765","block_type":"box","text":"associated with investing through these plans. Information with respect to these plans is available on request from","page_number":151,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"1d8398ea-a228-4b71-8013-046eed91af61","block_type":"box","text":"your financial intermediary.","page_number":151,"box":{"x":68,"y":302,"width":191,"height":11}},{"id":"7e8c7dc8-92bd-409b-b966-4984ef929a46","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":151,"box":{"x":102,"y":324,"width":796,"height":11}},{"id":"a3e7f856-697b-4e9d-ad44-8539db20aba8","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":151,"box":{"x":68,"y":339,"width":784,"height":12}},{"id":"336b75a1-de8d-4e93-a4df-d8e2e9e596e1","block_type":"box","text":"distributed as well. Investors considering participation in any retirement or education savings plan should review","page_number":151,"box":{"x":69,"y":355,"width":801,"height":11}},{"id":"a98ccd7d-ab76-477d-896e-30447b773c6d","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":151,"box":{"x":69,"y":370,"width":753,"height":11}},{"id":"89de39df-c921-4bc5-a5c4-81e92704fb30","block_type":"box","text":"establishment and maintenance of any such plan.","page_number":151,"box":{"x":69,"y":385,"width":354,"height":11}},{"id":"8cafbab7-33c5-4208-bc6b-2080b8da4700","block_type":"box","text":"Automatic Investment Plans","page_number":151,"box":{"x":68,"y":415,"width":207,"height":9}},{"id":"ef9cf65a-cdac-4510-b5bb-aa238fb3795a","block_type":"box","text":"Investor class shareholders and certain Service Share shareholders who were shareholders of the Compass","page_number":151,"box":{"x":102,"y":438,"width":773,"height":11}},{"id":"8223d074-4d2f-4296-9bc3-9e2b71b84b7e","block_type":"box","text":"Capital Group of Funds at the time of its combination with The PNC","page_number":151,"box":{"x":69,"y":453,"width":477,"height":11}},{"id":"5fb52587-3124-4c02-ae92-ed4acc5cc71c","block_type":"box","text":"®","page_number":151,"box":{"x":547,"y":453,"width":6,"height":5}},{"id":"93e51c42-dc94-44ef-96ea-49ed2c356ae6","block_type":"box","text":"Fund in 1996 may arrange for periodic","page_number":151,"box":{"x":559,"y":453,"width":272,"height":11}},{"id":"c36e36ff-204d-4950-b7d4-26597f1a793d","block_type":"box","text":"investments in that Fund through automatic deductions from a checking or savings account. The minimum pre","page_number":151,"box":{"x":70,"y":468,"width":787,"height":11}},{"id":"c5376342-54ff-4484-aa7a-f1a1f6d6be06","block_type":"box","text":"authorized investment amount is $50. If you buy shares of a Fund through certain accounts, no minimum charge to","page_number":151,"box":{"x":69,"y":482,"width":822,"height":12}},{"id":"46d58bd1-e1de-4352-9a85-5c9ab7a0d364","block_type":"box","text":"your bank account is required. Contact your financial adviser or other financial intermediary for more information.","page_number":151,"box":{"x":68,"y":498,"width":805,"height":11}},{"id":"c37552c4-b785-4ef3-91a6-7fb41b4fc81f","block_type":"box","text":"Automatic Dividend Reinvestment Plan","page_number":151,"box":{"x":68,"y":529,"width":285,"height":8}},{"id":"20b54600-8d4d-4124-8f8d-c9afe21fe3c6","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":151,"box":{"x":102,"y":551,"width":782,"height":11}},{"id":"6f855171-51a6-4081-a537-64a441d4c7c4","block_type":"box","text":"shareholders. All distributions are automatically reinvested at NAV in the form of additional full and fractional shares","page_number":151,"box":{"x":69,"y":566,"width":828,"height":11}},{"id":"4f1d5a9c-bf33-49bb-b755-4a10ac3346f0","block_type":"box","text":"of the same class of shares of the relevant Fund unless a shareholder elects otherwise or as otherwise set forth in a","page_number":151,"box":{"x":69,"y":581,"width":839,"height":9}},{"id":"7cc8a460-5bdd-4463-9a06-4034f063fa74","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":151,"box":{"x":70,"y":596,"width":822,"height":12}},{"id":"2a058f7e-c690-4cf0-99de-98bbb3e80d6c","block_type":"box","text":"become effective with respect to dividends paid after its receipt by the Transfer Agent.","page_number":151,"box":{"x":69,"y":612,"width":614,"height":11}},{"id":"a1d75c15-189c-4eb3-873a-91c6f5dbbc35","block_type":"box","text":"Systematic Withdrawal Plans","page_number":151,"box":{"x":68,"y":642,"width":214,"height":11}},{"id":"fe83baa9-9994-4446-899c-f4cea21740b6","block_type":"box","text":"Shareholders may receive regular distributions from their accounts via a Systematic Withdrawal Plan (“SWP”).","page_number":151,"box":{"x":102,"y":664,"width":780,"height":12}},{"id":"abd9702d-457b-4618-9020-5c22e75cdb5b","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":151,"box":{"x":70,"y":679,"width":742,"height":12}},{"id":"cd123d4c-1270-4178-bdc8-27edcff9eb92","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":151,"box":{"x":69,"y":694,"width":834,"height":12}},{"id":"8ec565e0-fe67-4fd6-8965-4008a77dab29","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":151,"box":{"x":68,"y":710,"width":823,"height":11}},{"id":"09179cf4-fa70-4db0-ad70-ad1105bc3bcf","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":151,"box":{"x":69,"y":725,"width":840,"height":11}},{"id":"31f9752c-2798-412f-97b9-bc2221637a00","block_type":"box","text":"by completing the Systematic Withdrawal Plan Application Form which may be obtained by visiting our website at","page_number":151,"box":{"x":69,"y":740,"width":800,"height":11}},{"id":"208d74de-516b-4e6b-8d17-73de69b4219c","block_type":"box","text":"www.blackrock.com.","page_number":151,"box":{"x":68,"y":755,"width":142,"height":9}},{"id":"57dac241-f453-4855-b8fb-a85fbbd31847","block_type":"box","text":"Shareholders should realize that if withdrawals exceed income dividends their invested principal in the account","page_number":151,"box":{"x":102,"y":778,"width":789,"height":11}},{"id":"c066ba9f-319e-43cd-b2f3-bc2e811f6c98","block_type":"box","text":"will be depleted. To participate in the SWP, shareholders must have their dividends automatically reinvested.","page_number":151,"box":{"x":68,"y":793,"width":774,"height":11}},{"id":"21ac3875-63c4-4d23-a4e7-f5cd8c46875c","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":151,"box":{"x":69,"y":808,"width":815,"height":11}},{"id":"546be5a7-fa81-441c-abf0-cb9ef78d1d94","block_type":"box","text":"(800) 441-7762. Purchases of additional Investor A or Investor P Shares of the Fund concurrently with withdrawals","page_number":151,"box":{"x":69,"y":823,"width":817,"height":11}},{"id":"923eb6a4-13f7-4473-9f37-7de302e0dc2f","block_type":"box","text":"may be disadvantageous to investors because of the sales charges involved and, therefore, are discouraged. No","page_number":151,"box":{"x":69,"y":838,"width":803,"height":12}},{"id":"bcb43b95-869a-4227-a647-3a6417ef38df","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":151,"box":{"x":69,"y":853,"width":820,"height":12}},{"id":"cf921949-ab9c-469e-8486-cf02996dd9b5","block_type":"box","text":"original investment on an annualized basis. For example, monthly, quarterly and semi-annual SWP redemptions of","page_number":151,"box":{"x":69,"y":869,"width":810,"height":11}},{"id":"a7f3ab69-08f3-4ca2-bc7c-e98c7f25766e","block_type":"box","text":"II-121","page_number":151,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"5687783f-74de-4aac-ab80-5dbffe1a8f69","block_type":"box","text":"NM1026U-5979889-151/232","page_number":151,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c58cf431-1c1d-40e0-bad1-c432db4e7e09","block_type":"box","text":"Investor C Shares will not be subject to the CDSC if they do not exceed 1% (monthly), 3% (quarterly) and 6% (semi","page_number":152,"box":{"x":70,"y":45,"width":816,"height":11}},{"id":"7011bc93-edb9-49be-813b-aa5344acec76","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":152,"box":{"x":69,"y":60,"width":840,"height":11}},{"id":"5fdab8b0-b414-474b-b67c-5b59fce1aa37","block_type":"box","text":"of this limit are still subject to the applicable CDSC.","page_number":152,"box":{"x":69,"y":75,"width":367,"height":11}},{"id":"e7af9f74-e192-4474-89b0-f76b336649d1","block_type":"box","text":"For this reason, a shareholder may not participate in the Automatic Investment Plan described above (see “How","page_number":152,"box":{"x":102,"y":98,"width":798,"height":11}},{"id":"7e5c7382-69f5-486a-9915-4dfa5602121e","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":152,"box":{"x":68,"y":113,"width":834,"height":11}},{"id":"3bc6bf52-bfc4-4938-8de0-6033a7d3b5dd","block_type":"box","text":"Prospectus) and the SWP at the same time.","page_number":152,"box":{"x":69,"y":128,"width":311,"height":11}},{"id":"63a70d58-b048-4460-bbf5-22eb8e8102ae","block_type":"box","text":"Dividend Allocation Plan","page_number":152,"box":{"x":69,"y":158,"width":176,"height":9}},{"id":"9ea9f3d4-1ec6-4310-8898-a2e999998d0b","block_type":"box","text":"The Dividend Allocation Plan, as applicable, allows shareholders to elect to have all their dividends and any other","page_number":152,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"49d48f99-00f2-4114-a9b7-df6edc85b7cf","block_type":"box","text":"distributions from any Eligible Fund (which means funds so designated by the Distributor from time to time)","page_number":152,"box":{"x":69,"y":196,"width":763,"height":11}},{"id":"09773870-15da-4e67-a01a-e4a93359ee83","block_type":"box","text":"automatically invested at NAV in one other such Eligible Fund designated by the shareholder, provided the account","page_number":152,"box":{"x":69,"y":211,"width":814,"height":11}},{"id":"cfbc7a0b-5c70-4d1a-be3a-d00a545fd104","block_type":"box","text":"into which the dividends and distributions are directed is initially funded with the requisite minimum amount.","page_number":152,"box":{"x":70,"y":226,"width":771,"height":11}},{"id":"58fedce7-d23e-470e-a3c6-14de5958ded7","block_type":"box","text":"PRICING OF SHARES","page_number":152,"box":{"x":406,"y":256,"width":167,"height":9}},{"id":"6a88e33b-0956-4970-958b-2bb13984c704","block_type":"box","text":"Determination of Net Asset Value","page_number":152,"box":{"x":69,"y":286,"width":243,"height":9}},{"id":"48d1dd1e-c947-46c2-bcb6-27361fb38a03","block_type":"box","text":"Valuation of Shares.","page_number":152,"box":{"x":101,"y":309,"width":145,"height":9}},{"id":"a63dace4-c7ab-4e00-a2a5-784ff32c27c8","block_type":"box","text":"The NAV for each class of shares of each Fund is generally calculated as of the close of","page_number":152,"box":{"x":252,"y":309,"width":626,"height":11}},{"id":"e17fca75-ec02-4e85-8746-4c3427ed0798","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":152,"box":{"x":69,"y":324,"width":785,"height":11}},{"id":"0daee325-22dd-449d-a7b9-75190dde0584","block_type":"box","text":"Valuation of assets held by a Fund is as follows:","page_number":152,"box":{"x":68,"y":339,"width":343,"height":11}},{"id":"31b2cba4-4897-4804-8536-f515f97bb001","block_type":"box","text":"Equity Investments.","page_number":152,"box":{"x":102,"y":362,"width":143,"height":11}},{"id":"d0a03415-03e2-4317-8e70-c0db698aac97","block_type":"box","text":"Equity securities traded on a recognized securities exchange (","page_number":152,"box":{"x":252,"y":362,"width":439,"height":11}},{"id":"83afcb08-6da5-44df-8868-396d8324da05","block_type":"box","text":"e.g.","page_number":152,"box":{"x":693,"y":363,"width":25,"height":10}},{"id":"8bbd98bb-eaf1-4204-9190-ca529027ef3d","block_type":"box","text":", NYSE), on separate","page_number":152,"box":{"x":720,"y":362,"width":147,"height":11}},{"id":"e27b2ece-0af2-48ae-9824-e5ad47f35495","block_type":"box","text":"trading boards of a securities exchange or through a market system that provides contemporaneous transaction","page_number":152,"box":{"x":68,"y":377,"width":799,"height":11}},{"id":"fd494961-21ce-4b86-9104-c028156215f0","block_type":"box","text":"pricing information (each, an “Exchange”) are valued using information obtained via independent pricing services,","page_number":152,"box":{"x":70,"y":392,"width":808,"height":11}},{"id":"e02602c2-47e8-4d6e-8c09-f6cf61a0f9cb","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":152,"box":{"x":68,"y":407,"width":820,"height":11}},{"id":"cded49bc-ea7e-47b0-8c64-c9ebb209963e","block_type":"box","text":"Exchange prior to the time as of which the assets or liabilities are valued. However, under certain circumstances,","page_number":152,"box":{"x":70,"y":422,"width":805,"height":11}},{"id":"b95643ca-3220-40c9-99de-13be21e1ba1a","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":152,"box":{"x":69,"y":437,"width":793,"height":11}},{"id":"a4e7a87e-ea78-490c-902a-ba6a4a1985a0","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":152,"box":{"x":70,"y":452,"width":836,"height":11}},{"id":"e53de84c-0356-4862-8da0-b7f1372b1623","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":152,"box":{"x":68,"y":468,"width":815,"height":11}},{"id":"497c5f00-f888-409c-b932-cdff2a079eb7","block_type":"box","text":"last bid (long positions) or ask (short positions) price, if available, will be used as the value of such security. If a Fund","page_number":152,"box":{"x":70,"y":482,"width":837,"height":12}},{"id":"2923487d-5cb1-4758-a615-d199e4147898","block_type":"box","text":"holds both long and short positions in the same security, the last bid price will be applied to securities held long and","page_number":152,"box":{"x":69,"y":498,"width":832,"height":11}},{"id":"d5270880-523f-4637-a2ab-0a75978cb76f","block_type":"box","text":"the last ask price will be applied to securities sold short. If no bid or ask price is available on a day on which a Fund","page_number":152,"box":{"x":68,"y":513,"width":828,"height":11}},{"id":"1c31b1d7-c1b6-4c52-aa84-4fe28c38d889","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":152,"box":{"x":68,"y":528,"width":819,"height":11}},{"id":"0f602400-2c91-48c3-abe7-812e1317cdd7","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":152,"box":{"x":70,"y":543,"width":798,"height":11}},{"id":"dc8f0bd8-3a7c-4c63-acd9-d419297f3eb0","block_type":"box","text":"defined below).","page_number":152,"box":{"x":69,"y":558,"width":106,"height":11}},{"id":"50e2acd1-f5db-40b8-ae52-e97164f89a24","block_type":"box","text":"Fixed-Income Investments.","page_number":152,"box":{"x":102,"y":581,"width":194,"height":9}},{"id":"debbd9a1-bfad-4c90-af42-0e7543a14f61","block_type":"box","text":"Fixed-income securities are generally valued using prices provided by dealers or","page_number":152,"box":{"x":304,"y":581,"width":565,"height":11}},{"id":"7c5e6bc3-7da0-4e0f-a76f-dd9d35de3989","block_type":"box","text":"prices (including evaluated prices) supplied by the Fund’s approved independent third-party pricing services, each in","page_number":152,"box":{"x":70,"y":596,"width":825,"height":11}},{"id":"4f14346d-a431-4af0-a159-9f054747904d","block_type":"box","text":"accordance with the Valuation Procedures. The pricing services may use valuation models that utilize certain inputs","page_number":152,"box":{"x":69,"y":611,"width":823,"height":11}},{"id":"4d50b7cf-15cf-411f-a301-788146edf005","block_type":"box","text":"and assumptions to derive values, including transaction data (","page_number":152,"box":{"x":69,"y":626,"width":443,"height":11}},{"id":"37400102-e9f8-4d82-a84b-ade343f5be8d","block_type":"box","text":"e.g.","page_number":152,"box":{"x":514,"y":628,"width":24,"height":9}},{"id":"2d5d95db-6fb8-4e20-8e55-ab7fcbe7f666","block_type":"box","text":", recent representative bids and offers), credit","page_number":152,"box":{"x":541,"y":626,"width":328,"height":11}},{"id":"0b841ad9-524a-415e-af52-2e5d9ec62e61","block_type":"box","text":"quality information, perceived market movements, news, and other relevant information and by other methods, which","page_number":152,"box":{"x":69,"y":641,"width":834,"height":11}},{"id":"e39634bc-6c32-4eb7-b38d-8a2c462670e0","block_type":"box","text":"may include consideration of: yields or prices of securities of comparable quality, coupon, maturity and type;","page_number":152,"box":{"x":69,"y":656,"width":769,"height":11}},{"id":"5ccd26b4-8ea8-4cfe-956b-025a22ba4332","block_type":"box","text":"indications as to values from dealers; general market conditions; and/or other factors and assumptions. Pricing","page_number":152,"box":{"x":70,"y":671,"width":797,"height":12}},{"id":"ada54cd2-4e93-4f33-927e-c4e7f871a1ee","block_type":"box","text":"services generally value fixed-income securities assuming orderly transactions of an institutional round lot size, but","page_number":152,"box":{"x":69,"y":686,"width":821,"height":12}},{"id":"99bbe5cd-4f28-4370-ae2b-d199ac283fbb","block_type":"box","text":"the Fund may hold or transact in such securities in smaller, odd lot sizes. Odd lots of securities in certain asset","page_number":152,"box":{"x":68,"y":702,"width":798,"height":11}},{"id":"e7485081-5b8a-49e3-b354-677ab0d45f36","block_type":"box","text":"classes may trade at lower prices than institutional round lots, and the value ultimately realized when the securities","page_number":152,"box":{"x":69,"y":717,"width":825,"height":11}},{"id":"d954c8bc-deeb-4d35-824a-2706c6cb1e3a","block_type":"box","text":"are sold could differ from the prices used by a Fund. The amortized cost method of valuation may be used with","page_number":152,"box":{"x":69,"y":732,"width":791,"height":11}},{"id":"eecda7cc-3989-4183-a91b-fcb159de35c6","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":152,"box":{"x":69,"y":747,"width":814,"height":11}},{"id":"c1afa7fe-536a-41bf-a303-903cd2ffb4cc","block_type":"box","text":"value. Certain fixed-income investments, including asset-backed and mortgage related securities, may be valued","page_number":152,"box":{"x":68,"y":762,"width":802,"height":11}},{"id":"55b8d777-38ca-42e2-8a85-c4acf927b960","block_type":"box","text":"based on valuation models that consider the estimated cash flows of each tranche of the issuer, establish a","page_number":152,"box":{"x":69,"y":777,"width":773,"height":11}},{"id":"b446f749-aa8c-4b35-ac69-0f155289940e","block_type":"box","text":"benchmark yield and develop an estimated tranche specific spread to the benchmark yield based on the unique","page_number":152,"box":{"x":69,"y":792,"width":795,"height":12}},{"id":"c21e3981-930d-480b-9830-6c9836b5df1a","block_type":"box","text":"attributes of the tranche.","page_number":152,"box":{"x":69,"y":807,"width":176,"height":9}},{"id":"02378c47-62d0-44c8-9b27-23a6b5c52fab","block_type":"box","text":"Options, Futures, Swaps and Other Derivatives.","page_number":152,"box":{"x":101,"y":830,"width":344,"height":11}},{"id":"331ed6cd-4e0f-4984-9b56-05246fe0e4a0","block_type":"box","text":"Exchange-traded equity options (except ETF options, equity","page_number":152,"box":{"x":453,"y":830,"width":416,"height":11}},{"id":"80ca8049-2d15-4636-b51d-e228a1deee9f","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":152,"box":{"x":70,"y":845,"width":829,"height":11}},{"id":"b85c7b1b-4a6e-452f-b728-b0c667a70294","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":152,"box":{"x":69,"y":860,"width":824,"height":12}},{"id":"b3e9b0b1-392e-46f9-bed2-2a71577ac91f","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":152,"box":{"x":68,"y":875,"width":838,"height":12}},{"id":"865bc08d-3d85-49bd-80d5-a3f603631bf1","block_type":"box","text":"the Fund values such option, the last bid (long positions) or ask (short positions) price, if available, will be used as","page_number":152,"box":{"x":68,"y":891,"width":820,"height":11}},{"id":"a7b38d58-a374-45a8-bb78-372aa30e4926","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":152,"box":{"x":68,"y":906,"width":808,"height":11}},{"id":"1371a5cf-699b-43d5-9e6f-f369dc9b8df8","block_type":"box","text":"II-122","page_number":152,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6033b09c-6582-4626-be54-6dc182a46594","block_type":"box","text":"NM1026U-5979889-152/232","page_number":152,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"64f6e10a-8aac-4317-8de1-5db031521600","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":153,"box":{"x":69,"y":45,"width":824,"height":11}},{"id":"e4c8d568-a4c9-4203-8b7c-f23475419383","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":153,"box":{"x":68,"y":60,"width":789,"height":11}},{"id":"1147bc6b-0420-4506-b6db-430827d4f522","block_type":"box","text":"options, ETF options, equity index options and OTC derivatives, may be valued using a mathematical model which","page_number":153,"box":{"x":69,"y":75,"width":807,"height":11}},{"id":"f597bf57-89f2-4d83-aec1-d9e1366b2dd0","block_type":"box","text":"may incorporate a number of market data factors. Financial futures contracts and options thereon, which are traded","page_number":153,"box":{"x":69,"y":90,"width":824,"height":11}},{"id":"f7f74be1-cfa1-4b30-99dd-abd306c5d790","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":153,"box":{"x":69,"y":105,"width":833,"height":11}},{"id":"8449521d-5247-4e28-8c24-7943a0b15860","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":153,"box":{"x":69,"y":120,"width":830,"height":12}},{"id":"ed4c6123-f0ee-4787-95f0-7e3572120116","block_type":"box","text":"accordance with the Valuation Procedures.","page_number":153,"box":{"x":69,"y":136,"width":301,"height":8}},{"id":"1e595c72-95e7-409e-8912-8df7eab79b8a","block_type":"box","text":"Underlying Funds.","page_number":153,"box":{"x":102,"y":158,"width":128,"height":11}},{"id":"073f94cd-fd18-465f-be43-e9f3ef75dbd6","block_type":"box","text":"Shares of underlying open-end funds that are not traded on an exchange (including money","page_number":153,"box":{"x":237,"y":158,"width":640,"height":11}},{"id":"46db552b-a286-4e7c-aaa5-f4b25f38b927","block_type":"box","text":"market funds) are valued at NAV. Shares of underlying exchange-traded closed-end funds or other ETFs will be valued","page_number":153,"box":{"x":69,"y":173,"width":830,"height":11}},{"id":"7396f1bc-2d98-49f6-b0c5-b3010259df15","block_type":"box","text":"at their most recent closing price.","page_number":153,"box":{"x":69,"y":188,"width":238,"height":12}},{"id":"110d1d8c-d56d-4fa2-b3e4-55f04b94acf8","block_type":"box","text":"General Valuation Information.","page_number":153,"box":{"x":101,"y":211,"width":220,"height":9}},{"id":"49278cde-8014-41dd-b178-4e8a9a7a7381","block_type":"box","text":"Prices obtained from independent third-party pricing services, broker-dealers or","page_number":153,"box":{"x":328,"y":211,"width":564,"height":11}},{"id":"0ade226b-e841-427c-8bba-70e1a9130fdc","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":153,"box":{"x":69,"y":226,"width":831,"height":9}},{"id":"9e51c36f-4596-4385-a027-961027cf27e9","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":153,"box":{"x":68,"y":241,"width":828,"height":11}},{"id":"8b36a86c-e7b4-4a85-97aa-c653aabeedda","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":153,"box":{"x":69,"y":257,"width":829,"height":11}},{"id":"6b875385-d888-427e-a6a9-663784ce430c","block_type":"box","text":"applied prospectively. Such determination will be made considering pertinent facts and circumstances surrounding","page_number":153,"box":{"x":69,"y":271,"width":817,"height":12}},{"id":"acc9aeb9-b59a-47c7-96b5-e2df26d80914","block_type":"box","text":"the revision.","page_number":153,"box":{"x":68,"y":287,"width":87,"height":9}},{"id":"de17c66f-6248-4fe6-8f40-6763f72c4c97","block_type":"box","text":"In determining the market value of portfolio investments, the Fund may employ independent third-party pricing","page_number":153,"box":{"x":102,"y":309,"width":784,"height":11}},{"id":"126d7fe4-fc3f-4477-b093-d8cec4fd7ee8","block_type":"box","text":"services, which may use, without limitation, evaluated pricing methods that take into consideration market indexes,","page_number":153,"box":{"x":69,"y":325,"width":823,"height":11}},{"id":"89cd6579-064b-495f-87a6-0107a48f6c81","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":153,"box":{"x":69,"y":339,"width":818,"height":12}},{"id":"00c8a0be-8885-49d4-a2c7-0024efad96c3","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":153,"box":{"x":70,"y":355,"width":832,"height":11}},{"id":"c80f2454-f6f7-426c-88a0-9d84e1252e02","block_type":"box","text":"price the Fund could receive upon the sale of any particular portfolio investment may differ from the Fund’s valuation","page_number":153,"box":{"x":70,"y":370,"width":832,"height":11}},{"id":"d38b1e48-a242-4707-849b-4d6ea65ef995","block_type":"box","text":"of the investment, particularly for assets that trade in thin or volatile markets or that are valued using a fair valuation","page_number":153,"box":{"x":69,"y":385,"width":834,"height":11}},{"id":"fc181b49-5b17-4e91-86b3-247b0663d4b9","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":153,"box":{"x":69,"y":400,"width":837,"height":11}},{"id":"1ac49e3d-e79a-4c62-a9da-e183b60a5687","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":153,"box":{"x":70,"y":415,"width":833,"height":11}},{"id":"1d1b791c-a09d-4bb9-82bb-6d312a7bb41e","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":153,"box":{"x":69,"y":430,"width":827,"height":11}},{"id":"6c972e2c-9ff7-4867-8c7b-5d8a803c11f8","block_type":"box","text":"impacted by technological issues and/or errors by pricing services or other third-party service providers.","page_number":153,"box":{"x":70,"y":446,"width":741,"height":11}},{"id":"92ee1626-6712-4ef2-b416-f644c56753d9","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":153,"box":{"x":102,"y":468,"width":800,"height":11}},{"id":"bbcd52c1-9cd4-4be2-8d0e-19cf127ed819","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":153,"box":{"x":69,"y":483,"width":811,"height":11}},{"id":"1c4b0025-0373-433d-922f-ae075ae5b084","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":153,"box":{"x":69,"y":498,"width":827,"height":11}},{"id":"e32af3da-9110-4321-8bce-cc5f4e00eadb","block_type":"box","text":"value. All other assets and liabilities (including securities for which market quotations are not readily available) held","page_number":153,"box":{"x":68,"y":513,"width":824,"height":12}},{"id":"13d9a626-f23e-41f9-9e63-159ab5ed45f4","block_type":"box","text":"by a Fund (including restricted securities and private market investments, as applicable) are valued at fair value as","page_number":153,"box":{"x":69,"y":528,"width":817,"height":12}},{"id":"97a1a1c1-eb40-4c7e-b63d-1a68d1cfabf6","block_type":"box","text":"determined in good faith by BlackRock pursuant to the Valuation Procedures. Any assets and liabilities which are","page_number":153,"box":{"x":69,"y":543,"width":802,"height":12}},{"id":"55b3bcb8-9316-4dcc-88a7-5339e41e1726","block_type":"box","text":"denominated in a foreign currency are translated into U.S. dollars at the prevailing market rates.","page_number":153,"box":{"x":69,"y":559,"width":685,"height":11}},{"id":"f56e61d2-c995-4bbb-aaa6-7946b5671c52","block_type":"box","text":"Certain of the securities acquired by the Funds may be traded on foreign exchanges or OTC markets on days on","page_number":153,"box":{"x":102,"y":581,"width":795,"height":12}},{"id":"7e1d39cd-8564-4753-9b2c-26a809cd6e1d","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":153,"box":{"x":68,"y":596,"width":805,"height":12}},{"id":"a5c7458a-a28b-4118-bb4b-af36d955e384","block_type":"box","text":"days when investors can neither purchase nor redeem shares of the Fund.","page_number":153,"box":{"x":69,"y":612,"width":529,"height":11}},{"id":"e6fa94ff-b73f-4238-b64d-aeab9b52c2f1","block_type":"box","text":"Fair Value.","page_number":153,"box":{"x":102,"y":634,"width":74,"height":9}},{"id":"13b6b97c-1200-4235-9cef-b50f5c200355","block_type":"box","text":"When market quotations are not readily available or are believed by BlackRock to be unreliable, a","page_number":153,"box":{"x":183,"y":634,"width":693,"height":11}},{"id":"82256060-4d83-40df-a070-3d0cec6d6a3e","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":153,"box":{"x":70,"y":649,"width":785,"height":12}},{"id":"6a3bf5f9-57ea-4be6-8ef1-d842cb50bfd0","block_type":"box","text":"accordance with the Valuation Procedures. Pursuant to Rule 2a-5 under the Investment Company Act, the Board of","page_number":153,"box":{"x":69,"y":664,"width":816,"height":12}},{"id":"ec8e122b-f25a-4dd3-8fc0-2002f1d7079f","block_type":"box","text":"Directors has designated BlackRock as the valuation designee for the respective Funds for which it serves as","page_number":153,"box":{"x":70,"y":680,"width":779,"height":11}},{"id":"63f375cf-a3ba-44a4-ad57-2494ed84444a","block_type":"box","text":"investment adviser. BlackRock may reasonably conclude that a market quotation is not readily available or is","page_number":153,"box":{"x":70,"y":695,"width":773,"height":11}},{"id":"987d8bed-907a-4196-8d4b-a2ac8997acf7","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":153,"box":{"x":69,"y":710,"width":772,"height":11}},{"id":"c6b3319a-918a-4dfa-8f0a-f780180cd75f","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":153,"box":{"x":69,"y":725,"width":826,"height":11}},{"id":"6da9cd4a-5ea9-44dc-9de6-30876fcb1327","block_type":"box","text":"(","page_number":153,"box":{"x":69,"y":740,"width":3,"height":11}},{"id":"722b7397-dcfd-4774-8771-6b0666365538","block_type":"box","text":"e.g.","page_number":153,"box":{"x":74,"y":742,"width":25,"height":9}},{"id":"b7597f45-69dc-4c55-a374-26da5a9eaf07","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":153,"box":{"x":101,"y":740,"width":806,"height":11}},{"id":"d76ee7a0-3947-4483-9e16-370ba5aec379","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":153,"box":{"x":69,"y":755,"width":813,"height":11}},{"id":"9c40d488-009d-4208-ac6f-2ef9b98c3fa9","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":153,"box":{"x":68,"y":770,"width":837,"height":12}},{"id":"537f4ec3-5a36-49e8-afda-84a7fd49d250","block_type":"box","text":"purpose, a “significant event” is deemed to occur if BlackRock determines, in its reasonable business judgment, that","page_number":153,"box":{"x":70,"y":785,"width":838,"height":12}},{"id":"1a95d5d4-070b-440f-ba64-12e7dcb032f3","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":153,"box":{"x":69,"y":801,"width":824,"height":11}},{"id":"f2976ff0-7ecc-4af9-afc2-27d931038738","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":153,"box":{"x":69,"y":816,"width":828,"height":11}},{"id":"e56aa121-be36-454f-905e-698efeccd211","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":153,"box":{"x":69,"y":831,"width":793,"height":11}},{"id":"9656b469-3ea9-44f4-b747-2353eb1be535","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":153,"box":{"x":70,"y":846,"width":819,"height":11}},{"id":"6bef0673-fb71-4d8b-a1fb-41ff5086111a","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":153,"box":{"x":68,"y":861,"width":810,"height":11}},{"id":"38e5d85e-9918-4309-8c5b-bf2a80f1fc8d","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":153,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"c811bfda-7ff4-44a7-b007-09a2d96e32ba","block_type":"box","text":"be treated as a Fair Value Asset. For certain foreign assets, a third-party vendor supplies evaluated, systematic fair","page_number":153,"box":{"x":69,"y":891,"width":822,"height":12}},{"id":"f0eb2971-577c-4cff-999f-d3ef91e6de3c","block_type":"box","text":"value pricing based upon the movement of a proprietary multi-factor model after the relevant foreign markets have","page_number":153,"box":{"x":68,"y":906,"width":814,"height":12}},{"id":"b69ba298-a7c8-4787-abb1-52019161950e","block_type":"box","text":"II-123","page_number":153,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"36da46c0-761e-4401-9e6c-c31b21703a36","block_type":"box","text":"NM1026U-5979889-153/232","page_number":153,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"5cd9733a-f63d-4f23-b530-9d422a49a05b","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":154,"box":{"x":69,"y":45,"width":827,"height":11}},{"id":"ae90730d-c0e7-47f3-8f0c-806619e0147e","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":154,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"cab81db3-2c26-4c3d-94f1-2244c5a5e12a","block_type":"box","text":"pricing time.","page_number":154,"box":{"x":70,"y":75,"width":85,"height":11}},{"id":"c651cc1d-f004-4d37-aadf-37a90d4bf2f8","block_type":"box","text":"BlackRock’s Rule 2a-5 Committee is responsible for reviewing and approving methodologies by investment type","page_number":154,"box":{"x":102,"y":98,"width":794,"height":11}},{"id":"8a0b5e18-468f-4377-8528-53097ae675ea","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":154,"box":{"x":69,"y":113,"width":829,"height":11}},{"id":"f8bcc1a5-6b18-4249-a786-a4e8d25b756e","block_type":"box","text":"assists BlackRock by periodically endeavoring to confirm the prices it receives from all third-party pricing services,","page_number":154,"box":{"x":69,"y":128,"width":813,"height":11}},{"id":"e074c564-0eea-4c82-83f0-c3b01cb0c53a","block_type":"box","text":"index providers and broker-dealers. BlackRock regularly evaluates the values assigned to the securities and other","page_number":154,"box":{"x":70,"y":143,"width":808,"height":11}},{"id":"0fa7ddf4-a5d9-459d-a7eb-ac126808b29f","block_type":"box","text":"assets and liabilities of the Funds.","page_number":154,"box":{"x":69,"y":158,"width":245,"height":9}},{"id":"2bf8e8bb-9c4d-4ea8-9c1d-20e14adee126","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":154,"box":{"x":101,"y":181,"width":795,"height":11}},{"id":"3c507085-b07f-418d-b786-4ba791b87c79","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":154,"box":{"x":69,"y":196,"width":832,"height":11}},{"id":"f7f43168-3cde-4ff5-ad0d-8b621a42eb6e","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":154,"box":{"x":69,"y":211,"width":805,"height":11}},{"id":"724f68a9-7a11-454e-9261-224d42b4578e","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":154,"box":{"x":69,"y":226,"width":834,"height":11}},{"id":"55824a9f-9bf3-420c-b799-76483a055142","block_type":"box","text":"determinations will be based upon all available factors that BlackRock deems relevant at the time of the","page_number":154,"box":{"x":69,"y":241,"width":744,"height":11}},{"id":"e2b41676-f363-40ec-9236-747ffcebd128","block_type":"box","text":"determination, and may be based on analytical values determined by BlackRock using proprietary or third-party","page_number":154,"box":{"x":69,"y":257,"width":791,"height":11}},{"id":"451dbe81-e9a8-406e-840e-1dc2ddd80c90","block_type":"box","text":"valuation models.","page_number":154,"box":{"x":68,"y":272,"width":125,"height":8}},{"id":"cfd7a842-c8d9-4c5d-9c94-5849a2bcac2e","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":154,"box":{"x":102,"y":294,"width":785,"height":11}},{"id":"5748bfe9-f360-45dd-91f5-0823a7964ce7","block_type":"box","text":"value of an investment, one or more fair value methodologies may be used (depending on certain factors, including","page_number":154,"box":{"x":68,"y":309,"width":822,"height":11}},{"id":"e68c2876-4cac-4e85-af1f-44ce682430a4","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":154,"box":{"x":68,"y":324,"width":820,"height":12}},{"id":"daa65088-7f65-4c58-a3cb-8ef285329d02","block_type":"box","text":"alternatively, using proprietary or third-party models that may rely upon one or more unobservable inputs. Prices of","page_number":154,"box":{"x":69,"y":339,"width":818,"height":12}},{"id":"b7dac2a5-8796-418c-82b0-424e85cb63bc","block_type":"box","text":"actual, executed or historical transactions in the relevant investment (or comparable instruments) or, where","page_number":154,"box":{"x":69,"y":355,"width":766,"height":11}},{"id":"b8a9471d-c003-42cc-9d2b-b5420cabc8a6","block_type":"box","text":"appropriate, an appraisal by a third-party experienced in the valuation of similar instruments, may also be used as a","page_number":154,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"e584bb3d-5880-454b-94d9-026fb63ada60","block_type":"box","text":"basis for establishing the fair value of an investment.","page_number":154,"box":{"x":69,"y":385,"width":378,"height":11}},{"id":"ee617238-a7b8-4b54-ba19-2d4e0968320b","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":154,"box":{"x":101,"y":407,"width":784,"height":12}},{"id":"396b2c34-8e9e-4748-9d6b-d378a76d0053","block_type":"box","text":"liabilities could have been sold during the period in which the particular fair values were used in determining a Fund’s","page_number":154,"box":{"x":70,"y":423,"width":836,"height":11}},{"id":"461d12f8-ff9e-4bb4-805a-019a28c227f2","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":154,"box":{"x":70,"y":438,"width":834,"height":11}},{"id":"b61e832d-8585-47e5-9f9c-ca0c21abde46","block_type":"box","text":"fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.","page_number":154,"box":{"x":68,"y":453,"width":728,"height":11}},{"id":"cdcc97d6-1f50-4aa0-ab57-cefcc738d9b9","block_type":"box","text":"Each Fund’s annual audited financial statements, which are prepared in accordance with accounting principles","page_number":154,"box":{"x":102,"y":475,"width":786,"height":12}},{"id":"4a5b4155-707e-4652-a838-97f5e9e5c4c0","block_type":"box","text":"generally accepted in the United States of America (“US GAAP”), follow the requirements for valuation set forth in","page_number":154,"box":{"x":68,"y":491,"width":809,"height":11}},{"id":"64c56d21-0317-4fe0-901f-3c21038e4420","block_type":"box","text":"Financial Accounting Standards Board Accounting Standards Codification Topic 820, “Fair Value Measurements and","page_number":154,"box":{"x":70,"y":506,"width":821,"height":11}},{"id":"3e2a9981-fa57-4640-9ff5-dd4e7eed1bd8","block_type":"box","text":"Disclosures” (“ASC 820”), which defines and establishes a framework for measuring fair value under US GAAP and","page_number":154,"box":{"x":70,"y":521,"width":818,"height":11}},{"id":"af639f74-44ea-4f4d-9bbd-926c639b8a27","block_type":"box","text":"expands financial statement disclosure requirements relating to fair value measurements.","page_number":154,"box":{"x":69,"y":536,"width":641,"height":11}},{"id":"78549185-64d3-432f-9d80-acf775892d32","block_type":"box","text":"Generally, ASC 820 and other accounting rules applicable to funds and various assets in which they invest are","page_number":154,"box":{"x":102,"y":559,"width":786,"height":11}},{"id":"8fb1aa9b-0965-4b31-bc8e-eafb78aee9de","block_type":"box","text":"evolving. Such changes may adversely affect a Fund. For example, the evolution of rules governing the determination","page_number":154,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"ede0bd29-eb96-4f80-908f-3defffb64a80","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":154,"box":{"x":69,"y":589,"width":780,"height":11}},{"id":"79c7f8fe-9a97-435b-886c-b2d4fd165130","block_type":"box","text":"increase the cost and/or reduce the availability of third-party determinations of fair market value. This may in turn","page_number":154,"box":{"x":70,"y":604,"width":810,"height":11}},{"id":"1ac88992-fcf4-4e50-91a7-e4789c28d722","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":154,"box":{"x":70,"y":619,"width":810,"height":11}},{"id":"dea59c69-ad7b-4392-8942-251a9a4a2a9b","block_type":"box","text":"party determination of fair market value.","page_number":154,"box":{"x":70,"y":634,"width":285,"height":11}},{"id":"0f21809f-082a-4133-9d81-c179e7e2f326","block_type":"box","text":"Computation of Offering Price Per Share","page_number":154,"box":{"x":69,"y":665,"width":292,"height":11}},{"id":"e6df8c93-bc24-4b92-b6b7-ca7fd69de5db","block_type":"box","text":"See “Computation of Offering Price Per Share” in Part I of a Fund’s SAI for an illustration of the computation of","page_number":154,"box":{"x":102,"y":687,"width":791,"height":11}},{"id":"8f6b54cd-cbd5-4a29-af01-60feccd2e7c9","block_type":"box","text":"the offering price for shares of your Fund.","page_number":154,"box":{"x":68,"y":702,"width":295,"height":12}},{"id":"c2dda899-7b46-4fff-b4ab-35d3730eb9d5","block_type":"box","text":"PORTFOLIO TRANSACTIONS AND BROKERAGE","page_number":154,"box":{"x":303,"y":732,"width":373,"height":10}},{"id":"16738a89-0877-4e11-a288-626ef921bf2d","block_type":"box","text":"Transactions in Portfolio Securities","page_number":154,"box":{"x":68,"y":762,"width":257,"height":9}},{"id":"93ee0c74-1dad-4728-9eb5-41616b98a0e7","block_type":"box","text":"Subject to policies established by the Board of Directors, BlackRock is primarily responsible for the execution of","page_number":154,"box":{"x":102,"y":785,"width":798,"height":11}},{"id":"735f4ddc-c243-45e6-98f6-4682822b39e6","block_type":"box","text":"a Fund’s portfolio transactions and the allocation of brokerage. BlackRock does not execute transactions through any","page_number":154,"box":{"x":69,"y":800,"width":839,"height":11}},{"id":"1d6d6165-8503-4932-95af-21fc3b8fe1d9","block_type":"box","text":"particular broker or dealer, but seeks to obtain the best net results for the Fund, taking into account certain factors","page_number":154,"box":{"x":70,"y":815,"width":822,"height":11}},{"id":"6fd4ca7c-27b1-44ea-8a2f-cad228951cfa","block_type":"box","text":"set out below. While BlackRock generally seeks reasonable trade execution costs, a Fund does not necessarily pay","page_number":154,"box":{"x":69,"y":830,"width":820,"height":11}},{"id":"346d7774-f404-4f3c-b902-573739df5702","block_type":"box","text":"the lowest spread or commission available, and payment of the lowest commission or spread is not necessarily","page_number":154,"box":{"x":68,"y":845,"width":798,"height":11}},{"id":"4152de62-3957-4d4f-8445-19dda21af19d","block_type":"box","text":"consistent with obtaining the best price and execution in particular transactions. Subject to applicable legal","page_number":154,"box":{"x":69,"y":860,"width":765,"height":12}},{"id":"8c4a7910-05be-4f9c-bb4a-01a7a8ee9650","block_type":"box","text":"requirements, BlackRock may select a broker based partly upon brokerage or research services provided to","page_number":154,"box":{"x":69,"y":876,"width":768,"height":11}},{"id":"72879f81-5911-4dc3-baa2-6c937727e66a","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":154,"box":{"x":70,"y":891,"width":830,"height":11}},{"id":"379003c4-5d9f-4940-ae16-4f686b6ec3a5","block_type":"box","text":"II-124","page_number":154,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"40ee516b-cb33-4d9e-9b00-9766260daca0","block_type":"box","text":"NM1026U-5979889-154/232","page_number":154,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ba03b884-cb02-4f9f-a671-95c07ffb535c","block_type":"box","text":"commission than other brokers would charge if BlackRock determines in good faith that the commission is","page_number":155,"box":{"x":69,"y":45,"width":760,"height":11}},{"id":"13f76f02-e773-4f28-b3d9-edf650d0f065","block_type":"box","text":"reasonable in relation to the services provided.","page_number":155,"box":{"x":69,"y":60,"width":336,"height":11}},{"id":"ee6795c4-d68d-4c0f-bd76-496f13a04c6a","block_type":"box","text":"In the case of Feeder Funds, because each Feeder Fund generally invests exclusively in beneficial interests of a","page_number":155,"box":{"x":102,"y":82,"width":794,"height":12}},{"id":"27e53ddb-f882-476b-a9b2-87493446c888","block_type":"box","text":"Master Portfolio, it is expected that all transactions in portfolio securities will be entered into by the Master Portfolio.","page_number":155,"box":{"x":70,"y":98,"width":835,"height":11}},{"id":"d3e32eca-339c-46a4-951a-3c52a473f06d","block_type":"box","text":"In selecting brokers or dealers to execute portfolio transactions, the Manager and sub-advisers seek to obtain","page_number":155,"box":{"x":102,"y":120,"width":784,"height":12}},{"id":"7743f1ab-6618-48d6-b6f2-38cc178c80a1","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":155,"box":{"x":68,"y":135,"width":829,"height":12}},{"id":"c1a4c767-d7ac-4390-b4d6-221cdd40ae17","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":155,"box":{"x":69,"y":150,"width":802,"height":12}},{"id":"8ef73f99-6cdc-4748-9fd5-c579a2be9d53","block_type":"box","text":"(ii) the desired timing of the transaction; (iii) BlackRock’s knowledge of the expected commission rates and spreads","page_number":155,"box":{"x":69,"y":166,"width":826,"height":11}},{"id":"2cb4ddf5-348e-48c7-ba47-0acdec688894","block_type":"box","text":"currently available; (iv) the activity existing and expected in the market for the particular security or instrument,","page_number":155,"box":{"x":69,"y":181,"width":789,"height":11}},{"id":"01630162-8f33-4104-802c-312b8e116782","block_type":"box","text":"including any anticipated execution difficulties; (v) the full range of brokerage services provided; (vi) the broker’s or","page_number":155,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"2daff0c8-71f1-4150-a7d8-84434b6e46bd","block_type":"box","text":"dealer’s capital; (vii) the quality of research and research services provided; (viii) the reasonableness of the","page_number":155,"box":{"x":69,"y":211,"width":769,"height":11}},{"id":"656da97b-654b-441f-b158-abb8f284ac37","block_type":"box","text":"commission, dealer spread or its equivalent for the specific transaction; and (ix) BlackRock’s knowledge of any actual","page_number":155,"box":{"x":69,"y":226,"width":837,"height":11}},{"id":"a0af9925-46e5-4d67-8616-f8e1b4ae6daa","block_type":"box","text":"or apparent operational problems of a broker or dealer.","page_number":155,"box":{"x":69,"y":241,"width":391,"height":11}},{"id":"34cf3d61-cda7-4c28-be6b-184054ed46e7","block_type":"box","text":"Section 28(e) of the Exchange Act (“Section 28(e)”) permits an investment adviser, under certain circumstances","page_number":155,"box":{"x":102,"y":264,"width":801,"height":11}},{"id":"728e4d82-023e-4c78-bcfc-dbaef7a0f6ff","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":155,"box":{"x":68,"y":279,"width":802,"height":11}},{"id":"a07f5929-d013-47d5-8896-94e609b0d682","block_type":"box","text":"another broker or dealer would have charged for effecting the same transaction in recognition of the value of","page_number":155,"box":{"x":69,"y":294,"width":775,"height":11}},{"id":"4a45b182-f405-4056-ba64-585324706d87","block_type":"box","text":"brokerage and research services provided by that broker or dealer. This includes commissions paid on riskless","page_number":155,"box":{"x":69,"y":309,"width":790,"height":11}},{"id":"38fbc483-cf31-40a4-b61a-93c8dbf41b2e","block_type":"box","text":"principal transactions under certain conditions. Brokerage and research services include: (1) furnishing advice as to","page_number":155,"box":{"x":70,"y":324,"width":827,"height":12}},{"id":"54205157-e49c-4d83-a86c-f8dcd33602f2","block_type":"box","text":"the value of securities, including pricing and appraisal advice, credit analysis, risk measurement analysis,","page_number":155,"box":{"x":68,"y":339,"width":753,"height":12}},{"id":"ec2b262e-9bde-42d8-a4d7-c8e60fce4932","block_type":"box","text":"performance and other analysis, as well as the advisability of investing in, purchasing or selling securities, and the","page_number":155,"box":{"x":70,"y":355,"width":818,"height":11}},{"id":"01573a25-ab92-4810-9571-84ab658f2ad4","block_type":"box","text":"availability of securities or purchasers or sellers of securities; (2) furnishing analyses and reports concerning issuers,","page_number":155,"box":{"x":69,"y":370,"width":837,"height":11}},{"id":"4e76beec-5315-43db-ab34-250f3d0af2f8","block_type":"box","text":"industries, securities, economic factors and trends, portfolio strategy, and the performance of accounts; and","page_number":155,"box":{"x":70,"y":385,"width":775,"height":11}},{"id":"a4082610-e794-47e7-8fe2-2296273cf126","block_type":"box","text":"(3) effecting securities transactions and performing functions incidental to securities transactions (such as","page_number":155,"box":{"x":69,"y":400,"width":764,"height":11}},{"id":"fdd8a177-783b-49e5-9510-66000eea962a","block_type":"box","text":"clearance, settlement, and custody). BlackRock believes that access to independent investment research is","page_number":155,"box":{"x":69,"y":415,"width":770,"height":11}},{"id":"1eabacd8-3937-4eb1-8fd7-cecd49a01530","block_type":"box","text":"beneficial to its investment decision-making processes and, therefore, to the Funds.","page_number":155,"box":{"x":69,"y":430,"width":599,"height":11}},{"id":"8e13c2dd-60d0-4181-bbd0-3afc4b8ac5cb","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may participate in client commission arrangements under which","page_number":155,"box":{"x":102,"y":453,"width":796,"height":11}},{"id":"992cc911-e03a-4afa-a49a-19574ead9aa8","block_type":"box","text":"BlackRock may execute transactions through a broker-dealer and request that the broker-dealer allocate a portion of","page_number":155,"box":{"x":70,"y":468,"width":829,"height":11}},{"id":"f06a2522-b319-4c45-9834-1f39de1833c6","block_type":"box","text":"the commissions or commission credits to another firm that provides research to BlackRock. BlackRock believes that","page_number":155,"box":{"x":68,"y":483,"width":839,"height":11}},{"id":"0b3239bf-5d22-457f-9746-51613a1912ae","block_type":"box","text":"research services obtained through soft dollar or commission sharing arrangements enhance its investment decision","page_number":155,"box":{"x":69,"y":498,"width":839,"height":11}},{"id":"c0dd3ede-2d07-4c9e-a6fd-2f0930107984","block_type":"box","text":"making capabilities, thereby increasing the prospects for higher investment returns. BlackRock will engage only in","page_number":155,"box":{"x":69,"y":513,"width":809,"height":12}},{"id":"1475eacf-b8be-4522-a968-0ae3ac98423c","block_type":"box","text":"soft dollar or commission sharing transactions that comply with the requirements of Section 28(e). Certain Funds","page_number":155,"box":{"x":69,"y":528,"width":808,"height":12}},{"id":"c09df91c-cbdd-4c41-9cfe-70d8ee96097b","block_type":"box","text":"may be subject to additional regulations, including MiFID II. Under MiFID II, EU investment managers, including BIL,","page_number":155,"box":{"x":69,"y":544,"width":818,"height":11}},{"id":"9c8db19b-22a6-4612-a9d5-9dfdaddbf1a4","block_type":"box","text":"pay for any research out of their own resources and not through soft dollars or commission sharing arrangements.","page_number":155,"box":{"x":70,"y":559,"width":813,"height":11}},{"id":"b3c1592d-2048-4a96-bc6a-aeab58646ccc","block_type":"box","text":"BlackRock regularly evaluates the soft dollar products and services utilized, as well as the overall soft dollar and","page_number":155,"box":{"x":70,"y":574,"width":801,"height":11}},{"id":"d217223f-e53a-4137-9a59-322bcad563df","block_type":"box","text":"commission sharing arrangements to ensure that trades are executed by firms that are regarded as best able to","page_number":155,"box":{"x":69,"y":589,"width":802,"height":11}},{"id":"59de213e-177a-4eb5-924d-c7712f76deff","block_type":"box","text":"execute trades for client accounts, while at the same time providing access to the research and other services","page_number":155,"box":{"x":69,"y":604,"width":790,"height":11}},{"id":"8765ffbb-29e2-47b8-beab-31be6410a1f0","block_type":"box","text":"BlackRock views as impactful to its trading results.","page_number":155,"box":{"x":70,"y":619,"width":361,"height":11}},{"id":"869569d5-9df9-4f82-bef9-74f592ce4d87","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may utilize soft dollars and related services, including research","page_number":155,"box":{"x":102,"y":642,"width":791,"height":11}},{"id":"8899febb-2380-4724-ad71-260f29742b23","block_type":"box","text":"(whether prepared by the broker-dealer or prepared by a third-party and provided to BlackRock by the broker-dealer)","page_number":155,"box":{"x":69,"y":657,"width":819,"height":11}},{"id":"bd071e21-fc05-4dbd-bb7c-47036529e168","block_type":"box","text":"and execution or brokerage services within applicable rules and BlackRock’s policies to the extent that such","page_number":155,"box":{"x":69,"y":672,"width":772,"height":11}},{"id":"bc3d8eb9-49f6-4921-8f3f-a4bc1e4506a2","block_type":"box","text":"permitted services do not compromise BlackRock’s ability to seek to obtain best execution. In this regard, the","page_number":155,"box":{"x":70,"y":687,"width":785,"height":11}},{"id":"1269b817-828b-4d2c-833e-5b48fcf57354","block_type":"box","text":"portfolio management investment and/or trading teams may consider a variety of factors, including the degree to","page_number":155,"box":{"x":70,"y":702,"width":806,"height":12}},{"id":"b5a95591-3924-4f71-9441-a92ea03a3708","block_type":"box","text":"which the broker-dealer: (a) provides access to company management; (b) provides access to their analysts;","page_number":155,"box":{"x":68,"y":718,"width":772,"height":11}},{"id":"b3917aee-f0c2-4d50-b155-8d2f97ca47d9","block_type":"box","text":"(c) provides meaningful/insightful research notes on companies or other potential investments; (d) facilitates calls on","page_number":155,"box":{"x":69,"y":732,"width":838,"height":12}},{"id":"32ac44b0-ed88-4ec3-8ff6-f56ebe464bd1","block_type":"box","text":"which meaningful or insightful ideas about companies or potential investments are discussed; (e) facilitates","page_number":155,"box":{"x":68,"y":748,"width":769,"height":11}},{"id":"7a308ea1-2ef6-4a78-8308-d143e5017194","block_type":"box","text":"conferences at which meaningful or insightful ideas about companies or potential investments are discussed; or","page_number":155,"box":{"x":69,"y":763,"width":801,"height":11}},{"id":"6da96ef2-a3e0-477d-abfd-3edd70ec8ab0","block_type":"box","text":"(f) provides research tools such as market data, financial analysis, and other third-party related research and","page_number":155,"box":{"x":69,"y":778,"width":778,"height":11}},{"id":"17bfdc46-09fd-4697-9a0a-3f7f2aa9352e","block_type":"box","text":"brokerage tools that aid in the investment process.","page_number":155,"box":{"x":69,"y":793,"width":363,"height":11}},{"id":"604c8bc2-298e-4c15-9dc4-3d0f9b945c1e","block_type":"box","text":"Research-oriented services for which BlackRock, unless prohibited by applicable law, might pay with Fund","page_number":155,"box":{"x":102,"y":816,"width":749,"height":11}},{"id":"0d22f78f-1a76-49bb-8169-9fca46381ff3","block_type":"box","text":"commissions may be in written form or through direct contact with individuals and may include information as to","page_number":155,"box":{"x":69,"y":831,"width":799,"height":11}},{"id":"eb075fea-6be1-45fc-b8a6-b69ae5c9b0e6","block_type":"box","text":"particular companies or industries and securities or groups of securities, as well as market, economic, or","page_number":155,"box":{"x":70,"y":846,"width":752,"height":11}},{"id":"d00ce8d6-d244-4fc7-99f3-d4c14d654a69","block_type":"box","text":"institutional advice and statistical information, political developments and technical market information that assists","page_number":155,"box":{"x":70,"y":861,"width":823,"height":11}},{"id":"5fb9b271-7e63-4f15-abfd-68ff4b7b0578","block_type":"box","text":"in the valuation of investments. Except as noted immediately below, research services furnished by brokers may be","page_number":155,"box":{"x":70,"y":876,"width":822,"height":11}},{"id":"57bfd4b5-4dab-43e0-a0f2-7061d1f934f3","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":155,"box":{"x":69,"y":891,"width":840,"height":12}},{"id":"4e3c7517-cbf5-4243-8d4f-824be4760c3c","block_type":"box","text":"that paid commissions to the broker providing such services. In some cases, research information received from","page_number":155,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"29afe7a7-cf9a-40db-9ba2-f617a0fec582","block_type":"box","text":"II-125","page_number":155,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"3b781e0b-f205-4ff6-a90a-dc21f7372d40","block_type":"box","text":"NM1026U-5979889-155/232","page_number":155,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0efae2cb-8af4-4077-8c0e-3978a9b24bd3","block_type":"box","text":"brokers by mutual fund management personnel, or personnel principally responsible for BlackRock’s individually","page_number":156,"box":{"x":69,"y":45,"width":798,"height":11}},{"id":"df10f739-ecd7-409c-a347-9f637409df77","block_type":"box","text":"managed portfolios, is not necessarily shared by and between such personnel. Any investment advisory or other fees","page_number":156,"box":{"x":69,"y":60,"width":836,"height":11}},{"id":"aa625d41-fb62-450d-aee8-6386e6b47782","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":156,"box":{"x":70,"y":75,"width":832,"height":11}},{"id":"9fc6d375-81e1-47bb-896b-b19930bef618","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":156,"box":{"x":70,"y":90,"width":798,"height":11}},{"id":"0b33512d-2780-4baf-b3cd-82410cca9b49","block_type":"box","text":"occurs BlackRock makes a good faith allocation, under all the circumstances, between the research and non","page_number":156,"box":{"x":69,"y":105,"width":780,"height":11}},{"id":"2021744d-4144-4eea-8d46-4ff9563e0554","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":156,"box":{"x":69,"y":120,"width":827,"height":12}},{"id":"82053caf-e6d4-4db3-8780-34713be6810b","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":156,"box":{"x":69,"y":135,"width":821,"height":12}},{"id":"c60e8a2b-4bd7-4e51-af2a-23bd4bd9f5ce","block_type":"box","text":"non-research purposes. In making this good faith allocation, BlackRock faces a potential conflict of interest, but","page_number":156,"box":{"x":69,"y":150,"width":797,"height":12}},{"id":"d9ccb2b5-ff49-4172-8e01-f59840f4ed58","block_type":"box","text":"BlackRock believes that its allocation procedures are reasonably designed to ensure that it appropriately allocates","page_number":156,"box":{"x":70,"y":166,"width":815,"height":11}},{"id":"34677109-0db0-436e-a440-7edc18fe4eb1","block_type":"box","text":"the anticipated use of such services to their research and non-research uses.","page_number":156,"box":{"x":68,"y":181,"width":555,"height":11}},{"id":"568b67c6-7a9e-4d61-8ad8-d9427fe413b3","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":156,"box":{"x":102,"y":203,"width":802,"height":12}},{"id":"a2639552-ad37-4e48-9394-16174b8cf437","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":156,"box":{"x":68,"y":218,"width":825,"height":12}},{"id":"d2a526a2-6042-4ab6-aeea-a767a06822f1","block_type":"box","text":"or agree with clients to have research costs paid by clients through research payment accounts that are directly","page_number":156,"box":{"x":69,"y":234,"width":798,"height":11}},{"id":"5f0ad0b7-b006-455d-8ec1-b2d30171291f","block_type":"box","text":"funded or funded by a specific client research charge collected alongside execution commissions, provided that the","page_number":156,"box":{"x":68,"y":249,"width":824,"height":11}},{"id":"cc0f5117-764a-4e55-b75d-9d331aa3552f","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":156,"box":{"x":70,"y":264,"width":812,"height":11}},{"id":"343e7d20-0eb0-4d2f-8c1f-63f107934314","block_type":"box","text":"resources and not through soft dollars or commission sharing arrangements.","page_number":156,"box":{"x":69,"y":279,"width":547,"height":11}},{"id":"a1d856d1-2e5d-405d-98db-4fb6ae63ee1a","block_type":"box","text":"Payments of commissions to brokers who are affiliated persons of the Fund, or the Master Portfolio with respect","page_number":156,"box":{"x":102,"y":302,"width":804,"height":11}},{"id":"58c71c63-7ac2-401a-b370-7f54d186e9ef","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":156,"box":{"x":68,"y":317,"width":806,"height":11}},{"id":"41dee578-7aa5-4975-ae38-83998253692e","block_type":"box","text":"Investment Company Act. Subject to policies established by the Board of Directors of the Master Portfolio, BlackRock","page_number":156,"box":{"x":70,"y":332,"width":836,"height":11}},{"id":"3f9632c8-e590-4ea6-807e-681c015776c4","block_type":"box","text":"is primarily responsible for the execution of the Master Portfolio’s portfolio transactions and the allocation of","page_number":156,"box":{"x":70,"y":347,"width":777,"height":11}},{"id":"1441e99d-53c3-4a2c-b49d-8366334c15ec","block_type":"box","text":"brokerage.","page_number":156,"box":{"x":69,"y":362,"width":74,"height":11}},{"id":"98fdf9cd-3297-458b-b921-23a68152d0b5","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":156,"box":{"x":102,"y":385,"width":781,"height":11}},{"id":"01dc2169-0523-4456-ada2-e4af4a0ef825","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":156,"box":{"x":68,"y":400,"width":810,"height":11}},{"id":"354ed0aa-3d96-473e-a481-442b1ce36370","block_type":"box","text":"research services. FINRA has adopted rules expressly permitting these types of arrangements under certain","page_number":156,"box":{"x":69,"y":415,"width":771,"height":11}},{"id":"56b619aa-fa9b-49c2-a7e7-38815cd7d90a","block_type":"box","text":"circumstances. Generally, the broker will provide research “credits” in these situations at a rate that is higher than","page_number":156,"box":{"x":69,"y":430,"width":818,"height":11}},{"id":"ae5ff483-ecac-4d88-b999-a64f7e4a9f34","block_type":"box","text":"that available for typical secondary market transactions. These arrangements may not fall within the safe harbor of","page_number":156,"box":{"x":68,"y":445,"width":821,"height":12}},{"id":"f7ed8ad4-9f2a-462f-b7d1-d627d002c804","block_type":"box","text":"Section 28(e).","page_number":156,"box":{"x":69,"y":460,"width":99,"height":11}},{"id":"e918dd3e-b648-4272-bf68-481c5e0f21f9","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":156,"box":{"x":102,"y":483,"width":755,"height":9}},{"id":"83804b5d-323c-4253-a26e-8f830e44defe","block_type":"box","text":"brokers or dealers to execute portfolio transactions for a Fund; however, whether or not a particular broker or dealer","page_number":156,"box":{"x":69,"y":498,"width":828,"height":11}},{"id":"8855b872-5484-48d7-9b53-fbddf2ba6211","block_type":"box","text":"sells shares of the mutual funds advised by BlackRock neither qualifies nor disqualifies such broker or dealer to","page_number":156,"box":{"x":69,"y":513,"width":799,"height":11}},{"id":"c8581460-4f54-4de9-8218-7e7908daf398","block_type":"box","text":"execute transactions for those mutual funds.","page_number":156,"box":{"x":69,"y":528,"width":319,"height":9}},{"id":"27b4fb0f-554e-4ec4-83b8-f261dee25595","block_type":"box","text":"Each Fund anticipates that its brokerage transactions involving foreign securities generally will be conducted","page_number":156,"box":{"x":102,"y":551,"width":770,"height":11}},{"id":"3aa51f52-63e1-441e-80d7-a2b99b1f8234","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":156,"box":{"x":70,"y":566,"width":825,"height":11}},{"id":"08928187-cd5c-463c-8c15-82870c9aaf2d","block_type":"box","text":"in the form of depositary receipts, or other securities convertible into foreign equity securities. Depositary receipts","page_number":156,"box":{"x":70,"y":581,"width":816,"height":12}},{"id":"2126895d-64f6-4ea3-b700-72c1956462b5","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":156,"box":{"x":69,"y":597,"width":805,"height":11}},{"id":"c50c7729-c5db-4f6e-8271-9f8e74b7276e","block_type":"box","text":"American Depositary Receipts, like other securities traded in the United States, will be subject to negotiated","page_number":156,"box":{"x":68,"y":612,"width":773,"height":11}},{"id":"55a7b74c-c052-4174-b5bc-73a82984c3f0","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":156,"box":{"x":69,"y":627,"width":798,"height":11}},{"id":"f13087fd-f90b-4a36-867f-9096f8e02987","block_type":"box","text":"intends to manage its portfolio so as to give reasonable assurance that it will be able to obtain U.S. dollars to the","page_number":156,"box":{"x":70,"y":642,"width":812,"height":11}},{"id":"d45520a2-2b60-4af1-87bd-e973b86d57ca","block_type":"box","text":"extent necessary to meet anticipated redemptions. Under present conditions, it is not believed that these","page_number":156,"box":{"x":69,"y":657,"width":754,"height":11}},{"id":"988da5ec-6359-47f7-a4de-c0cca44f7aa4","block_type":"box","text":"considerations will have a significant effect on a Fund’s portfolio strategies.","page_number":156,"box":{"x":69,"y":672,"width":540,"height":11}},{"id":"2b98f442-592a-4767-8cca-2c4a2d8d5c08","block_type":"box","text":"See “Portfolio Transactions and Brokerage” in the SAI for information about the brokerage commissions paid by","page_number":156,"box":{"x":102,"y":695,"width":798,"height":11}},{"id":"514b30ad-b4e5-40f1-9c15-3fbc8c2bd40f","block_type":"box","text":"your Fund, including commissions paid to affiliates, if any, for the periods indicated.","page_number":156,"box":{"x":68,"y":710,"width":597,"height":11}},{"id":"a6faf9fb-6e19-495c-a6bf-5da7fd8eefd0","block_type":"box","text":"Each Fund may invest in certain securities traded in the OTC market and intends to deal directly with the dealers","page_number":156,"box":{"x":102,"y":733,"width":802,"height":11}},{"id":"58c9df67-2edb-43c7-9339-5af819fdde4e","block_type":"box","text":"who make a market in the particular securities, except in those circumstances in which better prices and execution","page_number":156,"box":{"x":68,"y":748,"width":822,"height":11}},{"id":"a0a027a9-eb11-44d5-b437-02e7e93eecd1","block_type":"box","text":"are available elsewhere. Under the Investment Company Act, persons affiliated with a Fund and persons who are","page_number":156,"box":{"x":69,"y":763,"width":804,"height":11}},{"id":"4ad33490-baca-4fe4-9fda-7490d5a6b29c","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":156,"box":{"x":69,"y":778,"width":832,"height":11}},{"id":"3bf6c12d-3bbd-495e-b35a-8f6fdddb0688","block_type":"box","text":"of securities unless a permissive order allowing such transactions is obtained from the Commission. Since","page_number":156,"box":{"x":69,"y":793,"width":762,"height":11}},{"id":"c39d848b-3962-4022-ad36-314c6a9f9430","block_type":"box","text":"transactions in the OTC market usually involve transactions with the dealers acting as principal for their own","page_number":156,"box":{"x":68,"y":808,"width":770,"height":11}},{"id":"a97d5389-e35a-44a6-93d2-89c53d26e06a","block_type":"box","text":"accounts, the Funds will not deal with affiliated persons in connection with such transactions. However, an affiliated","page_number":156,"box":{"x":69,"y":823,"width":828,"height":11}},{"id":"2252d00f-d5d9-4a8e-9674-71668ef74859","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":156,"box":{"x":70,"y":838,"width":814,"height":12}},{"id":"755c0575-65ce-4681-826e-f15b0d18b642","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":156,"box":{"x":69,"y":853,"width":825,"height":12}},{"id":"e0c48a9d-0bb8-441b-89e6-05110f2996d2","block_type":"box","text":"commission received by non-affiliated brokers in connection with comparable transactions.","page_number":156,"box":{"x":69,"y":869,"width":645,"height":11}},{"id":"b92dd618-7939-42d9-b5ec-0cada5de55dd","block_type":"box","text":"OTC issues, including most fixed-income securities such as corporate debt and U.S. Government Securities, are","page_number":156,"box":{"x":102,"y":891,"width":797,"height":12}},{"id":"2a787538-5c16-432a-9161-bfc89334343a","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":156,"box":{"x":69,"y":906,"width":826,"height":12}},{"id":"923d82a8-cead-4d8f-865b-32cd12a95641","block_type":"box","text":"II-126","page_number":156,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6df965f0-5168-4600-8d7b-882e731b2ee8","block_type":"box","text":"NM1026U-5979889-156/232","page_number":156,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"bd8895a1-5d7c-4fb8-b6ba-295371c04fb8","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":157,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"b382bbed-894e-45ff-88fc-a7a5c85672eb","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":157,"box":{"x":69,"y":60,"width":833,"height":11}},{"id":"0addc148-ce3a-4ca4-88ff-6b1ce67f059a","block_type":"box","text":"domestic securities will generally include a “spread,” which is the difference between the prices at which the dealer","page_number":157,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"b96e2fbf-2e83-4c8d-a42d-e6d0b161a007","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":157,"box":{"x":70,"y":90,"width":730,"height":11}},{"id":"79fb4cb4-8cca-4541-bbcf-757851fe8d25","block_type":"box","text":"Purchases of money market instruments by a Fund are made from dealers, underwriters and issuers. The Funds","page_number":157,"box":{"x":102,"y":113,"width":800,"height":11}},{"id":"02606f7c-df93-4139-9e76-524a879fe0bc","block_type":"box","text":"do not currently expect to incur any brokerage commission expense on such transactions because money market","page_number":157,"box":{"x":69,"y":128,"width":807,"height":11}},{"id":"0ed5cb03-3b52-4b18-9d84-c8d15db70489","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":157,"box":{"x":70,"y":143,"width":812,"height":11}},{"id":"455de9b1-b71d-4245-b76a-4ce08f52181a","block_type":"box","text":"stated commission. The price of the security, however, usually includes a profit to the dealer. Each money market","page_number":157,"box":{"x":69,"y":158,"width":807,"height":11}},{"id":"924f9cd5-3822-4786-afe1-63ddd78c0862","block_type":"box","text":"fund intends to purchase only securities with remaining maturities of 397 days or less as determined in accordance","page_number":157,"box":{"x":68,"y":173,"width":827,"height":11}},{"id":"d064bb99-9349-41a7-a7fb-a24399d062ca","block_type":"box","text":"with the rules of the Commission. As a result, the portfolio turnover rates of a money market fund will be relatively","page_number":157,"box":{"x":68,"y":188,"width":817,"height":11}},{"id":"8c9b64a9-aeef-470c-bd4f-417e4169495a","block_type":"box","text":"high. However, because brokerage commissions will not normally be paid with respect to investments made by a","page_number":157,"box":{"x":69,"y":204,"width":802,"height":11}},{"id":"da151f37-1bfb-445c-9fc1-a590d4cada2e","block_type":"box","text":"money market fund, the turnover rates should not adversely affect the Fund’s NAVs or net income.","page_number":157,"box":{"x":69,"y":218,"width":700,"height":12}},{"id":"e4eff0fd-88a1-47a7-b6e4-4951507f78d1","block_type":"box","text":"Securities purchased in underwritten offerings include a fixed amount of compensation to the underwriter,","page_number":157,"box":{"x":102,"y":241,"width":756,"height":11}},{"id":"55f13dd7-cb13-4eb4-8c80-a6168d0be50b","block_type":"box","text":"generally referred to as the underwriter’s concession or discount. When offered securities are purchased or sold","page_number":157,"box":{"x":68,"y":256,"width":804,"height":12}},{"id":"ddf7311a-c98c-430f-8285-043bac96207a","block_type":"box","text":"directly from or to an issuer, no commissions or discounts are paid except where required by local markets.","page_number":157,"box":{"x":69,"y":271,"width":766,"height":12}},{"id":"df8f29a1-67e4-495e-bf83-89980d64b41e","block_type":"box","text":"The Manager or sub-advisers may seek to obtain an undertaking from issuers of commercial paper or dealers","page_number":157,"box":{"x":101,"y":294,"width":780,"height":11}},{"id":"d321ef59-0fcb-4527-b7fa-a83b22355f58","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":157,"box":{"x":69,"y":309,"width":826,"height":11}},{"id":"ad9763d1-28b4-4034-8bef-a992b9beaf9f","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":157,"box":{"x":69,"y":324,"width":806,"height":11}},{"id":"0c1c6833-2c76-418b-83b2-1bda2d5a58f1","block_type":"box","text":"anticipated need for liquidity makes such action desirable. Any such repurchase prior to maturity reduces the","page_number":157,"box":{"x":69,"y":339,"width":776,"height":12}},{"id":"3f702803-d95c-45b8-96d2-4d69f2c11041","block_type":"box","text":"possibility that a Fund would incur a capital loss in liquidating commercial paper, especially if interest rates have","page_number":157,"box":{"x":70,"y":355,"width":800,"height":11}},{"id":"d6e5ea4a-3cb3-4c95-b93d-52a650089e79","block_type":"box","text":"risen since acquisition of such commercial paper.","page_number":157,"box":{"x":69,"y":370,"width":352,"height":11}},{"id":"618334cd-ec67-4242-9b8a-059be1acddb6","block_type":"box","text":"Investment decisions for each Fund and for other investment accounts managed by the Manager or sub-advisers","page_number":157,"box":{"x":102,"y":392,"width":800,"height":12}},{"id":"6ede4649-287d-49c0-9990-592d5e5536cf","block_type":"box","text":"are made independently of each other in light of differing conditions. BlackRock allocates investments among client","page_number":157,"box":{"x":69,"y":407,"width":824,"height":12}},{"id":"61c9bee6-9fa7-43d9-b9fc-c0a908c7f69b","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":157,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"4ddbccf1-6750-47e1-bae4-5ae1d6b57062","block_type":"box","text":"These factors include: (i) investment objectives or strategies for particular accounts, including sector, industry,","page_number":157,"box":{"x":68,"y":438,"width":788,"height":11}},{"id":"0e02c7c4-0b64-4305-8fb9-9d0bc2f01645","block_type":"box","text":"country or region and capitalization weightings, (ii) tax considerations of an account, (iii) risk or investment","page_number":157,"box":{"x":69,"y":453,"width":759,"height":11}},{"id":"b8aa8fa2-776c-4536-af65-3495761b7e14","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":157,"box":{"x":69,"y":468,"width":780,"height":11}},{"id":"cff5b751-e02a-407d-b355-67d744ec8b26","block_type":"box","text":"available investment, (vi) cash availability and liquidity requirements for accounts, (vii) regulatory restrictions,","page_number":157,"box":{"x":69,"y":483,"width":777,"height":11}},{"id":"838bdab2-e393-4680-9258-0641c04213ca","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":157,"box":{"x":69,"y":498,"width":788,"height":11}},{"id":"65d0cb9a-e221-4f0c-9072-4addb3f6d9bc","block_type":"box","text":"approved by BlackRock’s general counsel. Moreover, investments may not be allocated to one client account over","page_number":157,"box":{"x":69,"y":514,"width":811,"height":11}},{"id":"96278dbb-72b7-4f20-94a8-b62bad4597a6","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":157,"box":{"x":69,"y":528,"width":829,"height":12}},{"id":"0ef60c80-394a-4fd8-b182-0a81adbb9471","block_type":"box","text":"generate higher fees paid by one client account over another or to produce greater performance compensation to","page_number":157,"box":{"x":68,"y":543,"width":808,"height":12}},{"id":"064a25ce-d526-4323-a61a-0752bc6b04dd","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":157,"box":{"x":70,"y":559,"width":832,"height":11}},{"id":"7c9952e7-4f73-4744-9954-47c23efad30b","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":157,"box":{"x":70,"y":574,"width":836,"height":11}},{"id":"f29a2d4d-025b-4432-8d2f-22879d51a987","block_type":"box","text":"or (v) to manage or equalize investment performance among different client accounts.","page_number":157,"box":{"x":69,"y":589,"width":613,"height":11}},{"id":"1fc0634c-796c-4366-90b3-72f68f8ba0af","block_type":"box","text":"Equity securities will generally be allocated among client accounts within the same investment mandate on a pro","page_number":157,"box":{"x":102,"y":612,"width":802,"height":11}},{"id":"aa950b7b-1322-4a9f-b596-6ff66cc7e496","block_type":"box","text":"rata basis. All allocations of equity securities will be subject, where relevant, to share minimums established for","page_number":157,"box":{"x":69,"y":627,"width":800,"height":11}},{"id":"b4db49d7-a612-4886-8337-c65917ad24d9","block_type":"box","text":"accounts and compliance constraints.","page_number":157,"box":{"x":69,"y":642,"width":269,"height":11}},{"id":"15f49e5d-89d0-4d44-971a-5dc634319605","block_type":"box","text":"Initial public offerings of securities may be over-subscribed and subsequently trade at a premium in the","page_number":157,"box":{"x":102,"y":664,"width":736,"height":12}},{"id":"1cfd492b-ec72-4262-b186-1c4fbf9b6583","block_type":"box","text":"secondary market. In these situations, the supply of securities available for client accounts is often less than the","page_number":157,"box":{"x":69,"y":680,"width":808,"height":11}},{"id":"55f6512e-200c-489b-b523-319a44014a43","block_type":"box","text":"amount of securities the accounts would otherwise take. In order to allocate these investments fairly and equitably","page_number":157,"box":{"x":69,"y":695,"width":821,"height":11}},{"id":"2490d34e-1a99-4036-b1f1-241653b35b41","block_type":"box","text":"among client accounts over time, each portfolio manager or a member of his or her respective investment team will","page_number":157,"box":{"x":69,"y":710,"width":823,"height":11}},{"id":"a02833ab-5f16-4654-9105-eec59b3ca704","block_type":"box","text":"indicate to BlackRock’s trading desk their level of interest in a particular offering with respect to eligible client","page_number":157,"box":{"x":70,"y":725,"width":783,"height":11}},{"id":"973c7650-33e8-4259-9b48-b2ebf015e67c","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":157,"box":{"x":69,"y":740,"width":793,"height":11}},{"id":"83bbf0e7-6fa2-477b-97f4-5f9a3a9aa8f0","block_type":"box","text":"eligible for particular client accounts that are managed by portfolio teams who have indicated interest in the offering","page_number":157,"box":{"x":69,"y":755,"width":831,"height":11}},{"id":"8e71dd3d-a02f-4a25-babc-c0d59b89be4a","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":157,"box":{"x":69,"y":770,"width":828,"height":11}},{"id":"8387f3e1-f405-48ec-8e5c-8de974d45365","block_type":"box","text":"the case of international equity securities, the country where the offering is taking place and the investment mandate","page_number":157,"box":{"x":68,"y":785,"width":839,"height":12}},{"id":"f9a9a0bc-b97a-4c55-8b35-1df7c3230613","block_type":"box","text":"of the client account. Generally, shares received during the initial public offering will be allocated among participating","page_number":157,"box":{"x":69,"y":801,"width":835,"height":11}},{"id":"91dfdb5b-7d2d-4637-a46f-5528b68866ef","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":157,"box":{"x":69,"y":816,"width":819,"height":11}},{"id":"c5511ba4-016c-4f3b-826e-68d8b0f6ebcf","block_type":"box","text":"allocated among all accounts for which the investment is eligible, portfolio managers may rotate such investment","page_number":157,"box":{"x":69,"y":831,"width":808,"height":11}},{"id":"571fb7da-d131-4e72-ad0f-0726e245dc64","block_type":"box","text":"opportunities among one or more accounts so long as the rotation system provides for fair access for all client","page_number":157,"box":{"x":69,"y":846,"width":791,"height":11}},{"id":"4dccdd77-b8b9-442d-85b3-734032cc9272","block_type":"box","text":"accounts over time. Other allocation methodologies that are considered by BlackRock to be fair and equitable to","page_number":157,"box":{"x":69,"y":861,"width":799,"height":11}},{"id":"9631613e-4e6e-4257-8014-692fb6ca28d2","block_type":"box","text":"clients may be used as well.","page_number":157,"box":{"x":69,"y":876,"width":200,"height":11}},{"id":"d39a710b-f25b-440c-9aec-b31be0723922","block_type":"box","text":"II-127","page_number":157,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"705cf897-e17a-4c41-93b9-8260d505f125","block_type":"box","text":"NM1026U-5979889-157/232","page_number":157,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"68e9e9d5-bd16-4506-a96e-e8529f6b3853","block_type":"box","text":"Because different accounts may have differing investment objectives and policies, BlackRock may buy and sell","page_number":158,"box":{"x":102,"y":45,"width":789,"height":11}},{"id":"9a54607f-72c9-4f6f-b981-2942e7c9b803","block_type":"box","text":"the same securities at the same time for different clients based on the particular investment objective, guidelines","page_number":158,"box":{"x":68,"y":60,"width":815,"height":11}},{"id":"3eddd109-5450-41e2-90d7-1227aaf1854e","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":158,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"5ba92618-ae75-4775-b5a6-817e2d9693c9","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":158,"box":{"x":68,"y":90,"width":833,"height":11}},{"id":"cdee119e-b946-4529-90a9-af3360b5d5e4","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":158,"box":{"x":69,"y":105,"width":829,"height":11}},{"id":"148232a8-9b49-4303-98a4-62461750fdf3","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":158,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"ae3de17f-6df6-4a7a-bfa6-8708b02ce875","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":158,"box":{"x":69,"y":135,"width":806,"height":11}},{"id":"2844143d-1a88-49c6-aab1-268bded585fc","block_type":"box","text":"adversely impacting other BlackRock clients that still hold the security. If purchases or sales of securities arise for","page_number":158,"box":{"x":69,"y":150,"width":814,"height":12}},{"id":"180bbae6-c4a4-49b0-a8ef-71b903f6f990","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":158,"box":{"x":69,"y":166,"width":836,"height":9}},{"id":"7468f1eb-79ee-4f46-9d07-50323a428326","block_type":"box","text":"affiliate act as investment manager, transactions in such securities will be made, insofar as feasible, for the","page_number":158,"box":{"x":69,"y":181,"width":773,"height":11}},{"id":"75d1758a-af86-499a-b4ab-931eb6e54ef5","block_type":"box","text":"respective funds and clients in a manner deemed equitable to all.","page_number":158,"box":{"x":69,"y":196,"width":467,"height":11}},{"id":"b016a448-f94e-4b23-bd6f-06485497964f","block_type":"box","text":"In certain instances, BlackRock may find it efficient for purposes of seeking to obtain best execution, to","page_number":158,"box":{"x":102,"y":218,"width":741,"height":12}},{"id":"24c6efa8-cad1-408c-8d62-3523724943e7","block_type":"box","text":"aggregate certain contemporaneous purchases or sale orders of its advisory accounts. In general, all","page_number":158,"box":{"x":69,"y":234,"width":721,"height":11}},{"id":"439dc12b-fe7a-41b6-ac0a-319572ba213f","block_type":"box","text":"contemporaneous trades for client accounts under management by the same portfolio manager or investment team","page_number":158,"box":{"x":69,"y":249,"width":824,"height":11}},{"id":"3f7546bd-768d-432a-95d7-a0bcd18e33ae","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":158,"box":{"x":68,"y":264,"width":795,"height":11}},{"id":"9aa6c1d7-33b2-4154-b8ca-1d42aa74b25d","block_type":"box","text":"opportunity to achieve a more favorable execution at a potentially lower execution cost. The costs associated with an","page_number":158,"box":{"x":69,"y":279,"width":834,"height":11}},{"id":"b02bfe39-683d-443c-9266-7534eac54e36","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":158,"box":{"x":69,"y":294,"width":783,"height":11}},{"id":"03d14e99-b0e6-4fa8-bf19-c3f3a31f713c","block_type":"box","text":"particular portfolio manager or management team is filled at several different prices through multiple trades, all","page_number":158,"box":{"x":70,"y":309,"width":796,"height":11}},{"id":"73a02584-8bd6-468b-b273-82a976a92a87","block_type":"box","text":"accounts participating in the order will receive the average price except in the case of certain international markets","page_number":158,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"ed9fc5ad-ee1e-4ddf-9f55-c02c08ef5487","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":158,"box":{"x":68,"y":339,"width":819,"height":12}},{"id":"4f3b3cd7-8c5c-4e1f-8d2c-2520d1dd6a5d","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":158,"box":{"x":70,"y":355,"width":771,"height":11}},{"id":"bb5f7d4a-4a9f-42ca-8cdc-b3a33ef1404d","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":158,"box":{"x":68,"y":370,"width":815,"height":11}},{"id":"acafd60c-5cbb-4574-85f2-65ac76d8b796","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":158,"box":{"x":68,"y":385,"width":835,"height":11}},{"id":"5a0e0342-ef96-40a2-a1c9-8ca7c5f93cb6","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":158,"box":{"x":68,"y":400,"width":817,"height":11}},{"id":"8202d06d-2e91-4b4c-a02a-ebd21172b75c","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":158,"box":{"x":68,"y":415,"width":823,"height":11}},{"id":"fb7a8aa2-99ec-4209-ae01-9dcdbcce4423","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":158,"box":{"x":69,"y":430,"width":803,"height":11}},{"id":"f828c92c-bb4b-4697-b3c8-eff6344cde1a","block_type":"box","text":"A Fund will not purchase securities during the existence of any underwriting or selling group relating to such","page_number":158,"box":{"x":101,"y":453,"width":767,"height":11}},{"id":"6330362a-647f-4489-9b83-bb60a00f43a2","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":158,"box":{"x":69,"y":468,"width":826,"height":11}},{"id":"5b950b60-b9af-4961-8a5c-243560e2fd55","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":158,"box":{"x":69,"y":483,"width":816,"height":11}},{"id":"ac70a612-c3f5-4b4b-8556-6603b2860d73","block_type":"box","text":"Investment Company Act. In no instance will portfolio securities be purchased from or sold to BlackRock, BRIL or any","page_number":158,"box":{"x":70,"y":498,"width":833,"height":11}},{"id":"f42b6e08-ac80-4e1e-be86-f63cdf0ec6e7","block_type":"box","text":"affiliated person of the foregoing entities except as permitted by Commission exemptive order or by applicable law.","page_number":158,"box":{"x":69,"y":513,"width":818,"height":12}},{"id":"b48d2ed9-31ba-44cb-b7ff-723c542bdb08","block_type":"box","text":"A Fund’s purchase and sale orders for securities may be combined with those of other investment companies,","page_number":158,"box":{"x":101,"y":536,"width":786,"height":11}},{"id":"001a9e53-c7af-4b9b-b8f8-b6ea190e4e96","block_type":"box","text":"clients or accounts that BlackRock manages or advises. If purchases or sales of portfolio securities of a Fund and","page_number":158,"box":{"x":69,"y":551,"width":814,"height":11}},{"id":"0c88f7fc-c9c5-47ac-ac6a-629114d26645","block_type":"box","text":"one or more other accounts managed or advised by BlackRock are considered at or about the same time,","page_number":158,"box":{"x":69,"y":566,"width":751,"height":11}},{"id":"82f12df6-961f-4ea0-8581-711fb4bf161e","block_type":"box","text":"transactions in such securities are allocated among the Fund and the other accounts in a manner deemed equitable","page_number":158,"box":{"x":68,"y":582,"width":829,"height":11}},{"id":"9e526e69-547d-4b42-aa37-90603fef4c1a","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":158,"box":{"x":68,"y":596,"width":799,"height":12}},{"id":"c2941ada-49dd-408a-af54-39fe26bb5359","block_type":"box","text":"security as far as a Fund is concerned. However, in other cases, it is possible that the ability to participate in volume","page_number":158,"box":{"x":69,"y":612,"width":834,"height":11}},{"id":"4992a955-a823-40bd-b5d2-18b9c864174d","block_type":"box","text":"transactions and to negotiate lower transaction costs will be beneficial to the Fund. BlackRock may deal, trade and","page_number":158,"box":{"x":68,"y":627,"width":820,"height":11}},{"id":"1448dce7-49ab-4e8b-b52b-07b684c9514b","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":158,"box":{"x":70,"y":642,"width":812,"height":11}},{"id":"14be7b68-5fad-49a3-823f-b703737be8fe","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":158,"box":{"x":69,"y":657,"width":781,"height":10}},{"id":"3fe0b632-a93d-403c-9fa3-3b5273bb61cc","block_type":"box","text":"conformity with the Investment Company Act and Commission rules and regulations. Under these provisions, any","page_number":158,"box":{"x":69,"y":672,"width":805,"height":11}},{"id":"24317015-b5a7-4269-a9a5-22b3cf6b2280","block_type":"box","text":"commissions paid to affiliated brokers or dealers must be reasonable and fair compared to the commissions charged","page_number":158,"box":{"x":69,"y":687,"width":840,"height":11}},{"id":"47622744-45b6-4e03-acf1-e6c12a9cfaa2","block_type":"box","text":"by other brokers or dealers in comparable transactions. A Fund will not deal with affiliates in principal transactions","page_number":158,"box":{"x":69,"y":702,"width":815,"height":11}},{"id":"8d709fd2-29aa-41a8-9c50-a9370f43ee19","block_type":"box","text":"unless permitted by applicable Commission rules or regulations, or by Commission exemptive order.","page_number":158,"box":{"x":69,"y":718,"width":713,"height":11}},{"id":"c958a64f-e6ff-4c49-a817-6bc355c81ae1","block_type":"box","text":"Portfolio Turnover","page_number":158,"box":{"x":69,"y":748,"width":129,"height":9}},{"id":"e72d418d-c876-4351-a06b-e5188407a25d","block_type":"box","text":"The portfolio turnover rate is calculated by dividing the lesser of a Fund’s annual sales or purchases of portfolio","page_number":158,"box":{"x":101,"y":770,"width":798,"height":12}},{"id":"1e81bd60-e5b9-4850-81bc-faa44b4a99d4","block_type":"box","text":"securities (exclusive of purchases or sales of U.S. Government Securities and all other securities whose maturities at","page_number":158,"box":{"x":69,"y":785,"width":839,"height":11}},{"id":"830d7348-6b6c-4f1f-9c89-ce8c240cb3f3","block_type":"box","text":"the time of acquisition were one year or less) by the monthly average value of the securities in the portfolio during","page_number":158,"box":{"x":68,"y":801,"width":814,"height":11}},{"id":"840d2799-d9a4-4ac8-bb4e-30e64c419545","block_type":"box","text":"the year. A high rate of portfolio turnover results in certain tax consequences, such as increased capital gain","page_number":158,"box":{"x":68,"y":816,"width":777,"height":11}},{"id":"3f323292-2a14-43ff-9837-c8554c195e50","block_type":"box","text":"dividends and/or ordinary income dividends, and in correspondingly greater transaction costs in the form of dealer","page_number":158,"box":{"x":69,"y":831,"width":818,"height":11}},{"id":"f5db9e99-fab3-4cc2-9f7d-fc83212d3361","block_type":"box","text":"spreads and brokerage commissions, which are borne directly by a Fund.","page_number":158,"box":{"x":69,"y":846,"width":519,"height":11}},{"id":"67311083-c2ac-4660-88b2-afae701a0d89","block_type":"box","text":"II-128","page_number":158,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"99190347-978d-43e2-a831-5abc45c58fb9","block_type":"box","text":"NM1026U-5979889-158/232","page_number":158,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"17f1323d-8faa-4084-82e4-2b5b6ac669f0","block_type":"box","text":"DIVIDENDS AND TAXES","page_number":159,"box":{"x":396,"y":45,"width":186,"height":10}},{"id":"d2162f70-082a-4c9d-afc2-77cdd9c7e924","block_type":"box","text":"Dividends","page_number":159,"box":{"x":69,"y":76,"width":69,"height":8}},{"id":"bf4e7dac-0c01-4044-86e8-56835c8441f3","block_type":"box","text":"Each Fund intends to distribute substantially all of its net investment income, if any. Dividends from such net","page_number":159,"box":{"x":102,"y":98,"width":776,"height":11}},{"id":"af6434d3-f3a6-4ebc-8881-977853863a7f","block_type":"box","text":"investment income are paid as set forth in each Fund’s Prospectus. Each Fund also intends to distribute all net","page_number":159,"box":{"x":70,"y":113,"width":795,"height":11}},{"id":"ca28ccaf-801a-442e-bef7-39a7dddde075","block_type":"box","text":"realized capital gains, if any, as set forth in such Fund’s Prospectus. From time to time, a Fund may declare a special","page_number":159,"box":{"x":69,"y":128,"width":837,"height":12}},{"id":"c9671537-eaed-4738-807b-cf61a612a743","block_type":"box","text":"distribution at or about the end of the calendar year in order to comply with U.S. federal tax requirements that certain","page_number":159,"box":{"x":69,"y":143,"width":836,"height":12}},{"id":"6fc75786-b905-4f92-b547-86f5d2f9d02f","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":159,"box":{"x":70,"y":159,"width":822,"height":11}},{"id":"672553cd-3ca2-4316-a3c9-77da57814b13","block_type":"box","text":"net income from certain foreign currency transactions, such income will be distributed at least annually.","page_number":159,"box":{"x":69,"y":174,"width":739,"height":11}},{"id":"f2f75a31-6409-44de-af33-cf05bda26aed","block_type":"box","text":"For information concerning the manner in which dividends may be reinvested automatically in shares of each","page_number":159,"box":{"x":102,"y":196,"width":773,"height":12}},{"id":"912444a4-3f84-4149-a7ff-032967628b17","block_type":"box","text":"Fund, as applicable, see “Shareholder Services — Automatic Dividend Reinvestment Plan.” Shareholders may also","page_number":159,"box":{"x":70,"y":212,"width":819,"height":11}},{"id":"8b88822f-ca19-428b-af4e-941e81fd00bb","block_type":"box","text":"elect in writing to receive any such dividends in cash. Dividends are taxable to shareholders, as discussed below,","page_number":159,"box":{"x":69,"y":227,"width":807,"height":11}},{"id":"0637cb2f-a6b1-49b6-ac9d-b88a990b6dd6","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":159,"box":{"x":68,"y":242,"width":800,"height":11}},{"id":"e98e4688-a588-4d11-b314-43afbdd7982a","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":159,"box":{"x":69,"y":257,"width":801,"height":11}},{"id":"6f2d6162-eeb7-4c34-b537-efbc5d46119b","block_type":"box","text":"result of the service, distribution and higher transfer agency fees applicable to CDSC shares, the service fees","page_number":159,"box":{"x":69,"y":272,"width":783,"height":11}},{"id":"22fb167f-d623-4f58-85ce-2b6046b0ea9b","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":159,"box":{"x":69,"y":287,"width":820,"height":11}},{"id":"2b69b435-6152-4412-905c-0a6f6d2006ed","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":159,"box":{"x":69,"y":302,"width":794,"height":11}},{"id":"832f21ce-cf32-4374-b9c7-5e82398624d0","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":159,"box":{"x":69,"y":317,"width":834,"height":12}},{"id":"73a6483e-8113-4d19-982a-525dfce511e1","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":159,"box":{"x":68,"y":332,"width":826,"height":11}},{"id":"306cb32b-22d6-41ed-afeb-dff8d3452d25","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":159,"box":{"x":69,"y":348,"width":816,"height":11}},{"id":"5cf2a296-e3c1-4f36-9bc8-d4c123d62e67","block_type":"box","text":"fees and higher transfer agency fees applicable to CDSC shares.","page_number":159,"box":{"x":68,"y":363,"width":461,"height":11}},{"id":"3544f502-a224-4096-9a4e-67d844646b97","block_type":"box","text":"Taxes","page_number":159,"box":{"x":68,"y":393,"width":42,"height":9}},{"id":"55aaf1f8-0360-4bef-94b7-bd9efd5758ca","block_type":"box","text":"Each Fund intends to continue to qualify for the special tax treatment afforded to regulated investment","page_number":159,"box":{"x":102,"y":416,"width":732,"height":11}},{"id":"66f692d0-d141-4af7-b695-404c893a5263","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":159,"box":{"x":69,"y":431,"width":825,"height":11}},{"id":"3e56c252-de9d-4610-9019-5f5a1119ce80","block_type":"box","text":"U.S. federal income tax on the part of its investment company taxable income and net realized capital gains that it","page_number":159,"box":{"x":70,"y":446,"width":817,"height":11}},{"id":"17bce3f1-6550-4292-adc7-eb4278cba060","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":159,"box":{"x":69,"y":461,"width":832,"height":11}},{"id":"e0b19b68-8601-4afc-b414-4edcafe4ec2c","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":159,"box":{"x":69,"y":476,"width":791,"height":11}},{"id":"5c4cc55d-312e-4ac7-a229-baa35752de2f","block_type":"box","text":"company, a Fund must meet certain requirements regarding the source of its income and the composition and","page_number":159,"box":{"x":69,"y":491,"width":786,"height":12}},{"id":"76d93e5f-f48c-4175-8d13-455b70bd9137","block_type":"box","text":"diversification of its assets. See Part II, “Investment Risks and Considerations—Investment Restrictions (All Funds)”","page_number":159,"box":{"x":69,"y":506,"width":831,"height":11}},{"id":"cc4ec74e-4781-40ab-a739-777806494408","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":159,"box":{"x":68,"y":521,"width":819,"height":12}},{"id":"77c64467-b716-41bb-b5e3-85cae6465518","block_type":"box","text":"underlying assets of the Master Portfolio in which it has invested for purposes of satisfying the asset diversification","page_number":159,"box":{"x":69,"y":537,"width":824,"height":11}},{"id":"53ff1d7c-9c10-4316-b87b-3339f7441a09","block_type":"box","text":"requirement and various other requirements of the Code applicable to regulated investment companies.","page_number":159,"box":{"x":69,"y":552,"width":739,"height":11}},{"id":"599e7e14-4c2a-4556-ab2f-572e8993b7d9","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":159,"box":{"x":101,"y":574,"width":792,"height":12}},{"id":"90d13719-3b4a-475a-80a7-e752cb2c302a","block_type":"box","text":"failure to diversify its holdings in the manner described above by paying a tax, by disposing of certain assets, or by","page_number":159,"box":{"x":68,"y":589,"width":819,"height":12}},{"id":"c381422f-6892-46d4-a580-cf9886fa00d1","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":159,"box":{"x":70,"y":605,"width":830,"height":11}},{"id":"ad6714ca-1255-410d-8864-a839bd464321","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":159,"box":{"x":68,"y":620,"width":744,"height":11}},{"id":"ac02cfc3-c2d9-4730-8805-9ed54215790f","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":159,"box":{"x":69,"y":635,"width":835,"height":11}},{"id":"91548be2-4ec1-44ae-a14e-80955aff2ff8","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":159,"box":{"x":69,"y":650,"width":808,"height":11}},{"id":"657b5812-dda3-4281-86da-a0f6f7d79804","block_type":"box","text":"company with respect to items attributable to an interest in a qualified publicly-traded partnership. A Fund’s","page_number":159,"box":{"x":69,"y":665,"width":767,"height":11}},{"id":"33a4affe-88fb-4b6b-88d8-4048f0879ec0","block_type":"box","text":"investments in partnerships, including in qualified publicly-traded partnerships, may result in the Fund being subject","page_number":159,"box":{"x":70,"y":680,"width":826,"height":12}},{"id":"dbc1d630-5681-4b10-9480-1816ad794c17","block_type":"box","text":"to state, local, or non-U.S. income, franchise or withholding tax liabilities.","page_number":159,"box":{"x":68,"y":695,"width":521,"height":12}},{"id":"45f205d9-2a2b-4ba9-815a-642764727e3f","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":159,"box":{"x":102,"y":718,"width":798,"height":11}},{"id":"f7473a62-ae35-4ff3-a775-1f79c161a6bb","block_type":"box","text":"qualify as a regulated investment company under the Code, notwithstanding the availability of certain relief","page_number":159,"box":{"x":69,"y":733,"width":762,"height":11}},{"id":"0adf50b3-fda1-44e9-b35d-fef665301a28","block_type":"box","text":"provisions, such Fund would be taxed in the same manner as an ordinary corporation and all distributions from","page_number":159,"box":{"x":70,"y":748,"width":789,"height":11}},{"id":"91afbe4c-e77e-4412-b87c-3b4f84091aeb","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":159,"box":{"x":69,"y":763,"width":837,"height":12}},{"id":"8caead86-aa7b-4107-9421-4dc493efdcb9","block_type":"box","text":"ordinary dividend income eligible for taxation at a reduced tax rate for non-corporate shareholders and the dividends","page_number":159,"box":{"x":69,"y":778,"width":831,"height":12}},{"id":"d32b288f-c0c6-4177-97db-969d1c6d336e","block_type":"box","text":"received deduction for corporate shareholders. However, a Municipal Fund’s distributions derived from income on tax","page_number":159,"box":{"x":69,"y":794,"width":837,"height":11}},{"id":"1a4ccb38-e81f-450b-8b97-77a0aa9d1c5d","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":159,"box":{"x":69,"y":809,"width":825,"height":11}},{"id":"316430f6-9374-4773-971b-4ca5d1e34f09","block_type":"box","text":"series of a regulated investment company that consists of multiple series is treated as a separate corporation for","page_number":159,"box":{"x":69,"y":824,"width":811,"height":11}},{"id":"8c1d16a2-3a63-4392-9d37-c2ab27f47043","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":159,"box":{"x":70,"y":839,"width":813,"height":11}},{"id":"179dd366-e11a-463a-97e3-bfbd8f50a16f","block_type":"box","text":"under the rules for regulated investment companies. Losses in one series of a regulated investment company do not","page_number":159,"box":{"x":69,"y":854,"width":834,"height":11}},{"id":"2f354f5f-008d-46ae-9749-4ecd6da9f2b3","block_type":"box","text":"offset gains in another, and the requirements (other than certain organizational requirements) for qualifying for","page_number":159,"box":{"x":69,"y":869,"width":790,"height":11}},{"id":"493dddee-a337-49e3-bfcd-58d7cca44b8f","block_type":"box","text":"regulated investment company status will be determined at the level of the individual series. In the following","page_number":159,"box":{"x":69,"y":884,"width":771,"height":12}},{"id":"f2ba9720-d8e5-4171-a7e9-238e37ae471d","block_type":"box","text":"discussion, the term “Fund” means each individual series, if applicable.","page_number":159,"box":{"x":69,"y":899,"width":512,"height":11}},{"id":"b681f24b-095d-4bc7-b0e0-cb54f924689f","block_type":"box","text":"II-129","page_number":159,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"99248139-ecc5-44ab-b6d4-3426af752a9b","block_type":"box","text":"NM1026U-5979889-159/232","page_number":159,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"024eb002-2e78-4e97-9ff5-414c92c4975d","block_type":"box","text":"The Code requires a regulated investment company to pay a nondeductible 4% excise tax to the extent the","page_number":160,"box":{"x":101,"y":45,"width":759,"height":11}},{"id":"e65be688-d93f-4204-bcb5-e54b897da892","block_type":"box","text":"regulated investment company does not distribute, during each calendar year, at least 98% of its ordinary income,","page_number":160,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"8cccb9f9-6756-4e4e-987e-6a68bdd33b3b","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":160,"box":{"x":69,"y":75,"width":830,"height":11}},{"id":"621d267e-3c76-4867-bf2c-b76e746a6cd3","block_type":"box","text":"the regulated investment company’s taxable year ended on October 31, plus certain undistributed amounts from the","page_number":160,"box":{"x":68,"y":90,"width":832,"height":11}},{"id":"c391c3f9-7826-45eb-92e2-5d969a86a77c","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":160,"box":{"x":70,"y":105,"width":825,"height":11}},{"id":"098c717f-2f79-4300-8212-b76ab8bc5bda","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":160,"box":{"x":70,"y":120,"width":810,"height":11}},{"id":"6211c04a-8b3b-4bd4-ae8d-7c3bbfe6fbd7","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":160,"box":{"x":69,"y":135,"width":828,"height":12}},{"id":"13267df1-a950-49cd-8773-b495f0c17c83","block_type":"box","text":"the tax only on the amount by which it does not meet the foregoing distribution requirements.","page_number":160,"box":{"x":68,"y":150,"width":666,"height":12}},{"id":"087fb315-b052-4f19-a8ca-2ed48ba21923","block_type":"box","text":"Net capital loss carryforwards may be applied against realized capital gains in each succeeding year, until they","page_number":160,"box":{"x":102,"y":173,"width":790,"height":11}},{"id":"48457927-d121-48b6-a3d7-0c4bb339b9fe","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":160,"box":{"x":69,"y":188,"width":830,"height":12}},{"id":"b8eba0d6-f855-4842-a063-653ff22e5bc9","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":160,"box":{"x":69,"y":203,"width":770,"height":12}},{"id":"525fb81e-f8a8-4a11-9ed7-66e0392af9a2","block_type":"box","text":"limitation.","page_number":160,"box":{"x":70,"y":219,"width":68,"height":8}},{"id":"35ee84cf-4b5e-460e-83ba-6c080a5ffc84","block_type":"box","text":"Dividends paid by a Fund from its ordinary income or from an excess of net short-term capital gain over net long","page_number":160,"box":{"x":102,"y":241,"width":803,"height":11}},{"id":"24a5f738-c8d3-403a-8fb2-17141d87017e","block_type":"box","text":"term capital loss (together referred to as “ordinary income dividends”) are taxable to shareholders as ordinary","page_number":160,"box":{"x":68,"y":256,"width":790,"height":12}},{"id":"c651798d-6b6e-4b3c-8072-3c3310afe917","block_type":"box","text":"income. Distributions made from an excess of net long-term capital gain over net short-term capital loss (including","page_number":160,"box":{"x":70,"y":271,"width":815,"height":12}},{"id":"46ed02ab-9484-43af-83e1-c8c513d28a72","block_type":"box","text":"gains or losses from certain transactions in futures and options) (“capital gain dividends”) are taxable to","page_number":160,"box":{"x":68,"y":286,"width":748,"height":12}},{"id":"dd44a542-8ec9-4afc-a09b-95b7328da058","block_type":"box","text":"shareholders as long-term capital gains, regardless of the length of time the shareholder has owned Fund shares.","page_number":160,"box":{"x":69,"y":302,"width":811,"height":11}},{"id":"c9dd8306-6ab6-499a-a598-55b15fe9527b","block_type":"box","text":"Distributions paid by a Fund that are reported as exempt-interest dividends will not be subject to regular U.S. federal","page_number":160,"box":{"x":70,"y":317,"width":829,"height":11}},{"id":"0ec547a6-3261-487a-a0a5-6b6a2db5f30d","block_type":"box","text":"income tax. Certain dividend income and long-term capital gains are eligible for taxation at a reduced rate that","page_number":160,"box":{"x":70,"y":332,"width":785,"height":11}},{"id":"fc8cb062-08b6-4689-9884-df8ab0894d52","block_type":"box","text":"applies to non-corporate shareholders. Under these rules, the portion of ordinary income dividends constituting","page_number":160,"box":{"x":69,"y":347,"width":795,"height":11}},{"id":"d515a4c5-ae95-4c8c-9b26-25a36fbe521e","block_type":"box","text":"“qualified dividend income” when paid by a regulated investment company to a non-corporate shareholder may be","page_number":160,"box":{"x":70,"y":362,"width":809,"height":11}},{"id":"a54f4bae-fb6a-4f38-8286-cad2e0070f3e","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":160,"box":{"x":68,"y":377,"width":814,"height":12}},{"id":"8a6e6b8a-b509-4bcf-a480-c89e29bfe7f0","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":160,"box":{"x":68,"y":392,"width":822,"height":12}},{"id":"5cf5ef0e-b518-4897-b34c-04d197ebe692","block_type":"box","text":"the date on which the shares become ex-dividend with respect to such dividend (or, in the case of certain","page_number":160,"box":{"x":68,"y":407,"width":751,"height":11}},{"id":"d7e15d02-da46-47a3-807a-6689bf9f134b","block_type":"box","text":"accumulated dividends with respect to preferred stocks, the shareholder has held the shares on which the dividend","page_number":160,"box":{"x":69,"y":423,"width":823,"height":11}},{"id":"b5610874-a9a6-4476-826b-2782e3f04c1b","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":160,"box":{"x":68,"y":438,"width":817,"height":11}},{"id":"423682b0-f965-4a59-ae5f-65b71cfa5182","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":160,"box":{"x":68,"y":453,"width":813,"height":11}},{"id":"0648d550-0697-4a56-9fa3-311c29dbdac4","block_type":"box","text":"are derived from income on debt securities, certain types of preferred stock treated as debt for U.S. federal income","page_number":160,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"56188fdb-1a7e-4e50-8fb5-86a2edec2bfb","block_type":"box","text":"tax purposes and short-term capital gains, such distributions will not constitute “qualified dividend income.” In","page_number":160,"box":{"x":68,"y":483,"width":789,"height":11}},{"id":"dda58eb9-5394-4233-ad39-4fadd65ca297","block_type":"box","text":"addition, distributions that are derived from securities lending income, such as substitute dividend payments, will not","page_number":160,"box":{"x":69,"y":498,"width":836,"height":11}},{"id":"753e3285-256f-4f8f-a631-c439927c35dd","block_type":"box","text":"constitute “qualified dividend income.”","page_number":160,"box":{"x":69,"y":513,"width":275,"height":11}},{"id":"2b3f641a-b977-49b6-b497-939d3c9fdb2b","block_type":"box","text":"A 3.8% Medicare tax is imposed on the net investment income (which includes taxable dividends and redemption","page_number":160,"box":{"x":101,"y":536,"width":806,"height":11}},{"id":"58707cf6-2a57-416f-bacc-4f02d192dc4b","block_type":"box","text":"proceeds) of certain individuals, trusts and estates.","page_number":160,"box":{"x":70,"y":551,"width":368,"height":11}},{"id":"be4cbaff-6d99-45d9-be10-2856c1ab244d","block_type":"box","text":"A Fund’s net capital gain (the excess of net long-term capital gains over net short-term capital losses) is not","page_number":160,"box":{"x":101,"y":574,"width":772,"height":11}},{"id":"f44ee923-4f7b-48f7-bc9c-663239e462d0","block_type":"box","text":"subject to the 90% distribution requirement for taxation as a regulated investment company, described above. If a","page_number":160,"box":{"x":69,"y":589,"width":811,"height":11}},{"id":"edce8327-48de-4090-8dcc-4d8b8d86cde6","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":160,"box":{"x":70,"y":604,"width":745,"height":11}},{"id":"5fb6d48e-e073-4d9f-9488-6d5b4ac053b5","block_type":"box","text":"undistributed capital gain in a written statement furnished to its shareholders, who will be required to include in","page_number":160,"box":{"x":69,"y":619,"width":795,"height":11}},{"id":"8bed22ba-552b-4b4c-a208-d4a9bbcbec45","block_type":"box","text":"income, as long-term capital gain, their proportionate shares of such undistributed net capital gain, will be deemed to","page_number":160,"box":{"x":70,"y":634,"width":838,"height":12}},{"id":"3c7048d9-f89c-4e26-be91-944c50fcdd0c","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":160,"box":{"x":69,"y":649,"width":809,"height":12}},{"id":"49dd56f8-9aa6-4737-bf37-fb98403f3e36","block_type":"box","text":"exceeds that liability) their proportionate shares of the tax paid by the Fund on that gain, and shall increase the tax","page_number":160,"box":{"x":69,"y":664,"width":822,"height":12}},{"id":"e438784e-6e19-41c0-8f46-f03b45845a8f","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":160,"box":{"x":69,"y":680,"width":838,"height":11}},{"id":"6a1b80cd-473c-4ce9-911e-3efb4865140e","block_type":"box","text":"against their taxes.","page_number":160,"box":{"x":69,"y":695,"width":135,"height":11}},{"id":"ceca9b0c-5954-42b4-aee8-597e75645e4b","block_type":"box","text":"Distributions in excess of a Fund’s current and accumulated earnings and profits will first reduce the adjusted","page_number":160,"box":{"x":102,"y":717,"width":783,"height":12}},{"id":"2b733396-9384-46f8-b7bc-445b44c1322a","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":160,"box":{"x":68,"y":732,"width":812,"height":12}},{"id":"562071ec-0a14-4b74-83da-e3db614d5967","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":160,"box":{"x":69,"y":748,"width":769,"height":11}},{"id":"97d413b2-60fe-47c2-9448-80be79b157a6","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":160,"box":{"x":69,"y":763,"width":805,"height":11}},{"id":"0ee9dd43-cdd6-4948-99f0-d3a2b0ab1810","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":160,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"0a8cdba4-c6e3-4eb3-88ee-d3c727dbb87e","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":160,"box":{"x":68,"y":793,"width":831,"height":11}},{"id":"386c0d8b-3608-49f4-b07b-66120c67070c","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":160,"box":{"x":68,"y":808,"width":817,"height":11}},{"id":"69c78cfd-3e5f-4106-9d9c-0211e629f19c","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":160,"box":{"x":70,"y":823,"width":797,"height":12}},{"id":"07b68e98-5f9b-4566-9921-22758efdcde0","block_type":"box","text":"dividends received by the shareholder.","page_number":160,"box":{"x":69,"y":839,"width":272,"height":10}},{"id":"9fdbebe9-2604-408e-b8cf-0e7a5c1b2909","block_type":"box","text":"Ordinary income and capital gain dividends are taxable to shareholders even if they are reinvested in additional","page_number":160,"box":{"x":102,"y":861,"width":792,"height":11}},{"id":"d1ed55e3-c3ed-4c94-be85-060453d600db","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":160,"box":{"x":69,"y":876,"width":835,"height":11}},{"id":"3bed4ca1-9da4-48d1-98de-cd618b1a32a9","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":160,"box":{"x":68,"y":891,"width":809,"height":11}},{"id":"3edcfee9-a6c4-47a3-9069-900c82997a99","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":160,"box":{"x":68,"y":906,"width":819,"height":11}},{"id":"536a46c2-3030-4793-bedb-206049b7dd4e","block_type":"box","text":"II-130","page_number":160,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"077686ed-3b13-499d-8550-61f6415a0557","block_type":"box","text":"NM1026U-5979889-160/232","page_number":160,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ddfaaa4c-8641-441e-b921-76fc2c5d44f2","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":161,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"cd4f2c21-e9cd-4462-b062-e995113fbd7e","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":161,"box":{"x":69,"y":60,"width":794,"height":11}},{"id":"f0477ed2-2e82-41d6-b0a4-946fd150b266","block_type":"box","text":"calendar taxable year, if the Fund reports more capital gain dividends than it earns in such taxable year, then the","page_number":161,"box":{"x":69,"y":75,"width":804,"height":11}},{"id":"2f0169c5-43e5-46a7-abca-1461f4a34a68","block_type":"box","text":"Fund will reduce the amounts reported as capital gains. Where possible, such reduction will first be allocated to","page_number":161,"box":{"x":70,"y":90,"width":797,"height":11}},{"id":"eff464ec-6017-4b74-9751-2b0c554b6bf3","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":161,"box":{"x":69,"y":105,"width":810,"height":11}},{"id":"e193d2c7-d990-4f0e-a945-ba0f7bbe76fe","block_type":"box","text":"taxable year, certain net capital losses arising after October 31 of the current taxable year, and certain net ordinary","page_number":161,"box":{"x":68,"y":120,"width":826,"height":12}},{"id":"6d900946-8459-4159-b88d-c9e8775e6742","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":161,"box":{"x":70,"y":135,"width":772,"height":12}},{"id":"c9f7ccd7-4371-44fd-aa9a-2cc4a9bd66d7","block_type":"box","text":"increasing the amount of dividends otherwise includible in the shareholder’s income with respect to the current","page_number":161,"box":{"x":70,"y":150,"width":795,"height":12}},{"id":"e722469f-a773-49d3-82f1-953b39ede703","block_type":"box","text":"taxable year.","page_number":161,"box":{"x":68,"y":166,"width":89,"height":11}},{"id":"6e077461-fa26-4e97-ad0b-9df3f35c340f","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":161,"box":{"x":102,"y":188,"width":733,"height":12}},{"id":"b446ef85-d401-4ca3-9e2e-8b7401acb5c3","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":161,"box":{"x":69,"y":203,"width":832,"height":11}},{"id":"def1cea8-1203-4857-94a7-7b78055a18e7","block_type":"box","text":"basis in the converted Investor C Shares and the holding period of the acquired Investor A Shares will include the","page_number":161,"box":{"x":69,"y":218,"width":809,"height":12}},{"id":"4c19b964-5f3d-4b54-8b53-d0b8106343d1","block_type":"box","text":"holding period for the converted Investor C Shares.","page_number":161,"box":{"x":69,"y":234,"width":362,"height":11}},{"id":"54522dd4-bb79-4746-927b-f930ec08863a","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":161,"box":{"x":102,"y":256,"width":795,"height":12}},{"id":"82958ee2-38d3-4733-a254-e281aab0f73d","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":161,"box":{"x":69,"y":271,"width":824,"height":12}},{"id":"b4b31301-1e49-40c7-aa0c-795225c82c64","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":161,"box":{"x":69,"y":287,"width":797,"height":11}},{"id":"a5b7c28f-038f-4b19-ad33-91ff4dc614f8","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":161,"box":{"x":69,"y":302,"width":791,"height":11}},{"id":"cc94efd5-2092-4fbc-8251-d4bd1ec82665","block_type":"box","text":"privilege. Instead, such sales charge will be treated as an amount paid for the new shares.","page_number":161,"box":{"x":70,"y":317,"width":646,"height":11}},{"id":"9e034824-7a0e-460d-bece-05bd341d0e74","block_type":"box","text":"A sale, redemption, or exchange of Fund shares may give rise to a gain or loss. In general, any gain or loss","page_number":161,"box":{"x":101,"y":339,"width":762,"height":12}},{"id":"2ef4e48e-5b0a-41b7-a257-70ab35363091","block_type":"box","text":"realized upon a taxable disposition of shares of a Fund will be treated as long-term capital gain or loss if such shares","page_number":161,"box":{"x":69,"y":355,"width":836,"height":11}},{"id":"3f7e5d95-a296-4c5b-bdca-0a00dd78bd05","block_type":"box","text":"have been held for more than 12 months. Otherwise, the gain or loss on the taxable disposition of Fund shares will","page_number":161,"box":{"x":69,"y":370,"width":822,"height":11}},{"id":"7856fa7f-a591-459d-9d3f-fcab53e17c54","block_type":"box","text":"generally be treated as short-term capital gain or loss. Any loss realized upon a taxable disposition of shares held for","page_number":161,"box":{"x":68,"y":385,"width":838,"height":11}},{"id":"bcd3788d-ff7d-4715-8d57-9772e8e96ecb","block_type":"box","text":"six months or less will be treated as long-term capital loss, rather than short-term capital loss, to the extent of any","page_number":161,"box":{"x":69,"y":400,"width":820,"height":11}},{"id":"760816fa-6ef8-47a8-b998-b7817079a8ec","block_type":"box","text":"amounts treated as distributions to the shareholder of long-term capital gain (including any amounts credited to the","page_number":161,"box":{"x":69,"y":415,"width":823,"height":11}},{"id":"6619ac39-aa3d-4457-8f50-b164c3d2b3cd","block_type":"box","text":"shareholder as undistributed capital gains). Shareholders that hold shares of a Fund through a qualified tax-exempt","page_number":161,"box":{"x":69,"y":430,"width":822,"height":11}},{"id":"dfcfa42d-42a8-4902-b481-b0ad43524b44","block_type":"box","text":"plan described in section 401(a) of the Internal Revenue Code should see the Fund’s Prospectus for a discussion of","page_number":161,"box":{"x":70,"y":445,"width":829,"height":11}},{"id":"69cebe47-802a-4d72-93b6-3c3b2c31d3e3","block_type":"box","text":"special tax rules that apply to their investments.","page_number":161,"box":{"x":69,"y":461,"width":343,"height":11}},{"id":"02b86dec-2d39-4471-8205-64a3c278d640","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":161,"box":{"x":101,"y":483,"width":807,"height":11}},{"id":"ff6b9f30-c9fd-426f-8761-917b38162ceb","block_type":"box","text":"are acquired (whether through the automatic reinvestment of dividends or otherwise) within a 61-day period beginning","page_number":161,"box":{"x":69,"y":498,"width":839,"height":11}},{"id":"16be4e46-6422-4790-a973-6319aa0af401","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":161,"box":{"x":69,"y":513,"width":799,"height":12}},{"id":"bad824fe-e47c-46f8-86b2-2e047341504e","block_type":"box","text":"basis of the shares acquired will be adjusted to reflect the disallowed loss.","page_number":161,"box":{"x":69,"y":528,"width":534,"height":12}},{"id":"d988ccc8-3f18-4f63-b427-40425fef365d","block_type":"box","text":"A Fund is also generally required by law to report to each shareholder and to the IRS cost basis information for","page_number":161,"box":{"x":101,"y":551,"width":792,"height":11}},{"id":"4a0027d4-77ae-41eb-a832-cc4819d67ed9","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":161,"box":{"x":69,"y":566,"width":800,"height":11}},{"id":"ac0a5066-96e9-4bf9-8f8d-db80125acb99","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":161,"box":{"x":70,"y":581,"width":828,"height":12}},{"id":"583014d2-20f2-4abf-9c29-75f972b64a57","block_type":"box","text":"long-term or short-term. The adjusted cost basis of shares will be based on the default cost basis reporting method","page_number":161,"box":{"x":70,"y":596,"width":824,"height":12}},{"id":"06a9bf7f-8755-474e-be45-2ff0bb746f8e","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":161,"box":{"x":69,"y":612,"width":816,"height":11}},{"id":"975a67f4-c088-4a8a-848c-c05e0018ff32","block_type":"box","text":"different IRS-accepted method offered by the Fund. These requirements, however, will not apply for investments","page_number":161,"box":{"x":69,"y":627,"width":797,"height":11}},{"id":"96ecf739-6823-429d-96ff-a091c37987c3","block_type":"box","text":"through an IRA or other tax-advantaged account. Shareholders should consult their tax advisors to determine the best","page_number":161,"box":{"x":68,"y":642,"width":840,"height":11}},{"id":"574e2071-04c8-4c47-b792-a47005e88c2e","block_type":"box","text":"cost basis method for their tax situation, and to obtain more information about how these cost basis reporting","page_number":161,"box":{"x":69,"y":657,"width":788,"height":11}},{"id":"140d77a4-a9fb-406b-b2ca-4f620709c349","block_type":"box","text":"requirements apply to them. For shares of a Fund acquired before January 1, 2012, these requirements will not","page_number":161,"box":{"x":69,"y":672,"width":797,"height":11}},{"id":"3b3a7896-3caa-46ea-a78c-52c813be93aa","block_type":"box","text":"apply, but the Fund will continue to report to the IRS the gross proceeds received by a shareholder from the sale or","page_number":161,"box":{"x":69,"y":687,"width":821,"height":11}},{"id":"5ca53519-b170-45a3-a137-0b5e7d87c578","block_type":"box","text":"redemption of such shares.","page_number":161,"box":{"x":69,"y":702,"width":195,"height":11}},{"id":"0f8abcf3-be71-458d-814b-43fa24790928","block_type":"box","text":"The Manager may determine it is in the best interest of a Fund to distribute portfolio securities in kind for the","page_number":161,"box":{"x":101,"y":725,"width":780,"height":11}},{"id":"3f954ed3-9d7e-4b32-9d04-4266fa2e8e4a","block_type":"box","text":"purposes of portfolio management when meeting redemption requests. When the Manager determines to do so, a","page_number":161,"box":{"x":70,"y":740,"width":814,"height":11}},{"id":"710a15c1-5ab9-4a16-85eb-d27ac1ec640f","block_type":"box","text":"Fund generally will not recognize taxable gains in respect of the portfolio securities it distributes to the redeeming","page_number":161,"box":{"x":70,"y":755,"width":810,"height":11}},{"id":"90a3f425-106b-47a4-a4c3-3eb2d4e22e7f","block_type":"box","text":"shareholder, which may reduce the amount of taxable gains the Fund would otherwise be required to distribute.","page_number":161,"box":{"x":69,"y":770,"width":793,"height":12}},{"id":"5cc0290c-03cd-4d36-b4b1-5a6cab6f8831","block_type":"box","text":"While a Fund may engage in redemptions in kind that have the effect of reducing or eliminating distributable","page_number":161,"box":{"x":101,"y":793,"width":770,"height":11}},{"id":"4a1c2099-ae2c-4f60-bd66-398752bf33e6","block_type":"box","text":"capital gains as described above, the Funds do not employ a systematic approach to tax management. There is no","page_number":161,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"78ae0266-c4fb-466c-848b-c9e853524e7e","block_type":"box","text":"assurance that a Fund can or will be successful in effecting any redemptions in kind and shareholders should expect","page_number":161,"box":{"x":69,"y":823,"width":833,"height":12}},{"id":"530eb256-ea78-4bc5-af00-ffd562225a33","block_type":"box","text":"that each Fund will distribute capital gains.","page_number":161,"box":{"x":68,"y":839,"width":305,"height":11}},{"id":"d8b9c3c2-66f6-46a8-9ea4-867d771f57f2","block_type":"box","text":"Certain Funds may invest in derivative contracts such as options, futures contracts, forward contracts and swap","page_number":161,"box":{"x":102,"y":861,"width":799,"height":11}},{"id":"5037175c-4d3c-4271-a86a-600c39f81ed6","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":161,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"97a5de1e-3826-4b6e-b524-61fc1b55ed7e","block_type":"box","text":"investment in the underlying security and may adversely affect the timing, character and amount of income the Fund","page_number":161,"box":{"x":70,"y":891,"width":826,"height":12}},{"id":"0b0407d8-aab6-4c2c-b684-21d973d13e2b","block_type":"box","text":"realizes from its investments. As a result, a larger portion of the Fund’s distributions may be treated as ordinary","page_number":161,"box":{"x":69,"y":906,"width":803,"height":12}},{"id":"dbb071a2-4a77-4f93-8886-70963cced67b","block_type":"box","text":"II-131","page_number":161,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"9880cb65-6151-4699-b9ee-7b26e850d5b1","block_type":"box","text":"NM1026U-5979889-161/232","page_number":161,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4c7dd784-d9a7-41cd-b005-ef288c5efc42","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":162,"box":{"x":70,"y":45,"width":825,"height":11}},{"id":"89f3cd09-fe6d-4bb6-b285-e7ec5d0d03b4","block_type":"box","text":"(and, for purposes of the 4% excise tax, certain other dates as prescribed under the Code) are generally “marked-to","page_number":162,"box":{"x":69,"y":60,"width":829,"height":11}},{"id":"64cb384e-2134-4dcc-a278-563c1b23033a","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":162,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"30e508e1-3370-4d48-bce9-1d7e02e971f7","block_type":"box","text":"considered 60% long-term and 40% short-term capital gain or loss), which may increase the amount that must be","page_number":162,"box":{"x":69,"y":90,"width":808,"height":11}},{"id":"7de58a28-2d3f-4806-a2e4-5ae4da26d086","block_type":"box","text":"distributed to meet distribution requirements and avoid the excise tax. In addition, the tax treatment of certain","page_number":162,"box":{"x":69,"y":105,"width":787,"height":11}},{"id":"587b2344-b0f1-4443-9360-a19e9642224f","block_type":"box","text":"derivative contracts, such as swap agreements, is unsettled and may be subject to future legislation, regulation or","page_number":162,"box":{"x":69,"y":120,"width":816,"height":12}},{"id":"cf900dfa-b09a-44aa-b7fe-b0bcc38d69fb","block_type":"box","text":"administrative pronouncements issued by the IRS. If such future guidance limits the Fund’s ability to use derivatives,","page_number":162,"box":{"x":69,"y":135,"width":832,"height":12}},{"id":"c00e32db-940b-476a-8465-5a665e822f2e","block_type":"box","text":"the Fund may have to find other ways of achieving its investment objectives.","page_number":162,"box":{"x":68,"y":150,"width":542,"height":12}},{"id":"89d073f9-a558-446a-8ef6-32c4067218d8","block_type":"box","text":"Certain swap agreements, including exchange-traded swap agreements, are treated as notional principal","page_number":162,"box":{"x":102,"y":173,"width":744,"height":11}},{"id":"e238f7ed-13c6-4922-b4bb-36cb53340bc4","block_type":"box","text":"contracts rather than as section 1256 contracts. This can affect the type of income earned by such swap","page_number":162,"box":{"x":69,"y":188,"width":751,"height":11}},{"id":"37c3165d-9908-4e53-87d2-8911dc68a783","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":162,"box":{"x":69,"y":203,"width":819,"height":12}},{"id":"1dc33ca6-7337-47cd-8f57-60e4fe6db0a6","block_type":"box","text":"on a section 1256 contract is treated as short-term capital gain taxed at ordinary rates and 60% is treated as long","page_number":162,"box":{"x":69,"y":219,"width":823,"height":11}},{"id":"16069c7f-18e8-4719-bd1f-5f3311716b8d","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":162,"box":{"x":68,"y":234,"width":823,"height":11}},{"id":"8bc2045a-bb82-43b3-ba7b-85490587d6b9","block_type":"box","text":"which may be taxable at more favorable rates than ordinary income. Proposed regulations interpret what types of","page_number":162,"box":{"x":68,"y":249,"width":807,"height":11}},{"id":"74363a8a-eecc-4992-a38b-4927b420781a","block_type":"box","text":"swap agreements are to be treated as notional principal contracts rather than as section 1256 contracts. When","page_number":162,"box":{"x":69,"y":264,"width":797,"height":11}},{"id":"8aa2dad4-4f89-45c8-b21a-feac54f52ea9","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":162,"box":{"x":68,"y":279,"width":838,"height":11}},{"id":"f1d9269d-4052-450c-ac8c-49a54311ccdb","block_type":"box","text":"of the distributions made to shareholders as ordinary income and less as long-term capital gains.","page_number":162,"box":{"x":69,"y":294,"width":695,"height":11}},{"id":"c643ba1c-dcd3-4c28-bad7-0248852b2a96","block_type":"box","text":"Certain Funds may invest in zero coupon U.S. Treasury bonds and other debt securities that are issued at a","page_number":162,"box":{"x":102,"y":317,"width":768,"height":11}},{"id":"3a579d4f-485f-447d-b771-b0e822c07261","block_type":"box","text":"discount or provide for deferred interest. Even though a Fund receives no actual interest payments on these","page_number":162,"box":{"x":69,"y":332,"width":769,"height":11}},{"id":"842a9f03-4c19-4f5f-b2c8-33064a4b7fdd","block_type":"box","text":"securities, it will be deemed to receive income equal, generally, to a portion of the excess of the stated redemption","page_number":162,"box":{"x":69,"y":347,"width":822,"height":11}},{"id":"942dd573-7115-43f0-979b-d9c2202c3ec9","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":162,"box":{"x":70,"y":362,"width":819,"height":11}},{"id":"983ad91d-27c0-484e-bd00-1eed894fe9e9","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":162,"box":{"x":68,"y":377,"width":818,"height":12}},{"id":"3b9cc16c-9df5-41b0-9f6c-cd785cd3d226","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":162,"box":{"x":70,"y":392,"width":830,"height":12}},{"id":"680a8687-b4bd-4af3-b598-1220f5001d97","block_type":"box","text":"in order to satisfy its distribution requirements. In addition, a Fund’s investment in foreign currencies or foreign","page_number":162,"box":{"x":70,"y":407,"width":792,"height":12}},{"id":"a27e8259-831b-42e1-ae37-6f1bf248c6b6","block_type":"box","text":"currency denominated or referenced debt securities, certain asset-backed securities and contingent payment and","page_number":162,"box":{"x":69,"y":423,"width":808,"height":11}},{"id":"2f2f9f07-ba76-43cb-bf07-1870256d9af1","block_type":"box","text":"inflation-indexed debt instruments also may increase or accelerate the Fund’s recognition of income, including the","page_number":162,"box":{"x":70,"y":438,"width":812,"height":11}},{"id":"823f6bbd-1af8-44f5-a97a-66d99e52e472","block_type":"box","text":"recognition of taxable income in excess of cash generated by such investments. Any transaction by the Fund in","page_number":162,"box":{"x":69,"y":453,"width":789,"height":11}},{"id":"6a9f2369-0089-46d2-941f-b71d96c91ea2","block_type":"box","text":"foreign currencies, foreign currency-denominated debt obligations or certain foreign currency options, futures","page_number":162,"box":{"x":68,"y":468,"width":777,"height":11}},{"id":"955d363e-140b-4159-b180-c660a805b311","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":162,"box":{"x":69,"y":483,"width":810,"height":11}},{"id":"b49d2478-830e-47ef-9d45-a17886d5a8b9","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":162,"box":{"x":70,"y":498,"width":801,"height":11}},{"id":"4f5ad247-a0fa-4c91-b5f8-28ecf5cef239","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":162,"box":{"x":69,"y":513,"width":762,"height":12}},{"id":"023edcac-b55b-40e0-8490-147c9ebb7f51","block_type":"box","text":"potentially require the recharacterization of prior ordinary income distributions. Such ordinary income treatment may","page_number":162,"box":{"x":70,"y":528,"width":827,"height":12}},{"id":"b80afeac-04f6-4fe0-89a0-b065b06f1d20","block_type":"box","text":"accelerate Fund distributions to shareholders and increase the distributions taxed to shareholders as ordinary","page_number":162,"box":{"x":69,"y":544,"width":787,"height":11}},{"id":"17383f36-b220-49c7-85b0-0e1437729f5e","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":162,"box":{"x":70,"y":559,"width":822,"height":11}},{"id":"164ad625-3fc6-4e05-9e0f-a919c666c932","block_type":"box","text":"in subsequent taxable years.","page_number":162,"box":{"x":70,"y":574,"width":203,"height":11}},{"id":"c34978c0-685e-467b-9910-5b1e3ce10e8e","block_type":"box","text":"Ordinary income dividends paid to shareholders who are nonresident aliens or foreign entities (other than pass","page_number":162,"box":{"x":102,"y":596,"width":795,"height":12}},{"id":"9088b48c-138e-43fa-ad2e-71c5508405d4","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":162,"box":{"x":68,"y":612,"width":816,"height":11}},{"id":"1acf61e1-18fc-4b33-8d55-18869f2198df","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":162,"box":{"x":69,"y":627,"width":835,"height":11}},{"id":"c2abdf3e-350f-446c-a140-b7b0068509d0","block_type":"box","text":"withholding exemption is provided under applicable treaty law. Capital gain dividends paid to shareholders that are","page_number":162,"box":{"x":68,"y":642,"width":815,"height":11}},{"id":"9e6ea3c1-f4b9-43f7-9958-cdf6ac654cb7","block_type":"box","text":"nonresident aliens or foreign entities, if and to the extent properly reported as capital gain dividends, generally will","page_number":162,"box":{"x":69,"y":657,"width":816,"height":11}},{"id":"da0b04f8-3560-4219-8973-1ad5356cf3a6","block_type":"box","text":"not be subject to a 30% withholding tax, unless certain exceptions apply. Dividends derived by a regulated investment","page_number":162,"box":{"x":69,"y":672,"width":840,"height":11}},{"id":"ac61cbfb-4cf0-411e-9397-dcf6febccce8","block_type":"box","text":"company from short-term capital gains and qualified net interest income (including income from original issue","page_number":162,"box":{"x":69,"y":687,"width":781,"height":11}},{"id":"4fc5032b-2ba9-4d95-aa4d-ff59c592bac3","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":162,"box":{"x":69,"y":702,"width":824,"height":12}},{"id":"a2f06df6-05c9-402a-81ca-403c15904cbe","block_type":"box","text":"extent properly reported as “short-term capital gain dividends” or “interest-related dividends”, respectively, generally","page_number":162,"box":{"x":69,"y":718,"width":832,"height":11}},{"id":"33d949f6-5697-4040-8aba-a71bfdf80247","block_type":"box","text":"will not be subject to U.S. withholding tax. Where possible, the Funds intend to report such dividends as interest","page_number":162,"box":{"x":68,"y":733,"width":808,"height":11}},{"id":"700cfbd7-94a9-4cf7-a8dd-bf32a1fd8bf5","block_type":"box","text":"related dividends or short-term capital gain dividends. However, depending on its circumstances, a Fund may report","page_number":162,"box":{"x":69,"y":748,"width":826,"height":11}},{"id":"46609ced-e2e6-42c3-9a32-899d40bf1de8","block_type":"box","text":"all, some or none of its potentially eligible dividends as interest-related or as short-term capital gain dividends, and/","page_number":162,"box":{"x":69,"y":763,"width":830,"height":11}},{"id":"75a1e9c8-f38b-48fb-a7aa-45aea60c03dc","block_type":"box","text":"or treat such dividends, in whole or in part, as ineligible for this exemption from withholding. In order to qualify for","page_number":162,"box":{"x":69,"y":778,"width":811,"height":11}},{"id":"affd5cd5-cbd6-437a-a01c-f4b2f9154fdc","block_type":"box","text":"this exemption from withholding, a foreign shareholder must comply with applicable certification requirements","page_number":162,"box":{"x":68,"y":793,"width":784,"height":11}},{"id":"c422ad0f-2414-4fb5-9e4e-2e1014f5bc9c","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":162,"box":{"x":69,"y":808,"width":828,"height":11}},{"id":"cbbe13c8-6d0e-4212-8623-7e0341d9a60a","block_type":"box","text":"Form). In the case of shares held through an intermediary, the intermediary may withhold even if the Fund reports the","page_number":162,"box":{"x":70,"y":823,"width":839,"height":12}},{"id":"27ecbfc8-d534-4cf1-8e9d-e42bbdc8b803","block_type":"box","text":"payment as an interest-related or short-term capital gain dividend. Foreign shareholders should contact their","page_number":162,"box":{"x":70,"y":839,"width":772,"height":11}},{"id":"6b65522c-c8d5-4a41-b449-a83922781735","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":162,"box":{"x":70,"y":853,"width":791,"height":11}},{"id":"2eaa2fc3-6ef0-4429-a5cc-6eee89870416","block_type":"box","text":"portion, if any, of a Fund’s distributions will be reported as interest-related dividends or short-term capital gain","page_number":162,"box":{"x":70,"y":869,"width":787,"height":11}},{"id":"76c8ef1e-3a3b-413b-804e-3e478cff54cf","block_type":"box","text":"dividends under these rules.","page_number":162,"box":{"x":69,"y":884,"width":201,"height":9}},{"id":"e8759f0f-3d12-4eb9-931c-5b0e5a80aa63","block_type":"box","text":"II-132","page_number":162,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"723cb6e4-c66e-4d32-acd9-3190583130d3","block_type":"box","text":"NM1026U-5979889-162/232","page_number":162,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"61aa5c97-4715-47ee-a89d-b64d96f20a4d","block_type":"box","text":"Distributions to certain foreign shareholders by a Fund at least 50% of the assets of which are “U.S. real","page_number":163,"box":{"x":102,"y":45,"width":747,"height":11}},{"id":"08d9710b-956c-4c84-97ab-7e93a1052605","block_type":"box","text":"property interests” (as defined in the Code and Treasury regulations) at any time during the five-year period ending on","page_number":163,"box":{"x":70,"y":60,"width":838,"height":11}},{"id":"4fdadf75-6e82-497c-ab80-d035881566ad","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":163,"box":{"x":68,"y":75,"width":829,"height":11}},{"id":"7729ffd5-8008-410c-a8d4-5248d147f4f2","block_type":"box","text":"real property interests (including shares in certain “U.S. real property holding corporations” such as certain REITs,","page_number":163,"box":{"x":69,"y":90,"width":817,"height":11}},{"id":"1b6a568b-68da-4db6-8143-05d847ff9024","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":163,"box":{"x":69,"y":105,"width":786,"height":11}},{"id":"704fe7d9-fa2f-4092-b7de-274768574c32","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":163,"box":{"x":69,"y":120,"width":800,"height":12}},{"id":"0d30eceb-59f4-42b3-a111-06fe7a8e0f16","block_type":"box","text":"period ending on the date of the distributions), generally must be treated by such foreign shareholders as income","page_number":163,"box":{"x":70,"y":135,"width":807,"height":12}},{"id":"b2863e32-0495-46d5-9933-a4aeb275e92f","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":163,"box":{"x":69,"y":150,"width":772,"height":12}},{"id":"9a341178-f4b2-4761-935f-0769c4ab5ce2","block_type":"box","text":"graduated rates applicable to U.S. shareholders, except for distributions to foreign shareholders that held no more","page_number":163,"box":{"x":68,"y":166,"width":818,"height":11}},{"id":"02e21317-2ffa-49e7-a7e0-1cb19657d969","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":163,"box":{"x":68,"y":181,"width":820,"height":11}},{"id":"ee2053ce-86e1-4247-91ce-a53dda6a5c31","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":163,"box":{"x":69,"y":196,"width":833,"height":11}},{"id":"874e3f37-30e1-4b2d-906c-8e75c2b3dde8","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":163,"box":{"x":69,"y":211,"width":823,"height":11}},{"id":"0bbfcce0-c729-402a-917b-1a7fae05a969","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":163,"box":{"x":69,"y":226,"width":774,"height":11}},{"id":"9600dcfc-7b9f-45f8-8a2c-a959a353a493","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":163,"box":{"x":69,"y":241,"width":839,"height":11}},{"id":"cd453218-c3ad-4152-966e-ab437b2e4047","block_type":"box","text":"sales or redemptions of shares held by certain foreign shareholders in such a Fund generally will be subject to U.S.","page_number":163,"box":{"x":69,"y":256,"width":822,"height":12}},{"id":"55cbf616-bcdc-40e4-a432-6288182c73e8","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":163,"box":{"x":70,"y":271,"width":827,"height":12}},{"id":"43a6b878-af4d-413c-8f2c-a99cf14ed8aa","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":163,"box":{"x":69,"y":286,"width":823,"height":12}},{"id":"26c1ae77-39c4-4a3e-a977-853caf2cf20a","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":163,"box":{"x":68,"y":302,"width":827,"height":11}},{"id":"c425a630-a24a-4a32-881f-f94c781cff28","block_type":"box","text":"at all times during the five-year period ending on the date of the sale or redemption.","page_number":163,"box":{"x":69,"y":317,"width":596,"height":11}},{"id":"cde66c1a-7d7e-4b92-890c-0a14532d4dd0","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":163,"box":{"x":102,"y":339,"width":802,"height":12}},{"id":"5ef7c05d-f711-47e6-af46-c2d56a456811","block_type":"box","text":"distributions made in the form of U.S. real property interests (including shares in certain “U.S. real property holding","page_number":163,"box":{"x":69,"y":355,"width":827,"height":11}},{"id":"0cf586eb-fbef-4eaa-88c4-c87ccb025b50","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":163,"box":{"x":69,"y":370,"width":804,"height":11}},{"id":"bf565cff-03a7-4fb5-9794-489ae0786559","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":163,"box":{"x":69,"y":385,"width":824,"height":11}},{"id":"afb88b08-67a7-4043-8436-963123c82a4c","block_type":"box","text":"five-year period ending on the date of the distribution) generally will cause the Fund to recognize a portion of any","page_number":163,"box":{"x":68,"y":400,"width":801,"height":11}},{"id":"39fd6bb1-987e-41b0-89e5-94818320bf44","block_type":"box","text":"unrecognized gain in the U.S. real property interests equal to the product of (i) the excess of fair market value of","page_number":163,"box":{"x":69,"y":415,"width":803,"height":11}},{"id":"645208eb-efbc-4b2b-8f19-4b7d1cabb8c6","block_type":"box","text":"such U.S. real property interests over the Fund’s adjusted bases in such interests and (ii) the greatest foreign","page_number":163,"box":{"x":69,"y":430,"width":785,"height":11}},{"id":"f4e40a18-8cc6-4730-9342-8555bedd2f09","block_type":"box","text":"ownership percentage of the Fund during the five-year period ending on the date of distribution.","page_number":163,"box":{"x":69,"y":445,"width":676,"height":12}},{"id":"f4cd3d4d-7092-426c-8f05-a214eace855f","block_type":"box","text":"A foreign shareholder may also be subject to certain “wash sale” rules to prevent the avoidance of the tax filing","page_number":163,"box":{"x":101,"y":468,"width":798,"height":11}},{"id":"4f2e3cbb-d82d-4b7d-8dbb-432a04bd0def","block_type":"box","text":"and payment obligations discussed above through the sale and repurchase of Fund shares.","page_number":163,"box":{"x":69,"y":483,"width":651,"height":11}},{"id":"6f33a5b4-11db-43a6-ae10-b824dbb34cb9","block_type":"box","text":"Shareholders that are nonresident aliens or foreign entities are urged to consult their own tax advisors","page_number":163,"box":{"x":102,"y":506,"width":731,"height":11}},{"id":"c1272b2b-15fc-480b-b848-f84dee5285d2","block_type":"box","text":"concerning the particular tax consequences to them of an investment in a Fund.","page_number":163,"box":{"x":69,"y":521,"width":570,"height":11}},{"id":"c4f9545a-8415-4d38-af88-72373e1550da","block_type":"box","text":"Separately, a 30% withholding tax is currently imposed on U.S.-source dividends, interest and other income","page_number":163,"box":{"x":102,"y":544,"width":763,"height":11}},{"id":"5bf7e095-ae39-4314-b13e-07bf2e18b104","block_type":"box","text":"items paid to (i) certain foreign financial institutions and investment funds, and (ii) certain other foreign entities. To","page_number":163,"box":{"x":70,"y":559,"width":820,"height":11}},{"id":"43c9acdf-961a-4c22-afde-31d49831065f","block_type":"box","text":"avoid withholding, foreign financial institutions and investment funds will generally either need to (a) collect and","page_number":163,"box":{"x":69,"y":574,"width":794,"height":11}},{"id":"3ac767ef-1e71-4a40-824c-a03de56b9a22","block_type":"box","text":"report to the IRS detailed information identifying their U.S. accounts and U.S. account holders, comply with due","page_number":163,"box":{"x":69,"y":589,"width":794,"height":11}},{"id":"69d493a3-9925-4de5-96b8-f25a52bb1ee7","block_type":"box","text":"diligence procedures for identifying U.S. accounts and withhold tax on certain payments made to noncomplying","page_number":163,"box":{"x":69,"y":604,"width":791,"height":11}},{"id":"6b332b41-4174-4b2f-9da2-4c285ee43e94","block_type":"box","text":"foreign entities and account holders or (b) if an intergovernmental agreement is entered into and implementing","page_number":163,"box":{"x":68,"y":619,"width":791,"height":11}},{"id":"6f427592-6d1a-4cc8-8ef8-f83da2343c60","block_type":"box","text":"legislation is adopted, comply with the agreement and legislation. Other foreign entities will generally either need to","page_number":163,"box":{"x":70,"y":634,"width":822,"height":12}},{"id":"4cb42ed4-5a95-488b-92fa-f8528a5bd95c","block_type":"box","text":"provide detailed information identifying each substantial U.S. owner or certify there are no such owners.","page_number":163,"box":{"x":70,"y":649,"width":739,"height":12}},{"id":"423bc609-5e19-4a2a-a0ad-b0914e0d1fa2","block_type":"box","text":"Under certain provisions of the Code, some shareholders may be subject to a 24% withholding tax on ordinary","page_number":163,"box":{"x":102,"y":672,"width":786,"height":11}},{"id":"d9a3a0c7-8975-49b8-aa36-b8f746565a31","block_type":"box","text":"income dividends, capital gain dividends and redemption payments (“backup withholding”). Generally, shareholders","page_number":163,"box":{"x":70,"y":687,"width":820,"height":11}},{"id":"3df8c2ea-2a8a-4bfc-80ad-1e30eb63dd1e","block_type":"box","text":"subject to backup withholding will be non-corporate shareholders for whom no certified taxpayer identification number","page_number":163,"box":{"x":69,"y":702,"width":837,"height":12}},{"id":"b8e0f5d5-c2dc-4098-a3a8-6e0474d0668a","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":163,"box":{"x":70,"y":717,"width":821,"height":12}},{"id":"90b564be-00e7-4112-af40-b3fb55fb7e64","block_type":"box","text":"account, an investor must certify under penalty of perjury that such number is correct and that such investor is not","page_number":163,"box":{"x":69,"y":732,"width":819,"height":12}},{"id":"832ef15e-c1f8-410a-8b73-f5060123e17f","block_type":"box","text":"otherwise subject to backup withholding. Backup withholding is not an additional tax. Any amount withheld generally","page_number":163,"box":{"x":69,"y":748,"width":826,"height":11}},{"id":"9332c6cc-f916-4c77-8d1c-88e003edd3c7","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":163,"box":{"x":69,"y":763,"width":802,"height":11}},{"id":"58e25606-9d5a-4ae9-9c80-ad3f451430ef","block_type":"box","text":"required information is timely forwarded to the IRS.","page_number":163,"box":{"x":69,"y":778,"width":364,"height":11}},{"id":"5400ad3b-5e36-4429-a600-0bbfd2881524","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":163,"box":{"x":102,"y":800,"width":774,"height":12}},{"id":"a7079b18-f21c-497c-b6a2-6bd4f8bf5489","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":163,"box":{"x":68,"y":815,"width":787,"height":12}},{"id":"9a822a57-e1b8-4913-bcf7-82251682b437","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":163,"box":{"x":68,"y":830,"width":835,"height":12}},{"id":"28ec00de-47ea-44ba-8ec9-ea5b15bf0b73","block_type":"box","text":"the shareholder must file a disclosure statement on IRS Form 8886 with the IRS. Direct shareholders of portfolio","page_number":163,"box":{"x":68,"y":846,"width":809,"height":11}},{"id":"76961945-fa38-4596-a09f-0cb7eeb3775f","block_type":"box","text":"securities are in many cases exempted. That a loss is reportable under these regulations does not affect the legal","page_number":163,"box":{"x":69,"y":861,"width":817,"height":11}},{"id":"b8c04024-97d8-4ca5-aed6-d20708d83ab7","block_type":"box","text":"determination of whether the taxpayer’s treatment of the loss is proper. Shareholders should consult their tax","page_number":163,"box":{"x":69,"y":876,"width":783,"height":11}},{"id":"71afcde8-b7f1-4249-aeee-0091573d81f9","block_type":"box","text":"advisors to determine the applicability of these regulations in light of their individual circumstances.","page_number":163,"box":{"x":69,"y":891,"width":710,"height":12}},{"id":"37b113e5-9ab2-4b50-8faa-9bae319b4067","block_type":"box","text":"II-133","page_number":163,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"bb4f67f0-14d2-43f5-9016-d57eb2132596","block_type":"box","text":"NM1026U-5979889-163/232","page_number":163,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c9afbfdc-f548-48d5-b21c-b760f559950c","block_type":"box","text":"Certain types of income received by a Fund from REITs, real estate mortgage investment conduits, taxable","page_number":164,"box":{"x":102,"y":45,"width":758,"height":11}},{"id":"baa52fd1-9590-4ce6-b630-b48869afb6c7","block_type":"box","text":"mortgage pools or other investments may cause the Fund to report some or all of its distributions as “excess","page_number":164,"box":{"x":69,"y":60,"width":782,"height":11}},{"id":"4afe4ef7-2150-4364-a0c7-140029d733a0","block_type":"box","text":"inclusion income.” To Fund shareholders, such excess inclusion income may: (i) constitute taxable income, as","page_number":164,"box":{"x":70,"y":75,"width":783,"height":11}},{"id":"cd9f62f5-0ec3-4b2b-a980-da44c3c9893e","block_type":"box","text":"unrelated business taxable income (“UBTI”) for those shareholders who would otherwise be tax-exempt such as","page_number":164,"box":{"x":69,"y":90,"width":797,"height":11}},{"id":"d114c739-4778-4008-9168-8300635eb45e","block_type":"box","text":"individual retirement accounts, 401(k) accounts, Keogh plans, pension plans and certain charitable entities; (ii) not","page_number":164,"box":{"x":70,"y":105,"width":822,"height":11}},{"id":"c507a387-7600-4cb4-9111-193ee544a188","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":164,"box":{"x":69,"y":120,"width":836,"height":12}},{"id":"c74a0212-471d-472c-9deb-1d68b9bfdb2d","block_type":"box","text":"U.S. shareholders even from tax treaty countries; and (iv) cause the Fund to be subject to tax if certain “disqualified","page_number":164,"box":{"x":70,"y":135,"width":826,"height":11}},{"id":"3775250d-b031-4fde-af3e-3f791a3afba5","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":164,"box":{"x":69,"y":150,"width":808,"height":12}},{"id":"820460b1-d0d4-4e3a-a123-68c234bf7061","block_type":"box","text":"expected to generate excess inclusion income, but the Fund may not always be successful in doing so. Because","page_number":164,"box":{"x":69,"y":166,"width":800,"height":11}},{"id":"2820eb63-63c3-40e1-a55a-03514f52e112","block_type":"box","text":"information about a REIT’s investments may be inadequate or inaccurate, or because a REIT may change its","page_number":164,"box":{"x":70,"y":181,"width":770,"height":11}},{"id":"077145c7-4f76-4c13-a2a9-571a49d08535","block_type":"box","text":"investment program, the Fund may not be successful in avoiding the consequences described above. Avoidance of","page_number":164,"box":{"x":70,"y":196,"width":816,"height":11}},{"id":"14d3af38-e8ee-4267-a933-cbce0984d57d","block_type":"box","text":"investments in REITs that generate excess inclusion income may require the Fund to forego otherwise attractive","page_number":164,"box":{"x":70,"y":211,"width":796,"height":11}},{"id":"bec95e22-922a-49cc-9c8a-12976f7381bc","block_type":"box","text":"investment opportunities.","page_number":164,"box":{"x":70,"y":226,"width":180,"height":11}},{"id":"6618ee83-2669-4333-b5eb-330efff94d40","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":164,"box":{"x":102,"y":249,"width":801,"height":11}},{"id":"4dece042-183a-4e2c-9831-5db59fc036eb","block_type":"box","text":"imposed by foreign countries. Tax conventions between certain foreign countries and the United States may reduce or","page_number":164,"box":{"x":70,"y":264,"width":839,"height":11}},{"id":"d191dfe1-564d-4f79-8535-6a2de4702749","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":164,"box":{"x":69,"y":279,"width":840,"height":11}},{"id":"aa2b5e7a-fe19-4a56-97ca-e480f1f6d0f9","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":164,"box":{"x":68,"y":294,"width":837,"height":11}},{"id":"380d88e6-66c8-4d31-bdc1-f9bbf2ad2ed7","block_type":"box","text":"Fund, subject to certain requirements and limitations contained in the Code. For example, certain retirement","page_number":164,"box":{"x":70,"y":309,"width":774,"height":11}},{"id":"6ed5cd1a-e44f-4b88-bfb8-a21c992f9323","block_type":"box","text":"accounts and certain tax-exempt organizations cannot claim foreign tax credits on investments in foreign securities","page_number":164,"box":{"x":69,"y":324,"width":820,"height":12}},{"id":"38f22eea-948b-423b-bbff-b20c2a229dea","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":164,"box":{"x":69,"y":339,"width":795,"height":12}},{"id":"e8c2a36c-0054-44d4-8e5a-8afa1f756ba8","block_type":"box","text":"respect to a security only if the holder of the security meets certain holding period requirements. Both the","page_number":164,"box":{"x":69,"y":355,"width":755,"height":11}},{"id":"66446f00-57ed-4b37-94c7-49d53855c667","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":164,"box":{"x":69,"y":370,"width":811,"height":11}},{"id":"feebd394-dd5e-4925-a333-01f937f42abb","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":164,"box":{"x":69,"y":385,"width":839,"height":11}},{"id":"658a6e8f-f295-49f2-a15c-0ce5dca56248","block_type":"box","text":"the Fund. Further, to the extent that a Fund engages in securities lending with respect to a security paying income","page_number":164,"box":{"x":68,"y":400,"width":812,"height":11}},{"id":"bfc43346-2b90-439d-924c-7eaadb73890b","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":164,"box":{"x":69,"y":415,"width":829,"height":11}},{"id":"b4d828c6-34c5-46fe-95c5-23a0af84ff9e","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":164,"box":{"x":68,"y":430,"width":827,"height":11}},{"id":"0e11c106-ec31-4fc2-a429-302716db2580","block_type":"box","text":"IRS pursuant to which shareholders of the Fund will be required to include their proportionate shares of such foreign","page_number":164,"box":{"x":70,"y":445,"width":829,"height":12}},{"id":"e5685fb3-0f76-4337-8edc-ade6b32112cf","block_type":"box","text":"taxes in their U.S. income tax returns as gross income, treat such proportionate shares as taxes paid by them, and","page_number":164,"box":{"x":68,"y":460,"width":825,"height":12}},{"id":"c0738573-f8ad-4593-b53c-6601e1598f8d","block_type":"box","text":"deduct such proportionate shares in computing their taxable incomes or, alternatively, use them as foreign tax","page_number":164,"box":{"x":69,"y":475,"width":788,"height":12}},{"id":"e2930f15-f384-44ef-a4c7-a72bb5fbd3d9","block_type":"box","text":"credits against their U.S. income taxes. No deductions for foreign taxes, however, may be claimed by noncorporate","page_number":164,"box":{"x":69,"y":491,"width":818,"height":11}},{"id":"b224e0a5-2068-4ed6-b2b5-bc833fc850c0","block_type":"box","text":"shareholders who do not itemize deductions. A shareholder that is a nonresident alien individual or a foreign","page_number":164,"box":{"x":69,"y":506,"width":773,"height":11}},{"id":"81dc19b4-d6f9-4a63-8717-2056f350b0ea","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":164,"box":{"x":69,"y":521,"width":817,"height":11}},{"id":"51ae8e5d-1845-452a-b834-ffd7940b46c3","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":164,"box":{"x":70,"y":536,"width":814,"height":11}},{"id":"953ceeaf-b37d-433a-978b-985034a70665","block_type":"box","text":"having been paid by such shareholder. A Fund will report annually to its shareholders the amount per share of such","page_number":164,"box":{"x":69,"y":551,"width":821,"height":11}},{"id":"30f7b469-76d1-4603-8aee-7e1dea4af85d","block_type":"box","text":"foreign taxes and other information needed to claim the foreign tax credit.","page_number":164,"box":{"x":68,"y":566,"width":527,"height":11}},{"id":"3e086518-e622-4816-99b0-208dc62bddb0","block_type":"box","text":"Certain transactions entered into by the Funds are subject to special tax rules of the Code that may, among","page_number":164,"box":{"x":102,"y":589,"width":768,"height":11}},{"id":"284782d5-fd27-4906-b8ea-0b5640b18f77","block_type":"box","text":"other things, (a) affect the character of gains and losses realized, (b) disallow, suspend or otherwise limit the","page_number":164,"box":{"x":69,"y":604,"width":780,"height":11}},{"id":"8ae93d1c-1565-4079-b335-566475593f8c","block_type":"box","text":"allowance of certain losses or deductions, and (c) accelerate the recognition of income without a corresponding","page_number":164,"box":{"x":69,"y":619,"width":797,"height":11}},{"id":"cce2cc83-0437-4435-8030-ed22d8331c27","block_type":"box","text":"receipt of cash (with which to make the necessary distributions to satisfy distribution requirements applicable to","page_number":164,"box":{"x":69,"y":634,"width":802,"height":11}},{"id":"f3a2bb70-16e6-4233-9f00-d8e67e9ddc57","block_type":"box","text":"regulated investment companies). Operation of these rules could, therefore, affect the character, amount and timing","page_number":164,"box":{"x":69,"y":649,"width":831,"height":12}},{"id":"4aaab454-657d-444f-bf24-0b5ecf1833b8","block_type":"box","text":"of distributions to shareholders. Special tax rules also may require a Fund to mark-to-market certain types of","page_number":164,"box":{"x":69,"y":664,"width":776,"height":12}},{"id":"0a995985-8f1e-4dfc-8910-85158de0626b","block_type":"box","text":"positions in its portfolio (","page_number":164,"box":{"x":70,"y":680,"width":177,"height":11}},{"id":"f22e6172-9c8b-4c9f-9313-9aee4b5c96bf","block_type":"box","text":"i.e.","page_number":164,"box":{"x":249,"y":680,"width":20,"height":9}},{"id":"c81048bd-3c7d-4dd6-8d4b-5a9678a7c9ec","block_type":"box","text":", treat them as sold on the last day of the taxable year), and may result in the recognition","page_number":164,"box":{"x":272,"y":680,"width":636,"height":11}},{"id":"1b053e7c-9dad-4443-9f98-f8068437b2ff","block_type":"box","text":"of income without a corresponding receipt of cash. Funds engaging in transactions affected by these provisions","page_number":164,"box":{"x":69,"y":695,"width":795,"height":11}},{"id":"a55228d1-7919-44d2-b664-63f0dd295660","block_type":"box","text":"intend to monitor their transactions, make appropriate tax elections and make appropriate entries in their books and","page_number":164,"box":{"x":70,"y":710,"width":830,"height":11}},{"id":"cc320ecc-bcd3-497f-a5f8-0d1f837c55c4","block_type":"box","text":"records to lessen the effect of these tax rules and avoid any possible disqualification from the special treatment","page_number":164,"box":{"x":69,"y":725,"width":804,"height":11}},{"id":"0e4635cd-4e13-498b-bc56-23ba00699806","block_type":"box","text":"afforded regulated investment companies under the Code.","page_number":164,"box":{"x":69,"y":740,"width":415,"height":11}},{"id":"f591bf16-7a4b-4b29-9a34-8f5f941c87e4","block_type":"box","text":"Certain of a Fund’s investments in derivative instruments and foreign currency-denominated instruments, and","page_number":164,"box":{"x":102,"y":763,"width":781,"height":11}},{"id":"78b56e63-20f5-40fc-ae0e-4594bab8d79e","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":164,"box":{"x":69,"y":778,"width":835,"height":11}},{"id":"f347cb40-c9aa-4569-b455-e304bfc30bdd","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":164,"box":{"x":70,"y":793,"width":811,"height":11}},{"id":"f5b09574-7bd4-46ae-88b3-0cd0266dbacf","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":164,"box":{"x":69,"y":808,"width":818,"height":11}},{"id":"87b089ce-c353-45fa-a20f-2f685fe59e1d","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":164,"box":{"x":69,"y":823,"width":820,"height":12}},{"id":"39a6e980-77cb-4d13-950b-f2928aaef903","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":164,"box":{"x":69,"y":838,"width":834,"height":11}},{"id":"b2c77b4a-7e03-492e-9a7c-2233a11b7eca","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":164,"box":{"x":69,"y":853,"width":833,"height":12}},{"id":"bfaebd47-f881-4299-97df-22d5b361e560","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":164,"box":{"x":69,"y":869,"width":805,"height":11}},{"id":"9bc58a7a-ccd3-473a-897e-da4e146bd18d","block_type":"box","text":"II-134","page_number":164,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"a5c7c6c1-22fb-4f9b-ab04-8aeb39ab31d6","block_type":"box","text":"NM1026U-5979889-164/232","page_number":164,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e069e248-2c37-499a-9f05-3bc5a8ab71d0","block_type":"box","text":"earnings and profits (including earnings and profits arising from tax-exempt income), (ii) thereafter, as a return of","page_number":165,"box":{"x":69,"y":45,"width":805,"height":11}},{"id":"0c84b15f-5385-48ce-b2b5-20df138f2b73","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":165,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"1bb12679-2a22-467c-82d1-d5469007af9d","block_type":"box","text":"capital asset.","page_number":165,"box":{"x":69,"y":75,"width":95,"height":11}},{"id":"5e06660f-ea07-46c7-9ff5-a5e28929e1cf","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":165,"box":{"x":102,"y":98,"width":787,"height":11}},{"id":"472cc9b5-9b0e-4366-819e-2bdce7b8174a","block_type":"box","text":"indefinitely or permanently deferred as “wash sales.” Distributions of short-term capital gains by underlying funds will","page_number":165,"box":{"x":70,"y":113,"width":836,"height":11}},{"id":"d1e01505-7170-4185-bd26-d41495ce5f14","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":165,"box":{"x":69,"y":128,"width":812,"height":11}},{"id":"cf79a4e7-e6f8-4aba-9aac-515ffd241af3","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":165,"box":{"x":69,"y":143,"width":805,"height":11}},{"id":"441c152a-ffa7-4e82-a98c-c06ce8da12db","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":165,"box":{"x":68,"y":158,"width":829,"height":11}},{"id":"6c00ff8c-72cb-4a8c-9aa5-94f17bde7f63","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":165,"box":{"x":70,"y":173,"width":803,"height":11}},{"id":"95104156-61a9-4d6f-8578-0508cbaa0918","block_type":"box","text":"Fund were to invest otherwise.","page_number":165,"box":{"x":70,"y":188,"width":216,"height":9}},{"id":"77a65821-853f-4733-a5a8-43685b8380d8","block_type":"box","text":"A Fund may take certain positions through a wholly-owned (or majority-owned), foreign subsidiary (the","page_number":165,"box":{"x":101,"y":211,"width":721,"height":11}},{"id":"19bf176b-bc75-4fd2-9e29-e7d6902f888b","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":165,"box":{"x":70,"y":226,"width":787,"height":11}},{"id":"dc346bc9-c6b1-4e8d-8ddb-6eb16be02c76","block_type":"box","text":"income will be “subpart F income” for U.S. federal income tax purposes. If that is the case, the Fund will be required","page_number":165,"box":{"x":70,"y":241,"width":831,"height":11}},{"id":"277c83ee-3efb-4ab5-9be0-3dc668fe1f6e","block_type":"box","text":"to report all of the Subsidiary’s net income as ordinary income regardless of whether that income would be treated","page_number":165,"box":{"x":68,"y":256,"width":823,"height":12}},{"id":"3c2206f5-d244-4b66-abff-1d644241fa48","block_type":"box","text":"differently (for example, as capital gain) at the Subsidiary level and regardless of whether that income is distributed","page_number":165,"box":{"x":69,"y":271,"width":825,"height":12}},{"id":"f8121b1e-4ec6-4463-8647-8d9122576de1","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":165,"box":{"x":68,"y":286,"width":838,"height":12}},{"id":"dc9a1c95-fddc-4718-832d-02a19b414f53","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":165,"box":{"x":68,"y":302,"width":830,"height":11}},{"id":"6254b2ec-e994-4913-944a-0331c8642a7d","block_type":"box","text":"expected that the Subsidiary will be subject to an entity-level federal tax.","page_number":165,"box":{"x":69,"y":317,"width":515,"height":11}},{"id":"3625f465-5501-4813-841f-725f46399eee","block_type":"box","text":"If a Fund purchases shares of an investment company (or similar investment entity) organized under foreign law,","page_number":165,"box":{"x":102,"y":339,"width":798,"height":12}},{"id":"5d5f4959-1bde-432f-b248-b476f2a9e37d","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":165,"box":{"x":68,"y":355,"width":835,"height":11}},{"id":"dc700064-b3cb-4379-bdf1-29232a71d4be","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":165,"box":{"x":70,"y":370,"width":827,"height":11}},{"id":"daded836-b33c-47f0-b0fa-d7f499a10df8","block_type":"box","text":"to tax underpayments) on tax liability treated as having been deferred with respect to certain distributions from such","page_number":165,"box":{"x":68,"y":385,"width":830,"height":11}},{"id":"e07b9de4-01af-47fe-ba4c-44182dd19e0e","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":165,"box":{"x":69,"y":400,"width":802,"height":11}},{"id":"18be5a10-0e4d-4ec7-881f-70a7ac49ee2e","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":165,"box":{"x":69,"y":415,"width":821,"height":11}},{"id":"2da012fa-262f-405f-9231-bc52986e2b95","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":165,"box":{"x":70,"y":430,"width":797,"height":11}},{"id":"795f3bb4-fcd0-4c0c-a42d-2d48bfa73804","block_type":"box","text":"made separately for each PFIC held and, once made, would be effective for all subsequent taxable years, unless","page_number":165,"box":{"x":69,"y":445,"width":801,"height":11}},{"id":"fbf56636-5f99-4b3b-bdbd-819b2d5bdc93","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":165,"box":{"x":69,"y":460,"width":818,"height":12}},{"id":"f58f0ea9-bb7b-49b8-bf79-9d4efcabaa5e","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":165,"box":{"x":68,"y":475,"width":797,"height":12}},{"id":"ae7197c8-fc75-4e91-ad2c-6656db37c332","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":165,"box":{"x":69,"y":491,"width":824,"height":11}},{"id":"3d9827d0-6e4a-4682-b43c-84894527319d","block_type":"box","text":"to-market election, a Fund could avoid imposition of the interest charge with respect to excess distributions from","page_number":165,"box":{"x":68,"y":506,"width":804,"height":11}},{"id":"4801ffc1-fc3b-42f2-a113-8a8f15cd8a97","block_type":"box","text":"PFICs, but in any particular year might be required to recognize income in excess of the distributions it received from","page_number":165,"box":{"x":69,"y":521,"width":831,"height":11}},{"id":"4114910b-d23c-4301-a0b4-e2bb48821beb","block_type":"box","text":"PFICs.","page_number":165,"box":{"x":69,"y":536,"width":42,"height":9}},{"id":"923b197d-a15d-4597-8245-f1f700135644","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":165,"box":{"x":102,"y":559,"width":804,"height":11}},{"id":"3772e74f-160a-4273-b431-7688aa8f04e4","block_type":"box","text":"of the foregoing requirements, the Fund would be required to include in income each year a portion of the ordinary","page_number":165,"box":{"x":69,"y":574,"width":816,"height":11}},{"id":"b31ca580-0c0e-47da-b1c1-0fbdfcb25238","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":165,"box":{"x":69,"y":589,"width":816,"height":11}},{"id":"6ccca923-3ed8-437c-809c-d78fa083f6c9","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":165,"box":{"x":68,"y":604,"width":840,"height":11}},{"id":"a6db467b-89c0-4464-8266-ceed838346ad","block_type":"box","text":"the Fund would be required to obtain certain annual information from the PFICs in which it invests, which may be","page_number":165,"box":{"x":68,"y":619,"width":804,"height":11}},{"id":"044f94f6-a596-4cd0-972f-de9bf34176c0","block_type":"box","text":"difficult or impossible to obtain.","page_number":165,"box":{"x":69,"y":634,"width":225,"height":11}},{"id":"42f155bf-09bf-4e48-9fa9-95f0fba7657f","block_type":"box","text":"In certain situations, a Fund may, for a taxable year, defer all or a portion of its net capital loss (or if there is no","page_number":165,"box":{"x":102,"y":657,"width":796,"height":11}},{"id":"ffe5e041-1e3f-4bc5-bc7c-8a565018304a","block_type":"box","text":"net capital loss, any net long-term or short-term capital loss) realized after October and its late-year ordinary loss","page_number":165,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"84c6edce-7749-43fa-8782-d1ecc04628ad","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":165,"box":{"x":69,"y":687,"width":778,"height":11}},{"id":"c445c250-6448-4683-984d-808e22cdfc50","block_type":"box","text":"currency and PFIC gains plus the excess of post-December ordinary losses over post-December ordinary income) until","page_number":165,"box":{"x":69,"y":702,"width":838,"height":12}},{"id":"57ec894a-af3f-4091-ab02-b7976448968a","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":165,"box":{"x":68,"y":717,"width":824,"height":12}},{"id":"e937ebb8-d2a9-40be-973d-cebdddc2901d","block_type":"box","text":"recognition of such realized losses. Such deferrals and other rules regarding gains and losses realized after October","page_number":165,"box":{"x":69,"y":732,"width":830,"height":12}},{"id":"c03cf788-6dbe-4167-8a18-2ab2ae97873d","block_type":"box","text":"(or December) may affect the tax character of shareholder distributions.","page_number":165,"box":{"x":69,"y":748,"width":511,"height":11}},{"id":"d3e86297-3f9d-4fc8-8f22-98607b761696","block_type":"box","text":"Municipal Funds","page_number":165,"box":{"x":102,"y":771,"width":115,"height":10}},{"id":"3ca3b801-aae3-4307-bb41-351de45af0bc","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":165,"box":{"x":102,"y":793,"width":798,"height":11}},{"id":"14e7ad36-b361-4956-8569-b861b8f051b4","block_type":"box","text":"Code. Under such section if, at the close of each quarter of a Fund’s taxable year, at least 50% of the value of the","page_number":165,"box":{"x":69,"y":808,"width":815,"height":11}},{"id":"a1b882c4-9ae3-4dfa-aa8d-e620528ce4fc","block_type":"box","text":"Fund’s total assets consists of obligations exempt from U.S. federal income tax (“tax-exempt obligations”) under","page_number":165,"box":{"x":70,"y":823,"width":803,"height":12}},{"id":"a23109b1-a341-4f83-8905-66e45eef5e37","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":165,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"b2e352ca-06f5-4875-98d6-4b6d899386e8","block_type":"box","text":"qualified to pay exempt-interest dividends to holders of all outstanding classes of its shares (together the","page_number":165,"box":{"x":69,"y":853,"width":752,"height":12}},{"id":"a05e296e-2737-42c3-8b0b-373753159fe3","block_type":"box","text":"“shareholders”). Exempt-interest dividends are dividends or any part thereof paid by a Fund that are attributable to","page_number":165,"box":{"x":70,"y":869,"width":817,"height":11}},{"id":"ace0dd96-0796-4bd8-9a9b-cfbba930932b","block_type":"box","text":"interest on tax-exempt obligations and reported by the Fund as exempt-interest dividends. A Fund will allocate","page_number":165,"box":{"x":70,"y":884,"width":780,"height":11}},{"id":"0f509b32-ef59-4ef7-98cd-52785adcec9d","block_type":"box","text":"interest from tax-exempt obligations (as well as ordinary income, capital gains and tax preference items discussed","page_number":165,"box":{"x":70,"y":899,"width":815,"height":11}},{"id":"d84360bf-5a29-4b5c-b93f-9d6496e5a2de","block_type":"box","text":"II-135","page_number":165,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"b885a1b8-4321-40c0-98dc-97f5a106c11b","block_type":"box","text":"NM1026U-5979889-165/232","page_number":165,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4cfa5484-aab3-493f-8e7e-7ca27fbc4f23","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":166,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"e217b6a9-6192-4926-8c1f-302667c43e84","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":166,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"dc3983c0-fb72-4e99-b4a6-501c922e5fd3","block_type":"box","text":"to each class of shareholders during the taxable year, or such other method as the IRS may prescribe.","page_number":166,"box":{"x":68,"y":75,"width":730,"height":11}},{"id":"31379421-abd2-4b16-beb2-1b95bbe20a36","block_type":"box","text":"Exempt-interest dividends will be excludable from a shareholder’s gross income for U.S. federal income tax","page_number":166,"box":{"x":102,"y":98,"width":763,"height":11}},{"id":"a9637c30-a1d7-44d9-b1c6-a042f0767cff","block_type":"box","text":"purposes. Exempt-interest dividends are included, however, in determining the portion, if any, of a person’s social","page_number":166,"box":{"x":70,"y":113,"width":809,"height":11}},{"id":"18d2825f-1021-4b0e-bb35-de1ace5692e5","block_type":"box","text":"security and railroad retirement benefits subject to U.S. federal income taxes. Interest on indebtedness incurred or","page_number":166,"box":{"x":69,"y":128,"width":821,"height":11}},{"id":"2076e67b-86e6-4e1f-a36f-f6146721f18c","block_type":"box","text":"continued to purchase or carry shares of a regulated investment company paying exempt-interest dividends, such as","page_number":166,"box":{"x":69,"y":143,"width":831,"height":11}},{"id":"e4c5b591-08ef-4cf6-9ca4-2f3ef50fbc60","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":166,"box":{"x":68,"y":158,"width":800,"height":11}},{"id":"38d08570-165d-49fa-8856-f3f1c5d8a88a","block_type":"box","text":"exempt-interest dividends. Shareholders are advised to consult their tax advisors with respect to whether exempt","page_number":166,"box":{"x":69,"y":173,"width":810,"height":11}},{"id":"1d985ff4-73eb-4f66-b876-945e1eb084f4","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":166,"box":{"x":70,"y":188,"width":836,"height":11}},{"id":"4119bcd4-143e-4e1a-b712-0ca38dc3931d","block_type":"box","text":"user” or “related person” under Code Section 147(a) with respect to property financed with the proceeds of an issue","page_number":166,"box":{"x":69,"y":203,"width":835,"height":12}},{"id":"12d23124-4939-469b-aa9f-6dab7c5bea1f","block_type":"box","text":"of PABs, if any, held by a Fund.","page_number":166,"box":{"x":69,"y":218,"width":217,"height":12}},{"id":"ac39ed7b-da34-4b85-bc95-e9133d0173ee","block_type":"box","text":"Substitute payments received by a Fund representing interest paid on tax-exempt obligations loaned out by the","page_number":166,"box":{"x":102,"y":241,"width":788,"height":11}},{"id":"e3608cf6-da8a-4c73-ba44-c3cfa1563655","block_type":"box","text":"Fund will not be considered exempt interest, and distributions by the Fund of such substitute payments will not","page_number":166,"box":{"x":70,"y":256,"width":790,"height":11}},{"id":"7f48d035-105e-47a4-bd37-557311a354db","block_type":"box","text":"constitute exempt-interest dividends.","page_number":166,"box":{"x":69,"y":272,"width":261,"height":10}},{"id":"502e8fc0-2b58-4493-bcac-597381229322","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":166,"box":{"x":102,"y":294,"width":765,"height":11}},{"id":"22074477-62a1-44d5-82bd-27408b18277a","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":166,"box":{"x":69,"y":309,"width":819,"height":11}},{"id":"9b700d0a-f1ed-4fcf-96f1-7a58689f5ab9","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":166,"box":{"x":68,"y":324,"width":813,"height":12}},{"id":"d3c8036e-54cf-4335-a20a-b37a9b99c66c","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":166,"box":{"x":70,"y":339,"width":809,"height":12}},{"id":"6d5b19a6-ddde-4efd-9727-918db3f889af","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":166,"box":{"x":69,"y":355,"width":829,"height":11}},{"id":"abee66d4-0e4d-48a8-a9e4-c2d27d150b29","block_type":"box","text":"any capital gain dividends received by the shareholder.","page_number":166,"box":{"x":69,"y":370,"width":388,"height":11}},{"id":"1f10a03f-3cde-40ab-a24e-2a6ec19451c0","block_type":"box","text":"All or a portion of a Fund’s gains from the sale or redemption of tax-exempt obligations purchased at a market","page_number":166,"box":{"x":101,"y":392,"width":787,"height":12}},{"id":"879a0880-3e8c-4e34-9016-7e4511d2db2d","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":166,"box":{"x":69,"y":407,"width":817,"height":12}},{"id":"d90c5a4d-acdb-449b-9b92-1bdd5f5692c1","block_type":"box","text":"income dividends received by shareholders.","page_number":166,"box":{"x":70,"y":423,"width":309,"height":11}},{"id":"1c482e97-5b68-484c-bd9d-d084eb2f18a0","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":166,"box":{"x":101,"y":446,"width":766,"height":11}},{"id":"6a4dbbb3-2363-4ff0-b988-692f5b04aa7e","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":166,"box":{"x":69,"y":460,"width":808,"height":12}},{"id":"422b06b7-30da-4804-bf02-e8acaebffb8c","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":166,"box":{"x":70,"y":476,"width":815,"height":11}},{"id":"9f7d265c-5c34-4414-a131-60db906768cf","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":166,"box":{"x":70,"y":491,"width":815,"height":11}},{"id":"980240c5-db6b-4fcb-83b5-3f717933f024","block_type":"box","text":"the accrued market discount.","page_number":166,"box":{"x":68,"y":506,"width":208,"height":9}},{"id":"f8f9ecfe-3df5-4ece-b90f-d610f0e51a2a","block_type":"box","text":"The Code subjects interest received on certain otherwise tax-exempt securities to a federal alternative minimum","page_number":166,"box":{"x":101,"y":528,"width":801,"height":12}},{"id":"830db37e-ee31-4d74-88a9-31f6cf3a76f4","block_type":"box","text":"tax. The alternative minimum tax applies to interest received on certain “PABs” issued after August 7, 1986. PABs","page_number":166,"box":{"x":68,"y":543,"width":818,"height":12}},{"id":"6f1b303f-91e2-4ef3-aba6-e83758d1703c","block_type":"box","text":"are bonds that, although tax-exempt, are used for purposes other than those generally performed by governmental","page_number":166,"box":{"x":69,"y":559,"width":816,"height":11}},{"id":"998dd1d5-158b-4277-93fd-317ce6201f1a","block_type":"box","text":"units and that benefit non-governmental entities (","page_number":166,"box":{"x":69,"y":574,"width":351,"height":11}},{"id":"66584f9c-a528-4b8f-96bb-141782a99b43","block_type":"box","text":"e.g.","page_number":166,"box":{"x":422,"y":575,"width":24,"height":10}},{"id":"ba45c82d-5107-4d09-b239-5221fee27c81","block_type":"box","text":", bonds used for industrial development or housing purposes).","page_number":166,"box":{"x":449,"y":574,"width":441,"height":11}},{"id":"9211de53-0017-4780-be6d-c7cf0ad158e0","block_type":"box","text":"Income received on such bonds is classified as an item of “tax preference,” which could subject certain investors in","page_number":166,"box":{"x":70,"y":589,"width":827,"height":11}},{"id":"4df49375-2703-46c2-b078-6c71a0046637","block_type":"box","text":"such bonds, including shareholders of a Fund, to a federal alternative minimum tax. A Fund will purchase such","page_number":166,"box":{"x":69,"y":604,"width":786,"height":11}},{"id":"57ede00c-9eab-46b6-bdca-5eabc4b4618f","block_type":"box","text":"“PABs” and will report to shareholders after the close of the calendar year the portion of the Fund’s dividends","page_number":166,"box":{"x":70,"y":619,"width":782,"height":11}},{"id":"66e79203-e9bc-45d3-ac5f-91471cd79ddd","block_type":"box","text":"declared during the year that constitute an item of tax preference for alternative minimum tax purposes.","page_number":166,"box":{"x":69,"y":634,"width":740,"height":12}},{"id":"16fecee3-19d0-4bd5-b5a9-449756642b99","block_type":"box","text":"Each Municipal Fund may engage in interest rate swap transactions. The U.S. federal income tax rules governing","page_number":166,"box":{"x":102,"y":657,"width":802,"height":11}},{"id":"11706995-d63b-4c1d-bf3f-37973fa8bdaf","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":166,"box":{"x":68,"y":672,"width":812,"height":11}},{"id":"4a5ab61e-557e-43b4-a448-8033c9b55a57","block_type":"box","text":"such arrangements as ordinary income and to amortize payments made under certain circumstances. Because","page_number":166,"box":{"x":69,"y":687,"width":794,"height":11}},{"id":"50a2364f-c75e-4839-be86-2b48f195754a","block_type":"box","text":"payments received by a Fund in connection with swap transactions will be taxable rather than tax-exempt and","page_number":166,"box":{"x":70,"y":703,"width":776,"height":10}},{"id":"b52d9a36-f1e4-4657-aac2-8440bdab73f1","block_type":"box","text":"because swap payments made by a Fund will offset both taxable and tax-exempt gross income proportionately, they","page_number":166,"box":{"x":69,"y":717,"width":826,"height":12}},{"id":"7975e27e-3fc7-4771-9ea8-41ff18c35dda","block_type":"box","text":"may result in increased taxable distributions to shareholders.","page_number":166,"box":{"x":69,"y":733,"width":436,"height":11}},{"id":"e56cee35-275c-4ada-80b0-248c224cea73","block_type":"box","text":"Please see Part I of your Fund’s SAI for certain state tax information relevant to an investment in BlackRock","page_number":166,"box":{"x":102,"y":755,"width":771,"height":11}},{"id":"3413f6fe-7c2a-4d3c-9ea9-0d128870af7d","block_type":"box","text":"California Municipal Opportunities Fund, BlackRock New Jersey Municipal Bond Fund, BlackRock New York Municipal","page_number":166,"box":{"x":69,"y":770,"width":828,"height":11}},{"id":"e7058a11-5dd3-413e-8759-96aa9bb03020","block_type":"box","text":"Opportunities Fund and BlackRock Pennsylvania Municipal Bond Fund, as well as information on economic conditions","page_number":166,"box":{"x":69,"y":785,"width":836,"height":12}},{"id":"6383d4d9-8fb5-492a-b35b-b26ef69501d0","block_type":"box","text":"within each applicable state.","page_number":166,"box":{"x":68,"y":801,"width":203,"height":11}},{"id":"496bbf4e-a2bf-4264-a607-fa4a6e3881e7","block_type":"box","text":"In the case of a Feeder Fund, such Fund is entitled to look to the underlying assets of the Master Portfolio in","page_number":166,"box":{"x":102,"y":823,"width":774,"height":12}},{"id":"430b7704-02f2-4d03-9e1e-ed07db991e98","block_type":"box","text":"which it has invested for purposes of satisfying various qualification requirements of the Code applicable to regulated","page_number":166,"box":{"x":68,"y":838,"width":837,"height":12}},{"id":"81ecb683-97dd-4bd0-bd5f-c61b22b36355","block_type":"box","text":"investment companies. Each Master Portfolio is classified either as a partnership or a separate disregarded entity","page_number":166,"box":{"x":70,"y":853,"width":816,"height":12}},{"id":"58b03126-5302-4c02-8ea4-3cf57cc6bde4","block_type":"box","text":"(depending on the particular Master Portfolio) for U.S. federal income tax purposes. If applicable tax provisions were","page_number":166,"box":{"x":69,"y":869,"width":830,"height":11}},{"id":"0e295a88-ee06-4ad5-82c5-d668b69a01c7","block_type":"box","text":"to change the classification of a Master Portfolio, then the Board of Directors of a Feeder Fund would determine, in","page_number":166,"box":{"x":68,"y":884,"width":822,"height":11}},{"id":"75745e6f-88ef-4512-904f-ad53ffceca70","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":166,"box":{"x":70,"y":899,"width":783,"height":11}},{"id":"4d700d85-3d09-4247-9e27-f91233e291a0","block_type":"box","text":"II-136","page_number":166,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"722ed763-9418-4119-a36c-34fc754d1b20","block_type":"box","text":"NM1026U-5979889-166/232","page_number":166,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e9f30727-e38b-4796-a3d2-1fa7cd4b91ea","block_type":"box","text":"withdraw the Feeder Fund’s investments from the Master Portfolio and to retain an investment manager to manage","page_number":167,"box":{"x":68,"y":45,"width":822,"height":11}},{"id":"98253628-b025-4e0e-af9a-dfc51cb334a1","block_type":"box","text":"the Feeder Fund’s assets in accordance with the investment policies applicable to the Feeder Fund.","page_number":167,"box":{"x":68,"y":60,"width":710,"height":11}},{"id":"e3bccaa3-e55f-46df-857e-3bdebdc8cba2","block_type":"box","text":"Ordinary income and capital gain dividends may also be subject to state and local taxes. Certain states exempt","page_number":167,"box":{"x":102,"y":83,"width":796,"height":11}},{"id":"19413e6e-4d71-4b1c-8049-170a7f528285","block_type":"box","text":"from state income taxation dividends paid by regulated investment companies that are derived from interest on U.S.","page_number":167,"box":{"x":68,"y":98,"width":828,"height":11}},{"id":"431ec6c7-45ad-4654-bab9-11ba3be2282a","block_type":"box","text":"government obligations. State law varies as to whether dividend income attributable to U.S. government obligations is","page_number":167,"box":{"x":68,"y":113,"width":841,"height":11}},{"id":"c694053d-a9bd-4ecb-81a8-3db1ae76f06f","block_type":"box","text":"exempt from state income tax.","page_number":167,"box":{"x":69,"y":128,"width":216,"height":11}},{"id":"7368098c-22d2-4fd3-a07c-d69d5edfbaea","block_type":"box","text":"Shareholders of each Fund are urged to consult their tax advisers regarding specific questions as to federal,","page_number":167,"box":{"x":102,"y":150,"width":771,"height":12}},{"id":"ff0f4cbb-fb08-492d-85aa-8923c0fc6c30","block_type":"box","text":"foreign, state or local taxes with respect to their Fund. Foreign investors should consider applicable foreign taxes in","page_number":167,"box":{"x":68,"y":166,"width":823,"height":11}},{"id":"e20fad6b-2335-486b-b007-948855f0dc89","block_type":"box","text":"their evaluation of an investment in a Fund.","page_number":167,"box":{"x":68,"y":181,"width":309,"height":9}},{"id":"6fcabac7-8faa-46ab-88f5-9c092b91b4c6","block_type":"box","text":"The foregoing general discussion of U.S. federal income tax consequences is based on the Code and the","page_number":167,"box":{"x":101,"y":203,"width":749,"height":12}},{"id":"7a656d4c-38b7-4bb7-acca-c3a7fd53c12e","block_type":"box","text":"regulations issued thereunder as in effect on the date of this SAI. Future legislative or administrative changes or","page_number":167,"box":{"x":69,"y":218,"width":803,"height":12}},{"id":"d125cf9b-4f32-40ae-8e82-64d4c597741d","block_type":"box","text":"court decisions may significantly change the conclusions expressed in this discussion, and any such changes or","page_number":167,"box":{"x":69,"y":234,"width":801,"height":11}},{"id":"1538a200-f2bb-4ea3-93de-b96e3acbc837","block_type":"box","text":"decisions may have a retroactive effect.","page_number":167,"box":{"x":69,"y":249,"width":283,"height":11}},{"id":"ec868352-ccb7-4c7e-a849-4d7a66b2a52b","block_type":"box","text":"PERFORMANCE DATA","page_number":167,"box":{"x":403,"y":278,"width":173,"height":10}},{"id":"e965abf9-bf45-4802-af46-22ec11248459","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":167,"box":{"x":102,"y":301,"width":738,"height":11}},{"id":"879ef482-c40e-4f3b-b3d7-cb6163c041af","block_type":"box","text":"applicable, yield and tax-equivalent yield in advertisements or information furnished to present or prospective","page_number":167,"box":{"x":69,"y":316,"width":779,"height":11}},{"id":"d80cd158-6489-42e8-85db-dd7493aef265","block_type":"box","text":"shareholders. Total return, yield and tax-equivalent yield each is based on a Fund’s historical performance and is not","page_number":167,"box":{"x":69,"y":331,"width":833,"height":11}},{"id":"1aca360b-7b70-4de9-8cd4-00aab5e284f7","block_type":"box","text":"intended to indicate future performance. Average annual total return is determined separately for each class of","page_number":167,"box":{"x":70,"y":346,"width":792,"height":12}},{"id":"4e110def-1e46-4593-b194-59326ef4e019","block_type":"box","text":"shares in accordance with a formula specified by the Commission.","page_number":167,"box":{"x":69,"y":361,"width":473,"height":12}},{"id":"21dc6346-cfa2-47c2-adbd-97adf4d07f8d","block_type":"box","text":"Quotations of average annual total return, before tax, for the specified periods are computed by finding the","page_number":167,"box":{"x":102,"y":384,"width":761,"height":11}},{"id":"50d1154a-84bf-4921-8900-0f1e6bbfed21","block_type":"box","text":"average annual compounded rates of return (based on net investment income and any realized and unrealized capital","page_number":167,"box":{"x":69,"y":399,"width":836,"height":12}},{"id":"032d7af3-bb00-4e73-830b-f24bd49170d7","block_type":"box","text":"gains or losses on portfolio investments over such periods) that would equate the initial amount invested to the","page_number":167,"box":{"x":68,"y":414,"width":798,"height":12}},{"id":"94a40114-f342-4cd6-8d3f-d0db707b6d0f","block_type":"box","text":"redeemable value of such investment at the end of each period. Average annual total return before taxes is","page_number":167,"box":{"x":69,"y":429,"width":765,"height":12}},{"id":"713132cb-329b-4fd4-8a5e-76917b217bbb","block_type":"box","text":"computed assuming all dividends are reinvested and taking into account all applicable recurring and nonrecurring","page_number":167,"box":{"x":69,"y":445,"width":808,"height":11}},{"id":"ab8de44d-1b0b-4460-b9e2-3993c6e6e7d8","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":167,"box":{"x":69,"y":460,"width":813,"height":11}},{"id":"9ec6a312-225f-4446-8c6a-2c8d2733c4bb","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":167,"box":{"x":69,"y":475,"width":839,"height":11}},{"id":"2a318c3f-3f6c-46b9-b121-33801fd4665a","block_type":"box","text":"but does not take into account taxes payable on dividends or on redemption.","page_number":167,"box":{"x":69,"y":490,"width":546,"height":11}},{"id":"fbe448b4-b1e0-4052-98b2-f39f46cd6359","block_type":"box","text":"Quotations of average annual total return, after taxes, on dividends for the specified periods are computed by","page_number":167,"box":{"x":102,"y":513,"width":781,"height":11}},{"id":"9adbcc57-8dbc-4fc4-8922-1e01d820d716","block_type":"box","text":"finding the average annual compounded rates of return that would equate the initial amount invested to the ending","page_number":167,"box":{"x":68,"y":528,"width":819,"height":11}},{"id":"9e72cfdc-baf5-44d7-9bc8-77d2690bdcc3","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":167,"box":{"x":68,"y":543,"width":810,"height":11}},{"id":"7ad335ad-e5b5-443b-be97-54c6a183c990","block_type":"box","text":"period. Average annual total return after taxes on dividends is computed assuming all dividends, less the taxes due","page_number":167,"box":{"x":70,"y":558,"width":823,"height":11}},{"id":"dc8259dd-5941-4551-94ff-522230de58a9","block_type":"box","text":"on such dividends, are reinvested and taking into account all applicable recurring and nonrecurring expenses,","page_number":167,"box":{"x":69,"y":573,"width":780,"height":11}},{"id":"7b54f97b-4ddf-4d1d-8288-1e29d13dd6e6","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":167,"box":{"x":70,"y":588,"width":825,"height":12}},{"id":"8f154f85-941d-4889-9c5e-84ea29e0b5eb","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":167,"box":{"x":69,"y":603,"width":817,"height":11}},{"id":"da85ad98-56b6-4483-b90d-cd75dd770132","block_type":"box","text":"due on dividends are calculated by applying to each dividend the highest applicable marginal U.S. federal individual","page_number":167,"box":{"x":69,"y":618,"width":820,"height":12}},{"id":"4706ad37-8fa7-40c6-b43b-32884675032e","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":167,"box":{"x":70,"y":634,"width":833,"height":11}},{"id":"b0e1dc5a-9956-4b17-804e-1b98910c31af","block_type":"box","text":"(including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each dividend. The","page_number":167,"box":{"x":69,"y":649,"width":797,"height":11}},{"id":"35190a63-d338-4330-a2d9-04b51afdef10","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":167,"box":{"x":68,"y":664,"width":824,"height":11}},{"id":"37764b7c-916f-4508-a793-898e55fd7b2f","block_type":"box","text":"may be adjusted to reflect subsequent recharacterizations of distributions. The applicable tax rates may vary over the","page_number":167,"box":{"x":69,"y":679,"width":837,"height":11}},{"id":"073253e4-5b7d-40d8-b80e-1777e813111c","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":167,"box":{"x":69,"y":694,"width":814,"height":11}},{"id":"6031bf71-154b-470f-bfe1-e659d3cf3a92","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":167,"box":{"x":69,"y":709,"width":830,"height":11}},{"id":"183f64c9-9ef4-4a50-8652-2dd74bdfb0f0","block_type":"box","text":"redemption at the end of the applicable periods with no tax consequences associated with such redemption.","page_number":167,"box":{"x":69,"y":724,"width":774,"height":11}},{"id":"06761dc1-d7f0-4fe7-a1ff-1881d2922ce7","block_type":"box","text":"Quotations of average annual total return, after taxes, on both dividends and redemption for the specified","page_number":167,"box":{"x":102,"y":747,"width":752,"height":11}},{"id":"d274f8cb-10e6-41ea-87d2-d52181db8a2c","block_type":"box","text":"periods are computed by finding the average annual compounded rates of return that would equate the initial amount","page_number":167,"box":{"x":70,"y":762,"width":835,"height":11}},{"id":"bebf1abe-9405-4119-aabb-2415b3cb6479","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":167,"box":{"x":70,"y":777,"width":820,"height":12}},{"id":"52274c25-596b-4aee-9d4f-5955df33d625","block_type":"box","text":"received during such period as well as on complete redemption. Average annual total return after taxes on","page_number":167,"box":{"x":69,"y":792,"width":756,"height":12}},{"id":"4db423b7-06fb-4690-8826-b5b2064f1def","block_type":"box","text":"distributions and redemption is computed assuming all dividends, less the taxes due on such dividends, are","page_number":167,"box":{"x":69,"y":808,"width":772,"height":11}},{"id":"ec0ae312-6041-40a1-8e4f-7ec43a138e98","block_type":"box","text":"reinvested and taking into account all applicable recurring and nonrecurring expenses, including the maximum sales","page_number":167,"box":{"x":69,"y":823,"width":827,"height":11}},{"id":"167d8387-058d-4cbd-8ac0-bee75bb5757c","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":167,"box":{"x":69,"y":838,"width":825,"height":11}},{"id":"1c646f15-d478-453f-b846-6ee6ca6fc306","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":167,"box":{"x":70,"y":853,"width":812,"height":11}},{"id":"dd242371-ebb7-4924-9f0d-8ab534fa040a","block_type":"box","text":"complete redemption and payment of taxes due on such redemption. The ending value is determined assuming","page_number":167,"box":{"x":69,"y":868,"width":795,"height":11}},{"id":"121ad200-e6da-4d69-80a2-136b4e503f6a","block_type":"box","text":"complete redemption at the end of the applicable periods, subtracting capital gains taxes resulting from the","page_number":167,"box":{"x":69,"y":883,"width":768,"height":11}},{"id":"91d656bb-a85d-4c1e-84de-ab75e539777a","block_type":"box","text":"redemption and adding the presumed tax benefit from capital losses resulting from redemption. The taxes due on","page_number":167,"box":{"x":69,"y":898,"width":810,"height":11}},{"id":"e9317216-7fc6-403c-8212-554dffee2fef","block_type":"box","text":"II-137","page_number":167,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"368833f1-d887-46a9-8c00-ce8ec7029ef1","block_type":"box","text":"NM1026U-5979889-167/232","page_number":167,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"187b47af-224b-4e07-9b5d-852fdfeed899","block_type":"box","text":"dividends and on the deemed redemption are calculated by applying the highest applicable marginal U.S. federal","page_number":168,"box":{"x":69,"y":45,"width":802,"height":11}},{"id":"11e6e7d9-1086-42cb-8f64-30796b5eb64f","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":168,"box":{"x":70,"y":60,"width":825,"height":11}},{"id":"b4975cd1-8fef-455f-84af-9d1df5e84c3c","block_type":"box","text":"the tax character (including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each","page_number":168,"box":{"x":68,"y":75,"width":823,"height":11}},{"id":"bf08d053-72ae-4157-8116-1a12388c9cbc","block_type":"box","text":"component of each dividend and/or the redemption payment. The applicable tax rates may vary over the","page_number":168,"box":{"x":69,"y":90,"width":743,"height":11}},{"id":"34af2b33-7d3a-47cd-9505-d059b2100f09","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":168,"box":{"x":69,"y":105,"width":814,"height":11}},{"id":"58b3d342-7300-456d-a102-b4b32d2f430a","block_type":"box","text":"tax credits, are taken into account according to federal law.","page_number":168,"box":{"x":68,"y":120,"width":422,"height":12}},{"id":"e439900d-4abc-46e1-b197-6829d4150e33","block_type":"box","text":"A Fund also may quote annual, average annual and annualized total return and aggregate total return","page_number":168,"box":{"x":101,"y":143,"width":720,"height":11}},{"id":"beb632f6-6cc8-4905-afdc-dad54e08f8a1","block_type":"box","text":"performance data, both as a percentage and as a dollar amount based on a hypothetical investment of $1,000 or","page_number":168,"box":{"x":70,"y":157,"width":813,"height":12}},{"id":"0d8f6bd9-a351-4d7b-8262-a953cf334f9b","block_type":"box","text":"some other amount, for various periods other than those noted in Part I of each Fund’s SAI. Such data will be","page_number":168,"box":{"x":69,"y":173,"width":781,"height":11}},{"id":"ff4a9c8d-83fe-421d-b203-51be46c0258d","block_type":"box","text":"computed as described above, except that (1) as required by the periods of the quotations, actual annual, annualized","page_number":168,"box":{"x":69,"y":188,"width":837,"height":11}},{"id":"0c40fb89-5430-4aa9-91b4-3d33d77242e1","block_type":"box","text":"or aggregate data, rather than average annual data, may be quoted and (2) the maximum applicable sales charges","page_number":168,"box":{"x":69,"y":203,"width":817,"height":12}},{"id":"f821ded5-502e-4ae2-8ad7-1e2fb0376d30","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":168,"box":{"x":68,"y":218,"width":815,"height":11}},{"id":"7eee2525-004c-49fb-89ba-8a456fda1ed9","block_type":"box","text":"performance data calculations of including or excluding the maximum applicable sales charges, actual annual or","page_number":168,"box":{"x":70,"y":234,"width":801,"height":11}},{"id":"a589569c-b0cd-4843-a1ae-fa36a00a9098","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":168,"box":{"x":69,"y":249,"width":819,"height":11}},{"id":"bca5182c-c720-43c3-bc2d-bc0d6c25f207","block_type":"box","text":"return reflect compounding of return; aggregate total return data generally will be higher than average annual total","page_number":168,"box":{"x":69,"y":264,"width":811,"height":11}},{"id":"6eae8b11-7dad-46db-b6d5-952cbebbc902","block_type":"box","text":"return data since the aggregate rates of return reflect compounding over a longer period of time.","page_number":168,"box":{"x":69,"y":279,"width":686,"height":11}},{"id":"2e7dac9d-b4d9-47f6-8a25-d7474bc9047a","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":168,"box":{"x":101,"y":302,"width":796,"height":11}},{"id":"a84e03c5-1610-4c71-99fa-3103f6e4ed70","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":168,"box":{"x":69,"y":317,"width":821,"height":11}},{"id":"3f399a7a-bda4-4f51-8423-bf0e27ba4085","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":168,"box":{"x":68,"y":332,"width":817,"height":11}},{"id":"45b8d67b-ced0-4a37-b85b-1ee7d96685c5","block_type":"box","text":"Tax equivalent yield quotations will be computed by dividing (a) the part of a Fund’s yield that is tax-exempt by (b) one","page_number":168,"box":{"x":68,"y":347,"width":837,"height":11}},{"id":"a964dd70-2009-463d-b5ce-4f3ef8182f40","block_type":"box","text":"minus a stated tax rate and adding the result to that part, if any, of the Fund’s yield that is not tax-exempt.","page_number":168,"box":{"x":69,"y":362,"width":759,"height":11}},{"id":"6c8ae871-9885-48cd-93d3-d4597719ee96","block_type":"box","text":"A Fund’s total return will vary depending on market conditions, the securities comprising a Fund’s portfolio, a","page_number":168,"box":{"x":101,"y":385,"width":779,"height":11}},{"id":"f88de2d6-9b54-48ab-bc71-8b5fe0592ac1","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":168,"box":{"x":70,"y":400,"width":819,"height":11}},{"id":"9a3545a5-d2e6-4e90-9f94-57b605810e08","block_type":"box","text":"The value of an investment in a Fund will fluctuate and an investor’s shares, when redeemed, may be worth more or","page_number":168,"box":{"x":68,"y":415,"width":830,"height":11}},{"id":"c8e90154-ba86-4aeb-9321-8551807b10c8","block_type":"box","text":"less than their original cost.","page_number":168,"box":{"x":70,"y":430,"width":196,"height":11}},{"id":"350cbe9e-b089-455c-9784-640a4c93e9e9","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":168,"box":{"x":102,"y":453,"width":782,"height":11}},{"id":"af0fa930-604a-4661-9200-f822ad20e364","block_type":"box","text":"the case of CDSC shares applicable to certain investors, as described under “Purchase of Shares” and “Redemption","page_number":168,"box":{"x":68,"y":468,"width":836,"height":11}},{"id":"7fe234ea-29d0-4349-b1d3-02da4d37682b","block_type":"box","text":"of Shares,” respectively, the total return data quoted by a Fund in advertisements directed to such investors may","page_number":168,"box":{"x":69,"y":483,"width":807,"height":11}},{"id":"eda9e00e-8efb-451b-b8ae-21a2be134641","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":168,"box":{"x":68,"y":498,"width":820,"height":11}},{"id":"cc16f1ae-ec1f-4630-9ef0-c95865757bcf","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":168,"box":{"x":68,"y":513,"width":824,"height":12}},{"id":"413be97e-a1cd-4df7-a620-5634cea8cfd3","block_type":"box","text":"lower amount of expenses is deducted.","page_number":168,"box":{"x":70,"y":528,"width":278,"height":11}},{"id":"3f69adaa-49ef-4fa8-868b-747685201699","block_type":"box","text":"On occasion, a Fund may compare its performance to, among other things, the Fund’s benchmark index","page_number":168,"box":{"x":102,"y":551,"width":741,"height":11}},{"id":"00c03427-8ee2-433c-af8e-1ab4d290fe48","block_type":"box","text":"indicated in the Prospectus, the Value Line Composite Index, the Dow Jones Industrial Average, or to other published","page_number":168,"box":{"x":70,"y":566,"width":830,"height":11}},{"id":"65e43ac0-1f83-4d68-8126-c51d417a66be","block_type":"box","text":"indices, or to performance data published by Lipper Inc., Morningstar, Inc. (“Morningstar”),","page_number":168,"box":{"x":70,"y":581,"width":646,"height":12}},{"id":"444ab194-3c36-4bd9-a495-e61945a49f49","block_type":"box","text":"Money Magazine, U.S.","page_number":168,"box":{"x":724,"y":581,"width":156,"height":12}},{"id":"230818e1-ebee-4b7d-b83c-33786636c005","block_type":"box","text":"News & World Repor t, BusinessWeek, Forbes Magazine, For tune Magazine","page_number":168,"box":{"x":70,"y":597,"width":533,"height":11}},{"id":"cc77b74e-83ec-4c29-9861-caea28ccea16","block_type":"box","text":"or other industry publications. When","page_number":168,"box":{"x":608,"y":597,"width":257,"height":11}},{"id":"0b2d2a79-36c8-4257-91f1-3b0e27d1995b","block_type":"box","text":"comparing its performance to a market index, a Fund may refer to various statistical measures derived from the","page_number":168,"box":{"x":69,"y":612,"width":797,"height":11}},{"id":"cca03133-4977-4bb3-94f9-c6c08cd22a89","block_type":"box","text":"historical performance of a Fund and the index, such as standard deviation and beta. As with other performance","page_number":168,"box":{"x":69,"y":627,"width":803,"height":11}},{"id":"06b00440-8373-4002-bb99-3fa6e73d6a3c","block_type":"box","text":"data, performance comparisons should not be considered indicative of a Fund’s relative performance for any future","page_number":168,"box":{"x":69,"y":642,"width":824,"height":11}},{"id":"1e2e7d7d-7dcc-4076-abac-94614f5b243e","block_type":"box","text":"period. In addition, from time to time a Fund may include the Fund’s Morningstar risk-adjusted performance ratings","page_number":168,"box":{"x":70,"y":657,"width":818,"height":11}},{"id":"8ee87205-0609-4750-aa0f-9f5bd2340d84","block_type":"box","text":"assigned by Morningstar in advertising or supplemental sales literature. From time to time a Fund may quote in","page_number":168,"box":{"x":69,"y":672,"width":793,"height":11}},{"id":"bdbb7fb9-d181-4b27-8138-f352eae1bc95","block_type":"box","text":"advertisements or other materials other applicable measures of Fund performance and may also make reference to","page_number":168,"box":{"x":69,"y":687,"width":826,"height":11}},{"id":"d4897137-b253-4c59-b804-50ebf9fe1a1a","block_type":"box","text":"awards that may be given to the Manager. Certain Funds may also compare their performance to composite indices","page_number":168,"box":{"x":69,"y":702,"width":825,"height":12}},{"id":"54ae7a6c-3c5b-4be5-8cea-928fe564088d","block_type":"box","text":"developed by Fund management.","page_number":168,"box":{"x":69,"y":718,"width":233,"height":11}},{"id":"e32948ae-988d-463a-b084-4ece50d4433e","block_type":"box","text":"A Fund may provide information designed to help investors understand how the Fund is seeking to achieve its","page_number":168,"box":{"x":101,"y":740,"width":780,"height":11}},{"id":"1da666be-3915-4e47-b6ba-ec1b0c8efff0","block_type":"box","text":"investment objectives. This may include information about past, current or possible economic, market, political or","page_number":168,"box":{"x":70,"y":755,"width":810,"height":11}},{"id":"684c8d05-071b-4a1f-9490-85ad9f65df79","block_type":"box","text":"other conditions, descriptive information or general principles of investing such as asset allocation, diversification","page_number":168,"box":{"x":69,"y":770,"width":810,"height":12}},{"id":"5f9283a2-c726-40a7-a5f7-3655ef196ef2","block_type":"box","text":"and risk tolerance, discussion of a Fund’s portfolio composition, investment philosophy, strategy or investment","page_number":168,"box":{"x":69,"y":785,"width":792,"height":12}},{"id":"527edcb7-4909-4034-8f7e-54a0bed658dd","block_type":"box","text":"techniques, comparisons of the Fund’s performance or portfolio composition to that of other funds or types of","page_number":168,"box":{"x":68,"y":801,"width":788,"height":11}},{"id":"59f5e0e7-5ee1-4960-b2e2-73cf2e9ab927","block_type":"box","text":"investments, indices relevant to the comparison being made, or to a hypothetical or model portfolio. A Fund may also","page_number":168,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"1b9732df-5e10-405a-9736-6c3be62f02ce","block_type":"box","text":"quote various measures of volatility and benchmark correlation in advertising and other materials, and may compare","page_number":168,"box":{"x":69,"y":831,"width":830,"height":11}},{"id":"3d2fa0ec-ac66-43e5-a224-d5e0e855e122","block_type":"box","text":"these measures to those of other funds or types of investments.","page_number":168,"box":{"x":68,"y":846,"width":461,"height":11}},{"id":"465bab5c-0416-4bac-b00e-a6098c948129","block_type":"box","text":"II-138","page_number":168,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"84946f6c-a00f-4d18-a7b1-f9f281eed7c8","block_type":"box","text":"NM1026U-5979889-168/232","page_number":168,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"5bdaa498-d804-4f25-9c76-cc3cc2effd3f","block_type":"box","text":"PROXY VOTING POLICIES AND PROCEDURES","page_number":169,"box":{"x":308,"y":45,"width":362,"height":10}},{"id":"2e20bfb9-9a2f-4c07-b185-43d6c011db5f","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":169,"box":{"x":101,"y":68,"width":802,"height":11}},{"id":"48de2ee5-bfab-49c0-b695-b2d52461c688","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":169,"box":{"x":70,"y":83,"width":809,"height":11}},{"id":"9c5c57b4-c307-4a63-8f5d-6098d0e6faa5","block_type":"box","text":"Policy”), with respect to certain Funds, and (ii) the Index Equity Fund Proxy Voting Policy, with respect to certain other","page_number":169,"box":{"x":69,"y":98,"width":833,"height":11}},{"id":"fcf270a2-29d2-40b7-aa4a-af010e367b72","block_type":"box","text":"Funds, as applicable. Please refer to Part I of this SAI, which discloses the policy applicable to each Fund.","page_number":169,"box":{"x":70,"y":113,"width":755,"height":11}},{"id":"340c18bc-bd23-4ae8-bbf3-8f89bb54cf4d","block_type":"box","text":"With respect to Funds covered by the Active Fund Proxy Voting Policy, the Manager has adopted the BlackRock","page_number":169,"box":{"x":101,"y":136,"width":785,"height":11}},{"id":"4acc6108-d0ae-416d-937e-d90cc104c533","block_type":"box","text":"Active Investment Stewardship—Global Engagement and Voting Guidelines (the “BAIS Guidelines”). Certain of such","page_number":169,"box":{"x":68,"y":151,"width":822,"height":11}},{"id":"4fa5563b-a58c-4fcd-8b4a-442b96abd750","block_type":"box","text":"Funds, as listed within the Active Fund Proxy Voting Policy and as disclosed in Part I of this SAI, follow supplemental","page_number":169,"box":{"x":70,"y":166,"width":824,"height":11}},{"id":"08a71292-806c-42a3-b886-e503b6b105e1","block_type":"box","text":"guidelines within the BAIS Guidelines that are applicable to certain climate and decarbonization issues (the “BAIS","page_number":169,"box":{"x":68,"y":181,"width":812,"height":12}},{"id":"555d715e-2d7c-4f37-91bd-f3e295f01583","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":169,"box":{"x":69,"y":197,"width":392,"height":10}},{"id":"82bf7c26-2b4c-4296-881c-c333d737a305","block_type":"box","text":"With respect to Funds covered by the Index Equity Fund Proxy Voting Policy, the Manager has adopted the","page_number":169,"box":{"x":101,"y":219,"width":749,"height":11}},{"id":"802abce8-a2b0-4809-bb57-0b658e89844d","block_type":"box","text":"BlackRock Investment Stewardship (“BIS”) Global Benchmark Policy, comprised of the Global Principles for","page_number":169,"box":{"x":70,"y":234,"width":759,"height":11}},{"id":"2e808604-cb69-49da-9816-ccae8139aaf3","block_type":"box","text":"Benchmark Policies, regional voting guidelines, and engagement priorities, which are each available upon request. In","page_number":169,"box":{"x":70,"y":250,"width":830,"height":11}},{"id":"800395b0-9f5c-4424-8360-c47ca8c4cb50","block_type":"box","text":"addition, certain of such Funds, as listed within the Index Equity Fund Proxy Voting Policy and as disclosed in Part I of","page_number":169,"box":{"x":69,"y":264,"width":838,"height":12}},{"id":"9f82b5a7-4b6b-41d2-becb-be019b441d03","block_type":"box","text":"this SAI, follow supplemental guidelines that are applicable to certain climate and decarbonization issues (the “BIS","page_number":169,"box":{"x":68,"y":280,"width":822,"height":11}},{"id":"b638b954-b0ec-4a92-998c-f26d279945a7","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":169,"box":{"x":69,"y":295,"width":392,"height":11}},{"id":"25c5eb41-8d1d-42cd-9c04-9b0df7be1161","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":169,"box":{"x":102,"y":317,"width":767,"height":12}},{"id":"c93157f1-f663-47fe-b41e-ed442922d5e3","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":169,"box":{"x":68,"y":332,"width":827,"height":12}},{"id":"999bd3c8-f4f1-4066-a8b3-8f8ca233e981","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":169,"box":{"x":69,"y":348,"width":819,"height":11}},{"id":"7bcd3ecf-38f7-4f35-b04e-286037cb428d","block_type":"box","text":"underlying fund may use the Index Equity Fund Proxy Voting Policy, and the opposite is also true.","page_number":169,"box":{"x":69,"y":363,"width":684,"height":11}},{"id":"0655bab3-c362-4be3-a3ce-1cc100663455","block_type":"box","text":"Copies of the Active Fund Proxy Voting Policy, Index Equity Fund Proxy Voting Policy, the BAIS Guidelines, the","page_number":169,"box":{"x":102,"y":385,"width":766,"height":12}},{"id":"58df077d-ee2a-48e9-9f68-df043615b78d","block_type":"box","text":"Global Principles for Benchmark Policies and the BIS Climate and Decarbonization Stewardship Guidelines are","page_number":169,"box":{"x":69,"y":401,"width":784,"height":11}},{"id":"e7725040-1c56-44dc-933e-ba2b51878a0e","block_type":"box","text":"attached as Appendix B to this SAI. Only those guidelines that are applicable to a particular Fund pursuant to the","page_number":169,"box":{"x":69,"y":416,"width":805,"height":11}},{"id":"ad24f2f6-5042-405c-a2fb-b012bbf8340c","block_type":"box","text":"Active Fund Proxy Voting Policy or the Index Equity Fund Proxy Voting Policy are considered to form a part of the","page_number":169,"box":{"x":68,"y":431,"width":790,"height":11}},{"id":"396ec78b-0d3d-4ff3-a97a-fbf050fa07bc","block_type":"box","text":"Fund’s SAI. Information on how each Fund voted proxies relating to portfolio securities during the most recent 12-","page_number":169,"box":{"x":70,"y":446,"width":810,"height":11}},{"id":"22afaa89-31e1-4ef6-995b-d5161a446069","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":169,"box":{"x":69,"y":461,"width":788,"height":11}},{"id":"61f6048e-a780-466a-b0a6-a60e2012d0a9","block_type":"box","text":"Commission’s website at http://www.sec.gov.","page_number":169,"box":{"x":69,"y":476,"width":327,"height":11}},{"id":"daecb2e6-047f-42f6-8dc5-1ed93579eb0a","block_type":"box","text":"GENERAL INFORMATION","page_number":169,"box":{"x":391,"y":506,"width":195,"height":9}},{"id":"810ecf34-9b57-4f6d-9732-26634f86b540","block_type":"box","text":"Description of Shares","page_number":169,"box":{"x":69,"y":536,"width":156,"height":11}},{"id":"0b1dec4b-bd61-4934-aa32-3296d9fd89a7","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":169,"box":{"x":102,"y":559,"width":800,"height":9}},{"id":"f6e73200-21e7-44c6-9cfc-2dee6683af2b","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":169,"box":{"x":69,"y":574,"width":811,"height":11}},{"id":"3c3a6133-e24b-4ea6-9bfe-16beb6702cb6","block_type":"box","text":"Shareholders of a class that bears distribution and/or service expenses have exclusive voting rights with respect to","page_number":169,"box":{"x":69,"y":589,"width":825,"height":11}},{"id":"e977a279-d9e1-4e9f-81b9-f47231b04f11","block_type":"box","text":"matters relating to such distribution and service expenditures. Voting rights are not cumulative, so that the holders of","page_number":169,"box":{"x":69,"y":604,"width":838,"height":11}},{"id":"2c47429b-0ab7-44ab-bf0a-e9f7bffc04a3","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":169,"box":{"x":69,"y":619,"width":835,"height":11}},{"id":"f2ff1c11-26c0-4b6b-809e-5a77d79ba210","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":169,"box":{"x":69,"y":634,"width":781,"height":12}},{"id":"ffd96e18-1ce1-4a06-9bf6-1f8c40777af1","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":169,"box":{"x":102,"y":657,"width":801,"height":11}},{"id":"996cba64-025e-4a1e-97a3-299a00cfbd4a","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":169,"box":{"x":69,"y":672,"width":760,"height":11}},{"id":"26690d03-6192-40a4-9ee6-225fa738f0a0","block_type":"box","text":"management agreement; (iii) approval of a distribution agreement; and (iv) ratification of selection of independent","page_number":169,"box":{"x":69,"y":687,"width":810,"height":11}},{"id":"1a419f76-ec13-4ba7-bd1e-4c402bda56b7","block_type":"box","text":"accountants. Shares issued are fully paid and non-assessable and have no preemptive rights. Redemption and","page_number":169,"box":{"x":69,"y":702,"width":790,"height":12}},{"id":"31013a10-4c3b-41f8-b638-51f46b82e710","block_type":"box","text":"conversion rights are discussed elsewhere herein and in each Fund’s Prospectus. Each share of each class of","page_number":169,"box":{"x":69,"y":717,"width":787,"height":12}},{"id":"682149da-d59a-44dc-bfba-68e10af708c1","block_type":"box","text":"Common Stock is entitled to participate equally in dividends and distributions declared by a Fund and in the net","page_number":169,"box":{"x":69,"y":733,"width":797,"height":11}},{"id":"9e7fbc94-930a-4bbb-baaa-c2017b5444b7","block_type":"box","text":"assets of the Fund upon liquidation or dissolution after satisfaction of outstanding liabilities.","page_number":169,"box":{"x":69,"y":748,"width":658,"height":11}},{"id":"c94ac134-3110-4560-9759-41c615608d14","block_type":"box","text":"For Funds organized as Maryland corporations, the by-laws of the Fund require that a special meeting of","page_number":169,"box":{"x":102,"y":770,"width":741,"height":12}},{"id":"87196136-2041-4cbd-ba19-ba02e5b13246","block_type":"box","text":"shareholders be held upon the written request of a minimum percentage of the outstanding shares of the Fund","page_number":169,"box":{"x":69,"y":785,"width":790,"height":12}},{"id":"efffd883-3bed-40f0-8a63-edc3398f7b0c","block_type":"box","text":"entitled to vote at such meeting, if they comply with applicable Maryland law.","page_number":169,"box":{"x":69,"y":801,"width":546,"height":11}},{"id":"cb8a2610-16ee-45d2-a0d7-91c09e1eb06d","block_type":"box","text":"Certain of the Funds are organized as “Massachusetts business trusts.” Under Massachusetts law,","page_number":169,"box":{"x":102,"y":823,"width":712,"height":12}},{"id":"32603193-cd74-4f6b-aed5-53df85fb9230","block_type":"box","text":"shareholders of such a trust may, under certain circumstances, be held personally liable as partners for its","page_number":169,"box":{"x":69,"y":838,"width":765,"height":11}},{"id":"9c8c583b-350f-48f9-b346-cb818f2f370a","block_type":"box","text":"obligations. However, the Declaration of Trust establishing a trust, a copy of which for each applicable Fund, together","page_number":169,"box":{"x":69,"y":853,"width":834,"height":12}},{"id":"625db355-c584-44db-8d21-98ca01998fd0","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":169,"box":{"x":68,"y":869,"width":729,"height":11}},{"id":"b01c61ad-4018-4657-bb7e-fcbf77f2798b","block_type":"box","text":"Commonwealth of Massachusetts, contains an express disclaimer of shareholder liability for acts or obligations of","page_number":169,"box":{"x":69,"y":884,"width":815,"height":11}},{"id":"7b452426-7bc4-48b1-8ae8-60fa1de280e1","block_type":"box","text":"the trust and provides for indemnification and reimbursement of expenses out of the trust property for any","page_number":169,"box":{"x":68,"y":899,"width":761,"height":11}},{"id":"250ece50-21e4-4995-8d3f-53823b9388ca","block_type":"box","text":"II-139","page_number":169,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"8f2128d7-d189-49eb-93ae-cce19c7d0de1","block_type":"box","text":"NM1026U-5979889-169/232","page_number":169,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a48e79b0-69f2-4760-b0da-3efaf12d0a05","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":170,"box":{"x":69,"y":45,"width":824,"height":11}},{"id":"dfe3fcb2-163e-45d9-935b-852eaacfec11","block_type":"box","text":"may maintain appropriate insurance (for example, fidelity bond and errors and omissions insurance) for the protection","page_number":170,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"a7e9613d-f3b2-4c16-813b-1ad2eaacf997","block_type":"box","text":"of the trust, its shareholders, trustees, officers, employees and agents covering possible tort and other liabilities.","page_number":170,"box":{"x":69,"y":75,"width":813,"height":11}},{"id":"27845c89-87ad-4c12-bdf1-bcf6d24bacf5","block_type":"box","text":"Thus, the risk of a shareholder incurring financial loss on account of shareholder liability is limited to circumstances","page_number":170,"box":{"x":68,"y":90,"width":827,"height":11}},{"id":"25038e72-908d-491e-8162-2f78736f4291","block_type":"box","text":"in which both inadequate insurance existed and the trust itself was unable to meet its obligations.","page_number":170,"box":{"x":70,"y":105,"width":699,"height":11}},{"id":"5889dc97-bbbe-4b14-9a4e-2fb3eaae204c","block_type":"box","text":"Certain Funds are organized as Delaware statutory trusts.","page_number":170,"box":{"x":102,"y":128,"width":413,"height":11}},{"id":"e0c7e644-11c8-41cf-b415-06735d722073","block_type":"box","text":"Additional Information","page_number":170,"box":{"x":68,"y":158,"width":161,"height":9}},{"id":"8eb34aee-7362-4002-a632-dda26cba08b2","block_type":"box","text":"Under a separate agreement, BlackRock has granted certain Funds the right to use the “BlackRock” name and","page_number":170,"box":{"x":102,"y":181,"width":789,"height":11}},{"id":"eddbd2a1-59b7-4508-8a1a-d334b8f38b8e","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":170,"box":{"x":69,"y":196,"width":799,"height":11}},{"id":"8ac0aa80-f9e7-40db-a74a-eec6c78f7afe","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":170,"box":{"x":70,"y":211,"width":837,"height":11}},{"id":"6b060214-b83b-49f1-9540-b30e65558dc9","block_type":"box","text":"such name to any other company.","page_number":170,"box":{"x":69,"y":226,"width":238,"height":11}},{"id":"3259ba6d-7bfd-47e0-ac0b-96c9b4762ef1","block_type":"box","text":"II-140","page_number":170,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"006907e0-2db4-48a1-949a-970f8cad3556","block_type":"box","text":"NM1026U-5979889-170/232","page_number":170,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a8a50c00-2808-4c3e-9bd8-752c024e5643","block_type":"box","text":"APPENDIX A","page_number":171,"box":{"x":438,"y":45,"width":101,"height":10}},{"id":"956219b8-a141-4ba4-a00b-f730d6c17c1b","block_type":"box","text":"Description of Bond Ratings","page_number":171,"box":{"x":377,"y":68,"width":224,"height":13}},{"id":"af8bbad0-c515-4b74-9d5c-ba967e64807f","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":171,"box":{"x":101,"y":91,"width":743,"height":12}},{"id":"7c865c7a-c862-4527-a569-17582915ed5b","block_type":"box","text":"designated as a nationally recognized statistical rating organization (“NRSRO”) by the Securities and Exchange","page_number":171,"box":{"x":69,"y":106,"width":787,"height":12}},{"id":"fc653ba2-64cd-4b91-964f-067e44a99678","block_type":"box","text":"Commission (“SEC”). While NRSROs may from time to time revise such ratings, they undertake no obligation to do","page_number":171,"box":{"x":69,"y":121,"width":817,"height":12}},{"id":"3719cd50-b908-4fa5-96c0-b5fe01407b5d","block_type":"box","text":"so, and the ratings given to securities at issuance do not necessarily represent ratings which would be given to these","page_number":171,"box":{"x":69,"y":137,"width":837,"height":11}},{"id":"367b61a1-1bee-4b72-a5a8-0c64e284322c","block_type":"box","text":"securities on a particular subsequent date.","page_number":171,"box":{"x":69,"y":152,"width":306,"height":11}},{"id":"06cea1c4-7cd5-4bed-b4bc-4c1ec6bb4c29","block_type":"box","text":"NRSROs may rate specific investments (","page_number":171,"box":{"x":102,"y":174,"width":286,"height":12}},{"id":"34668a89-de74-42c8-9630-61f9eb9d8119","block_type":"box","text":"e.g.","page_number":171,"box":{"x":390,"y":176,"width":25,"height":10}},{"id":"a282096d-6883-4de3-a98b-07aa111748a4","block_type":"box","text":", bonds), issuers (","page_number":171,"box":{"x":417,"y":175,"width":128,"height":10}},{"id":"1333adc8-54d4-49bd-b4b2-b19ae0c2f5e9","block_type":"box","text":"e.g.","page_number":171,"box":{"x":547,"y":176,"width":25,"height":10}},{"id":"264526c2-6ab0-435c-b744-764f7a974475","block_type":"box","text":", corporations, governments and financial","page_number":171,"box":{"x":574,"y":174,"width":293,"height":12}},{"id":"c4967180-4aa2-4d05-bc15-71e9a8eff8e9","block_type":"box","text":"institutions) and/or programs (","page_number":171,"box":{"x":70,"y":190,"width":217,"height":11}},{"id":"b9ca04a8-1d24-46ef-8623-78ac068479f2","block_type":"box","text":"e.g.","page_number":171,"box":{"x":289,"y":191,"width":25,"height":10}},{"id":"eab5c537-1559-495e-b05a-e20a6d7bb863","block_type":"box","text":", commercial paper programs). However, certain types of investments may not be","page_number":171,"box":{"x":317,"y":189,"width":578,"height":12}},{"id":"bba3b27f-6e06-4293-8ce9-d45c9b7fe7a4","block_type":"box","text":"rated by NRSROs, such as certain government/sovereign obligations, US agency securities, commercial paper, time","page_number":171,"box":{"x":69,"y":205,"width":826,"height":11}},{"id":"16450f92-bc55-4f5f-82cf-76422f482cd5","block_type":"box","text":"deposits at financial institutions, and derivative instruments such as credit default swaps. For these types of","page_number":171,"box":{"x":69,"y":220,"width":777,"height":11}},{"id":"e073fbaa-be28-4515-9168-fead8b8d26a0","block_type":"box","text":"investments, as well as US Treasury securities (some of which are not rated), where an NRSRO has not rated the","page_number":171,"box":{"x":70,"y":235,"width":807,"height":11}},{"id":"d4100dc4-405d-4c85-b21c-2d97822aef16","block_type":"box","text":"specific investment but has rated the investment’s issuer, program, financial institution or underlying reference","page_number":171,"box":{"x":69,"y":250,"width":791,"height":11}},{"id":"39685de1-6343-4df4-ba49-c799894082b2","block_type":"box","text":"asset, BlackRock Advisors, LLC, BlackRock Fund Advisors or their respective affiliates (“BlackRock”) may consider","page_number":171,"box":{"x":69,"y":265,"width":816,"height":11}},{"id":"41d8fccd-0445-4809-9b84-44afcbfb4492","block_type":"box","text":"the investment to have the same NRSRO rating as its issuer, program, financial institution or underlying reference","page_number":171,"box":{"x":68,"y":280,"width":812,"height":12}},{"id":"7dbdf5cc-4af6-4773-8d0e-e728e2ee2427","block_type":"box","text":"asset, as applicable. In the case of municipal securities, where one NRSRO provides multiple ratings for the same","page_number":171,"box":{"x":69,"y":295,"width":815,"height":12}},{"id":"1e5a51c1-5a62-4b85-a847-0ab757d34fa3","block_type":"box","text":"security (","page_number":171,"box":{"x":69,"y":311,"width":63,"height":11}},{"id":"37335bc1-5f36-451c-9eea-f346e54c1ccf","block_type":"box","text":"e.g.","page_number":171,"box":{"x":134,"y":312,"width":25,"height":10}},{"id":"a151afec-f878-4429-8555-358661821642","block_type":"box","text":", “underlying,” “insured” and/or “enhanced” ratings), BlackRock may consider the security to have the","page_number":171,"box":{"x":161,"y":311,"width":730,"height":11}},{"id":"33f70ab2-98b6-4568-8c13-0991fca91244","block_type":"box","text":"highest of the multiple ratings.","page_number":171,"box":{"x":69,"y":326,"width":216,"height":11}},{"id":"decf88ee-6399-43aa-808d-441fa661dcb1","block_type":"box","text":"New issue securities (regardless of type) may not be rated by an NRSRO at the time of their initial offering.","page_number":171,"box":{"x":102,"y":348,"width":760,"height":12}},{"id":"36920bbd-2961-407a-864a-7b0c387b3f7d","block_type":"box","text":"Preliminary prospectuses or term sheets for new issue securities may include an expected rating for the security (as","page_number":171,"box":{"x":69,"y":363,"width":830,"height":12}},{"id":"7d97aaae-9315-4722-af03-38a823518224","block_type":"box","text":"determined by the underwriter and/or issuer) or an NRSRO rating for the issuer of the security. If applicable, when","page_number":171,"box":{"x":69,"y":378,"width":812,"height":12}},{"id":"9607dcd2-42b7-44dd-a195-92cb6075add4","block_type":"box","text":"deciding whether to purchase a new issue security that has not yet been rated by an NRSRO, BlackRock may","page_number":171,"box":{"x":69,"y":394,"width":776,"height":11}},{"id":"48d8c2c0-7e00-4bd1-bb4f-b09c65afffb2","block_type":"box","text":"attribute an expected rating to the security based on: (i) the expected rating of the security set forth in the","page_number":171,"box":{"x":69,"y":409,"width":756,"height":11}},{"id":"7e9abc90-7327-4d01-8126-6d22967e3ddd","block_type":"box","text":"preliminary prospectus or term sheet for the security; (ii) the NRSRO’s rating for the issuer of the security set forth in","page_number":171,"box":{"x":70,"y":424,"width":835,"height":11}},{"id":"8e574103-353a-4cc0-be29-8c5f97c19aba","block_type":"box","text":"the preliminary prospectus or term sheet for the security; or (iii) with respect to asset-backed securities, the rating of","page_number":171,"box":{"x":68,"y":439,"width":836,"height":11}},{"id":"70771d3c-3586-471f-9ae4-4b8d1aa8b660","block_type":"box","text":"a prior issuance having a similar structure or the same sponsor.","page_number":171,"box":{"x":69,"y":454,"width":456,"height":11}},{"id":"885b17a3-ea69-4907-b471-005d78d99462","block_type":"box","text":"Where the investment objective of a fund is to track the performance of an index that includes credit ratings","page_number":171,"box":{"x":101,"y":477,"width":771,"height":11}},{"id":"01d9496d-c960-4512-892e-a278d284cad7","block_type":"box","text":"eligibility criteria as part of its index methodology, the fund may purchase any security within the index, such security","page_number":171,"box":{"x":69,"y":492,"width":832,"height":11}},{"id":"7598575b-63d9-4aef-91a3-562940e30d07","block_type":"box","text":"having been determined by the index provider as meeting its credit ratings eligibility criteria. The credit ratings","page_number":171,"box":{"x":69,"y":507,"width":782,"height":11}},{"id":"fed4a254-7193-40b1-a862-a69377bc8b1c","block_type":"box","text":"practices of an index provider may differ from BlackRock’s practices, as described above. Further, the fund may","page_number":171,"box":{"x":70,"y":522,"width":796,"height":11}},{"id":"a84a7cf2-fee4-44d6-848e-3b36ad2ea3d7","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":171,"box":{"x":70,"y":537,"width":811,"height":12}},{"id":"9d8b19d7-a6a3-4c4c-8c42-0444d7f1bc84","block_type":"box","text":"differs from the credit rating specified in its index methodology in various circumstances, including where a security is","page_number":171,"box":{"x":69,"y":552,"width":840,"height":12}},{"id":"6c08484b-d053-437d-a6e7-0b82fb1b4344","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":171,"box":{"x":69,"y":567,"width":824,"height":12}},{"id":"f9dabef9-9a63-4564-8556-e5e3b37a46b0","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":171,"box":{"x":68,"y":583,"width":781,"height":11}},{"id":"eebb06e3-5d47-4a61-91df-c1731ed09c43","block_type":"box","text":"Fixed-income securities which are unrated may expose the investor to risks with respect to capacity to pay","page_number":171,"box":{"x":102,"y":606,"width":756,"height":10}},{"id":"1c262293-7d49-4b03-97b2-71eb78f39bfe","block_type":"box","text":"interest or repay principal which are similar to the risks of lower-rated speculative bonds (although BlackRock may","page_number":171,"box":{"x":70,"y":620,"width":811,"height":12}},{"id":"adb9354e-2d0c-4169-8965-32238d638875","block_type":"box","text":"deem such unrated securities to be of higher quality). Evaluation of these securities is dependent on BlackRock’s","page_number":171,"box":{"x":69,"y":635,"width":809,"height":12}},{"id":"856b002a-c38a-450a-9484-b20898239fa0","block_type":"box","text":"judgment, analysis and experience in the evaluation of such securities.","page_number":171,"box":{"x":67,"y":651,"width":506,"height":11}},{"id":"a017a2c7-a2dc-4a9f-91ab-d793ba21d8e2","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":171,"box":{"x":102,"y":673,"width":776,"height":12}},{"id":"a253ac6a-810d-4613-8673-a4ba61eed6df","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":171,"box":{"x":69,"y":688,"width":818,"height":12}},{"id":"bba8ce18-eaa4-4072-bf5a-cb26246e8d13","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":171,"box":{"x":102,"y":711,"width":799,"height":11}},{"id":"24c5c15f-8c91-416d-b27e-cbd5cc04ba67","block_type":"box","text":"Fitch. Other terms used to describe such securities include “lower rated bonds,” “non-investment grade bonds,”","page_number":171,"box":{"x":70,"y":726,"width":798,"height":11}},{"id":"a637fec0-5c53-46cc-b0d1-4afb9f5724e8","block_type":"box","text":"“below investment grade bonds,” and “junk bonds.”","page_number":171,"box":{"x":70,"y":742,"width":368,"height":11}},{"id":"030c4fd1-4730-4d39-bed8-e44f921c72b3","block_type":"box","text":"The descriptions below relate to general long-term and short-term obligations of an issuer.","page_number":171,"box":{"x":101,"y":764,"width":643,"height":11}},{"id":"3ab5018f-b824-47e4-b24e-c00a19095376","block_type":"box","text":"A Description of Moody’s Investors Service, Inc.’s (“Moody’s”) Global Rating Scales","page_number":171,"box":{"x":68,"y":794,"width":616,"height":11}},{"id":"94f57001-c808-4bfb-a357-8f9187eb6c0b","block_type":"box","text":"Credit ratings are assigned on Moody’s global long-term and short-term rating scales and are forward-looking","page_number":171,"box":{"x":102,"y":817,"width":777,"height":11}},{"id":"45431958-09f0-4850-a4dc-f6f4faaedf16","block_type":"box","text":"opinions of the relative credit risks of financial obligations issued by non-financial corporates, financial institutions,","page_number":171,"box":{"x":69,"y":832,"width":818,"height":11}},{"id":"2d63207d-1162-4368-8381-81e9d23ef546","block_type":"box","text":"structured finance vehicles, project finance vehicles, and public sector entities. Moody’s defines credit risk as the","page_number":171,"box":{"x":69,"y":847,"width":812,"height":11}},{"id":"73a82a08-eb39-4bc8-bad5-a5c55ef5f85f","block_type":"box","text":"risk that an entity may not meet its contractual financial obligations as they come due and any estimated financial","page_number":171,"box":{"x":69,"y":862,"width":812,"height":12}},{"id":"f6efa419-3284-4491-a1a3-6423b2268597","block_type":"box","text":"loss in the event of default or impairment. The contractual financial obligations addressed by Moody’s ratings are","page_number":171,"box":{"x":70,"y":877,"width":807,"height":12}},{"id":"ce785448-2046-48ca-a9ca-cebe9eca7664","block_type":"box","text":"those that call for, without regard to enforceability, the payment of an ascertainable amount, which may vary based","page_number":171,"box":{"x":68,"y":892,"width":821,"height":12}},{"id":"b46e297a-5d96-4257-ac05-8018181671f1","block_type":"box","text":"upon standard sources of variation (","page_number":171,"box":{"x":69,"y":908,"width":257,"height":11}},{"id":"62417019-a47a-4708-863c-c8f1e612632d","block_type":"box","text":"e.g.","page_number":171,"box":{"x":328,"y":909,"width":25,"height":10}},{"id":"bcc193d9-f1c0-4db9-8854-639520c69af9","block_type":"box","text":", floating interest rates), by an ascertainable date. Moody’s rating addresses","page_number":171,"box":{"x":355,"y":908,"width":548,"height":11}},{"id":"def4d9ef-f630-4485-8432-d170b6d01c00","block_type":"box","text":"A-1","page_number":171,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"c4399fb8-98b0-491b-8d8a-a21903f5a38e","block_type":"box","text":"NM1026U-5979889-171/232","page_number":171,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"fb624afe-bb16-49fe-9d82-0ab75abf563a","block_type":"box","text":"the issuer’s ability to obtain cash sufficient to service the obligation, and its willingness to pay. Moody’s ratings do","page_number":172,"box":{"x":68,"y":45,"width":821,"height":11}},{"id":"403e73e3-acc4-4f95-baf8-2a3dfe052b75","block_type":"box","text":"not address non-standard sources of variation in the amount of the principal obligation (","page_number":172,"box":{"x":69,"y":60,"width":627,"height":11}},{"id":"d7a4c8dc-18bb-49ca-a58e-b8b95befab2b","block_type":"box","text":"e.g.","page_number":172,"box":{"x":697,"y":61,"width":25,"height":10}},{"id":"2d5adf65-2e07-4363-ac3c-e94f84205834","block_type":"box","text":", equity indexed), absent","page_number":172,"box":{"x":725,"y":60,"width":174,"height":11}},{"id":"aff23ccf-9a62-4dc1-838c-d8a8ca184b7c","block_type":"box","text":"an express statement to the contrary in a press release accompanying an initial rating. Long-term ratings are","page_number":172,"box":{"x":69,"y":75,"width":777,"height":11}},{"id":"6335dc3c-7b81-40ff-adfb-3144e026c413","block_type":"box","text":"assigned to issuers or obligations with an original maturity of eleven months or more and reflect both on the","page_number":172,"box":{"x":69,"y":90,"width":771,"height":11}},{"id":"d23d8b70-92e7-4a6d-9f27-b729cdcf162f","block_type":"box","text":"likelihood of a default or impairment on contractual financial obligations and the expected financial loss suffered in","page_number":172,"box":{"x":70,"y":105,"width":819,"height":11}},{"id":"b8de5106-65d9-4a31-a3af-6058c4d8f512","block_type":"box","text":"the event of default or impairment. Short-term ratings are assigned for obligations with an original maturity of thirteen","page_number":172,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"09039aed-2d48-4a06-a49f-844b65185819","block_type":"box","text":"months or less and reflect both on the likelihood of a default or impairment on contractual financial obligations and","page_number":172,"box":{"x":69,"y":135,"width":822,"height":12}},{"id":"99dd05e4-0386-46aa-9038-d0e689bed893","block_type":"box","text":"the expected financial loss suffered in the event of default or impairment. Moody’s issues ratings at the issuer level","page_number":172,"box":{"x":68,"y":150,"width":829,"height":12}},{"id":"ab578daa-58a7-47fa-99b2-3e07b4339267","block_type":"box","text":"and instrument level on both the long-term scale and the short-term scale. Typically, ratings are made publicly","page_number":172,"box":{"x":69,"y":166,"width":784,"height":11}},{"id":"4f53a0d9-f2ab-4d60-b239-e4e0a6021018","block_type":"box","text":"available although private and unpublished ratings may also be assigned.","page_number":172,"box":{"x":69,"y":181,"width":521,"height":11}},{"id":"d5ff2661-c77d-4f74-9350-6f5838aba500","block_type":"box","text":"Moody’s differentiates structured finance ratings from fundamental ratings (","page_number":172,"box":{"x":102,"y":203,"width":542,"height":12}},{"id":"3509b01a-e890-43a6-ab86-f4a5336442fa","block_type":"box","text":"i.e.","page_number":172,"box":{"x":646,"y":204,"width":20,"height":8}},{"id":"72fe6617-d054-41e2-aeb7-76447a23d906","block_type":"box","text":", ratings on nonfinancial","page_number":172,"box":{"x":669,"y":203,"width":169,"height":12}},{"id":"667632e9-8ed2-4b5c-83ce-bd1ef3cadd4f","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":172,"box":{"x":69,"y":218,"width":837,"height":12}},{"id":"ac241b0a-18f1-4da5-aa67-98e41dca6172","block_type":"box","text":"finance ratings. The addition of (sf) to structured finance ratings should eliminate any presumption that such ratings","page_number":172,"box":{"x":68,"y":234,"width":828,"height":11}},{"id":"fead74e3-38e6-4be9-a9c8-323df8328a24","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":172,"box":{"x":69,"y":249,"width":832,"height":11}},{"id":"72e3d6c2-9fa4-443b-9808-97d0be66ce16","block_type":"box","text":"security ratings indicates that otherwise similarly rated structured finance and fundamental securities may have","page_number":172,"box":{"x":69,"y":264,"width":797,"height":11}},{"id":"aa6043c5-41c7-40bb-9b5e-274d9dc89271","block_type":"box","text":"different risk characteristics. Through its current methodologies, however, Moody’s aspires to achieve broad","page_number":172,"box":{"x":69,"y":279,"width":771,"height":11}},{"id":"dee0cd56-e53f-4254-9cd5-c7546170b592","block_type":"box","text":"expected equivalence in structured finance and fundamental rating performance when measured over a long period","page_number":172,"box":{"x":69,"y":294,"width":821,"height":11}},{"id":"0d097ae3-8b75-4a01-ab0e-40775fca2fa8","block_type":"box","text":"of time.","page_number":172,"box":{"x":69,"y":309,"width":53,"height":9}},{"id":"e2c982b7-4576-4dc3-8335-13fe68bd86a1","block_type":"box","text":"Description of Moody’s Global Long-Term Rating Scale","page_number":172,"box":{"x":69,"y":339,"width":395,"height":12}},{"id":"16875350-cb93-41e4-aede-743ba6653a34","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":172,"box":{"x":68,"y":367,"width":815,"height":11}},{"id":"00cabeb9-5bc5-4094-9ac4-e29b349e1d0f","block_type":"box","text":"risk.","page_number":172,"box":{"x":197,"y":383,"width":28,"height":8}},{"id":"620e7cfb-d1cc-487a-ba35-739f80e4b7ef","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":172,"box":{"x":68,"y":402,"width":773,"height":12}},{"id":"495ee835-2ce8-4ec8-89ec-28844d1cb8cf","block_type":"box","text":"A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.","page_number":172,"box":{"x":68,"y":423,"width":776,"height":11}},{"id":"bd7eec33-d4d4-482d-a4e6-3911061aa638","block_type":"box","text":"Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as","page_number":172,"box":{"x":70,"y":443,"width":813,"height":11}},{"id":"ef764621-c056-4d37-ba74-426816cebeb5","block_type":"box","text":"such may possess certain speculative characteristics.","page_number":172,"box":{"x":196,"y":458,"width":385,"height":11}},{"id":"65498440-e456-4887-a383-f830002ee697","block_type":"box","text":"Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.","page_number":172,"box":{"x":70,"y":478,"width":775,"height":11}},{"id":"84d4223b-52af-4f7f-945d-e5322a659894","block_type":"box","text":"B Obligations rated B are considered speculative and are subject to high credit risk.","page_number":172,"box":{"x":70,"y":498,"width":707,"height":11}},{"id":"4da260be-eb59-4dac-8f13-4ba2c7f8d150","block_type":"box","text":"Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to very high","page_number":172,"box":{"x":69,"y":518,"width":810,"height":12}},{"id":"6a8136c9-9cdd-4545-9b38-0d9a38435a63","block_type":"box","text":"credit risk.","page_number":172,"box":{"x":196,"y":534,"width":74,"height":8}},{"id":"93cf4387-3880-413d-8d0c-13d27bd49ca9","block_type":"box","text":"Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some","page_number":172,"box":{"x":69,"y":554,"width":783,"height":11}},{"id":"adaa15f1-681b-4a04-9582-71b562c6ea83","block_type":"box","text":"prospect of recovery of principal and interest.","page_number":172,"box":{"x":197,"y":569,"width":322,"height":11}},{"id":"3740587a-104e-4a41-bdd9-f5eeb040d3f5","block_type":"box","text":"C Obligations rated C are the lowest rated and are typically in default, with little prospect for recovery","page_number":172,"box":{"x":69,"y":589,"width":834,"height":11}},{"id":"d6afb9ff-1ce7-484d-81ab-77b1b6fb9b16","block_type":"box","text":"of principal or interest.","page_number":172,"box":{"x":196,"y":604,"width":160,"height":11}},{"id":"e0e7f474-4af7-450c-b314-4e47e417363b","block_type":"box","text":"Note:","page_number":172,"box":{"x":102,"y":624,"width":37,"height":9}},{"id":"69dc9df4-f654-47e2-86ef-5765121fbf3d","block_type":"box","text":"Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through","page_number":172,"box":{"x":146,"y":624,"width":731,"height":11}},{"id":"d21b93c6-354d-41a0-be82-6c8e6ca1df64","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":172,"box":{"x":69,"y":639,"width":831,"height":12}},{"id":"6669c718-86d2-455b-a183-064abce3bbc2","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":172,"box":{"x":70,"y":654,"width":829,"height":12}},{"id":"d3fa6e1a-cb4b-4674-9f6f-15c5e6ff7842","block_type":"box","text":"Additionally, a “(hyb)” indicator is appended to all ratings of hybrid securities issued by banks, insurers, finance","page_number":172,"box":{"x":68,"y":669,"width":795,"height":12}},{"id":"717aef15-61ed-44c7-815a-6653a6f091cf","block_type":"box","text":"companies, and securities firms.","page_number":172,"box":{"x":69,"y":685,"width":232,"height":11}},{"id":"d2e9a13e-43b4-42c8-a0a9-d0092c2b6f28","block_type":"box","text":"By their terms, hybrid securities allow for the omission of scheduled dividends, interest, or principal payments,","page_number":172,"box":{"x":102,"y":707,"width":787,"height":11}},{"id":"dd7944e4-de16-4e8c-900f-2dfe743c0058","block_type":"box","text":"which can potentially result in impairment if such an omission occurs. Hybrid securities may also be subject to","page_number":172,"box":{"x":68,"y":722,"width":788,"height":12}},{"id":"1dfe6cdc-b5ed-47af-baf1-667cd3d82220","block_type":"box","text":"contractually allowable write-downs of principal that could result in impairment. Together with the hybrid indicator, the","page_number":172,"box":{"x":69,"y":738,"width":833,"height":11}},{"id":"aa33babb-dc16-4057-a886-449e1a54a7c3","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":172,"box":{"x":70,"y":753,"width":809,"height":11}},{"id":"025dc334-4f42-4665-ab6e-5147148fd74d","block_type":"box","text":"that security.","page_number":172,"box":{"x":68,"y":768,"width":91,"height":11}},{"id":"9e16fa66-8df9-42d9-8415-dd2b19551f45","block_type":"box","text":"Description of Moody’s Global Short-Term Rating Scale","page_number":172,"box":{"x":69,"y":798,"width":400,"height":11}},{"id":"58597d52-396b-4d60-a1ce-ffc4e6d0f9aa","block_type":"box","text":"P-1 Ratings of Prime-1 reflect a superior ability to repay short-term obligations.","page_number":172,"box":{"x":69,"y":826,"width":658,"height":11}},{"id":"2a5aaaeb-5e0a-434e-a45d-874de37abf17","block_type":"box","text":"P-2 Ratings of Prime-2 reflect a strong ability to repay short-term obligations.","page_number":172,"box":{"x":69,"y":846,"width":645,"height":11}},{"id":"69e130cc-b24c-4dfa-b297-656315c00ef5","block_type":"box","text":"P-3 Ratings of Prime-3 reflect an acceptable ability to repay short-term obligations.","page_number":172,"box":{"x":69,"y":866,"width":686,"height":11}},{"id":"16523e08-be88-447f-acc4-43627fd040c2","block_type":"box","text":"NP Issuers (or supporting institutions) rated Not Prime do not fall within any of the Prime rating","page_number":172,"box":{"x":70,"y":886,"width":778,"height":12}},{"id":"b1d4261d-ec02-468c-9961-70da7ee5a76a","block_type":"box","text":"categories.","page_number":172,"box":{"x":196,"y":902,"width":77,"height":11}},{"id":"e0a7e5c4-79af-4c98-93fe-8eb0aab3379d","block_type":"box","text":"A-2","page_number":172,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"3ce8552e-a32a-4452-8b7a-5d6cff6f9d94","block_type":"box","text":"NM1026U-5979889-172/232","page_number":172,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"b5d9a23d-ce9a-49fc-9832-541f585d6a1a","block_type":"box","text":"Description of Moody’s U.S. Municipal Short-Term Debt and Demand Obligation Ratings","page_number":173,"box":{"x":69,"y":45,"width":637,"height":11}},{"id":"fad86213-9d2e-459c-a36b-18866395e8f1","block_type":"box","text":"Moody’s uses the global short-term Prime rating scale for commercial paper issued by U.S. municipalities and","page_number":173,"box":{"x":102,"y":67,"width":784,"height":12}},{"id":"7ac1e3f0-2f36-4bca-bbbd-536c1678beff","block_type":"box","text":"nonprofits. These commercial paper programs may be backed by external letters of credit or liquidity facilities, or by","page_number":173,"box":{"x":69,"y":82,"width":824,"height":12}},{"id":"e3ec663b-0b84-485f-9de1-20987e8b1ec5","block_type":"box","text":"an issuer’s self-liquidity.","page_number":173,"box":{"x":69,"y":98,"width":170,"height":11}},{"id":"d8842f12-c365-4aea-b7d4-ed086a9eacc4","block_type":"box","text":"For other short-term municipal obligations, Moody’s uses one of two other short-term rating scales, the","page_number":173,"box":{"x":102,"y":120,"width":736,"height":12}},{"id":"d5ff038c-237a-4776-85fa-2827532e188a","block_type":"box","text":"Municipal Investment Grade (“MIG”) and Variable Municipal Investment Grade (“VMIG”) scales discussed below.","page_number":173,"box":{"x":70,"y":135,"width":796,"height":11}},{"id":"b5d09d75-4a2d-48bf-88ad-604454697b22","block_type":"box","text":"MIG Ratings","page_number":173,"box":{"x":102,"y":158,"width":85,"height":11}},{"id":"0a655ef8-2519-49f0-b639-f2b597023428","block_type":"box","text":"Moody’s uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and certain other short","page_number":173,"box":{"x":102,"y":181,"width":803,"height":11}},{"id":"54ece04c-359a-45f7-a3f6-9eefaf087e9a","block_type":"box","text":"term obligations, which typically mature in three years or less. Under certain circumstances, Moody’s uses the MIG","page_number":173,"box":{"x":68,"y":196,"width":823,"height":11}},{"id":"e1b3ba21-3a28-48c4-8014-f45516569e56","block_type":"box","text":"scale for bond anticipation notes with maturities of up to five years.","page_number":173,"box":{"x":69,"y":211,"width":480,"height":11}},{"id":"25f14703-c241-4d52-93d2-9871cc5669e1","block_type":"box","text":"MIG Scale","page_number":173,"box":{"x":102,"y":234,"width":71,"height":9}},{"id":"e66604c5-a440-445c-b510-3af490fd00ee","block_type":"box","text":"MIG 1 This designation denotes superior credit quality. Excellent protection is afforded by established","page_number":173,"box":{"x":70,"y":261,"width":802,"height":12}},{"id":"84e15522-ac4a-4217-bd7b-1bfad732020d","block_type":"box","text":"cash flows, highly reliable liquidity support, or demonstrated broad-based access to the market for","page_number":173,"box":{"x":196,"y":276,"width":703,"height":12}},{"id":"6d81219e-943f-424b-b439-21473cafa590","block_type":"box","text":"refinancing.","page_number":173,"box":{"x":197,"y":292,"width":80,"height":11}},{"id":"3419f9f6-b96a-4703-bc24-461d7acb5bb7","block_type":"box","text":"MIG 2 This designation denotes strong credit quality. Margins of protection are ample, although not as","page_number":173,"box":{"x":70,"y":312,"width":809,"height":11}},{"id":"1b742df1-ea0b-4e1e-a7e3-3a2eae262df3","block_type":"box","text":"large as in the preceding group.","page_number":173,"box":{"x":197,"y":327,"width":224,"height":11}},{"id":"6df45361-8c3e-42df-813e-e831686e596f","block_type":"box","text":"MIG 3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be","page_number":173,"box":{"x":70,"y":347,"width":785,"height":11}},{"id":"48a35485-4349-454a-ab77-d0d81291b753","block_type":"box","text":"narrow, and market access for refinancing is likely to be less well-established.","page_number":173,"box":{"x":197,"y":362,"width":554,"height":11}},{"id":"dd88aa3f-7cb0-437d-9047-225114953347","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Debt instruments in this category may","page_number":173,"box":{"x":69,"y":382,"width":813,"height":12}},{"id":"fcaeefad-0a3f-4dd5-8138-279275caa6d3","block_type":"box","text":"lack sufficient margins of protection.","page_number":173,"box":{"x":197,"y":397,"width":259,"height":12}},{"id":"7f935293-cc63-471f-b318-638a8b464627","block_type":"box","text":"VMIG Ratings","page_number":173,"box":{"x":68,"y":425,"width":100,"height":11}},{"id":"f2a3659e-952c-4fd3-ab7c-7ce67052bda3","block_type":"box","text":"In the case of variable rate demand obligations (“VRDOs”), a two-component rating is assigned. The components","page_number":173,"box":{"x":102,"y":448,"width":804,"height":11}},{"id":"320da1f8-de51-47be-bbff-cc1beaf2199d","block_type":"box","text":"are a long-term rating and a short-term payment obligation rating. The long-term rating addresses the issuer’s ability","page_number":173,"box":{"x":69,"y":463,"width":829,"height":11}},{"id":"5ed27f0a-034f-4f3f-8543-b92107725722","block_type":"box","text":"to meet scheduled principal and interest payments. The short-term payment obligation rating addresses the ability of","page_number":173,"box":{"x":68,"y":478,"width":836,"height":11}},{"id":"429dbdac-e2c5-4c6d-aa85-f6d4d482118b","block_type":"box","text":"the issuer or the liquidity provider meet any purchase-price payment obligation resulting from optional tenders (“on","page_number":173,"box":{"x":68,"y":493,"width":817,"height":11}},{"id":"19bf3942-3fc7-48e0-b1eb-8ec9da26380b","block_type":"box","text":"demand”) and/or mandatory tenders of the VRDO. The short-term demand obligation rating uses the VMIG scale.","page_number":173,"box":{"x":69,"y":508,"width":807,"height":12}},{"id":"e2e3bcbe-d858-402c-b331-c897c94d74a6","block_type":"box","text":"VMIG ratings with liquidity support use as an input the short-term Counterparty Risk Assessment of the support","page_number":173,"box":{"x":68,"y":523,"width":800,"height":12}},{"id":"c5ad650b-fc2c-42d7-86ad-74fbfd6b6981","block_type":"box","text":"provider, or the long-term rating of the underlying obligor in the absence of third party liquidity support. Transitions of","page_number":173,"box":{"x":70,"y":538,"width":832,"height":12}},{"id":"04b3edfe-786d-4002-bea9-f50ab72b969f","block_type":"box","text":"VMIG ratings of demand obligations with conditional liquidity support differ from transitions on the Prime scale to","page_number":173,"box":{"x":68,"y":554,"width":807,"height":11}},{"id":"38cc25b8-4531-4f4a-8783-8ad064040a98","block_type":"box","text":"reflect the risk that external liquidity support will terminate if the issuer’s long-term rating drops below investment","page_number":173,"box":{"x":69,"y":569,"width":812,"height":11}},{"id":"e47e6812-65d8-45f2-81db-c2e83efd26b2","block_type":"box","text":"grade.","page_number":173,"box":{"x":68,"y":584,"width":43,"height":11}},{"id":"f4cf1458-ab7e-44a2-af3e-33273983c1d0","block_type":"box","text":"Moody’s typically assigns the VMIG short-term demand obligation rating if the frequency of the demand feature is","page_number":173,"box":{"x":102,"y":606,"width":807,"height":12}},{"id":"155d4e7d-404e-4f8f-a2d8-77298d75520e","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":173,"box":{"x":70,"y":622,"width":833,"height":11}},{"id":"73e9f71f-9681-4390-b82f-ea32a9a14335","block_type":"box","text":"payable only with remarketing proceeds, the short-term demand obligation rating is “NR”.","page_number":173,"box":{"x":70,"y":637,"width":635,"height":11}},{"id":"91d61e3a-15f9-4032-ae2d-bd9bb1101071","block_type":"box","text":"Industrial development bonds in the US where the obligor is a corporate may carry a VMIG rating that reflects","page_number":173,"box":{"x":102,"y":659,"width":778,"height":12}},{"id":"96cc2aca-ea09-469b-8900-e8bff03681fe","block_type":"box","text":"Moody’s view of the relative likelihood of default and loss. In these cases, liquidity assessment is based on the","page_number":173,"box":{"x":70,"y":675,"width":795,"height":11}},{"id":"c4b747cc-f172-4226-86fa-f3c3602a8d26","block_type":"box","text":"liquidity of the corporate obligor.","page_number":173,"box":{"x":70,"y":690,"width":226,"height":11}},{"id":"c657cd25-18dc-42e4-aa87-5362243564fe","block_type":"box","text":"VMIG Scale","page_number":173,"box":{"x":101,"y":712,"width":81,"height":9}},{"id":"1a241180-e8e9-4d3a-ac34-7d19567f2be6","block_type":"box","text":"VMIG 1 This designation denotes superior credit quality. Excellent protection is afforded by the superior","page_number":173,"box":{"x":68,"y":740,"width":808,"height":11}},{"id":"18eda281-71e1-4126-b2ae-e56f8e547992","block_type":"box","text":"short-term credit strength of the liquidity provider and structural and legal protections.","page_number":173,"box":{"x":196,"y":755,"width":613,"height":11}},{"id":"61683538-4a9f-4cc8-a6ad-8b1ced60dc1e","block_type":"box","text":"VMIG 2 This designation denotes strong credit quality. Good protection is afforded by the strong short-term","page_number":173,"box":{"x":68,"y":775,"width":834,"height":12}},{"id":"851cb164-3514-4393-8449-895a2dde8c33","block_type":"box","text":"credit strength of the liquidity provider and structural and legal protections.","page_number":173,"box":{"x":196,"y":790,"width":533,"height":12}},{"id":"72f8028a-eb20-499e-a79d-3fcd6f6d8af6","block_type":"box","text":"VMIG 3 This designation denotes acceptable credit quality. Adequate protection is afforded by the","page_number":173,"box":{"x":68,"y":811,"width":768,"height":11}},{"id":"bbc4a58d-76a6-44a9-b4cb-d0c2baf78b49","block_type":"box","text":"satisfactory short-term credit strength of the liquidity provider and structural and legal protections.","page_number":173,"box":{"x":196,"y":826,"width":701,"height":11}},{"id":"78f0b35d-77d9-45f8-88a4-b5daea6ef665","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Demand features rated in this category","page_number":173,"box":{"x":69,"y":846,"width":820,"height":11}},{"id":"67222928-ad60-4876-a1da-98af291c72b7","block_type":"box","text":"may be supported by a liquidity provider that does not have a sufficiently strong short-term rating or","page_number":173,"box":{"x":197,"y":861,"width":711,"height":11}},{"id":"4965095f-2f67-4a5c-9526-6917719a2a52","block_type":"box","text":"may lack the structural or legal protections.","page_number":173,"box":{"x":197,"y":876,"width":308,"height":11}},{"id":"b5c39bda-9ff4-49f9-aec4-f7e037f165b0","block_type":"box","text":"A-3","page_number":173,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"06b75ac7-9a9e-49fd-8c79-8af73c6e49fc","block_type":"box","text":"NM1026U-5979889-173/232","page_number":173,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2a728d58-42a5-47a0-a2e2-f200bdad93ba","block_type":"box","text":"Description of S&P Global Ratings (“S&P”), a Division of S&P Global Inc., Issue Credit Ratings","page_number":174,"box":{"x":69,"y":45,"width":691,"height":11}},{"id":"e67cefaa-3986-438f-ba5c-dbea56b20dc6","block_type":"box","text":"An S&P issue credit rating is a forward-looking opinion about the creditworthiness of an obligor with respect to a","page_number":174,"box":{"x":101,"y":67,"width":801,"height":12}},{"id":"9ff05a97-bf3b-4434-876c-84dd065d74f8","block_type":"box","text":"specific financial obligation, a specific class of financial obligations, or a specific financial program (including ratings","page_number":174,"box":{"x":69,"y":82,"width":829,"height":12}},{"id":"3214e1c2-3cca-46e6-afc6-7266301a6eba","block_type":"box","text":"on medium-term note programs and commercial paper programs). It takes into consideration the creditworthiness of","page_number":174,"box":{"x":69,"y":98,"width":831,"height":11}},{"id":"31e15933-d993-4bd1-ab21-b1e25d469fd0","block_type":"box","text":"guarantors, insurers, or other forms of credit enhancement on the obligation and takes into account the currency in","page_number":174,"box":{"x":68,"y":113,"width":823,"height":11}},{"id":"d8c2e866-7f70-488d-bc9c-a5ff6bfe346b","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":174,"box":{"x":68,"y":128,"width":841,"height":11}},{"id":"329298d1-d501-403c-ba6d-d708cce56d81","block_type":"box","text":"its financial commitments as they come due, and this opinion may assess terms, such as collateral security and","page_number":174,"box":{"x":70,"y":143,"width":801,"height":11}},{"id":"3ae23584-cf30-4a3b-8277-03c236a90179","block_type":"box","text":"subordination, which could affect ultimate payment in the event of default.","page_number":174,"box":{"x":69,"y":158,"width":530,"height":11}},{"id":"49d22976-bc1f-420f-b069-cfc8fbe4f5a9","block_type":"box","text":"Issue credit ratings can be either long-term or short-term. Short-term issue credit ratings are generally assigned","page_number":174,"box":{"x":102,"y":181,"width":796,"height":11}},{"id":"db370c13-239b-4cbe-bc9a-7acc2529b7a0","block_type":"box","text":"to those obligations considered short-term in the relevant market, typically with an original maturity of no more than","page_number":174,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"b685fece-460d-4088-a1be-ed572bdac039","block_type":"box","text":"365 days. Short-term issue credit ratings are also used to indicate the creditworthiness of an obligor with respect to","page_number":174,"box":{"x":69,"y":211,"width":832,"height":11}},{"id":"adeffcd8-4d1c-4b42-91d6-77444a5399b2","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":174,"box":{"x":70,"y":226,"width":826,"height":11}},{"id":"2a5214a0-fa1a-4988-b676-1cfa86868ddb","block_type":"box","text":"an original maturity of greater than 365 days. However, the ratings S&P assigns to certain instruments may diverge","page_number":174,"box":{"x":69,"y":241,"width":823,"height":11}},{"id":"0f0d7214-c317-4f18-a521-43d65a254717","block_type":"box","text":"from these guidelines based on market practices.","page_number":174,"box":{"x":68,"y":256,"width":354,"height":12}},{"id":"1f68e02f-95db-498d-9be3-ce501dcd8be7","block_type":"box","text":"Issue credit ratings are based, in varying degrees, on S&P’s analysis of the following considerations:","page_number":174,"box":{"x":102,"y":279,"width":718,"height":11}},{"id":"7a9b67e6-da60-440f-b7ac-b57f73c44a08","block_type":"box","text":"•","page_number":174,"box":{"x":69,"y":302,"width":6,"height":5}},{"id":"4dbc4a11-c202-4add-a72e-caeb14b9db9e","block_type":"box","text":"The likelihood of payment—the capacity and willingness of the obligor to meet its financial commitments on an","page_number":174,"box":{"x":101,"y":299,"width":790,"height":11}},{"id":"7425a785-d9ae-4651-a1f4-de6426a1caae","block_type":"box","text":"obligation in accordance with the terms of the obligation;","page_number":174,"box":{"x":102,"y":314,"width":404,"height":12}},{"id":"27361e92-4b8e-4797-a67e-10f95fd7d5b4","block_type":"box","text":"•","page_number":174,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"0d2e2038-3659-4105-8f53-60a082244530","block_type":"box","text":"The nature and provisions of the financial obligation, and the promise S&P imputes; and","page_number":174,"box":{"x":101,"y":334,"width":629,"height":12}},{"id":"83b104bc-a2d5-4e87-a509-be8238180021","block_type":"box","text":"•","page_number":174,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"3c445b50-1c20-41c3-ada1-d45e88c8bcc6","block_type":"box","text":"The protection afforded by, and relative position of, the financial obligation in the event of a bankruptcy,","page_number":174,"box":{"x":101,"y":355,"width":738,"height":11}},{"id":"6942f178-922b-428a-ab56-a70e84a16dbc","block_type":"box","text":"reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors’ rights.","page_number":174,"box":{"x":102,"y":370,"width":770,"height":11}},{"id":"1ce82c92-dbad-42e3-b163-2ffd88a6b8b8","block_type":"box","text":"An issue rating is an assessment of default risk but may incorporate an assessment of relative seniority or","page_number":174,"box":{"x":101,"y":392,"width":763,"height":12}},{"id":"1fbadf58-dcb1-42d5-a061-3cd1f7db3480","block_type":"box","text":"ultimate recovery in the event of default. Junior obligations are typically rated lower than senior obligations, to reflect","page_number":174,"box":{"x":69,"y":407,"width":833,"height":12}},{"id":"697752b1-2949-49d5-9bcf-f9be97008d6c","block_type":"box","text":"lower priority in bankruptcy, as noted above. (Such differentiation may apply when an entity has both senior and","page_number":174,"box":{"x":70,"y":423,"width":794,"height":11}},{"id":"5465f37d-5abb-4b06-aff9-9ba6bcd04dc7","block_type":"box","text":"subordinated obligations, secured and unsecured obligations, or operating company and holding company","page_number":174,"box":{"x":69,"y":438,"width":754,"height":11}},{"id":"517c742f-fa32-4363-be0d-91ffa752ed55","block_type":"box","text":"obligations.)","page_number":174,"box":{"x":69,"y":453,"width":86,"height":11}},{"id":"2a812819-8e0f-42a8-b945-52d68620b8d6","block_type":"box","text":"Long-Term Issue Credit Ratings*","page_number":174,"box":{"x":69,"y":483,"width":236,"height":11}},{"id":"3dc4d2c9-2f99-4665-bb4c-5fb7c2afa0bb","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":174,"box":{"x":68,"y":511,"width":833,"height":11}},{"id":"fca17c90-62e5-40f3-8546-264db261c529","block_type":"box","text":"financial commitments on the obligation is extremely strong.","page_number":174,"box":{"x":196,"y":526,"width":429,"height":11}},{"id":"64583c88-8f63-40c4-b687-8420ff8a859f","block_type":"box","text":"AA An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree. The","page_number":174,"box":{"x":68,"y":546,"width":788,"height":11}},{"id":"0e0ef9ff-50d8-482a-bb76-7dba7ddacb61","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is very strong.","page_number":174,"box":{"x":196,"y":561,"width":602,"height":11}},{"id":"5cd608bc-2e2b-4c14-af0e-659c918b95d3","block_type":"box","text":"A An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes in","page_number":174,"box":{"x":68,"y":581,"width":770,"height":12}},{"id":"55803b75-477e-4cd6-9e75-44c4853e6fca","block_type":"box","text":"circumstances and economic conditions than obligations in higher-rated categories. However, the","page_number":174,"box":{"x":196,"y":597,"width":692,"height":11}},{"id":"8a30c31d-0dc9-43db-81aa-847a0c6ccb65","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is still strong.","page_number":174,"box":{"x":196,"y":612,"width":598,"height":11}},{"id":"f5e0282f-8726-4d9c-bcd6-478861a0e24f","block_type":"box","text":"BBB An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse economic","page_number":174,"box":{"x":70,"y":632,"width":806,"height":11}},{"id":"e9c73aba-fdbc-4e5a-a933-a7c1919b7b01","block_type":"box","text":"conditions or changing circumstances are more likely to weaken the obligor’s capacity to meet its","page_number":174,"box":{"x":196,"y":647,"width":694,"height":11}},{"id":"feb47afb-5cbe-41c8-a8e3-802b18130194","block_type":"box","text":"financial commitments on the obligation.","page_number":174,"box":{"x":196,"y":662,"width":289,"height":11}},{"id":"ce5a6826-7923-44a9-90fa-99bcefa5f4a9","block_type":"box","text":"BB,","page_number":174,"box":{"x":70,"y":682,"width":22,"height":11}},{"id":"dc06a905-d4df-4a69-8242-66c80a73de57","block_type":"box","text":"B,","page_number":174,"box":{"x":70,"y":697,"width":12,"height":11}},{"id":"9a7aaea4-2d8a-4a16-85a9-2da6a8783bdc","block_type":"box","text":"CCC,","page_number":174,"box":{"x":69,"y":712,"width":33,"height":11}},{"id":"55be3b69-aeff-4433-a4dc-3493d43fcd5c","block_type":"box","text":"CC,","page_number":174,"box":{"x":69,"y":728,"width":23,"height":10}},{"id":"4fcfbb79-7d7b-4fc8-a67a-218e95e7a3ad","block_type":"box","text":"and C","page_number":174,"box":{"x":69,"y":743,"width":40,"height":9}},{"id":"e5f6fc8f-efb9-492f-9ad1-b990d626eeff","block_type":"box","text":"Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded as having significant speculative","page_number":174,"box":{"x":196,"y":682,"width":667,"height":11}},{"id":"cb78a3f2-c7e3-4778-b207-67401ba60be4","block_type":"box","text":"characteristics. ‘BB’ indicates the least degree of speculation and ‘C’ the highest. While such","page_number":174,"box":{"x":196,"y":697,"width":667,"height":12}},{"id":"31fa2a55-e489-4998-b2d2-a4964061d7f4","block_type":"box","text":"obligations will likely have some quality and protective characteristics, these may be outweighed by","page_number":174,"box":{"x":196,"y":713,"width":707,"height":11}},{"id":"08ca4efb-c960-45f8-a407-30a3c7d452da","block_type":"box","text":"large uncertainties or major exposure to adverse conditions.","page_number":174,"box":{"x":197,"y":728,"width":428,"height":11}},{"id":"0033fb2c-e2f3-48d1-a339-42ad08aa8c5c","block_type":"box","text":"BB An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues. However, it","page_number":174,"box":{"x":70,"y":763,"width":838,"height":11}},{"id":"5ea492da-c11e-406a-919c-adfb443cc1ba","block_type":"box","text":"faces major ongoing uncertainties or exposure to adverse business, financial, or economic","page_number":174,"box":{"x":196,"y":778,"width":646,"height":11}},{"id":"1768d4d8-72db-40dc-a6ea-a8723d22e990","block_type":"box","text":"conditions that could lead to the obligor’s inadequate capacity to meet its financial commitments","page_number":174,"box":{"x":196,"y":793,"width":692,"height":11}},{"id":"a48e7822-e1b0-4001-a5ef-82414354b7da","block_type":"box","text":"on the obligation.","page_number":174,"box":{"x":196,"y":808,"width":122,"height":11}},{"id":"36a1e4fa-ea3c-4a4d-951a-ef5acf7ca97b","block_type":"box","text":"B An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but the obligor","page_number":174,"box":{"x":70,"y":828,"width":840,"height":12}},{"id":"50ae5e2b-273c-4cef-a578-00de4c3c9915","block_type":"box","text":"currently has the capacity to meet its financial commitments on the obligation. Adverse business,","page_number":174,"box":{"x":196,"y":843,"width":695,"height":12}},{"id":"3924058f-8e75-48d2-bfb6-1f63474e1949","block_type":"box","text":"financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its","page_number":174,"box":{"x":196,"y":858,"width":691,"height":12}},{"id":"4cf7c649-008a-40e5-8868-62a45adb6f57","block_type":"box","text":"financial commitments on the obligation.","page_number":174,"box":{"x":196,"y":874,"width":289,"height":11}},{"id":"4608086f-c605-45bc-b5ca-6b0aecce06eb","block_type":"box","text":"A-4","page_number":174,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"abd377aa-cc24-414d-9ce5-b2a57c4cf65d","block_type":"box","text":"NM1026U-5979889-174/232","page_number":174,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7d4b8d5f-932a-40c7-8b6b-909e16b18570","block_type":"box","text":"CCC An obligation rated ‘CCC’ is currently vulnerable to nonpayment and is dependent upon favorable","page_number":175,"box":{"x":69,"y":48,"width":816,"height":12}},{"id":"2503ff32-bb6f-488e-bcac-3bc8e8fb18ac","block_type":"box","text":"business, financial, and economic conditions for the obligor to meet its financial commitments on","page_number":175,"box":{"x":196,"y":63,"width":695,"height":12}},{"id":"8b3a9ff7-9c77-40d7-9be8-6236c4aaa966","block_type":"box","text":"the obligation. In the event of adverse business, financial, or economic conditions, the obligor is","page_number":175,"box":{"x":195,"y":79,"width":687,"height":11}},{"id":"b6e6d41b-210d-4a83-8a1f-966c49dcb9fc","block_type":"box","text":"not likely to have the capacity to meet its financial commitments on the obligation.","page_number":175,"box":{"x":197,"y":94,"width":586,"height":11}},{"id":"535aef3a-f3e1-4790-97b7-e2a36d3eabc9","block_type":"box","text":"CC An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is used when","page_number":175,"box":{"x":69,"y":114,"width":826,"height":11}},{"id":"9a469a9a-ec63-4846-8548-c0411221b32b","block_type":"box","text":"a default has not yet occurred but S&P expects default to be a virtual certainty, regardless of the","page_number":175,"box":{"x":196,"y":129,"width":692,"height":11}},{"id":"81e1475b-f862-40b6-8cd2-ff099c240a00","block_type":"box","text":"anticipated time to default.","page_number":175,"box":{"x":196,"y":144,"width":191,"height":11}},{"id":"200c9adf-e827-4a4b-aba4-ab533a10d8e4","block_type":"box","text":"C An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is expected","page_number":175,"box":{"x":69,"y":164,"width":826,"height":12}},{"id":"e9192113-b24f-4853-928a-2c13561cc551","block_type":"box","text":"to have lower relative seniority or lower ultimate recovery compared with obligations that are rated","page_number":175,"box":{"x":195,"y":180,"width":700,"height":11}},{"id":"6e5f4cc0-002c-4c00-944d-7da41c7141de","block_type":"box","text":"higher.","page_number":175,"box":{"x":197,"y":195,"width":45,"height":11}},{"id":"e62f3e6b-e144-446d-9dda-bfc11ebcf8fc","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":175,"box":{"x":70,"y":215,"width":789,"height":11}},{"id":"85013ad7-83fb-45db-9f56-7a6253a0e251","block_type":"box","text":"instruments, the ‘D’ rating category is used when payments on an obligation are not made on the","page_number":175,"box":{"x":197,"y":230,"width":695,"height":11}},{"id":"a818843a-83e6-457d-bbd3-ba757e697b83","block_type":"box","text":"date due, unless S&P believes that such payments will be made within five business days in the","page_number":175,"box":{"x":196,"y":245,"width":686,"height":11}},{"id":"4c1a8bb9-e1a6-4a7d-a77f-240abedfbf1b","block_type":"box","text":"absence of a stated grace period or within the earlier of the stated grace period or 30 calendar","page_number":175,"box":{"x":196,"y":260,"width":676,"height":11}},{"id":"520ea5d9-66fa-45e5-a0c3-492dd101b729","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":175,"box":{"x":196,"y":275,"width":708,"height":11}},{"id":"46c62616-327b-467b-844a-1e2c1d300ec3","block_type":"box","text":"action and where default on an obligation is a virtual certainty, for example due to automatic stay","page_number":175,"box":{"x":196,"y":290,"width":694,"height":12}},{"id":"6acad5b8-fc9d-4c19-9fbb-f2e030a3ea35","block_type":"box","text":"provisions. A rating on an obligation is lowered to ‘D’ if it is subject to a distressed debt","page_number":175,"box":{"x":197,"y":305,"width":626,"height":12}},{"id":"af51368d-3237-473d-82ed-47feff28f8c9","block_type":"box","text":"restructuring.","page_number":175,"box":{"x":197,"y":321,"width":92,"height":11}},{"id":"eb87c96f-54f2-491f-bc89-680c2d7fa9ae","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":175,"box":{"x":103,"y":341,"width":756,"height":11}},{"id":"918837ae-ee8a-40cf-bae8-1521f0dd5be4","block_type":"box","text":"standing within the rating categories.","page_number":175,"box":{"x":69,"y":356,"width":262,"height":11}},{"id":"fed2848f-315f-42ab-be50-67eecdd4716c","block_type":"box","text":"Short-Term Issue Credit Ratings","page_number":175,"box":{"x":68,"y":386,"width":233,"height":11}},{"id":"80ad52d1-f53b-4e04-897c-c4d38cd4053d","block_type":"box","text":"A-1 A short-term obligation rated ‘A-1’ is rated in the highest category by S&P. The obligor’s capacity to","page_number":175,"box":{"x":68,"y":414,"width":833,"height":11}},{"id":"c7a047d2-9a2e-4f38-ba93-45e7c0392872","block_type":"box","text":"meet its financial commitments on the obligation is strong. Within this category, certain obligations","page_number":175,"box":{"x":197,"y":429,"width":707,"height":11}},{"id":"2143a3cc-2953-4ad8-9f32-dcc181773d92","block_type":"box","text":"are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial","page_number":175,"box":{"x":196,"y":444,"width":691,"height":11}},{"id":"09bd0e32-751a-4b6f-a888-568e51a736c7","block_type":"box","text":"commitments on these obligations is extremely strong.","page_number":175,"box":{"x":196,"y":459,"width":390,"height":11}},{"id":"27ca399a-019c-47b5-91c4-e9f693d7f4b5","block_type":"box","text":"A-2 A short-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects of changes","page_number":175,"box":{"x":68,"y":479,"width":837,"height":12}},{"id":"62e69c8a-320a-4125-a7da-4b96b1e5cbe9","block_type":"box","text":"in circumstances and economic conditions than obligations in higher rating categories. However,","page_number":175,"box":{"x":197,"y":495,"width":684,"height":11}},{"id":"848d0305-c9d4-474c-8bde-b129cf6e7f8d","block_type":"box","text":"the obligor’s capacity to meet its financial commitments on the obligation is satisfactory.","page_number":175,"box":{"x":195,"y":509,"width":634,"height":12}},{"id":"aaa770e2-7f52-4502-b962-ece3142e07bf","block_type":"box","text":"A-3 A short-term obligation rated ‘A-3’ exhibits adequate protection parameters. However, adverse","page_number":175,"box":{"x":68,"y":530,"width":798,"height":11}},{"id":"28c5c5cd-2961-4e3d-b941-7eeb413ae672","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken an obligor’s capacity to","page_number":175,"box":{"x":196,"y":545,"width":699,"height":11}},{"id":"66533306-9b4e-4547-b05f-309bd6d54528","block_type":"box","text":"meet its financial commitments on the obligation.","page_number":175,"box":{"x":197,"y":560,"width":351,"height":11}},{"id":"c6e27eb4-3214-49f2-8106-9822df0d6970","block_type":"box","text":"B A short-term obligation rated ‘B’ is regarded as vulnerable and has significant speculative","page_number":175,"box":{"x":70,"y":580,"width":765,"height":11}},{"id":"fb5476d1-9316-49c7-a75d-57fdd07dbc60","block_type":"box","text":"characteristics. The obligor currently has the capacity to meet its financial commitments; however,","page_number":175,"box":{"x":196,"y":595,"width":700,"height":11}},{"id":"cb18fb8f-852f-4739-81ae-b78b1623d01c","block_type":"box","text":"it faces major ongoing uncertainties that could lead to the obligor’s inadequate capacity to meet its","page_number":175,"box":{"x":197,"y":610,"width":708,"height":12}},{"id":"a73f83f1-73bc-46c3-905d-804fbe794379","block_type":"box","text":"financial commitments.","page_number":175,"box":{"x":196,"y":625,"width":165,"height":9}},{"id":"75007b9c-d177-42d0-85dd-a72d4729e2ee","block_type":"box","text":"C A short-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent upon","page_number":175,"box":{"x":69,"y":646,"width":796,"height":11}},{"id":"36344a53-aaa5-48f7-83db-5c9e76909b46","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its financial","page_number":175,"box":{"x":196,"y":661,"width":641,"height":11}},{"id":"203d3b55-eda5-4a64-bbd5-bc6d8432920b","block_type":"box","text":"commitments on the obligation.","page_number":175,"box":{"x":196,"y":676,"width":224,"height":11}},{"id":"549b74ae-0f71-4bd0-b7fe-33d8781f71a6","block_type":"box","text":"D A short-term obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid","page_number":175,"box":{"x":70,"y":696,"width":808,"height":11}},{"id":"377cccc8-a00c-43ca-a72b-be92d101db20","block_type":"box","text":"capital instruments, the ‘D’ rating category is used when payments on an obligation are not made","page_number":175,"box":{"x":196,"y":711,"width":698,"height":11}},{"id":"a1999c5d-3eae-4f46-b104-2083f59ed031","block_type":"box","text":"on the date due, unless S&P believes that such payments will be made within any stated grace","page_number":175,"box":{"x":196,"y":726,"width":678,"height":12}},{"id":"87aa5a4a-3c64-415f-8806-c919aa658741","block_type":"box","text":"period. However, any stated grace period longer than five business days will be treated as five","page_number":175,"box":{"x":197,"y":741,"width":669,"height":12}},{"id":"0e182efe-f8be-49a8-a5c5-13a87fcad99b","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":175,"box":{"x":196,"y":756,"width":707,"height":12}},{"id":"f619f03a-0a7d-4f89-a975-7ed9febf7586","block_type":"box","text":"of a similar action and where default on an obligation is a virtual certainty, for example due to","page_number":175,"box":{"x":196,"y":772,"width":669,"height":11}},{"id":"da77ac78-1002-4e2b-aa7b-be16c999ed68","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":175,"box":{"x":196,"y":787,"width":700,"height":11}},{"id":"ac77be1d-fb27-4fb3-906c-a59cee74db2f","block_type":"box","text":"debt restructuring.","page_number":175,"box":{"x":196,"y":802,"width":130,"height":11}},{"id":"50e8c2d9-800c-401b-b9c7-5196fc1214c4","block_type":"box","text":"Description of S&P’s Municipal Short-Term Note Ratings","page_number":175,"box":{"x":69,"y":830,"width":411,"height":11}},{"id":"e713d750-8145-4063-80fc-05e697ebad09","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":175,"box":{"x":101,"y":852,"width":772,"height":11}},{"id":"c2b7f452-11c7-48e4-84bf-306e7ffab883","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":175,"box":{"x":69,"y":868,"width":823,"height":11}},{"id":"621e32ee-b127-4572-a040-55d9e87dde1c","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":175,"box":{"x":69,"y":882,"width":832,"height":12}},{"id":"463f1783-34ab-4ab2-aa54-c747dae5b8c2","block_type":"box","text":"assign, S&P’s analysis will review the following considerations:","page_number":175,"box":{"x":69,"y":898,"width":447,"height":11}},{"id":"5b38f87b-6c4a-44ee-b78a-8adbde6a1526","block_type":"box","text":"A-5","page_number":175,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"602dab09-041a-46ef-87fa-52643dda2bf6","block_type":"box","text":"NM1026U-5979889-175/232","page_number":175,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"34a05faa-67d7-48aa-9465-9af4824e1ae5","block_type":"box","text":"•","page_number":176,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"879ff9e1-5183-47d5-9a78-c1bbe6ce6371","block_type":"box","text":"Amortization schedule—the larger the final maturity relative to other maturities, the more likely it will be treated","page_number":176,"box":{"x":101,"y":45,"width":796,"height":11}},{"id":"67914613-a667-430f-ac54-f4e389b275eb","block_type":"box","text":"as a note; and","page_number":176,"box":{"x":102,"y":60,"width":101,"height":10}},{"id":"f1b6bc2c-888d-4b91-b023-6f5f92515020","block_type":"box","text":"•","page_number":176,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"7f481267-3eef-43bb-8781-ded7e9757a31","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":176,"box":{"x":102,"y":80,"width":794,"height":11}},{"id":"68cb96da-9772-4ed7-9a0d-b4ea036213ca","block_type":"box","text":"treated as a note.","page_number":176,"box":{"x":101,"y":95,"width":127,"height":9}},{"id":"de2d11b0-ccfd-43e1-b1d7-49a204dd8599","block_type":"box","text":"S&P’s municipal short-term note rating symbols are as follows:","page_number":176,"box":{"x":102,"y":118,"width":448,"height":11}},{"id":"77fda06e-1561-4307-ac01-af69adb43cad","block_type":"box","text":"SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very strong","page_number":176,"box":{"x":69,"y":146,"width":779,"height":11}},{"id":"8c3d6bce-283e-4a19-95d1-9696d189f32a","block_type":"box","text":"capacity to pay debt service is given a plus (+) designation.","page_number":176,"box":{"x":196,"y":161,"width":422,"height":11}},{"id":"99d57638-b2c4-450f-9828-3ba0fccdd8a3","block_type":"box","text":"SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and","page_number":176,"box":{"x":69,"y":181,"width":825,"height":11}},{"id":"6de3fe7d-66b9-4e14-aeb5-f16b8edfbd38","block_type":"box","text":"economic changes over the term of the notes.","page_number":176,"box":{"x":196,"y":196,"width":327,"height":11}},{"id":"eea596c1-b344-401b-9942-32839c7226b9","block_type":"box","text":"SP-3 Speculative capacity to pay principal and interest.","page_number":176,"box":{"x":69,"y":216,"width":479,"height":11}},{"id":"16efde0f-8f0f-4886-9a62-8c282de9b4db","block_type":"box","text":"D ‘D’ is assigned upon failure to pay the note when due, completion of a distressed debt","page_number":176,"box":{"x":70,"y":236,"width":745,"height":11}},{"id":"898df469-cdb5-4676-b6e7-3671d3b0ac4f","block_type":"box","text":"restructuring, or the filing of a bankruptcy petition or the taking of similar action and where default","page_number":176,"box":{"x":197,"y":251,"width":699,"height":12}},{"id":"4e442dfb-d301-4bdc-bd39-4ff0d850155e","block_type":"box","text":"on an obligation is a virtual certainty, for example due to automatic stay provisions.","page_number":176,"box":{"x":196,"y":266,"width":594,"height":12}},{"id":"ae8bd008-31ec-454b-96fb-457b4fc0d94c","block_type":"box","text":"Description of Fitch Ratings’ (“Fitch”) Credit Ratings Scales","page_number":176,"box":{"x":69,"y":294,"width":442,"height":11}},{"id":"49cfe4f2-01f4-46e5-a3f0-a0a98c075628","block_type":"box","text":"Fitch publishes credit ratings that are forward-looking opinions on the relative ability of an entity or obligation to","page_number":176,"box":{"x":102,"y":317,"width":793,"height":11}},{"id":"7530d202-9969-4bb0-8c00-228b9dcee7d8","block_type":"box","text":"meet financial commitments. Issuer default ratings (IDRs) are assigned to corporations, sovereign entities, financial","page_number":176,"box":{"x":69,"y":332,"width":826,"height":11}},{"id":"d109e73c-5561-4aa8-b8fa-7e81f21cff76","block_type":"box","text":"institutions such as banks, leasing companies and insurers, and public finance entities (local and regional","page_number":176,"box":{"x":70,"y":347,"width":756,"height":11}},{"id":"4e0de5f5-75df-4b09-84f3-4bed31794526","block_type":"box","text":"governments). Issue level ratings are also assigned, often include an expectation of recovery and may be notched","page_number":176,"box":{"x":68,"y":362,"width":813,"height":11}},{"id":"2f9fd806-da9b-4f07-a6d3-529530f47cc1","block_type":"box","text":"above or below the issuer level rating. Issue ratings are assigned to secured and unsecured debt securities, loans,","page_number":176,"box":{"x":69,"y":377,"width":819,"height":12}},{"id":"4bf710e9-c69a-49c0-84a8-c862f357d15b","block_type":"box","text":"preferred stock and other instruments, Structured finance ratings are issue ratings to securities backed by","page_number":176,"box":{"x":70,"y":392,"width":760,"height":12}},{"id":"ee2c27ed-2703-4f06-a402-1e6981eabd6d","block_type":"box","text":"receivables or other financial assets that consider the obligations’ relative vulnerability to default.","page_number":176,"box":{"x":69,"y":407,"width":694,"height":12}},{"id":"b05275fe-a4e0-4222-9cfe-bfd05d91c8a9","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":176,"box":{"x":102,"y":430,"width":747,"height":11}},{"id":"33da6d8f-9c87-464b-be63-b05fbc7c0a9f","block_type":"box","text":"commitments, such as interest, preferred dividends, repayment of principal, insurance claims or counterparty","page_number":176,"box":{"x":69,"y":445,"width":782,"height":11}},{"id":"e53b6474-ae9e-454e-bd6c-0403305d8a02","block_type":"box","text":"obligations. Credit ratings relating to securities and obligations of an issuer can include a recovery expectation.","page_number":176,"box":{"x":69,"y":460,"width":793,"height":12}},{"id":"e2da75ea-a154-4172-91dc-a247fee5aae6","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":176,"box":{"x":69,"y":475,"width":761,"height":12}},{"id":"fe7cfbf6-0c86-4936-bfc0-900c5e6bb840","block_type":"box","text":"accordance with the terms on which they invested. The agency’s credit ratings cover the global spectrum of","page_number":176,"box":{"x":69,"y":491,"width":766,"height":11}},{"id":"d157ca94-9f5b-4b21-aa23-a574785401a3","block_type":"box","text":"corporate, sovereign financial, bank, insurance, and public finance entities (including supranational and sub-national","page_number":176,"box":{"x":69,"y":506,"width":827,"height":11}},{"id":"ca34751a-2f2a-43e3-89bf-4713c1a5f292","block_type":"box","text":"entities) and the securities or other obligations they issue, as well as structured finance securities backed by","page_number":176,"box":{"x":69,"y":521,"width":779,"height":11}},{"id":"8570f278-cde8-4571-8fe9-e427b5827fc8","block_type":"box","text":"receivables or other financial assets.","page_number":176,"box":{"x":69,"y":536,"width":262,"height":9}},{"id":"8d532efe-7907-4742-9d8a-f016fa4c6069","block_type":"box","text":"The terms “investment grade” and “speculative grade” have established themselves over time as shorthand to","page_number":176,"box":{"x":101,"y":559,"width":794,"height":11}},{"id":"215cdf24-23ae-4cf6-a887-90f7d1391db0","block_type":"box","text":"describe the categories ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative grade). The terms investment","page_number":176,"box":{"x":69,"y":574,"width":826,"height":11}},{"id":"23a530aa-2c08-460d-8228-7675dd2c3a62","block_type":"box","text":"grade and speculative grade are market conventions and do not imply any recommendation or endorsement of a","page_number":176,"box":{"x":68,"y":589,"width":800,"height":11}},{"id":"c0162fb7-d50a-41c7-b6b0-ebf2a378ebd5","block_type":"box","text":"specific security for investment purposes. Investment grade categories indicate relatively low to moderate credit risk,","page_number":176,"box":{"x":69,"y":604,"width":832,"height":11}},{"id":"47ae0d28-aba5-49f6-a66b-6369619c53e2","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":176,"box":{"x":68,"y":619,"width":793,"height":11}},{"id":"d2999223-7ae3-469b-8460-c73fbcb32495","block_type":"box","text":"occurred.","page_number":176,"box":{"x":69,"y":634,"width":65,"height":9}},{"id":"08911575-3f68-43af-8f50-373628ff1a5c","block_type":"box","text":"Fitch may also include issues relating to a rated issuer that are not and have not been rated on its web page.","page_number":176,"box":{"x":102,"y":657,"width":779,"height":11}},{"id":"316914ee-d9e1-4f1f-bbdd-9b59d41ec75c","block_type":"box","text":"Such issues are also denoted as ‘NR’.","page_number":176,"box":{"x":69,"y":672,"width":274,"height":9}},{"id":"25d4b5b9-ad20-4954-9198-9e302e9514b9","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":176,"box":{"x":102,"y":695,"width":797,"height":11}},{"id":"e4384ae5-2d65-48cf-821c-4078a33984bb","block_type":"box","text":"not predictive of a specific frequency of default or loss.","page_number":176,"box":{"x":69,"y":710,"width":391,"height":11}},{"id":"edf0e980-a630-4ecd-9539-dd5914ca47ea","block_type":"box","text":"Fitch’s credit ratings do not directly address any risk other than credit risk. In particular, ratings do not deal with","page_number":176,"box":{"x":102,"y":733,"width":798,"height":11}},{"id":"3d6641b0-d13c-451d-b27c-0fcd6d49ba2c","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":176,"box":{"x":68,"y":748,"width":780,"height":11}},{"id":"c336f585-28bc-40fe-ace4-ec39290c967e","block_type":"box","text":"considerations. However, in terms of payment obligation on the rated liability, market risk may be considered to the","page_number":176,"box":{"x":69,"y":763,"width":821,"height":11}},{"id":"97b0ab41-b948-47d4-8867-4b5f8496b9a6","block_type":"box","text":"extent that it influences the ability of an issuer to pay upon a commitment.","page_number":176,"box":{"x":69,"y":778,"width":531,"height":11}},{"id":"4f1456f6-6df3-4926-8e20-222dd67f6c04","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":176,"box":{"x":102,"y":801,"width":801,"height":11}},{"id":"e9a4b1b6-7d3f-4738-ac6c-d7c26850c4ea","block_type":"box","text":"the obligation to pay upon a commitment (for example, in the case of index-linked bonds).","page_number":176,"box":{"x":68,"y":816,"width":639,"height":11}},{"id":"1a530c8f-c97a-4e24-bbb7-04ec63281aba","block_type":"box","text":"In the default components of ratings assigned to individual obligations or instruments, the agency typically rates","page_number":176,"box":{"x":102,"y":838,"width":799,"height":12}},{"id":"eb4da763-928d-4de1-b0b7-5a9764647b06","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":176,"box":{"x":68,"y":853,"width":794,"height":12}},{"id":"9227abe6-ccca-473f-a06b-298f3e321ad0","block_type":"box","text":"limited cases, Fitch may include additional considerations (","page_number":176,"box":{"x":70,"y":869,"width":420,"height":11}},{"id":"87a0792e-d558-4ff2-91f1-ad841645e9f1","block_type":"box","text":"i.e.","page_number":176,"box":{"x":492,"y":869,"width":20,"height":9}},{"id":"dc825145-d112-4fc7-ba69-ec82c750f812","block_type":"box","text":"rate to a higher or lower standard than that implied in","page_number":176,"box":{"x":519,"y":869,"width":380,"height":11}},{"id":"9ae77b84-06a0-4e5b-b2f7-622dc9e1ba4d","block_type":"box","text":"the obligation’s documentation).","page_number":176,"box":{"x":68,"y":884,"width":230,"height":11}},{"id":"8e77e586-af7e-47c6-9ebf-c390af1db13c","block_type":"box","text":"A-6","page_number":176,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"d8960da3-4a4f-4f55-a75f-21a37224b99f","block_type":"box","text":"NM1026U-5979889-176/232","page_number":176,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e31c1b9c-3f4a-438a-9010-21fb3e51ac0e","block_type":"box","text":"The primary credit rating scales can be used to provide a rating of privately issued obligations or certain note","page_number":177,"box":{"x":101,"y":45,"width":779,"height":11}},{"id":"b92e9615-cb35-49a0-9426-4ee355576081","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":177,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"cba65c40-8266-4e9c-9b3a-6dd11e56eceb","block_type":"box","text":"agents in the form of a rating letter.","page_number":177,"box":{"x":69,"y":75,"width":253,"height":11}},{"id":"6a5dfbe3-8951-45d9-b933-a64d1650fa0a","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":177,"box":{"x":101,"y":98,"width":797,"height":11}},{"id":"fb794177-ea8d-4e98-bba5-055a7b03cb6d","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":177,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"05947b78-c41e-4754-b400-5ad5135043ad","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":177,"box":{"x":69,"y":128,"width":796,"height":11}},{"id":"7db86f07-15d3-420f-aa9c-45a55b3fc32c","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":177,"box":{"x":69,"y":143,"width":811,"height":11}},{"id":"65f9cba8-8f7d-4ae1-93e5-69db993d45ef","block_type":"box","text":"case letter symbol combined with either an ‘*’ (","page_number":177,"box":{"x":69,"y":158,"width":340,"height":11}},{"id":"386a40e9-fb87-40bc-8986-e7ef8f0674cc","block_type":"box","text":"e.g.","page_number":177,"box":{"x":410,"y":160,"width":25,"height":9}},{"id":"fcd2c57b-d96b-4daa-8019-04b719fd78e4","block_type":"box","text":"‘bbb+*’) or (cat) suffix to denote the opinion status. Credit","page_number":177,"box":{"x":443,"y":158,"width":418,"height":11}},{"id":"b760bba3-36b2-4bad-8a3d-585a59cea513","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":177,"box":{"x":69,"y":173,"width":780,"height":11}},{"id":"9fad82cc-368f-4e1b-b92a-698fe467ac3e","block_type":"box","text":"sufficiently available. Rating assessment services are a notch-specific view using the primary rating scale of how an","page_number":177,"box":{"x":69,"y":188,"width":827,"height":12}},{"id":"45c3e4d5-f30b-4f96-9026-3a7f6dfd6c2b","block_type":"box","text":"existing or potential rating may be changed by a given set of hypothetical circumstances. While credit opinions and","page_number":177,"box":{"x":69,"y":203,"width":816,"height":12}},{"id":"46c7b04d-885b-45ce-b5da-4e863e0a71d2","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":177,"box":{"x":69,"y":219,"width":808,"height":11}},{"id":"ac3f9740-88a9-4997-8c49-0e01111d4b55","block_type":"box","text":"assigned, which can signify the trajectory of the credit profile.","page_number":177,"box":{"x":69,"y":234,"width":437,"height":11}},{"id":"d35c0928-5852-4406-b33f-eda31486d417","block_type":"box","text":"Description of Fitch’s Long-Term Corporate Finance Obligations Rating Scales","page_number":177,"box":{"x":69,"y":264,"width":567,"height":11}},{"id":"6cf5a958-66a5-431d-bc31-62c5df43932f","block_type":"box","text":"Ratings of individual securities or financial obligations of a corporate issuer address relative vulnerability to","page_number":177,"box":{"x":102,"y":286,"width":763,"height":12}},{"id":"8ee707dd-a23c-4213-a64d-0ffbba3fe157","block_type":"box","text":"default on an ordinal scale. In addition, for financial obligations in corporate finance, a measure of recovery given","page_number":177,"box":{"x":69,"y":302,"width":807,"height":11}},{"id":"57a98ac9-396d-4c9f-96e6-da4162e74777","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":177,"box":{"x":69,"y":317,"width":840,"height":11}},{"id":"c2dbb5f7-f940-4bee-88e8-3790da8899a9","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":177,"box":{"x":70,"y":332,"width":833,"height":11}},{"id":"e785549d-5499-43ea-989a-0e4498907652","block_type":"box","text":"On the contrary, Ratings of debtor-in-possession (“DIP”) obligations incorporate the expectation of full repayment.","page_number":177,"box":{"x":69,"y":347,"width":807,"height":11}},{"id":"c5ce09b1-5c43-4972-81ee-a4ad303a0d27","block_type":"box","text":"The relationship between the issuer scale and obligation scale assumes a generic historical average recovery.","page_number":177,"box":{"x":101,"y":370,"width":784,"height":11}},{"id":"2dc77576-741c-46e8-bfc2-5dff1172a0d7","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":177,"box":{"x":70,"y":385,"width":787,"height":11}},{"id":"f94fdd7f-ca6d-442f-bc0c-d80d10df3c44","block_type":"box","text":"default rating (“IDR”), based on their relative ranking, relative vulnerability to default or based on explicit Recovery","page_number":177,"box":{"x":69,"y":400,"width":813,"height":11}},{"id":"8776c0bb-4bd9-41e0-90a3-de466e0b4ca7","block_type":"box","text":"Ratings.","page_number":177,"box":{"x":70,"y":415,"width":55,"height":11}},{"id":"2aabbcff-8c00-4d27-96d5-d34a82dd78b7","block_type":"box","text":"As a result, individual obligations of entities, such as corporations, are assigned ratings higher, lower, or the","page_number":177,"box":{"x":101,"y":438,"width":772,"height":11}},{"id":"8ce5d442-4bb3-4160-a0ae-032fe2563fb2","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":177,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"57ed97b9-a95e-4ade-a18e-52f15d9254a8","block_type":"box","text":"end of the ratings scale, Fitch publishes explicit Recovery Ratings in many cases to complement issuer and","page_number":177,"box":{"x":69,"y":468,"width":766,"height":11}},{"id":"9f4e7b9d-2eec-469b-85f1-d9813e0d187a","block_type":"box","text":"obligation ratings.","page_number":177,"box":{"x":69,"y":483,"width":125,"height":11}},{"id":"86a9d95d-8bf6-4f58-a385-e90fb5c04d63","block_type":"box","text":"Fitch long-term obligations rating scales are as follows:","page_number":177,"box":{"x":102,"y":506,"width":390,"height":11}},{"id":"076570e0-cf32-4617-a182-e41b5b7c25b1","block_type":"box","text":"AAA Highest Credit Quality. ‘AAA’ ratings denote the lowest expectation of default risk. They are","page_number":177,"box":{"x":68,"y":533,"width":774,"height":12}},{"id":"c4a18a80-5c6b-4503-b88d-ab380ae4b7bb","block_type":"box","text":"assigned only in cases of exceptionally strong capacity for payment of financial commitments. This","page_number":177,"box":{"x":196,"y":549,"width":703,"height":11}},{"id":"763e96e5-ef39-4085-ad48-a35c6e97f1b8","block_type":"box","text":"capacity is highly unlikely to be adversely affected by foreseeable events.","page_number":177,"box":{"x":196,"y":564,"width":521,"height":11}},{"id":"f592e1dd-75a6-4444-ae22-e33e40a63b50","block_type":"box","text":"AA Very High Credit Quality. ‘AA’ ratings denote expectations of very low default risk. They indicate very","page_number":177,"box":{"x":68,"y":584,"width":838,"height":11}},{"id":"96b77a2a-3ba2-460e-93cb-cf1bc428ad05","block_type":"box","text":"strong capacity for payment of financial commitments. This capacity is not significantly vulnerable","page_number":177,"box":{"x":196,"y":599,"width":694,"height":11}},{"id":"f4957280-9d54-4dfe-a5d3-32a440852e90","block_type":"box","text":"to foreseeable events.","page_number":177,"box":{"x":195,"y":614,"width":159,"height":9}},{"id":"bd0d66d6-229c-49c3-807e-7fc311dce6c5","block_type":"box","text":"A High Credit Quality. ‘A’ ratings denote expectations of low default risk. The capacity for payment of","page_number":177,"box":{"x":68,"y":634,"width":828,"height":12}},{"id":"0c97e5a2-55ed-445e-80b1-5aa8d66bb95b","block_type":"box","text":"financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable","page_number":177,"box":{"x":196,"y":649,"width":695,"height":12}},{"id":"703b2754-a2ee-4dd6-99e4-e1b83b2234ff","block_type":"box","text":"to adverse business or economic conditions than is the case for higher ratings.","page_number":177,"box":{"x":195,"y":664,"width":565,"height":12}},{"id":"7c79a7b9-197f-4d98-9922-8297d1a52d16","block_type":"box","text":"BBB Good Credit Quality. ‘BBB’ ratings indicate that expectations of default risk are currently low. The","page_number":177,"box":{"x":70,"y":685,"width":814,"height":11}},{"id":"cfcfaa9a-2bbe-40c4-8de2-6a77b5b2f1d0","block_type":"box","text":"capacity for payment of financial commitments is considered adequate, but adverse business or","page_number":177,"box":{"x":196,"y":700,"width":686,"height":11}},{"id":"5e3382b2-8e16-4df2-aee3-e069de3751fa","block_type":"box","text":"economic conditions are more likely to impair this capacity.","page_number":177,"box":{"x":196,"y":715,"width":420,"height":11}},{"id":"73333927-84c5-45ee-9179-b124018a0c64","block_type":"box","text":"BB Speculative. ‘BB’ ratings indicate an elevated vulnerability to default risk, particularly in the event of","page_number":177,"box":{"x":70,"y":735,"width":839,"height":11}},{"id":"b4d4913a-5342-48d9-8ee0-8559d3a3ff4c","block_type":"box","text":"adverse changes in business or economic conditions over time; however, business or financial","page_number":177,"box":{"x":196,"y":750,"width":672,"height":11}},{"id":"38cf4068-e06d-4a18-9d95-8a46c0e56960","block_type":"box","text":"flexibility exists that supports the servicing of financial commitments.","page_number":177,"box":{"x":196,"y":765,"width":495,"height":12}},{"id":"6d0a202a-61b9-4484-96ae-d631c3fd66ee","block_type":"box","text":"B Highly Speculative. ‘B’ ratings indicate that material default risk is present, but a limited margin of","page_number":177,"box":{"x":70,"y":785,"width":828,"height":12}},{"id":"d0c2136a-23f1-4268-b766-1230f2bcabfb","block_type":"box","text":"safety remains. Financial commitments are currently being met; however, capacity for continued","page_number":177,"box":{"x":196,"y":801,"width":682,"height":11}},{"id":"94a9727e-405f-4315-9856-6f6cdbb9c9e1","block_type":"box","text":"payment is vulnerable to deterioration in the business and economic environment.","page_number":177,"box":{"x":197,"y":816,"width":584,"height":11}},{"id":"d31934b8-0097-4029-a275-9e7a66fa4a11","block_type":"box","text":"CCC Substantial Credit Risk. ‘CCC’ ratings indicate very low margin for safety. Default is a real","page_number":177,"box":{"x":69,"y":836,"width":764,"height":11}},{"id":"f2ea1987-715f-45db-bd70-5a3d2e6b2123","block_type":"box","text":"possibility.","page_number":177,"box":{"x":197,"y":851,"width":72,"height":11}},{"id":"1c97f44a-20b4-43c9-967c-ffc455fd9ab5","block_type":"box","text":"CC Very High Levels of Credit Risk. ‘CC’ ratings indicate default of some kind appears probable.","page_number":177,"box":{"x":69,"y":871,"width":784,"height":11}},{"id":"cf5ee554-c6fc-4939-88ea-233a78834945","block_type":"box","text":"C Exceptionally High Levels of Credit Risk. ‘C’ ratings indicate default or default-like process has","page_number":177,"box":{"x":69,"y":891,"width":798,"height":12}},{"id":"00b2fbae-1c87-4a6f-9e70-a83294376a38","block_type":"box","text":"begun, or for a closed funding vehicle, payment capacity is irrevocably impaired.","page_number":177,"box":{"x":196,"y":906,"width":569,"height":12}},{"id":"e21066ae-ba8e-4182-8ff3-ebc481022332","block_type":"box","text":"A-7","page_number":177,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"5eb9127d-657a-4b40-9e20-b1f89c37f740","block_type":"box","text":"NM1026U-5979889-177/232","page_number":177,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"dbba58b1-c6af-46bb-809c-e34adc6f12e6","block_type":"box","text":"RD Restricted Default. ‘RD’ ratings indicate an issuer that in Fitch’s opinion has experienced an","page_number":178,"box":{"x":70,"y":48,"width":782,"height":12}},{"id":"d8525533-e5bf-4425-a8dd-4454bc2ca4a5","block_type":"box","text":"uncured payment default or distressed debt exchange on a bond, loan or other material financial","page_number":178,"box":{"x":197,"y":63,"width":686,"height":12}},{"id":"70e489de-8173-401c-acc5-684bebebf2b1","block_type":"box","text":"obligation, but has not entered into bankruptcy filings, administration, receivership, liquidation, or","page_number":178,"box":{"x":196,"y":79,"width":696,"height":11}},{"id":"f6fbd75c-126b-4e9a-9f21-6190d6d94f89","block_type":"box","text":"other formal winding-up procedure, and has not otherwise ceased operating.","page_number":178,"box":{"x":196,"y":94,"width":544,"height":11}},{"id":"7ab22100-3f6d-4b01-84f3-349818aa1b95","block_type":"box","text":"D Default. ‘D’ ratings indicate an issuer that in Fitch’s opinion has entered into bankruptcy filings,","page_number":178,"box":{"x":70,"y":114,"width":807,"height":11}},{"id":"33fd892a-7a11-4a53-9253-6982f2873eea","block_type":"box","text":"administration, receivership, liquidation or other formal winding-up procedure or that has otherwise","page_number":178,"box":{"x":196,"y":129,"width":705,"height":11}},{"id":"e56e21cc-8880-45b4-a585-52c946ae54f0","block_type":"box","text":"ceased business and debt is still outstanding.","page_number":178,"box":{"x":196,"y":144,"width":328,"height":11}},{"id":"023986fc-5403-40df-b153-a4f75cc9834d","block_type":"box","text":"Within rating categories, Fitch may use modifiers. The modifiers “+” or “-” may be appended to a rating to denote","page_number":178,"box":{"x":101,"y":164,"width":808,"height":12}},{"id":"5f5a2605-5844-4a4f-84d2-0cd59e9a2fc0","block_type":"box","text":"relative status within major rating categories.","page_number":178,"box":{"x":69,"y":180,"width":320,"height":11}},{"id":"c2a37a1a-fc25-4471-b167-74ef1efbf59d","block_type":"box","text":"For example, the rating category ‘AA’ has three notch-specific rating levels (‘AA+’; ‘AA’; ‘AA–’; each a rating","page_number":178,"box":{"x":102,"y":202,"width":761,"height":11}},{"id":"5355fe70-4997-456c-80be-d391f68caf89","block_type":"box","text":"level). Such suffixes are not added to ‘AAA’ ratings and ratings below the ‘CCC’ category. For the short-term rating","page_number":178,"box":{"x":70,"y":217,"width":813,"height":12}},{"id":"a2bf8d99-714d-4a24-b48f-d7f4d6bbe6be","block_type":"box","text":"category of ‘F1’, a ‘+’ may be appended.","page_number":178,"box":{"x":69,"y":232,"width":289,"height":12}},{"id":"cc613f4b-20eb-4d53-baea-77d0da4e6020","block_type":"box","text":"Description of Fitch’s Short-Term Ratings Assigned to Issuers and Obligations","page_number":178,"box":{"x":69,"y":263,"width":568,"height":11}},{"id":"c2c87568-4386-479f-b64f-2c60ba60612d","block_type":"box","text":"A short-term issuer or obligation rating is based in all cases on the short-term vulnerability to default of the rated","page_number":178,"box":{"x":101,"y":285,"width":806,"height":12}},{"id":"e31c77b4-dccf-4b36-be59-66c496adf55b","block_type":"box","text":"entity and relates to the capacity to meet financial obligations in accordance with the documentation governing the","page_number":178,"box":{"x":69,"y":300,"width":817,"height":12}},{"id":"02fb38c5-7131-46a3-b94d-005e1ba3972c","block_type":"box","text":"relevant obligation. Short-term deposit ratings may be adjusted for loss severity. Short-term ratings are assigned to","page_number":178,"box":{"x":69,"y":315,"width":822,"height":12}},{"id":"a98819ad-84f3-44be-be9c-bf598570c9ca","block_type":"box","text":"obligations whose initial maturity is viewed as “short term” based on market convention. Typically, this means up to","page_number":178,"box":{"x":69,"y":331,"width":827,"height":11}},{"id":"57581a3d-2a14-444d-a870-560038e69913","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":178,"box":{"x":70,"y":346,"width":808,"height":11}},{"id":"d964de9b-69b8-4aad-b5be-1557fcf72fbe","block_type":"box","text":"finance markets.","page_number":178,"box":{"x":68,"y":361,"width":118,"height":9}},{"id":"79572344-79b5-407f-ad2d-340a562d16d4","block_type":"box","text":"Fitch short-term ratings are as follows:","page_number":178,"box":{"x":102,"y":383,"width":273,"height":12}},{"id":"508ab580-3916-4c04-9f5f-3632a6c394f0","block_type":"box","text":"F1 Highest Short-Term Credit Quality. Indicates the strongest intrinsic capacity for timely payment of","page_number":178,"box":{"x":70,"y":411,"width":816,"height":12}},{"id":"eb859927-4b52-40f0-8951-19b8444ecd6c","block_type":"box","text":"financial commitments; may have an added “+” to denote any exceptionally strong credit feature.","page_number":178,"box":{"x":196,"y":426,"width":692,"height":12}},{"id":"b1eb9e47-964e-46b0-972c-6cfcb43f4408","block_type":"box","text":"F2 Good Short-Term Credit Quality. Good intrinsic capacity for timely payment of financial","page_number":178,"box":{"x":70,"y":446,"width":734,"height":12}},{"id":"6a93859a-549b-4ca3-8e70-707d7bc78d0c","block_type":"box","text":"commitments.","page_number":178,"box":{"x":196,"y":462,"width":100,"height":9}},{"id":"6e44175a-8fc7-49c6-8df5-357a4d3d4ab9","block_type":"box","text":"F3 Fair Short-Term Credit Quality. The intrinsic capacity for timely payment of financial commitments is","page_number":178,"box":{"x":70,"y":482,"width":831,"height":11}},{"id":"7d734a6b-d1c9-4791-99bc-876cd8bff4ea","block_type":"box","text":"adequate.","page_number":178,"box":{"x":196,"y":497,"width":70,"height":11}},{"id":"d10c106a-b718-4ae6-811a-1f7f4515bfb4","block_type":"box","text":"B Speculative Short-Term Credit Quality. 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to the","page_number":179,"box":{"x":101,"y":408,"width":763,"height":11}},{"id":"f05cb2d6-c9d0-458d-a4df-83360eecf465","block_type":"box","text":"principles outlined in this Policy, as part of BlackRock’s authority to manage, acquire and dispose of account","page_number":179,"box":{"x":102,"y":423,"width":775,"height":12}},{"id":"c6ed3eb6-9cb0-4fbb-b390-8b40d569de89","block_type":"box","text":"assets, all as contemplated by the Funds’ respective investment management agreements.","page_number":179,"box":{"x":102,"y":439,"width":651,"height":11}},{"id":"a14788cf-c7b8-48e5-bb5b-12dd7747fbd0","block_type":"box","text":"BlackRock has adopted the BlackRock Active Investment Stewardship Global Engagement and Voting","page_number":179,"box":{"x":135,"y":461,"width":718,"height":11}},{"id":"3134fcbe-edab-44cd-bdfd-70a3c6d91a7b","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":179,"box":{"x":102,"y":491,"width":766,"height":12}},{"id":"39b64d1c-60e2-4654-a67b-e66b8884b30c","block_type":"box","text":"apply to the Funds listed in Appendix A, if any.","page_number":179,"box":{"x":102,"y":506,"width":325,"height":12}},{"id":"16fd4766-53e2-4481-b5d5-da17a07ef809","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":179,"box":{"x":135,"y":529,"width":751,"height":11}},{"id":"92ca2daf-d32b-4063-b563-8dd030c9be5f","block_type":"box","text":"respect of securities held by each such Fund (or may refrain from voting) in accordance with the Guidelines.","page_number":179,"box":{"x":102,"y":544,"width":765,"height":11}},{"id":"d9e9762e-ebc5-4fac-858b-f93a1fc94a9e","block_type":"box","text":"Conflicts Management","page_number":179,"box":{"x":101,"y":567,"width":165,"height":11}},{"id":"2dfcda32-1468-4efb-823b-cf9dc1864db3","block_type":"box","text":"BlackRock Active Investment Stewardship (“BAIS”) maintains policies and procedures that seek to prevent","page_number":179,"box":{"x":135,"y":590,"width":758,"height":11}},{"id":"a8735784-648b-4540-a38e-3922879a40d0","block_type":"box","text":"undue influence on BlackRock’s proxy voting activity and to mitigate material conflicts of interest in the exercise","page_number":179,"box":{"x":102,"y":605,"width":797,"height":11}},{"id":"70a47851-2e67-48aa-b5eb-a129425d4bb5","block_type":"box","text":"of proxy voting responsibilities. Potential material conflicts, and the resultant potential for undue influence, might","page_number":179,"box":{"x":102,"y":620,"width":805,"height":11}},{"id":"9dd33e36-44c7-492d-941f-6ead5115261a","block_type":"box","text":"be due to a relationship between the investee company (or any shareholder proponent or dissident shareholder)","page_number":179,"box":{"x":102,"y":635,"width":797,"height":11}},{"id":"e0cf2dd4-76c4-44ed-bf1a-25a1b54510b6","block_type":"box","text":"and BlackRock, BlackRock’s affiliates or employees, or a Fund or a Fund’s affiliates. BlackRock has taken","page_number":179,"box":{"x":102,"y":650,"width":756,"height":11}},{"id":"c5d68a4b-f259-49b4-a580-15d326d7a4b4","block_type":"box","text":"certain steps to mitigate potential conflicts, which are outlined in detail in the Guidelines. In mitigating conflicts,","page_number":179,"box":{"x":101,"y":665,"width":800,"height":11}},{"id":"986ba137-f067-4e23-8362-4769263efc87","block_type":"box","text":"BAIS will adhere to the Guidelines.","page_number":179,"box":{"x":102,"y":680,"width":244,"height":9}},{"id":"a20067dc-ffc5-473b-8f7e-d32523b0b4eb","block_type":"box","text":"In certain instances, BAIS will engage an independent third-party voting service provider to make proxy","page_number":179,"box":{"x":135,"y":703,"width":731,"height":11}},{"id":"37d5e5cb-4eb6-4ec2-980e-8d2e2f0920ec","block_type":"box","text":"voting recommendations as a further safeguard to avoid potential conflicts of interest, to satisfy regulatory","page_number":179,"box":{"x":101,"y":718,"width":763,"height":11}},{"id":"ec6f811c-7e38-48bd-b75a-ac0ab5a8039c","block_type":"box","text":"compliance requirements, or as may be otherwise required by applicable law.","page_number":179,"box":{"x":101,"y":733,"width":550,"height":11}},{"id":"aabe6982-0fd3-44ff-948f-d6c29af2e044","block_type":"box","text":"With respect to the relationship between securities lending and proxy voting, shares on loan cannot be voted","page_number":179,"box":{"x":134,"y":756,"width":774,"height":11}},{"id":"e23e74fa-0997-4538-ae2b-1a158fcb5fae","block_type":"box","text":"and BlackRock may determine to recall them for voting, as guided by BlackRock’s fiduciary responsibility to act","page_number":179,"box":{"x":102,"y":771,"width":791,"height":11}},{"id":"3f96b0bf-2877-4e8b-ae33-667a98e831f6","block_type":"box","text":"in clients’ financial interests. The Guidelines set forth BlackRock’s approach to recalling securities on loan in","page_number":179,"box":{"x":102,"y":786,"width":778,"height":11}},{"id":"a1f99321-95c6-47fe-a6ff-f0739969959d","block_type":"box","text":"connection with proxy voting.","page_number":179,"box":{"x":101,"y":801,"width":203,"height":11}},{"id":"03725df4-08a2-4e53-bf97-95925415b0e0","block_type":"box","text":"Reports to the Board","page_number":179,"box":{"x":102,"y":824,"width":153,"height":11}},{"id":"ad2c8aa2-d673-4b72-b825-de1ca0b5cdd2","block_type":"box","text":"BlackRock will report on an annual basis to the Directors on (1) a summary of the proxy voting process as","page_number":179,"box":{"x":135,"y":846,"width":755,"height":12}},{"id":"366c4bd2-a144-4f56-847c-1006e3a8e1c7","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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The guidance informs the voting recommendations BAIS","page_number":183,"box":{"x":69,"y":143,"width":803,"height":11}},{"id":"f7f55dce-f897-4953-bd05-662e0744d4c6","block_type":"box","text":"makes to BlackRock’s active portfolio managers. It applies to active equity holdings in BlackRock’s fundamental","page_number":183,"box":{"x":69,"y":158,"width":800,"height":11}},{"id":"df7c8b06-d5be-4584-8b17-f3f1a171caeb","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":183,"box":{"x":69,"y":173,"width":831,"height":11}},{"id":"3a3d121f-426d-4dc8-ad5e-f946d3287a7a","block_type":"box","text":"active fixed income strategies, to the extent those strategies hold voting securities or conduct issuer engagements.","page_number":183,"box":{"x":69,"y":188,"width":823,"height":12}},{"id":"47a39416-bbf8-4f7d-96a6-ada08fc6b529","block_type":"box","text":"The guidelines are not prescriptive as active portfolio managers have discretion as to how they integrate these","page_number":183,"box":{"x":68,"y":203,"width":789,"height":12}},{"id":"4a94040a-2afc-4199-abf9-b72d477ddc45","block_type":"box","text":"guidelines within their investment processes in light of their clients’ or funds’ investment objectives. 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The benchmark policy also may apply to","page_number":183,"box":{"x":68,"y":308,"width":823,"height":11}},{"id":"0988c22a-98e6-45aa-bea0-9a75582db9d3","block_type":"box","text":"holdings in BlackRock’s index and active fixed income strategies, to the extent those strategies hold voting securities","page_number":183,"box":{"x":69,"y":323,"width":837,"height":12}},{"id":"f726d4d9-e735-42a3-ab3a-69f4495c4982","block_type":"box","text":"or conduct issuer engagements. This document also includes BAIS’ decarbonization policy, which covers holdings in","page_number":183,"box":{"x":69,"y":339,"width":824,"height":11}},{"id":"643dc51e-3692-40a9-9ec7-54899bff2636","block_type":"box","text":"BlackRock active funds that have climate and decarbonization objectives in addition to financial objectives.","page_number":183,"box":{"x":70,"y":354,"width":759,"height":11}},{"id":"6ed20222-30b8-4461-b672-3535ebf11157","block_type":"box","text":"2","page_number":183,"box":{"x":69,"y":372,"width":4,"height":4}},{"id":"b7f8690d-7f36-4fe3-bc46-90c09f11eea0","block_type":"box","text":"BlackRock segmented active and index equity investment functions, including stewardship, in January 2025 as part","page_number":183,"box":{"x":79,"y":371,"width":825,"height":11}},{"id":"54c0750b-138f-4603-a45f-1534527ceb1b","block_type":"box","text":"of a strategic initiative to unlock the full breadth of the firm’s active and private markets capabilities for clients. 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The money BlackRock manages is not its own — it","page_number":184,"box":{"x":102,"y":64,"width":777,"height":11}},{"id":"b08ed639-b2c8-4d76-8323-f469d2c904fc","block_type":"box","text":"belongs to BlackRock’s clients, many of whom make their own asset allocation and portfolio construction decisions.","page_number":184,"box":{"x":69,"y":78,"width":828,"height":12}},{"id":"ccd37a38-4799-4e88-a534-f55161848ae5","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":184,"box":{"x":68,"y":93,"width":835,"height":11}},{"id":"6659a80a-8380-43a9-b30f-40be2c0ff327","block_type":"box","text":"by understanding clients’ long-term investment objectives and offering choice on how and where they wish to invest","page_number":184,"box":{"x":69,"y":108,"width":823,"height":11}},{"id":"d097313e-8eaa-4cae-8a14-d0e1a6f54e7b","block_type":"box","text":"their money. BlackRock then helps clients seek the best risk-adjusted returns based on those choices, underpinning","page_number":184,"box":{"x":68,"y":123,"width":830,"height":11}},{"id":"7b590c35-16fa-4c88-b232-9f5046db2176","block_type":"box","text":"this work with research, data and analytics.","page_number":184,"box":{"x":68,"y":138,"width":309,"height":11}},{"id":"1562ca48-6b7f-4c7e-b0c5-770ea87b1544","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":184,"box":{"x":101,"y":156,"width":796,"height":12}},{"id":"42cdac31-c27f-41ed-a86e-eb2d6be1b5fc","block_type":"box","text":"stewards of our clients’ assets, we engage with companies to discuss the corporate governance and business","page_number":184,"box":{"x":69,"y":171,"width":787,"height":12}},{"id":"5b21440c-f582-472e-a63c-0b7a8a81eeb6","block_type":"box","text":"practices that, in our experience, support companies in delivering durable, risk-adjusted financial returns over time.","page_number":184,"box":{"x":70,"y":186,"width":820,"height":12}},{"id":"928b55ed-6bfb-43be-9295-ed774421be50","block_type":"box","text":"We are committed to building strong relationships through constructive, ongoing dialogue with the boards and","page_number":184,"box":{"x":68,"y":201,"width":782,"height":11}},{"id":"e30e7f42-89e7-4795-b4ed-9a4bb40e5a09","block_type":"box","text":"executive management of the companies in which our clients are invested.","page_number":184,"box":{"x":69,"y":216,"width":531,"height":11}},{"id":"43645850-ce36-4d40-ae6f-12953abe01bb","block_type":"box","text":"ABOUT BLACKROCK ACTIVE INVESTMENT STEWARDSHIP","page_number":184,"box":{"x":277,"y":246,"width":424,"height":9}},{"id":"409315d5-63eb-44de-b1ce-4af7582bf850","block_type":"box","text":"BlackRock Active Investment Stewardship (BAIS) is a specialist team within the Portfolio Management Group and","page_number":184,"box":{"x":102,"y":265,"width":804,"height":11}},{"id":"9bec7bfd-7f2b-4220-8aaf-5de04c0cbe1d","block_type":"box","text":"manages BlackRock’s stewardship engagement and voting on behalf of clients invested in active strategies globally.","page_number":184,"box":{"x":69,"y":280,"width":826,"height":11}},{"id":"b6b66139-a3a6-4023-8ed1-ae6806766825","block_type":"box","text":"BAIS is also responsible for engagement with issuers in index fixed income strategies, where appropriate. Our","page_number":184,"box":{"x":70,"y":295,"width":783,"height":11}},{"id":"2ffcbf9c-8e35-4539-896f-889cf5a91f2a","block_type":"box","text":"activities are informed by these Global Engagement and Voting Guidelines (the “Guidelines”) and insights from active","page_number":184,"box":{"x":69,"y":309,"width":834,"height":12}},{"id":"bf35f5c1-7dbb-462e-8817-6457ae507c0d","block_type":"box","text":"investment analysts and portfolio managers, with whom we work closely in engaging companies and voting at","page_number":184,"box":{"x":70,"y":324,"width":779,"height":12}},{"id":"eb514300-2a4b-4b23-b57f-01047331e9ec","block_type":"box","text":"shareholder meetings.","page_number":184,"box":{"x":69,"y":339,"width":158,"height":11}},{"id":"f8821fb7-e03d-494e-b381-9a3f7c7733cb","block_type":"box","text":"Engagement with public companies is the foundation of our approach to stewardship within fundamental active","page_number":184,"box":{"x":102,"y":358,"width":789,"height":11}},{"id":"7967f229-b43e-4388-b604-3a1e1a4bbeb9","block_type":"box","text":"investing.","page_number":184,"box":{"x":70,"y":373,"width":65,"height":11}},{"id":"0d41f596-d6ec-4219-bcaf-9498b8f44369","block_type":"box","text":"3","page_number":184,"box":{"x":137,"y":373,"width":4,"height":5}},{"id":"bd663bf0-e2a3-4ff9-8ad7-cf9a2fb7420c","block_type":"box","text":"Through direct dialogue with company leadership, we seek to understand their businesses and how they","page_number":184,"box":{"x":146,"y":373,"width":744,"height":11}},{"id":"4d670662-8349-42a5-8baf-b7cc0d938630","block_type":"box","text":"manage risks and opportunities to deliver durable, risk-adjusted financial returns. Portfolio managers and","page_number":184,"box":{"x":69,"y":387,"width":751,"height":12}},{"id":"b0cca8b7-1fe8-4e84-9ab6-fe4540430e46","block_type":"box","text":"stewardship specialists may engage jointly or independently on material corporate governance matters. Our","page_number":184,"box":{"x":69,"y":402,"width":765,"height":12}},{"id":"3372f04c-320d-4a54-a3a1-e7a895149db3","block_type":"box","text":"discussions focus on topics relevant to a company’s success over time, including governance and leadership,","page_number":184,"box":{"x":69,"y":417,"width":782,"height":12}},{"id":"375a4237-b779-4ddf-ae8a-0201abce7ca7","block_type":"box","text":"corporate strategy, capital structure and financial performance, operations and material sustainability-related risks,","page_number":184,"box":{"x":69,"y":432,"width":820,"height":11}},{"id":"06cd5b51-4d77-40e9-9fa6-35b71bb2abcb","block_type":"box","text":"as well as macro-economic, geopolitical and sector dynamics. We aim to be constructive investors and are generally","page_number":184,"box":{"x":69,"y":447,"width":828,"height":11}},{"id":"10bffb5e-ec6d-4996-9662-7ddb5bc06482","block_type":"box","text":"supportive of management teams that have a track record of financial value creation. We aim to build and maintain","page_number":184,"box":{"x":69,"y":462,"width":821,"height":11}},{"id":"fb275682-82bb-4a6a-be97-f5ffb4d5b324","block_type":"box","text":"strong relationships with company leadership based on open dialogue and mutual respect.","page_number":184,"box":{"x":69,"y":477,"width":645,"height":11}},{"id":"fe3562ab-fc5a-48c5-81cf-fefe6a5c2dad","block_type":"box","text":"Different active equity strategies may implement these voting guidelines differently, as a result of the latitude","page_number":184,"box":{"x":102,"y":495,"width":780,"height":12}},{"id":"bf8273f4-e848-4189-9dec-deda87c43593","block_type":"box","text":"each portfolio manager has to make independent voting decisions on their holdings. For example, BAIS will generally","page_number":184,"box":{"x":69,"y":510,"width":831,"height":11}},{"id":"301c83f2-0160-4fe2-8816-fc720d8bf2b4","block_type":"box","text":"vote the holdings in Systematic Active Equity portfolios in accordance with these guidelines. We provide voting","page_number":184,"box":{"x":68,"y":525,"width":787,"height":11}},{"id":"579d9d92-04a6-455a-8106-39be3f0a577c","block_type":"box","text":"recommendations to fundamental equity portfolio managers, who may determine to vote differently based on each","page_number":184,"box":{"x":69,"y":540,"width":816,"height":11}},{"id":"572e8844-abca-4b54-ac5a-bd070b3e01a6","block_type":"box","text":"portfolio’s investment objectives and strategy.","page_number":184,"box":{"x":70,"y":555,"width":327,"height":11}},{"id":"816599fe-1767-4b94-adad-48cf41b4fa04","block_type":"box","text":"These guidelines discuss BAIS’ views on corporate governance topics on which we may engage with","page_number":184,"box":{"x":101,"y":574,"width":711,"height":11}},{"id":"d6ec0b2a-f121-48b3-b6a0-2d3f8bb2e962","block_type":"box","text":"management teams and board directors","page_number":184,"box":{"x":69,"y":589,"width":285,"height":11}},{"id":"1a20fbff-b573-4843-987a-3aac8ff9ac1c","block_type":"box","text":"4","page_number":184,"box":{"x":355,"y":589,"width":5,"height":4}},{"id":"a8701989-c807-4cff-97a7-612a7627914e","block_type":"box","text":"and on matters that routinely come to a shareholder vote. We recognize that","page_number":184,"box":{"x":366,"y":589,"width":544,"height":11}},{"id":"b218df44-2a1b-4fdb-935d-86334f9c7322","block_type":"box","text":"accepted corporate governance norms can differ across markets, and believe these guidelines represent globally","page_number":184,"box":{"x":69,"y":603,"width":807,"height":11}},{"id":"114bfb06-6dd1-4906-a516-0be5c9367b7c","block_type":"box","text":"applicable elements of governance that support a company’s ability to manage material risks and opportunities and","page_number":184,"box":{"x":69,"y":618,"width":827,"height":11}},{"id":"86043d27-174c-458b-b1bd-bc00991b254b","block_type":"box","text":"deliver financial returns to investors. Generally, we believe companies should observe accepted corporate governance","page_number":184,"box":{"x":69,"y":633,"width":840,"height":11}},{"id":"d9c6c09c-42ad-4f29-baf7-f4b2571f8973","block_type":"box","text":"norms within their local markets or, particularly in markets without well-established norms, aspire to widely","page_number":184,"box":{"x":69,"y":648,"width":762,"height":11}},{"id":"ca9a8018-c628-46e5-a390-31064cd6b625","block_type":"box","text":"recognized international best practices. As one of many minority shareholders, BlackRock cannot – and does not try","page_number":184,"box":{"x":69,"y":663,"width":827,"height":11}},{"id":"9e608cfb-0c23-409b-b21b-cb3828d5b9ef","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":184,"box":{"x":68,"y":678,"width":837,"height":11}},{"id":"99df60cd-c73f-4194-8c38-bba548b45863","block_type":"box","text":"their approach to corporate governance best aligns with the financial interests of their investors.","page_number":184,"box":{"x":68,"y":692,"width":687,"height":12}},{"id":"8d876374-9f43-4d5f-9c9f-d3385c5facdb","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN ACTIVE EQUITIES","page_number":184,"box":{"x":263,"y":722,"width":451,"height":11}},{"id":"487d0ff3-3d6f-47f1-9d38-28a2a6d06ddb","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":184,"box":{"x":101,"y":741,"width":753,"height":12}},{"id":"b8e72ad2-52b7-4e42-8c2c-0bb2b4fa5783","block_type":"box","text":"governance. The voting rights attached to clients’ holdings are an important mechanism for investors to express","page_number":184,"box":{"x":68,"y":756,"width":801,"height":11}},{"id":"342ff4e4-74d6-4c49-accb-26667b065143","block_type":"box","text":"support for, or concern about, a company’s performance. As a fiduciary, BlackRock is legally required to make proxy","page_number":184,"box":{"x":69,"y":771,"width":829,"height":11}},{"id":"1ec2765a-8b96-4fdf-9754-9bfc121dceea","block_type":"box","text":"voting determinations, on behalf of clients who have delegated voting authority to us, in a manner consistent with","page_number":184,"box":{"x":68,"y":786,"width":809,"height":11}},{"id":"a869f8ba-bd1f-4b7f-b6a3-a1e0be90985e","block_type":"box","text":"BlackRock’s contractual arrangements with clients and funds.","page_number":184,"box":{"x":70,"y":801,"width":438,"height":11}},{"id":"e70c4c6a-9dd4-4a7d-a209-ba8b363c653f","block_type":"box","text":"3","page_number":184,"box":{"x":69,"y":830,"width":4,"height":5}},{"id":"02846ffd-9c66-4e9a-92fd-aaddd8bf5387","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":184,"box":{"x":79,"y":830,"width":790,"height":11}},{"id":"4669fb67-0cc0-4b0b-8787-517a292bb83f","block_type":"box","text":"shareholders to maintain their eligibility to report their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":184,"box":{"x":69,"y":845,"width":836,"height":11}},{"id":"4cfd067e-e939-496e-b955-041030554a33","block_type":"box","text":"We comply fully with these requirements and do not engage with portfolio companies for the purpose, or with the","page_number":184,"box":{"x":68,"y":860,"width":805,"height":11}},{"id":"b6d03a71-04c3-4cee-9663-872806f1a673","block_type":"box","text":"effect, of changing or influencing control of the company.","page_number":184,"box":{"x":69,"y":875,"width":403,"height":12}},{"id":"3eefc5d6-0822-4997-9514-7a57bfc20dad","block_type":"box","text":"4","page_number":184,"box":{"x":69,"y":893,"width":4,"height":5}},{"id":"c465f306-2f97-4bdc-878b-f35ed5b7b819","block_type":"box","text":"References to the board, board directors or non-executive directors should be understood to include supervisory","page_number":184,"box":{"x":79,"y":893,"width":801,"height":11}},{"id":"2bbb7f4e-ab20-4b3c-8beb-6b9b51c5110b","block_type":"box","text":"boards and their members, where relevant.","page_number":184,"box":{"x":69,"y":908,"width":306,"height":11}},{"id":"874eccc0-407d-42af-9404-9f532035d75d","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":184,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"23b73ceb-0c40-4b99-92cc-b3bd6555a2cc","block_type":"box","text":"Global Engagement and Voting Guidelines | 4","page_number":184,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"739d5009-5479-43f0-bf44-f37adaa900da","block_type":"box","text":"NM1026U-5979889-184/232","page_number":184,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1ba3306a-895b-4c12-8f74-4b7c1901b2be","block_type":"box","text":"In general, we tend to support the recommendations of the board of directors and management. As indicated","page_number":185,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"e1c3054a-7a2f-483e-8f14-2cf374634641","block_type":"box","text":"below, we may vote against management recommendations when we have concerns about how companies are","page_number":185,"box":{"x":69,"y":60,"width":788,"height":11}},{"id":"406c9916-815b-4051-9986-96eac646740d","block_type":"box","text":"serving the financial interests of our clients as their shareholders. BAIS takes a globally consistent approach to","page_number":185,"box":{"x":69,"y":74,"width":795,"height":12}},{"id":"b6027a1c-90a9-43fe-974d-bdced304fbec","block_type":"box","text":"voting but considers the different corporate governance regulations and norms across markets. Votes are determined","page_number":185,"box":{"x":68,"y":89,"width":839,"height":12}},{"id":"80f364fe-24bd-4aaf-93aa-c0ff4803d2f1","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":185,"box":{"x":69,"y":104,"width":823,"height":11}},{"id":"5be0d967-642d-40b1-95d6-6420803efcb2","block_type":"box","text":"Please see page 19 for more information about how we fulfill and oversee our investment stewardship","page_number":185,"box":{"x":69,"y":119,"width":729,"height":11}},{"id":"99b001ba-595c-41f6-88d2-bedf87055b46","block_type":"box","text":"responsibilities for BlackRock’s non-index equity strategies.","page_number":185,"box":{"x":69,"y":134,"width":423,"height":11}},{"id":"9194bd51-46cc-45d8-a239-2973bc7513a2","block_type":"box","text":"5","page_number":185,"box":{"x":493,"y":134,"width":5,"height":5}},{"id":"bb14df70-1fb3-4352-83cc-9d155292be99","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN FIXED INCOME","page_number":185,"box":{"x":272,"y":164,"width":434,"height":9}},{"id":"64cb2814-819a-414d-8a71-7007ede2cc0d","block_type":"box","text":"Although fixed income investors do not have the right to vote at shareholder meetings, issuer engagement is a","page_number":185,"box":{"x":101,"y":183,"width":788,"height":11}},{"id":"c579353f-cf25-44a3-ae49-03a07fb2f9e0","block_type":"box","text":"component of fixed income investment strategies at BlackRock, particularly for those with sustainability objectives in","page_number":185,"box":{"x":69,"y":198,"width":831,"height":11}},{"id":"c51b49c2-eea3-444c-8291-418933785fca","block_type":"box","text":"addition to financial objectives. Most corporate governance-related fixed income engagements are undertaken in","page_number":185,"box":{"x":69,"y":212,"width":801,"height":12}},{"id":"e1427a08-11cc-4b9c-b75b-f45e31796f03","block_type":"box","text":"conjunction with the active investment stewardship team, and often active equity investors. In addition to the topics","page_number":185,"box":{"x":69,"y":227,"width":824,"height":11}},{"id":"a0fbef1f-a472-4c2b-a00a-6dc965aec6c2","block_type":"box","text":"listed below, engagement with fixed income investment teams may help inform an issuer’s approach to structuring","page_number":185,"box":{"x":70,"y":242,"width":816,"height":11}},{"id":"7dc5fade-baf9-4568-a552-a19223e1af68","block_type":"box","text":"specialist issuances and the standard terms and information in bond documentation.","page_number":185,"box":{"x":69,"y":257,"width":608,"height":11}},{"id":"4d4eec6f-ab55-44e1-bfd5-e04491e2865e","block_type":"box","text":"5","page_number":185,"box":{"x":69,"y":302,"width":4,"height":4}},{"id":"c36031ba-5e27-49dc-b391-417151e6ab9b","block_type":"box","text":"Non-index equity strategies include active equity holdings in BlackRock’s fundamental equity, systematic equity and","page_number":185,"box":{"x":79,"y":301,"width":820,"height":11}},{"id":"7cee745a-e4c7-4189-ae1c-23abc455ee86","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":185,"box":{"x":69,"y":316,"width":822,"height":12}},{"id":"4d4845a1-4709-4fab-9901-57bc0c699e86","block_type":"box","text":"extent those strategies hold voting securities or conduct issuer engagements.","page_number":185,"box":{"x":69,"y":332,"width":554,"height":11}},{"id":"6be4665d-090d-41ec-b712-fe9f068fd7e8","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":185,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"05e4796c-6f4f-425f-943e-5e2adadfab1c","block_type":"box","text":"Global Engagement and Voting Guidelines | 5","page_number":185,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"18c96dec-ae3b-4cea-804c-975ffdd09264","block_type":"box","text":"NM1026U-5979889-185/232","page_number":185,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"10281c05-a649-4cca-b3ee-296dbcfd82ca","block_type":"box","text":"BOARDS OF DIRECTORS","page_number":186,"box":{"x":400,"y":45,"width":178,"height":9}},{"id":"d2d28998-fe7e-4486-b924-3bcbc7349a55","block_type":"box","text":"Roles and responsibilities","page_number":186,"box":{"x":69,"y":67,"width":186,"height":11}},{"id":"cd91c708-b240-4cb4-9306-faaaa668f3b7","block_type":"box","text":"There is widespread consensus that the foundation of good corporate governance is an effective board of","page_number":186,"box":{"x":101,"y":86,"width":754,"height":11}},{"id":"aad6f020-8e0d-44d7-b095-f005b3ac6588","block_type":"box","text":"directors that is able to advise and supervise management in an independent and objective manner.","page_number":186,"box":{"x":69,"y":101,"width":715,"height":11}},{"id":"a50010de-0bbb-43da-ac7d-6018c319ea1a","block_type":"box","text":"6","page_number":186,"box":{"x":786,"y":101,"width":4,"height":5}},{"id":"1244ed1f-7f94-42ca-81a6-5086f92a68e0","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":186,"box":{"x":101,"y":119,"width":765,"height":12}},{"id":"df861be8-0b48-43f4-b91e-b6d9abc53228","block_type":"box","text":"realization of a company’s strategy, purpose and culture. These constructs are interdependent and, when aligned,","page_number":186,"box":{"x":69,"y":134,"width":811,"height":12}},{"id":"9b0aa396-efd5-4f80-ac2e-fdc896cd83ef","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":186,"box":{"x":69,"y":149,"width":822,"height":11}},{"id":"374c24fe-4921-45ea-944d-c86008135432","block_type":"box","text":"of corporate or employee misconduct, and attract and retain the caliber of workers necessary to deliver financial","page_number":186,"box":{"x":69,"y":164,"width":799,"height":11}},{"id":"898cd438-0b3c-4bff-a5d3-859104942c89","block_type":"box","text":"performance over time.","page_number":186,"box":{"x":70,"y":179,"width":164,"height":11}},{"id":"0c3e21af-8177-4ea6-8139-a4414b6f25ff","block_type":"box","text":"In overseeing the management of the company, the board ensures the necessary resources, policies and","page_number":186,"box":{"x":102,"y":198,"width":750,"height":11}},{"id":"23586132-a788-4898-8106-122b43180ae7","block_type":"box","text":"procedures are in place to help management meet its strategic objectives within an agreed risk tolerance.","page_number":186,"box":{"x":70,"y":213,"width":753,"height":11}},{"id":"ced4c6aa-0b2f-479d-9af0-c0dbbad08357","block_type":"box","text":"One of the most important responsibilities of the board is to appoint, and remove as necessary, the chief","page_number":186,"box":{"x":102,"y":231,"width":753,"height":11}},{"id":"7d320d19-994b-413e-a918-d94673beab80","block_type":"box","text":"executive officer (“CEO”). In addition, the board plays a meaningful role in monitoring the performance of the CEO","page_number":186,"box":{"x":69,"y":246,"width":811,"height":11}},{"id":"0c1f8ecb-4e19-4c8c-9a6c-e402c82d2d97","block_type":"box","text":"and other key executives, determining executive compensation, ensuring a rigorous audit, overseeing strategy","page_number":186,"box":{"x":69,"y":261,"width":783,"height":11}},{"id":"eccfbeae-fd61-410c-8166-04287b91718b","block_type":"box","text":"execution and risk management and engaging with shareholders, and other stakeholders, as necessary.","page_number":186,"box":{"x":69,"y":276,"width":742,"height":11}},{"id":"64685936-80e0-42a0-8ee2-99d98d3819b1","block_type":"box","text":"Composition and effectiveness","page_number":186,"box":{"x":69,"y":298,"width":224,"height":11}},{"id":"5cfab5ab-7394-4649-b06c-3119a0df2426","block_type":"box","text":"Appointment process","page_number":186,"box":{"x":68,"y":317,"width":152,"height":11}},{"id":"f1a32aff-80e1-4f24-a46c-4c2383a63aa7","block_type":"box","text":"A formal and transparent process for identifying and appointing director candidates is critical to ensuring the","page_number":186,"box":{"x":101,"y":335,"width":773,"height":12}},{"id":"19b2b754-a099-408c-8d60-2f78727ce4b6","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":186,"box":{"x":69,"y":350,"width":792,"height":11}},{"id":"f27593b8-0b29-4a92-b13d-dfbae87a0f1c","block_type":"box","text":"committee determines the general criteria given the company’s circumstances (","page_number":186,"box":{"x":69,"y":365,"width":568,"height":11}},{"id":"965e1f82-45d6-41f2-bec6-ec7e42b2d803","block_type":"box","text":"e.g.","page_number":186,"box":{"x":638,"y":367,"width":25,"height":9}},{"id":"ce566b40-176b-4af3-8d11-ca3982caddb4","block_type":"box","text":", sector, maturity, geographic","page_number":186,"box":{"x":666,"y":365,"width":204,"height":11}},{"id":"a8a5dd36-1540-497e-83c0-ae88d0e0504a","block_type":"box","text":"footprint) and any additional criteria for a specific role being filled (","page_number":186,"box":{"x":68,"y":380,"width":474,"height":11}},{"id":"e6e7fe90-5fb1-4068-8b06-2ecdcc83fa63","block_type":"box","text":"e.g.","page_number":186,"box":{"x":544,"y":381,"width":25,"height":10}},{"id":"2d798d8a-0b4b-41f2-942f-cd28587093f7","block_type":"box","text":", financial expertise, industry track record). To","page_number":186,"box":{"x":571,"y":380,"width":327,"height":11}},{"id":"c1f21d45-8b73-496b-bd88-b0a2e37a21ae","block_type":"box","text":"inform the process, we encourage companies to review the skills and experience of incumbent directors to identify","page_number":186,"box":{"x":70,"y":395,"width":815,"height":11}},{"id":"8b1e739c-51e8-49fc-9512-12e37b2ab049","block_type":"box","text":"any gaps and whether the skills and experience of a director candidate would be additive. We welcome disclosures","page_number":186,"box":{"x":69,"y":410,"width":817,"height":11}},{"id":"bb04115b-e29f-44fc-93db-a465edb32219","block_type":"box","text":"that explain how the board considered different skills and experience to ensure that the directors collectively can be","page_number":186,"box":{"x":68,"y":425,"width":829,"height":11}},{"id":"4467c7d5-0f80-4300-9cef-7c3fd209874b","block_type":"box","text":"effective in fulfilling their responsibilities. We assess a company’s board composition against that of its peer group","page_number":186,"box":{"x":69,"y":439,"width":821,"height":12}},{"id":"c66f2a01-6aac-443b-b63b-62245431ac58","block_type":"box","text":"and local market requirements.","page_number":186,"box":{"x":69,"y":455,"width":221,"height":10}},{"id":"d4460683-bb33-44c5-9a0c-476213483aef","block_type":"box","text":"Shareholders periodically vote to elect directors to serve on the board. We do not prescribe any particular board","page_number":186,"box":{"x":102,"y":473,"width":798,"height":11}},{"id":"4d326bc9-788c-4a94-b892-018fa5908968","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":186,"box":{"x":69,"y":488,"width":800,"height":11}},{"id":"c51ede8c-0132-4dd1-82a4-7bac309f484f","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":186,"box":{"x":70,"y":503,"width":794,"height":11}},{"id":"c9b3d94a-e303-4134-871d-7ffc32cbc747","block_type":"box","text":"committee, where a company has not demonstrated it has an appointment process that results in a high functioning","page_number":186,"box":{"x":69,"y":517,"width":830,"height":12}},{"id":"0bba95b6-f861-4629-8b76-8544e58566ec","block_type":"box","text":"board with the appropriate complement of skills and experience amongst the directors to support strong financial","page_number":186,"box":{"x":69,"y":532,"width":808,"height":12}},{"id":"a361c45f-4300-4356-a3c8-5ffd9f8ae049","block_type":"box","text":"performance over time. We may vote against newly nominated directors who do not seem to have the appropriate","page_number":186,"box":{"x":70,"y":547,"width":808,"height":12}},{"id":"25c9fa07-2ae6-47cd-98d5-74a77e4e5869","block_type":"box","text":"skills or experience to contribute to the board’s effectiveness.","page_number":186,"box":{"x":69,"y":562,"width":442,"height":11}},{"id":"80d2e938-1f5d-4ae2-91e4-9ebb2da5b894","block_type":"box","text":"Independence","page_number":186,"box":{"x":70,"y":585,"width":99,"height":10}},{"id":"44e4cbd8-9c5b-425d-844c-013257bc3cd6","block_type":"box","text":"Director independence from management, significant shareholders or other stakeholders (","page_number":186,"box":{"x":102,"y":603,"width":642,"height":11}},{"id":"6464e812-a9f6-450e-b61c-9b1da012f37e","block_type":"box","text":"e.g.","page_number":186,"box":{"x":746,"y":605,"width":25,"height":9}},{"id":"8cb7c940-a5eb-48d0-b259-85a23c9c5df3","block_type":"box","text":", government or","page_number":186,"box":{"x":773,"y":604,"width":111,"height":10}},{"id":"b109cc9a-8ab8-482b-9afd-d9aa63fb73f2","block_type":"box","text":"employees) is of paramount importance to the protection of the interests of minority shareholders such as","page_number":186,"box":{"x":69,"y":618,"width":759,"height":11}},{"id":"70f59c64-414d-4705-bebf-3a9659684f46","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":186,"box":{"x":70,"y":633,"width":793,"height":11}},{"id":"1d3b5bab-f569-4bfe-af53-6ff9e9d986bf","block_type":"box","text":"conflicts of interest or undue influence.","page_number":186,"box":{"x":69,"y":648,"width":278,"height":9}},{"id":"13c2a31c-252b-42b3-9e76-955fb4ba7666","block_type":"box","text":"7","page_number":186,"box":{"x":349,"y":648,"width":4,"height":5}},{"id":"5bdbd8fc-ee3c-462b-b574-22f2fcc5c524","block_type":"box","text":"This also helps to ensure that board committees are composed of a","page_number":186,"box":{"x":358,"y":648,"width":486,"height":11}},{"id":"d63130ab-2d8f-425a-a3bf-a426821bab2d","block_type":"box","text":"sufficient number of independent directors. Companies domiciled in markets with a higher threshold for board","page_number":186,"box":{"x":69,"y":663,"width":783,"height":11}},{"id":"988d19e1-ced7-44e5-8602-cb3745504d24","block_type":"box","text":"independence should meet those local requirements.","page_number":186,"box":{"x":70,"y":678,"width":378,"height":10}},{"id":"18694239-7784-4038-b4ed-888c3f2cf724","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":186,"box":{"x":101,"y":696,"width":803,"height":11}},{"id":"bdb71e18-2f6c-48e0-9cc9-38447c604593","block_type":"box","text":"independence. We may also vote against the election of the chair of the committee responsible for board","page_number":186,"box":{"x":70,"y":711,"width":748,"height":11}},{"id":"ae12c40d-ae7b-4a5b-9b8e-86290f7fc941","block_type":"box","text":"composition if this is a perennial issue.","page_number":186,"box":{"x":69,"y":726,"width":280,"height":11}},{"id":"5c95bc96-e495-482a-9295-e2578d4c34af","block_type":"box","text":"6","page_number":186,"box":{"x":69,"y":756,"width":4,"height":4}},{"id":"57d72c4b-ed42-4e2a-9d37-c065b00b947d","block_type":"box","text":"See the Corporate Governance Codes of Germany, Japan, and the UK, as well as the corporate governance","page_number":186,"box":{"x":93,"y":755,"width":763,"height":11}},{"id":"0f4c72fc-8794-431d-a1fc-e2e9bf0584fc","block_type":"box","text":"principles of the US Business Roundtable as examples.","page_number":186,"box":{"x":94,"y":770,"width":394,"height":11}},{"id":"d966f67d-9e13-4843-b249-d1afb1a6f523","block_type":"box","text":"7","page_number":186,"box":{"x":69,"y":788,"width":4,"height":5}},{"id":"f5c12242-fe3d-43c6-8434-064564bc5445","block_type":"box","text":"Common impediments to independence may include but are not limited to: current or recent employment at the","page_number":186,"box":{"x":93,"y":788,"width":795,"height":11}},{"id":"909aeaf6-d76c-446a-8ff4-673a0c94b3ee","block_type":"box","text":"company or a subsidiary; being, or representing, a shareholder with a substantial shareholding in the company;","page_number":186,"box":{"x":93,"y":803,"width":793,"height":11}},{"id":"fd6a8cb7-d555-44b6-b795-a6f606d2c37d","block_type":"box","text":"interlocking directorships; lengthy tenure, and having any other interest, business, or other relationship which","page_number":186,"box":{"x":94,"y":818,"width":778,"height":11}},{"id":"02cd5dfe-e650-4b76-9c1a-185b7de62d3d","block_type":"box","text":"could, or could reasonably be perceived to, materially interfere with a director’s ability to act in the best interests","page_number":186,"box":{"x":93,"y":833,"width":807,"height":11}},{"id":"4337cfb8-9ef1-4ae1-a8c4-7bb1d2ed3774","block_type":"box","text":"of the company and shareholders.","page_number":186,"box":{"x":93,"y":848,"width":242,"height":11}},{"id":"5b5c5d1f-d7b1-4847-818e-622f21f37101","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":186,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"b4b91003-51a0-480c-becb-ae9706a6d678","block_type":"box","text":"Global Engagement and Voting Guidelines | 6","page_number":186,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"f33de6f2-505c-4258-ab1d-061837a9190d","block_type":"box","text":"NM1026U-5979889-186/232","page_number":186,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d381319d-b0c5-4d48-a54c-230941eaf3a7","block_type":"box","text":"Independent board leadership","page_number":187,"box":{"x":70,"y":45,"width":212,"height":11}},{"id":"ff0a63b4-938d-4ed7-be31-568ec3da4673","block_type":"box","text":"Practices across markets differ, as do board structures, but we observe two main approaches to independent","page_number":187,"box":{"x":102,"y":63,"width":784,"height":11}},{"id":"e35399ff-da52-4b89-ae84-2232e9e613dd","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":187,"box":{"x":69,"y":78,"width":827,"height":11}},{"id":"7b6e98ba-7496-48dc-bfbf-e1d3bac2ab70","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":187,"box":{"x":68,"y":93,"width":774,"height":11}},{"id":"b44725d3-99e1-4b93-8793-b2e7047814f5","block_type":"box","text":"coordinating with the other non-executive directors and working closely with the executive chair on the board agenda","page_number":187,"box":{"x":69,"y":108,"width":826,"height":11}},{"id":"e97f3e2a-fd13-46c9-bc51-3b52af35cadd","block_type":"box","text":"and other board procedures. In this case, the executive chair and the lead independent director work together to","page_number":187,"box":{"x":69,"y":123,"width":801,"height":11}},{"id":"f7aeda63-0d50-492e-b96b-68570c3857cf","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":187,"box":{"x":69,"y":138,"width":823,"height":11}},{"id":"eadbcac6-31f0-49c4-9727-3ac7fb5f8d29","block_type":"box","text":"the chair of a relevant committee, should be available to investors to discuss governance matters such as CEO","page_number":187,"box":{"x":68,"y":152,"width":793,"height":12}},{"id":"a4e9316e-9647-4e0e-8992-1759bbee3e07","block_type":"box","text":"succession, executive pay, and board performance. We look to boards to explain their board leadership model and","page_number":187,"box":{"x":69,"y":167,"width":816,"height":11}},{"id":"31fba29d-3f5e-4dc6-beae-496b2a8eb07d","block_type":"box","text":"how it serves the interests of shareholders.","page_number":187,"box":{"x":69,"y":182,"width":311,"height":9}},{"id":"0508fb18-cdff-4c0c-bcdd-849768d73523","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":187,"box":{"x":101,"y":201,"width":798,"height":11}},{"id":"955ed6c7-328d-42a6-89f7-6042cef52193","block_type":"box","text":"an identified independent leader of the board with clear responsibilities for board performance. We may vote against","page_number":187,"box":{"x":69,"y":216,"width":831,"height":11}},{"id":"13388d81-1a19-4ea3-9b4b-38ac47fd72c5","block_type":"box","text":"the most senior independent director if the board has a policy of not engaging with shareholders.","page_number":187,"box":{"x":68,"y":231,"width":691,"height":11}},{"id":"f7021c06-caa6-4d8d-8fe3-0691685a7f99","block_type":"box","text":"Tenure and succession","page_number":187,"box":{"x":70,"y":253,"width":162,"height":9}},{"id":"ad22748c-0e2a-4c21-9f6d-2dbbca1549d1","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":187,"box":{"x":102,"y":272,"width":803,"height":11}},{"id":"6623ca7d-4fb6-4b25-9c3c-b8d461e891df","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":187,"box":{"x":69,"y":286,"width":805,"height":11}},{"id":"927da486-3dfe-431d-839a-3c3ab94de1f6","block_type":"box","text":"director tenure particularly around the contributions of directors who have served for longer periods than typically","page_number":187,"box":{"x":69,"y":301,"width":806,"height":12}},{"id":"844369bd-a2bf-425e-a454-071b4778b759","block_type":"box","text":"provided for under local practice. In our experience, long-serving directors could become less independent given their","page_number":187,"box":{"x":70,"y":316,"width":833,"height":12}},{"id":"90f0c448-770d-4136-958a-3c71fe10a9a8","block_type":"box","text":"long-term relationship with management and involvement in past board decisions.","page_number":187,"box":{"x":70,"y":331,"width":581,"height":11}},{"id":"2e037624-2c84-4782-b34e-e4d52e48ac59","block_type":"box","text":"Succession planning for board roles helps achieve the appropriate cadence of turnover that balances renewal","page_number":187,"box":{"x":102,"y":350,"width":779,"height":11}},{"id":"230151e6-51e8-4a55-9bd7-f8b446210017","block_type":"box","text":"through the regular introduction of directors with fresh perspectives and expertise with continuity through the","page_number":187,"box":{"x":68,"y":365,"width":777,"height":11}},{"id":"dce830f9-f043-43b5-96c9-ffcbed711e0a","block_type":"box","text":"retention of directors with long-term knowledge of the board and company.","page_number":187,"box":{"x":69,"y":379,"width":528,"height":12}},{"id":"daf8fcf1-c260-4db6-92c6-a580bc17415e","block_type":"box","text":"In markets where there is not specific director tenure guidance from regulation or corporate governance best","page_number":187,"box":{"x":102,"y":398,"width":774,"height":11}},{"id":"b5b9637d-3824-4b5a-88b7-aba552f8e641","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":187,"box":{"x":70,"y":413,"width":795,"height":11}},{"id":"54d1f10b-cedc-4816-8ab9-ba8dfc357c13","block_type":"box","text":"company does not clearly disclose its approach to director tenure and board renewal. We may vote against the","page_number":187,"box":{"x":69,"y":428,"width":788,"height":11}},{"id":"008363f2-6d3b-43fb-95d1-264649b3aecb","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":187,"box":{"x":69,"y":443,"width":839,"height":11}},{"id":"5d3181b0-988e-4215-9faf-1f6a9fa3c1f8","block_type":"box","text":"for their continued service is not evident.","page_number":187,"box":{"x":68,"y":458,"width":292,"height":9}},{"id":"4c15a4b6-5147-41b5-9ac5-f55fb21b58d5","block_type":"box","text":"Capacity","page_number":187,"box":{"x":70,"y":480,"width":60,"height":11}},{"id":"a533c9ce-5ca0-4eeb-a40d-0912942cceba","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":187,"box":{"x":101,"y":499,"width":784,"height":11}},{"id":"4606d58d-840f-4d4e-b05d-b305b662e6aa","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":187,"box":{"x":69,"y":513,"width":801,"height":12}},{"id":"dfa6e225-d056-4333-8b5f-141a2a20c58c","block_type":"box","text":"company taking into consideration competing responsibilities. We recognize that board leadership roles vary across","page_number":187,"box":{"x":69,"y":529,"width":823,"height":11}},{"id":"1e54bad4-4293-4533-a315-48b91ba18ac8","block_type":"box","text":"markets in responsibilities and required time commitment but note that they are generally more intensive than a","page_number":187,"box":{"x":69,"y":543,"width":800,"height":11}},{"id":"ea6d5f77-d79b-40e0-b54c-7fa2afae84a2","block_type":"box","text":"standard directorship. We will take local norms and practices into consideration when making our voting","page_number":187,"box":{"x":69,"y":558,"width":741,"height":11}},{"id":"2c9ba720-d30d-4c62-abbc-11f23bf1726b","block_type":"box","text":"determinations across markets.","page_number":187,"box":{"x":69,"y":573,"width":226,"height":9}},{"id":"362c8e3b-bff1-469b-a9d3-effafdc224f8","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":187,"box":{"x":101,"y":592,"width":776,"height":11}},{"id":"f3388b04-a893-4988-ae8b-70ada1fb9c8c","block_type":"box","text":"their duties to the board and company.","page_number":187,"box":{"x":68,"y":607,"width":275,"height":11}},{"id":"ae9110f5-5db7-4168-b97b-39a973e03848","block_type":"box","text":"Director elections","page_number":187,"box":{"x":70,"y":629,"width":124,"height":9}},{"id":"e2f0fa11-1c55-4bac-9010-b064bc35bfd5","block_type":"box","text":"Regular election of directors, ideally annually, supports director accountability to shareholders. A classified board","page_number":187,"box":{"x":102,"y":647,"width":805,"height":12}},{"id":"ccc31b47-f219-4a20-8883-f009d2bbabf9","block_type":"box","text":"structure","page_number":187,"box":{"x":69,"y":663,"width":63,"height":8}},{"id":"807bcc74-58c1-4d44-a9c7-dbde9c680cd5","block_type":"box","text":"8","page_number":187,"box":{"x":133,"y":663,"width":4,"height":4}},{"id":"ab783df6-012f-4bcb-8b6a-3e00feb3be0f","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":187,"box":{"x":144,"y":662,"width":761,"height":12}},{"id":"ce2bfdd9-1769-405f-833e-8543f87e68ce","block_type":"box","text":"basis of its business model (","page_number":187,"box":{"x":69,"y":677,"width":206,"height":11}},{"id":"be83c56e-c5df-4323-9b68-4f595b0dbc91","block_type":"box","text":"e.g.","page_number":187,"box":{"x":277,"y":679,"width":24,"height":10}},{"id":"7476ebe7-4f15-49a4-8dcb-33188441d8eb","block_type":"box","text":", a non-operating company such as closed-end funds).","page_number":187,"box":{"x":304,"y":677,"width":382,"height":12}},{"id":"f56f813a-3a88-4d8f-a9b7-5ad68d8ac24e","block_type":"box","text":"Shareholders should have the opportunity to evaluate nominated directors individually rather than in bundled","page_number":187,"box":{"x":102,"y":696,"width":774,"height":11}},{"id":"8bb8d73e-1d9d-40d3-9d60-18027aefa4b3","block_type":"box","text":"slates. We look to companies to provide sufficient information on each director standing for election so that","page_number":187,"box":{"x":69,"y":711,"width":770,"height":11}},{"id":"f05f7b40-4a30-4a35-a68b-3802b0418d42","block_type":"box","text":"shareholders can assess their capabilities and suitability. We will generally not support the election of directors","page_number":187,"box":{"x":69,"y":726,"width":794,"height":11}},{"id":"0955761b-d6fe-4ae3-a95c-be8f7207071e","block_type":"box","text":"whose names and biographical details have not been disclosed sufficiently in advance of the shareholder meeting.","page_number":187,"box":{"x":68,"y":740,"width":818,"height":12}},{"id":"48075d30-3a59-4c72-bcd6-53f37cbd0421","block_type":"box","text":"Each director’s appointment should be dependent on receiving a simple majority of the votes cast at the","page_number":187,"box":{"x":102,"y":759,"width":743,"height":11}},{"id":"0fe4f1ef-0037-4aad-bb16-70f78d63d544","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":187,"box":{"x":69,"y":774,"width":823,"height":11}},{"id":"7e7817a9-e17b-435c-be8b-c7dfda24cc68","block_type":"box","text":"to how its approach best serves investors’ interests.","page_number":187,"box":{"x":68,"y":789,"width":377,"height":11}},{"id":"c34ad2d0-3d85-4813-a2e1-500968bcb717","block_type":"box","text":"We may vote for shareholder or management proposals seeking to establish annual election of directors and/or","page_number":187,"box":{"x":101,"y":807,"width":798,"height":12}},{"id":"870d3ce9-d180-4fb3-afc0-2cf70731f733","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":187,"box":{"x":69,"y":822,"width":822,"height":12}},{"id":"954549f3-a9e3-4701-a642-05703bd049ba","block_type":"box","text":"part of a single slate if we have concerns about the profile or performance of an individual director.","page_number":187,"box":{"x":70,"y":837,"width":706,"height":12}},{"id":"f70c7665-59ce-47b4-a923-6d038c74008c","block_type":"box","text":"8","page_number":187,"box":{"x":69,"y":867,"width":4,"height":4}},{"id":"afae061f-6c9e-425b-9681-445bef492f57","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":187,"box":{"x":78,"y":866,"width":818,"height":12}},{"id":"87755eec-5e3f-46df-baea-6e4b08daf901","block_type":"box","text":"directors stands for election in any one year.","page_number":187,"box":{"x":69,"y":882,"width":315,"height":11}},{"id":"ac3cb215-46e4-423b-a427-8dabf7522dc8","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":187,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"6afc786f-c7a3-4d7d-93e7-a0f505994c3a","block_type":"box","text":"Global Engagement and Voting Guidelines | 7","page_number":187,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"872de9d9-4458-4b22-829c-a8d977ed3730","block_type":"box","text":"NM1026U-5979889-187/232","page_number":187,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c6fd49b5-cbab-48b3-842b-e992a8882464","block_type":"box","text":"Committees","page_number":188,"box":{"x":70,"y":45,"width":84,"height":9}},{"id":"45db6955-be6c-4e11-8f07-22796549cd2f","block_type":"box","text":"Many boards establish committees to focus on specific responsibilities of the board such as audit and risk,","page_number":188,"box":{"x":102,"y":63,"width":766,"height":11}},{"id":"2c70f2f8-cd14-4e68-a519-9742eb0a7c0c","block_type":"box","text":"governance and human capital, and executive compensation, amongst other matters. We do not prescribe to","page_number":188,"box":{"x":68,"y":78,"width":776,"height":11}},{"id":"1125a363-1d0b-4548-9fb7-c7e875cfe02a","block_type":"box","text":"companies what committees they should establish, but we seek to understand the board’s rationale for the","page_number":188,"box":{"x":69,"y":93,"width":766,"height":11}},{"id":"46aa0569-848a-460c-9f70-4c53e9ed89ad","block_type":"box","text":"committee structure it determines is appropriate. We note that, in some markets, regulation requires such","page_number":188,"box":{"x":69,"y":108,"width":759,"height":11}},{"id":"df114d47-38ed-4483-bcaf-40311404c003","block_type":"box","text":"committees. The responsibilities of each committee should be clear, and the board should ensure that all critical","page_number":188,"box":{"x":69,"y":123,"width":804,"height":11}},{"id":"cebf4535-a267-4a9a-a121-4ed72ed2432c","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":188,"box":{"x":69,"y":138,"width":837,"height":11}},{"id":"ab3e119a-3b15-496b-bd77-6ff2dc9497a5","block_type":"box","text":"the board discloses the structure, membership, proportion of independent directors, and responsibilities of each","page_number":188,"box":{"x":68,"y":152,"width":806,"height":11}},{"id":"397edb54-4b0e-43e0-9481-75f92cb4e180","block_type":"box","text":"committee. The responsibilities we typically see assigned to the three most common committees include:","page_number":188,"box":{"x":69,"y":168,"width":752,"height":11}},{"id":"e2f6f1df-9a9a-4405-b2b9-92ac111d5d88","block_type":"box","text":"•","page_number":188,"box":{"x":69,"y":188,"width":6,"height":4}},{"id":"04488838-20e4-42fe-845e-2722e3b57654","block_type":"box","text":"Audit and risk – oversight responsibilities for the integrity of financial reporting, risk management and","page_number":188,"box":{"x":101,"y":185,"width":722,"height":11}},{"id":"815d1c8d-6753-4986-a3e0-63c06ebd5277","block_type":"box","text":"compliance with legal and regulatory requirements; may also play an oversight role in relation to the internal","page_number":188,"box":{"x":101,"y":200,"width":771,"height":11}},{"id":"ed3cfa86-7bf5-4d75-b776-4ad8fe3d26c3","block_type":"box","text":"audit function and whistleblowing mechanisms.","page_number":188,"box":{"x":102,"y":214,"width":335,"height":12}},{"id":"9caec693-486c-414f-bf49-86caa0873b0e","block_type":"box","text":"•","page_number":188,"box":{"x":69,"y":235,"width":6,"height":4}},{"id":"f098e3b7-2e4c-4026-be1b-df0b95cdbf20","block_type":"box","text":"Nominating, governance and human capital – oversight responsibilities for corporate governance principles and","page_number":188,"box":{"x":102,"y":232,"width":790,"height":11}},{"id":"da25167c-ebbe-40cd-886c-4b9ee8be2ed0","block_type":"box","text":"practices of the company, including the periodic review of board performance; responsibility for succession","page_number":188,"box":{"x":102,"y":247,"width":761,"height":11}},{"id":"9f0941f7-3e8e-4df9-9961-336bb4032039","block_type":"box","text":"planning for CEO and key board roles, as well as the director appointment process; may also have oversight","page_number":188,"box":{"x":102,"y":262,"width":769,"height":11}},{"id":"b9a9c1ff-0671-49c0-8d17-198103d6fdf7","block_type":"box","text":"responsibilities for human capital management strategies, including corporate culture and purpose.","page_number":188,"box":{"x":102,"y":276,"width":707,"height":12}},{"id":"f59ab48d-ca03-439f-b32b-c1e0423afbdf","block_type":"box","text":"•","page_number":188,"box":{"x":69,"y":297,"width":6,"height":4}},{"id":"55d3823a-9799-417f-a6cb-98455882fcba","block_type":"box","text":"Executive compensation – determines the compensation policies and programs for the CEO and other executive","page_number":188,"box":{"x":102,"y":294,"width":796,"height":11}},{"id":"5504afc3-131e-467f-9d6e-f1b04063cc64","block_type":"box","text":"officers, approves annual awards and payments under the policies; may also have oversight responsibilities for","page_number":188,"box":{"x":102,"y":309,"width":793,"height":11}},{"id":"a606b680-8c8d-40a8-b899-e4ed95977178","block_type":"box","text":"firm-wide compensation policies.","page_number":188,"box":{"x":101,"y":323,"width":232,"height":11}},{"id":"0685c0da-60b5-4d0e-a7cd-fc959c5d2a16","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":188,"box":{"x":101,"y":342,"width":807,"height":11}},{"id":"181395e6-5e0c-4dd8-8c82-77b924e84a38","block_type":"box","text":"to convey concerns about how a committee has undertaken its responsibilities. We may vote against the election of","page_number":188,"box":{"x":68,"y":357,"width":828,"height":11}},{"id":"6b341dfa-f29b-4294-99c8-0b1633413f60","block_type":"box","text":"the most senior non-executive director if there is not a clearly disclosed approach to board committees.","page_number":188,"box":{"x":68,"y":372,"width":738,"height":11}},{"id":"71221bfd-1ce5-453f-bac0-ac16bc1e8a0a","block_type":"box","text":"Board and director evaluation","page_number":188,"box":{"x":70,"y":395,"width":209,"height":8}},{"id":"6570d95e-914e-4c91-9f5f-eecf69483ddb","block_type":"box","text":"We consider it best practice for companies to conduct an annual review of the performance of the board, the","page_number":188,"box":{"x":101,"y":413,"width":776,"height":11}},{"id":"64ff3d20-162c-4add-aa27-d57631c2e4a9","block_type":"box","text":"committees, the chair and individual directors. Periodically, this review could be undertaken by an independent third","page_number":188,"box":{"x":69,"y":428,"width":825,"height":11}},{"id":"4187696d-1d90-49b4-ae49-aae17aa0808d","block_type":"box","text":"party able to bring objective perspectives to the board on governance and performance. We encourage companies to","page_number":188,"box":{"x":70,"y":443,"width":831,"height":11}},{"id":"2ee499ee-27ca-46ed-9e9a-587c3b406f44","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":188,"box":{"x":69,"y":458,"width":835,"height":11}},{"id":"dccd1086-9dff-4059-9949-d5c2c6e43130","block_type":"box","text":"a result.","page_number":188,"box":{"x":69,"y":473,"width":57,"height":8}},{"id":"2b7504bc-85e4-4b9c-b7ff-d57054a53ca8","block_type":"box","text":"Access to independent advice","page_number":188,"box":{"x":68,"y":495,"width":214,"height":11}},{"id":"fc5ead97-ac79-42ad-b6ac-0d58a8c152a9","block_type":"box","text":"To support the directors in effectively fulfilling their duties to the company and shareholders, they should have","page_number":188,"box":{"x":101,"y":513,"width":786,"height":12}},{"id":"40fae33c-20cf-4135-a5e7-fd109c4cb54b","block_type":"box","text":"access to independent advice. In certain circumstances, it may be helpful to boards to retain independent third","page_number":188,"box":{"x":69,"y":528,"width":793,"height":11}},{"id":"99e5a287-8392-4d1e-90c4-08a132ca5f40","block_type":"box","text":"parties to advise on critical matters. These might include new industry developments such as emergent and","page_number":188,"box":{"x":70,"y":543,"width":770,"height":11}},{"id":"453bd8be-3822-47af-a48d-24ff376d1df7","block_type":"box","text":"disruptive technology, operating events with material consequences for the company’s reputation and/or","page_number":188,"box":{"x":69,"y":558,"width":746,"height":11}},{"id":"bfc09e54-39f1-401d-abab-1850dd9c2fac","block_type":"box","text":"performance, or significant transactions. Board committees may similarly retain third parties to advise them on","page_number":188,"box":{"x":70,"y":573,"width":793,"height":11}},{"id":"c48242e7-2092-415c-b5ca-014a36b669fd","block_type":"box","text":"specialist matters such as audit, compensation and succession planning.","page_number":188,"box":{"x":69,"y":588,"width":524,"height":11}},{"id":"95edaaaf-f7ab-4016-8d2d-a2cb884f293a","block_type":"box","text":"EXECUTIVE COMPENSATION","page_number":188,"box":{"x":385,"y":618,"width":207,"height":9}},{"id":"6c8090c9-dc8c-4da1-9792-24929314a3df","block_type":"box","text":"Boards play an important role in establishing compensation arrangements that enable the company to recruit,","page_number":188,"box":{"x":102,"y":637,"width":784,"height":11}},{"id":"f9b56762-91ac-4f73-b9b5-cf1e359f9e5f","block_type":"box","text":"retain and reward the caliber of executive management necessary to lead and operate the company to deliver","page_number":188,"box":{"x":69,"y":652,"width":782,"height":11}},{"id":"b102bdb8-ec4b-41bb-bc81-2f1dec08663e","block_type":"box","text":"superior financial returns over time. We focus on alignment between variable pay and a company’s financial","page_number":188,"box":{"x":69,"y":666,"width":766,"height":12}},{"id":"b5f8e360-e1b0-4634-8289-7ea1fc927734","block_type":"box","text":"performance.","page_number":188,"box":{"x":70,"y":681,"width":93,"height":11}},{"id":"253c43d2-e34d-4013-91d5-8c68c0908861","block_type":"box","text":"Generally, executive compensation arrangements have four components: base salary, annual bonus that rewards","page_number":188,"box":{"x":102,"y":700,"width":805,"height":11}},{"id":"2549f7c5-e32b-46e1-ac09-d9cecfb46775","block_type":"box","text":"performance against short-term metrics, incentives – most often share-based that reward performance against long","page_number":188,"box":{"x":70,"y":715,"width":831,"height":11}},{"id":"c588d8d2-2110-4200-84e8-05d129901cb4","block_type":"box","text":"term metrics, and pensions and benefits. In our observation, base salary, pensions and benefits are largely set","page_number":188,"box":{"x":68,"y":730,"width":798,"height":11}},{"id":"8787a1e7-707e-4beb-9b38-92221a989471","block_type":"box","text":"relative to market norms and benchmarks. The annual bonus and share-based incentive, or variable pay plans, tend","page_number":188,"box":{"x":69,"y":745,"width":824,"height":11}},{"id":"b738096f-01c1-4440-8ad0-324461fb6ef8","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":188,"box":{"x":68,"y":760,"width":807,"height":11}},{"id":"94a22d7a-7069-46ee-a824-3740f3f50fe0","block_type":"box","text":"recruit and motivate.","page_number":188,"box":{"x":69,"y":774,"width":146,"height":9}},{"id":"d81da0e1-4376-4429-9408-c8441eb9b968","block_type":"box","text":"Recognizing the unique circumstances of each company, we determine whether to support a company’s","page_number":188,"box":{"x":102,"y":793,"width":739,"height":11}},{"id":"b23a832b-32f6-4113-a430-eb8d168eb436","block_type":"box","text":"approach to executive compensation on a case-by-case basis. We rely on companies providing sufficient quantitative","page_number":188,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"9076a6e9-7cef-415f-acca-f210b251b074","block_type":"box","text":"and qualitative information in their disclosures to enable shareholders to understand the compensation","page_number":188,"box":{"x":69,"y":823,"width":737,"height":11}},{"id":"8444eded-649e-419d-931d-08c91a0aa1b9","block_type":"box","text":"arrangements and assess the alignment with investors’ interests. Features we look for in compensation","page_number":188,"box":{"x":69,"y":837,"width":741,"height":12}},{"id":"4e2b86c0-5e77-47ef-870d-0c9c4d85c97f","block_type":"box","text":"arrangements include:","page_number":188,"box":{"x":69,"y":853,"width":157,"height":11}},{"id":"46dcf70b-ff52-42c1-a7e6-9aef56048e9d","block_type":"box","text":"•","page_number":188,"box":{"x":69,"y":873,"width":6,"height":4}},{"id":"b9de8c80-49dd-4823-bd78-050fd5f8db88","block_type":"box","text":"Fixed pay components, including base salary, benefits and prerequisites that are appropriate in the context of","page_number":188,"box":{"x":102,"y":870,"width":783,"height":11}},{"id":"c4de7ae2-9229-4077-b086-0cac3a7e850e","block_type":"box","text":"the company’s size, sector and market.","page_number":188,"box":{"x":101,"y":885,"width":280,"height":11}},{"id":"1a51f5ae-5ddb-46be-9e8c-53f81c189a7a","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":188,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"ec8b8198-d59c-4b1e-bf5f-3eb057ad8904","block_type":"box","text":"Global Engagement and Voting Guidelines | 8","page_number":188,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"3423eadc-0024-4cde-97f2-29979d646db7","block_type":"box","text":"NM1026U-5979889-188/232","page_number":188,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"fea4af45-559e-4009-83a9-08e02e031231","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"7efde95f-854c-490b-96f1-50a487fa5d95","block_type":"box","text":"Variable pay subject to performance metrics that are closely linked to the company’s short- and long-term","page_number":189,"box":{"x":101,"y":45,"width":752,"height":11}},{"id":"05a48dcf-776f-4350-8706-99c253e6c101","block_type":"box","text":"strategic objectives.","page_number":189,"box":{"x":102,"y":60,"width":140,"height":11}},{"id":"fe243227-6e69-40c9-b0c0-232c6a1f12a5","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":80,"width":6,"height":4}},{"id":"c53ba75f-512d-4b63-8a2e-b2954805e3c2","block_type":"box","text":"Long-term incentives that motivate sustained performance across a multi-year period.","page_number":189,"box":{"x":102,"y":77,"width":609,"height":11}},{"id":"b8232135-1cf8-4e36-ac66-a78eeec08853","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":97,"width":6,"height":5}},{"id":"3c8408c8-e9f1-4001-9165-73e250a232f9","block_type":"box","text":"A balance between fixed and variable pay, short- and long-term incentives, and specific instruments (cash and","page_number":189,"box":{"x":101,"y":94,"width":784,"height":12}},{"id":"b30ea84f-afd6-4430-b8da-77f04c5f9ac7","block_type":"box","text":"equity awards) that promotes pay program durability and seldom necessitates one-off, discretionary payments.","page_number":189,"box":{"x":101,"y":109,"width":790,"height":11}},{"id":"51cb5247-3faf-4a0a-8db1-4de96b7aa60e","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":129,"width":6,"height":5}},{"id":"08b895ab-6b2f-4df3-8845-f4091397cee0","block_type":"box","text":"Pay outcomes that are consistent with the returns to investors over the relevant time period.","page_number":189,"box":{"x":102,"y":127,"width":658,"height":11}},{"id":"4b7841e6-2d89-4090-9231-0e4f1eb1031c","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":147,"width":6,"height":4}},{"id":"ccd679e8-6957-4ae4-be0e-a98ad2a8ecf1","block_type":"box","text":"Board discretion, if allowed within the variable pay arrangements, to be used sparingly, responsibly and","page_number":189,"box":{"x":102,"y":144,"width":735,"height":11}},{"id":"659796ce-6529-4ac5-a401-562e0809080e","block_type":"box","text":"transparently.","page_number":189,"box":{"x":101,"y":159,"width":95,"height":11}},{"id":"72abcb02-c29c-495c-a38b-60617e8ddaf3","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":179,"width":6,"height":5}},{"id":"63b99535-3a32-405b-b7f9-7f159eb27ca8","block_type":"box","text":"A requirement, that participants in long-term share-based incentive plans build a meaningful shareholding in the","page_number":189,"box":{"x":101,"y":176,"width":798,"height":11}},{"id":"57a67409-9d92-4b68-a901-31bce36d4b20","block_type":"box","text":"company within a defined time period, as determined by the board or relevant board committee.","page_number":189,"box":{"x":101,"y":191,"width":683,"height":11}},{"id":"7280500e-bbe3-475a-9f9e-a44d8d013925","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":211,"width":6,"height":5}},{"id":"a37adc5f-5c60-43d1-8f0c-386cd6e49471","block_type":"box","text":"Change of control provisions that appropriately balance the interests of executives and shareholders.","page_number":189,"box":{"x":102,"y":208,"width":720,"height":12}},{"id":"a2329c3f-8979-4a6c-bdba-14ff01e60ae7","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":229,"width":6,"height":4}},{"id":"ead8e283-8925-47ba-8b16-aa83998f2b31","block_type":"box","text":"Clawback or malus provisions that allow the company to recoup or hold back variable compensation from","page_number":189,"box":{"x":102,"y":226,"width":747,"height":11}},{"id":"13eb4daf-a92c-4a63-9164-ec461e4d11a5","block_type":"box","text":"individuals whose awards were based on fraudulent activities, misstated financial reports, or executive","page_number":189,"box":{"x":102,"y":241,"width":733,"height":11}},{"id":"2ecf71ed-f27e-4853-81ba-eaf5b2f01544","block_type":"box","text":"misconduct.","page_number":189,"box":{"x":102,"y":256,"width":84,"height":8}},{"id":"c7c158f8-d066-4669-9685-5d91025f3de1","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":276,"width":6,"height":4}},{"id":"60993043-4b18-47da-b117-56140cdb82eb","block_type":"box","text":"Severance arrangements that protect the company’s interests but do not cost more than is contractual.","page_number":189,"box":{"x":102,"y":273,"width":738,"height":11}},{"id":"b7e5b082-97f4-4c65-a690-07e32bd4d623","block_type":"box","text":"We may vote against proposals to introduce new share-based incentives, approve existing policies or plans, or","page_number":189,"box":{"x":101,"y":292,"width":787,"height":11}},{"id":"927aac7e-2d91-4310-a296-f9940b2532dd","block_type":"box","text":"approve the compensation report where we do not see alignment between executive compensation arrangements","page_number":189,"box":{"x":69,"y":307,"width":810,"height":11}},{"id":"e32cdea4-a692-4156-88cb-0cf01dc481b7","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":189,"box":{"x":69,"y":321,"width":831,"height":11}},{"id":"f734d5eb-498b-4dd3-b6dc-73135e73e900","block_type":"box","text":"compensation misaligned with performance, we may vote against the election of the chair of the responsible","page_number":189,"box":{"x":69,"y":336,"width":775,"height":11}},{"id":"ca13ccda-b37b-47c8-9432-21b27ad5586e","block_type":"box","text":"committee, or the most senior independent director.","page_number":189,"box":{"x":69,"y":351,"width":371,"height":11}},{"id":"37ebc716-9532-44ce-a36b-441046482a89","block_type":"box","text":"NON-EXECUTIVE DIRECTOR COMPENSATION","page_number":189,"box":{"x":326,"y":381,"width":325,"height":9}},{"id":"a556bdd5-1cee-4942-9e7e-d34deb75d14f","block_type":"box","text":"Companies generally pay non-executive directors an annual retainer or fee in cash, shares or a combination of","page_number":189,"box":{"x":102,"y":400,"width":785,"height":11}},{"id":"911312ef-ddc9-41ff-8630-fd788717a00d","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":189,"box":{"x":68,"y":415,"width":831,"height":11}},{"id":"0c508200-65a3-4ff8-9a97-23fc313d7a65","block_type":"box","text":"do not support non-executive directors participating in performance-based incentive plans as doing so may create a","page_number":189,"box":{"x":69,"y":430,"width":825,"height":11}},{"id":"5ed789d9-c01c-4ab4-885c-538dce6c67e9","block_type":"box","text":"conflict of interest and undermine their independence from management, whom they oversee.","page_number":189,"box":{"x":69,"y":444,"width":668,"height":12}},{"id":"f41d8016-5946-408c-aff6-be1570235fbb","block_type":"box","text":"CAPITAL STRUCTURE","page_number":189,"box":{"x":411,"y":475,"width":156,"height":8}},{"id":"c8814b32-ba45-410c-8f69-7ac1c741aba1","block_type":"box","text":"Boards are responsible for ensuring senior executive leadership has established a capital strategy that achieves","page_number":189,"box":{"x":102,"y":493,"width":800,"height":12}},{"id":"f8046e7f-6c2f-434c-9877-05c63a10c9c6","block_type":"box","text":"appropriate capital allocation in support of long-term financial resilience.","page_number":189,"box":{"x":69,"y":508,"width":516,"height":11}},{"id":"a64c6070-7dd9-42b4-a6f8-380769610b6b","block_type":"box","text":"Where company practices diverge from those set out below, we look for companies to disclose why they view","page_number":189,"box":{"x":101,"y":527,"width":776,"height":11}},{"id":"37842e4f-9234-42a7-920b-40d5dd4dc805","block_type":"box","text":"these practices to be aligned with shareholders’ interests. We may vote against management proposals seeking","page_number":189,"box":{"x":68,"y":542,"width":803,"height":11}},{"id":"f839c5af-331c-45db-ace0-ad273ef0c774","block_type":"box","text":"capital-related authorities, or the election of the most senior independent director, if we have concerns about a","page_number":189,"box":{"x":69,"y":557,"width":790,"height":11}},{"id":"974bc097-e4aa-4578-8686-b0894ba33cbf","block_type":"box","text":"company’s approach. We may also support a shareholder proposal seeking conversion of shares with differentiated","page_number":189,"box":{"x":69,"y":571,"width":825,"height":12}},{"id":"eefbbec4-597a-49f5-b6ec-e47021d1b7e1","block_type":"box","text":"voting rights to a one-share, one-vote standard.","page_number":189,"box":{"x":68,"y":587,"width":336,"height":11}},{"id":"e91c9dad-2437-4e8f-aa94-89a24130aca1","block_type":"box","text":"Share issuance","page_number":189,"box":{"x":68,"y":609,"width":111,"height":9}},{"id":"12b6ac25-5918-4e86-98a1-be3bd47b9a9c","block_type":"box","text":"We assess requests for share issuance for particular transactions on a case-by-case basis. We will generally","page_number":189,"box":{"x":101,"y":627,"width":776,"height":12}},{"id":"f837b15c-7644-4b67-a9eb-d317ad8e00ce","block_type":"box","text":"support authorities to issue shares when subject to pre-emptive rights, and up to 20% absent pre-emptive rights. We","page_number":189,"box":{"x":69,"y":642,"width":832,"height":12}},{"id":"58f77ecd-792d-4104-848b-bfab0685853e","block_type":"box","text":"consider it good practice for companies to seek regular approval of these authorities to allow shareholders to take","page_number":189,"box":{"x":69,"y":657,"width":815,"height":11}},{"id":"68b5f553-88d9-45c1-a903-8be5ac3bfef0","block_type":"box","text":"into consideration how prior authorities were used, as well as the current circumstances of the company and the","page_number":189,"box":{"x":70,"y":672,"width":802,"height":11}},{"id":"cbe294a2-2b3d-44c6-ab51-7fb23178b7e7","block_type":"box","text":"market environment.","page_number":189,"box":{"x":69,"y":687,"width":145,"height":9}},{"id":"d85e1f33-8c79-4339-a698-e6b60a22754a","block_type":"box","text":"Share buybacks","page_number":189,"box":{"x":68,"y":709,"width":116,"height":11}},{"id":"41b228be-8308-4774-9968-f4160514a54c","block_type":"box","text":"We assess share buyback proposals in the context of the company’s disclosed capital management strategy and","page_number":189,"box":{"x":101,"y":728,"width":806,"height":11}},{"id":"d9599dee-72c5-4546-8395-a4cc64c1e7e9","block_type":"box","text":"management’s determination of the appropriate balance between investment that supports the long-term growth of","page_number":189,"box":{"x":69,"y":743,"width":823,"height":11}},{"id":"ef8521fb-b5ee-4652-b0f0-3afd3d4e29f5","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":189,"box":{"x":68,"y":758,"width":836,"height":11}},{"id":"5da78216-45fd-42be-8c1e-65b63f9b71d5","block_type":"box","text":"company’s balance sheet and executive compensation arrangements and the price at which shares are repurchased","page_number":189,"box":{"x":69,"y":773,"width":830,"height":11}},{"id":"fe948030-0a94-4650-91d6-eedd64ddfe0f","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":189,"box":{"x":69,"y":787,"width":822,"height":12}},{"id":"399ed6f3-e16c-4b8b-99bb-db30ad029178","block_type":"box","text":"allow shareholders to take into consideration how prior authorities were used, as well as the current circumstances","page_number":189,"box":{"x":69,"y":802,"width":823,"height":11}},{"id":"713f96bf-7c6f-4b4b-acfc-8fc92b9a9c4c","block_type":"box","text":"of the company and the market environment.","page_number":189,"box":{"x":69,"y":817,"width":319,"height":11}},{"id":"b5dbd2c4-8b62-4be1-8ef2-a354f3f8da7e","block_type":"box","text":"Dividends","page_number":189,"box":{"x":69,"y":840,"width":69,"height":8}},{"id":"ef25e9c7-9ce5-4e8e-b848-ac50bb163b04","block_type":"box","text":"We generally defer to management and the board on dividend policy but may engage to seek further clarification","page_number":189,"box":{"x":101,"y":858,"width":799,"height":11}},{"id":"2363a0b2-bf94-449c-9db5-ac77e075b2b9","block_type":"box","text":"where a proposed dividend appears out of line with the company’s financial position.","page_number":189,"box":{"x":68,"y":873,"width":604,"height":11}},{"id":"42d41080-03fa-497e-9946-0ed882918f64","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":189,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"fc3f8676-c972-40b5-91c3-10ab1b20e83a","block_type":"box","text":"Global Engagement and Voting Guidelines | 9","page_number":189,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"fc4eefb6-fa24-4fde-ac83-58edcafbe1d3","block_type":"box","text":"NM1026U-5979889-189/232","page_number":189,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"99df2365-4b38-4cc6-8271-b49def3745fb","block_type":"box","text":"Differentiated voting rights","page_number":190,"box":{"x":69,"y":45,"width":196,"height":11}},{"id":"06f33b91-7170-4a5b-8666-afa1ba284873","block_type":"box","text":"We prefer companies to adopt a one-share, one-vote structure for share classes with the same economic","page_number":190,"box":{"x":101,"y":63,"width":750,"height":11}},{"id":"cc47861f-a826-40f8-bc18-b224a5ac5c2d","block_type":"box","text":"exposure. Certain companies, particularly those new to public markets, could make the case to adopt a","page_number":190,"box":{"x":69,"y":78,"width":740,"height":11}},{"id":"f69b227f-debc-46e2-9ab1-5fe5f53d0c26","block_type":"box","text":"differentiated voting rights structure, or dual class stock. In those situations, we encourage companies to evaluate","page_number":190,"box":{"x":69,"y":93,"width":819,"height":11}},{"id":"61efb3f3-33fa-4f67-970e-1cb50dd61c83","block_type":"box","text":"and seek approval for their capital structure on a periodic basis.","page_number":190,"box":{"x":69,"y":108,"width":456,"height":11}},{"id":"baa95fa6-b2c2-462b-baa3-d288db276745","block_type":"box","text":"TRANSACTIONS AND SPECIAL SITUATIONS","page_number":190,"box":{"x":332,"y":138,"width":314,"height":9}},{"id":"79468700-2c7c-4d2e-94f7-2ca473487248","block_type":"box","text":"We monitor developments in transactions and special situations closely and undertake our own detailed","page_number":190,"box":{"x":101,"y":157,"width":743,"height":11}},{"id":"8eb3d2ed-deb6-4323-9e17-20e869526e27","block_type":"box","text":"analyses of proposals.","page_number":190,"box":{"x":69,"y":172,"width":159,"height":11}},{"id":"6011e3c6-ab39-4111-b0bc-df6cf3b93059","block_type":"box","text":"Mergers and acquisitions","page_number":190,"box":{"x":69,"y":194,"width":184,"height":11}},{"id":"e3abf39c-6f97-4349-95ae-6531429bd2cd","block_type":"box","text":"We evaluate proposed mergers or acquisitions by assessing the financial outcome for our clients as minority","page_number":190,"box":{"x":101,"y":213,"width":775,"height":11}},{"id":"c61bdefc-4a99-45a4-acfb-d37e068afda7","block_type":"box","text":"shareholders. Management should provide an assessment of the proposed transaction’s strategic and financial","page_number":190,"box":{"x":69,"y":228,"width":797,"height":11}},{"id":"69f91bee-01b7-4a14-a3db-2450ee2a0db2","block_type":"box","text":"rationale, along with its execution and operational risks. We review each transaction independently based on these","page_number":190,"box":{"x":69,"y":243,"width":819,"height":11}},{"id":"f48b79d0-6913-4604-885b-409b5ad72707","block_type":"box","text":"factors and the degree to which the transaction enhances shareholder value. The board might consider establishing","page_number":190,"box":{"x":68,"y":257,"width":827,"height":12}},{"id":"ca9ce487-871c-4809-b618-f074d1c5b524","block_type":"box","text":"an ad hoc transaction committee to undertake an independent assessment of a significant merger or acquisition, in","page_number":190,"box":{"x":69,"y":272,"width":827,"height":11}},{"id":"3beb4325-a82b-4c75-9333-2fd2c09c9317","block_type":"box","text":"advance of making its recommendation to shareholders.","page_number":190,"box":{"x":69,"y":287,"width":400,"height":11}},{"id":"5d5aeb65-ad7f-48e2-9317-389de138aeb7","block_type":"box","text":"We will vote against transactions that, in our assessment, do not advance our clients’ financial interests.","page_number":190,"box":{"x":101,"y":306,"width":749,"height":11}},{"id":"4a27f75d-0443-40dc-82d5-97d1a1eed91b","block_type":"box","text":"Anti-takeover defenses","page_number":190,"box":{"x":68,"y":328,"width":167,"height":9}},{"id":"1557115f-eb9f-4c4f-92fe-f9b3480374fd","block_type":"box","text":"In principle, we do not support companies using anti-takeover defenses, also known as poison pills or","page_number":190,"box":{"x":102,"y":347,"width":727,"height":11}},{"id":"af346b86-e209-4f53-aeb3-2624ee31fbd6","block_type":"box","text":"shareholder rights plans, as they can entrench management and boards which have not delivered long-term","page_number":190,"box":{"x":69,"y":362,"width":766,"height":11}},{"id":"199f0883-33f3-4320-b33c-4331fd34486d","block_type":"box","text":"shareholder value. By exception, a poison pill may be supported if its purpose is to delay a takeover that is","page_number":190,"box":{"x":69,"y":376,"width":763,"height":12}},{"id":"39a4d76a-bd68-4553-a5f0-3dc544039810","block_type":"box","text":"considered sub-optimal and enable management to seek an improved offer. Similarly, management could make the","page_number":190,"box":{"x":69,"y":391,"width":821,"height":12}},{"id":"2aa0b98d-0364-4d8e-af3d-8b9ff70d82fa","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":190,"box":{"x":69,"y":406,"width":799,"height":11}},{"id":"686a8957-1a13-4271-8866-5a8f58e8d2f0","block_type":"box","text":"investors. Defense mechanisms introduced in these circumstances should be limited in term and threshold, and also","page_number":190,"box":{"x":70,"y":421,"width":836,"height":11}},{"id":"8c318136-aebb-44f9-9cab-c58310a01000","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":190,"box":{"x":69,"y":436,"width":835,"height":11}},{"id":"3740a465-1eb0-4303-a000-8c31621440f4","block_type":"box","text":"a shareholder vote any mechanisms expected to be in place for more than 12 months.","page_number":190,"box":{"x":69,"y":451,"width":616,"height":11}},{"id":"094be76f-97c8-4306-b695-edf58026b021","block_type":"box","text":"Shareholder activism","page_number":190,"box":{"x":68,"y":473,"width":153,"height":9}},{"id":"c093f0b6-201a-45f9-a9b7-caa1eb74ee15","block_type":"box","text":"When companies are the focus of an activism campaign, we may communicate with the activist to understand","page_number":190,"box":{"x":101,"y":492,"width":783,"height":11}},{"id":"b9bad8de-a560-4341-8186-055ecb3fb21a","block_type":"box","text":"their analysis and objectives, once they have publicly disclosed their campaign. We may also engage with company","page_number":190,"box":{"x":68,"y":507,"width":819,"height":11}},{"id":"4c4f7b35-5495-400c-a4cc-125208a614ad","block_type":"box","text":"management and possibly board members, especially those the activist may be seeking to replace. In our","page_number":190,"box":{"x":69,"y":522,"width":755,"height":11}},{"id":"1ca8d377-9e38-4d55-a268-0afb0f8c16be","block_type":"box","text":"assessment, we evaluate various factors, including the concerns raised by the activist and the case for change; the","page_number":190,"box":{"x":69,"y":536,"width":824,"height":12}},{"id":"1e38a6ed-4d9c-4ed1-a0d6-2e98613b329d","block_type":"box","text":"quality of both the activist’s and management’s plans; and the qualifications of each party’s candidates. We evaluate","page_number":190,"box":{"x":69,"y":551,"width":839,"height":12}},{"id":"387a9658-7360-4d06-9145-bd42dc6910e6","block_type":"box","text":"each contested situation by assessing the potential financial outcome for our clients as minority shareholders.","page_number":190,"box":{"x":69,"y":566,"width":788,"height":11}},{"id":"686e23c4-6f38-485c-b601-383f097e017d","block_type":"box","text":"We may support board candidates nominated by a shareholder activist if BAIS, in its independent judgment, or","page_number":190,"box":{"x":101,"y":585,"width":789,"height":11}},{"id":"f56fcb42-fa51-45e8-892a-e98dec2e37b0","block_type":"box","text":"the relevant portfolio manager has determined that there is a case for change to enhance shareholder value, or if the","page_number":190,"box":{"x":68,"y":600,"width":839,"height":11}},{"id":"97013328-3d8c-46e0-9a5b-783cd62bc1e7","block_type":"box","text":"incumbent board members do not demonstrate the relevant skills and expertise or have a poor track record of","page_number":190,"box":{"x":70,"y":614,"width":786,"height":11}},{"id":"ffdd0fe0-078c-4cd7-91a9-48f50e574f14","block_type":"box","text":"protecting shareholders’ interests.","page_number":190,"box":{"x":70,"y":630,"width":244,"height":11}},{"id":"c94585ce-503e-4301-ad1d-2939b7bbaada","block_type":"box","text":"Significant shareholders and related party transactions","page_number":190,"box":{"x":68,"y":652,"width":403,"height":11}},{"id":"9aa26012-2030-4cfc-a50e-0f1ff4312253","block_type":"box","text":"Boards of companies with affiliated shareholders or directors should give equitable consideration to the","page_number":190,"box":{"x":102,"y":670,"width":740,"height":12}},{"id":"b2dad07e-293b-4071-bf19-af9b42f499f0","block_type":"box","text":"interests of all shareholders when evaluating related party transactions.","page_number":190,"box":{"x":70,"y":685,"width":511,"height":12}},{"id":"62720510-da6a-49f7-9bf0-d1e152419757","block_type":"box","text":"We consider it good practice for transactions with related parties, such as significant shareholders or companies","page_number":190,"box":{"x":101,"y":704,"width":805,"height":11}},{"id":"1141c61c-8392-4d6d-a959-dac4cd26ad49","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":190,"box":{"x":69,"y":719,"width":832,"height":11}},{"id":"8a1e3e48-c860-42e6-a098-3b1069c526e8","block_type":"box","text":"have been agreed with a non-related party. In our view, such transactions should be reviewed and approved by the","page_number":190,"box":{"x":69,"y":734,"width":812,"height":11}},{"id":"107ad797-7343-49cc-8fd5-8ef6dade156f","block_type":"box","text":"independent members of the board, and if voted on, only disinterested shareholders should vote.","page_number":190,"box":{"x":70,"y":748,"width":692,"height":12}},{"id":"e414bfbb-7a47-496a-b9ff-ba424b4f516a","block_type":"box","text":"CORPORATE REPORTING, RISK MANAGEMENT AND AUDIT","page_number":190,"box":{"x":274,"y":779,"width":430,"height":10}},{"id":"b57bdabb-6c76-44f9-88d5-2261b009639a","block_type":"box","text":"Investors depend on corporate reporting, both regulatory and voluntary, to understand a company’s strategy, its","page_number":190,"box":{"x":102,"y":798,"width":796,"height":11}},{"id":"327ff752-5a67-42f3-8e66-48c7e099983e","block_type":"box","text":"implementation and financial performance, as well as to assess the quality of management and operations and","page_number":190,"box":{"x":70,"y":812,"width":795,"height":12}},{"id":"daf71ec2-0c51-4bd0-8a8f-7d1d043453aa","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":190,"box":{"x":70,"y":827,"width":779,"height":11}},{"id":"0045be2c-8161-4aab-b4ca-5495e6cf4bff","block_type":"box","text":"oversee corporate reporting and the policies and procedures underpinning the internal audit function and external","page_number":190,"box":{"x":69,"y":842,"width":809,"height":11}},{"id":"2ecc4a92-e825-4bae-a0cc-e2a65a648e57","block_type":"box","text":"audit.","page_number":190,"box":{"x":69,"y":857,"width":38,"height":9}},{"id":"ccccc957-c75f-41e3-8924-282c8425137c","block_type":"box","text":"A company’s financial reporting should provide decision-useful information for investors, and other stakeholders,","page_number":190,"box":{"x":101,"y":875,"width":803,"height":12}},{"id":"0b464ad4-5fdf-4e6d-bc73-0366b5ccabf5","block_type":"box","text":"on its financial performance and position. It should provide an accurate and balanced assessment of the risks and","page_number":190,"box":{"x":69,"y":890,"width":819,"height":11}},{"id":"820136ac-dfe7-49e5-bf1e-136229e3bbf3","block_type":"box","text":"opportunities the company faces in realizing its long-term strategy. Accordingly, the assumptions made by","page_number":190,"box":{"x":69,"y":905,"width":752,"height":12}},{"id":"bb3d1bd6-dd31-4e72-a302-8117ada202ec","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":190,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"343b7c62-9aff-4501-8683-36bc8c07957f","block_type":"box","text":"Global Engagement and Voting Guidelines | 10","page_number":190,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"8d8dccb6-448e-4f30-bfc6-4c4005de6c87","block_type":"box","text":"NM1026U-5979889-190/232","page_number":190,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"eac4f28c-a307-41ad-a9ff-bc91cc966a05","block_type":"box","text":"management and reviewed by the auditor in preparing the financial statements should be reasonable and justified.","page_number":191,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"939937c4-62eb-4f71-ac78-6733e76c335f","block_type":"box","text":"Financial statements should be prepared in accordance with globally developed reporting standards and any","page_number":191,"box":{"x":70,"y":60,"width":771,"height":11}},{"id":"7b8073a9-5482-4557-b383-dbadbc52f110","block_type":"box","text":"divergence from generally accepted accounting principles should be explained in detail and justified. Accounting","page_number":191,"box":{"x":69,"y":74,"width":796,"height":12}},{"id":"2769fca1-adb8-4767-a656-c2b225748643","block_type":"box","text":"restatements should be explained in detail and any remedial actions, and the implications of these, disclosed.","page_number":191,"box":{"x":69,"y":89,"width":788,"height":11}},{"id":"3a08c903-8170-45ac-8360-ed0e3c6a7bee","block_type":"box","text":"In this context, audit committees play a vital role in a company’s financial reporting system by providing","page_number":191,"box":{"x":102,"y":108,"width":739,"height":11}},{"id":"52a6f775-a32b-4ae9-a7df-f2bb554d2ee0","block_type":"box","text":"independent oversight of the accounts, material financial and, where appropriate to the jurisdiction, non-financial","page_number":191,"box":{"x":70,"y":123,"width":801,"height":11}},{"id":"f31b4726-52e8-4a88-a562-e00f81b3f89e","block_type":"box","text":"information, internal control frameworks and Enterprise Risk Management systems. In our view, effective audit","page_number":191,"box":{"x":70,"y":138,"width":787,"height":11}},{"id":"4068dcb4-7760-4cd6-850a-a4495c350f14","block_type":"box","text":"committee oversight strengthens the quality and reliability of a company’s financial statements and provides an","page_number":191,"box":{"x":69,"y":152,"width":795,"height":12}},{"id":"64568d9e-6271-4beb-bb99-916a3dc4b780","block_type":"box","text":"important level of reassurance to shareholders. Audit committees should have a procedure in place for assessing the","page_number":191,"box":{"x":70,"y":167,"width":838,"height":12}},{"id":"2999b292-93a4-448d-962f-0c1976c04119","block_type":"box","text":"independence of the auditor and the quality of the external audit process annually.","page_number":191,"box":{"x":70,"y":182,"width":585,"height":11}},{"id":"f6771756-f938-4317-8bef-5406f3b3857c","block_type":"box","text":"Similarly, we encourage companies to disclose material sustainability-related factors that are integral to how a","page_number":191,"box":{"x":102,"y":201,"width":784,"height":11}},{"id":"f4e79d4c-5776-45ee-8152-7d16241aea0e","block_type":"box","text":"company manages risks or generates revenue. BAIS finds it helpful to our understanding when companies provide","page_number":191,"box":{"x":69,"y":216,"width":812,"height":11}},{"id":"56a3e0bd-b6be-4bc9-bc3e-04a1803097e1","block_type":"box","text":"robust, standardized disclosures on their material sustainability-related risks and opportunities. The International","page_number":191,"box":{"x":69,"y":231,"width":806,"height":11}},{"id":"8ef1738a-5ed4-45e1-9165-0d0f26bd2d4c","block_type":"box","text":"Sustainability Standards Board (ISSB) is one entity working to meet these objectives through its reporting standards,","page_number":191,"box":{"x":69,"y":246,"width":832,"height":11}},{"id":"dcb5cd15-810c-461b-9811-c5093068bc95","block_type":"box","text":"which may be helpful to companies in preparing such reports.","page_number":191,"box":{"x":68,"y":260,"width":440,"height":12}},{"id":"7713df23-2c49-4d22-a76e-c196a0556b4f","block_type":"box","text":"9","page_number":191,"box":{"x":509,"y":261,"width":5,"height":4}},{"id":"68d7061d-6dd0-4adc-ac0a-5b1539a67fbd","block_type":"box","text":"However, we do not mandate any specific disclosure","page_number":191,"box":{"x":520,"y":260,"width":372,"height":11}},{"id":"23af6286-dbde-4722-a706-69ecfd42e433","block_type":"box","text":"framework, and note that companies in certain jurisdictions are subject to mandatory reporting requirements under","page_number":191,"box":{"x":68,"y":275,"width":824,"height":11}},{"id":"8e9d7633-3b4b-4412-a310-bc598ac6d4eb","block_type":"box","text":"standards specified by policy makers.","page_number":191,"box":{"x":69,"y":290,"width":267,"height":11}},{"id":"3187c810-6774-469e-8bcb-085e7ccc0df4","block_type":"box","text":"10","page_number":191,"box":{"x":338,"y":290,"width":9,"height":5}},{"id":"cae380d6-9709-474a-855c-42a0bc2dc11f","block_type":"box","text":"Companies should establish robust risk management and internal control processes appropriate to the","page_number":191,"box":{"x":102,"y":309,"width":735,"height":11}},{"id":"388a6996-dac9-4b10-bede-bf10c0e777e7","block_type":"box","text":"company’s business, risk tolerance, and regulatory environment. A credible whistleblowing system for employees,","page_number":191,"box":{"x":69,"y":323,"width":810,"height":12}},{"id":"1eb08740-5501-4f50-ad4a-7869a066f91f","block_type":"box","text":"and potentially other stakeholders, can be a useful mechanism for ensuring that senior management and the board","page_number":191,"box":{"x":69,"y":338,"width":822,"height":12}},{"id":"f3df8f8d-cd1d-4f18-b8f3-500ad4dd2b18","block_type":"box","text":"are aware of potential misconduct or breaches in risk management and internal control processes.","page_number":191,"box":{"x":69,"y":353,"width":704,"height":12}},{"id":"01e40a44-93aa-421f-a475-9f70e1060503","block_type":"box","text":"A comprehensive audit conducted by an independent audit firm contributes to investor confidence in the quality","page_number":191,"box":{"x":101,"y":372,"width":794,"height":11}},{"id":"a9af0416-8d3c-4bec-819a-ac184e151de4","block_type":"box","text":"of corporate reporting. It is helpful when the audit report gives some insight into the scope and focus of the audit, as","page_number":191,"box":{"x":69,"y":387,"width":836,"height":11}},{"id":"b72ed258-f4c2-4a25-9e81-7b2b2ae2697d","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":191,"box":{"x":68,"y":402,"width":838,"height":11}},{"id":"1e14525e-95a9-4f91-93c8-0a0bdd8931c5","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":191,"box":{"x":69,"y":416,"width":773,"height":11}},{"id":"799ed9cf-f586-44bc-8dcf-0f224b904dc2","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":191,"box":{"x":69,"y":431,"width":804,"height":12}},{"id":"7104f4e4-f8cc-4d87-bebf-4a2a6c0d626d","block_type":"box","text":"audit. The audit committee should explain its position on auditor tenure and how it confirmed that the auditor","page_number":191,"box":{"x":69,"y":446,"width":780,"height":11}},{"id":"de1f52d1-74de-400f-b194-f26bdef7d1cf","block_type":"box","text":"remained independent.","page_number":191,"box":{"x":69,"y":461,"width":163,"height":11}},{"id":"042a5948-f79e-46b9-a2a3-29d0b0b6bce1","block_type":"box","text":"We may vote against the election of the responsible directors if corporate reporting is insufficient or there are","page_number":191,"box":{"x":101,"y":480,"width":783,"height":11}},{"id":"0831965a-f456-475d-9001-587d19f3b22e","block_type":"box","text":"material misstatements in financial reports. In markets where relevant, we may vote against a proposal to approve","page_number":191,"box":{"x":69,"y":495,"width":819,"height":11}},{"id":"40ebf735-56b0-436a-b666-59899c5c067b","block_type":"box","text":"the financial statements or the discharge of the board when we are concerned about the quality of corporate","page_number":191,"box":{"x":68,"y":509,"width":774,"height":12}},{"id":"6ad0df0c-8560-42e2-859f-2efb73218cb8","block_type":"box","text":"reporting or the audit. We may vote against proposals to appoint the auditor, ratify the audit report, or approve the","page_number":191,"box":{"x":69,"y":524,"width":816,"height":12}},{"id":"df81bb8d-b1e5-487d-b1de-af5e6630779c","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":191,"box":{"x":69,"y":539,"width":779,"height":11}},{"id":"86dd6162-4f31-463b-bd2d-c72c99c3f498","block_type":"box","text":"misstatements in financial reports and the board has not established reasonable remediation plans.","page_number":191,"box":{"x":69,"y":554,"width":718,"height":11}},{"id":"0b0c742e-5f6a-4c5d-9d19-32cf2f816dc0","block_type":"box","text":"SHAREHOLDER RIGHTS AND PROTECTIONS","page_number":191,"box":{"x":329,"y":584,"width":319,"height":9}},{"id":"706f2872-39ff-4ad4-be33-5a600758e122","block_type":"box","text":"General shareholder meetings","page_number":191,"box":{"x":69,"y":607,"width":217,"height":11}},{"id":"d900be54-598c-4205-9b75-e623c6759d43","block_type":"box","text":"Companies normally have an annual general meeting of shareholders at which routine and non-routine items of","page_number":191,"box":{"x":102,"y":625,"width":792,"height":12}},{"id":"f2fedc26-0dee-44b3-9200-1fb0742b30be","block_type":"box","text":"business are discussed and voted on by shareholders in attendance or submitting proxy votes. Companies should","page_number":191,"box":{"x":69,"y":640,"width":812,"height":11}},{"id":"e66781a1-7e77-442e-8858-71538d36beac","block_type":"box","text":"disclose materials relevant to the shareholder meeting sufficiently in advance so that shareholders can take them","page_number":191,"box":{"x":69,"y":655,"width":813,"height":11}},{"id":"20186d59-eb1c-48f4-b8fa-74dc6acbfad6","block_type":"box","text":"into consideration in their voting decisions. Many companies offer shareholders the option of participating in the","page_number":191,"box":{"x":70,"y":670,"width":801,"height":11}},{"id":"4f0ed92f-fa13-48ba-9a4b-67452f2a947f","block_type":"box","text":"meeting virtually which, whilst welcome, should not limit the rights of shareholders to participate as they would during","page_number":191,"box":{"x":69,"y":685,"width":841,"height":11}},{"id":"8f6baf21-6496-44cd-b4e9-9d833c5d5884","block_type":"box","text":"an in-person meeting.","page_number":191,"box":{"x":69,"y":700,"width":152,"height":11}},{"id":"81bf4289-b9ba-40b1-b20e-39f44f9a1c83","block_type":"box","text":"We may vote against directors when materials related to the business of the shareholder meeting are not","page_number":191,"box":{"x":101,"y":718,"width":752,"height":12}},{"id":"44ace57d-a312-407f-a924-12eb72046af8","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":191,"box":{"x":70,"y":733,"width":821,"height":11}},{"id":"073a5db5-492b-4b60-8b2a-cd0e48544e4e","block_type":"box","text":"may vote against directors if the format of the shareholder meeting does not accommodate reasonable shareholder","page_number":191,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"ac17dc85-5d1f-478a-96ad-794f77cb3d60","block_type":"box","text":"participation.","page_number":191,"box":{"x":70,"y":763,"width":91,"height":11}},{"id":"aceeb87f-bcbc-45b5-a008-9372bf9e3241","block_type":"box","text":"9","page_number":191,"box":{"x":69,"y":793,"width":4,"height":4}},{"id":"a62f6b22-118c-4f7b-9df0-567d6570e548","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards","page_number":191,"box":{"x":93,"y":792,"width":744,"height":11}},{"id":"2b605856-2914-4c73-9b8d-deed1e452071","block_type":"box","text":"(IFRS) Foundation. Please refer to the IFRS website to learn more about the framework and standards S1","page_number":191,"box":{"x":94,"y":807,"width":748,"height":11}},{"id":"b566ae94-1952-4fbe-bf8b-cd6282578a3b","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":191,"box":{"x":94,"y":822,"width":778,"height":12}},{"id":"622ba1ec-72a0-4612-b244-b3d1aa0bc7a7","block_type":"box","text":"Disclosures.”","page_number":191,"box":{"x":94,"y":838,"width":93,"height":8}},{"id":"5ffcad2a-cd1a-47c1-bb97-3485457749ac","block_type":"box","text":"10","page_number":191,"box":{"x":69,"y":856,"width":9,"height":4}},{"id":"05a31ff4-5c16-49f0-9fa7-8b9281e32468","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":191,"box":{"x":93,"y":858,"width":810,"height":11}},{"id":"44c56d5b-fa49-40b3-988f-ed77df80bcd8","block_type":"box","text":"See, for examples, https://www.ifrs.org/newsandevents/news/2025/06/ifrsfoundationpublishesjurisdictional\r\nprofiles-issb-standards/ and https://finance.ec.europa.eu/capital-markets-union-and-financial-markets/companyreporting\r\nandaditing/companreporting/corporatesstainabilitreportingen","page_number":191,"box":{"x":94,"y":866,"width":804,"height":12}},{"id":"3f8ea761-119b-461d-98d2-6cc512925ddb","block_type":"box","text":"p/ p//p/p\r\nreporting-and-auditing/company-reporting/corporate-sustainability-reporting_en.","page_number":191,"box":{"x":94,"y":876,"width":564,"height":11}},{"id":"82327baa-0f51-4720-8d0e-d9b586c51401","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":191,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"897789e6-cc85-403f-a7fb-4a6f689a7e1a","block_type":"box","text":"Global Engagement and Voting Guidelines | 11","page_number":191,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"b2f7cffa-4815-420f-9b8b-378ccbff8de5","block_type":"box","text":"NM1026U-5979889-191/232","page_number":191,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f36c8f52-89b3-4fc0-a635-d8ce3cf00dbb","block_type":"box","text":"Bylaw amendments","page_number":192,"box":{"x":69,"y":45,"width":141,"height":11}},{"id":"cf96b18a-d701-4da4-8a8e-2fe9244ab87a","block_type":"box","text":"We review bylaw amendments proposed by management on a case-by-case basis and will generally support","page_number":192,"box":{"x":101,"y":64,"width":766,"height":11}},{"id":"2f35f3a2-5339-44a9-8e8d-26c5a5eee3ea","block_type":"box","text":"those that are aligned with the interests of minority shareholders. Any material changes to the bylaws should be","page_number":192,"box":{"x":68,"y":78,"width":800,"height":11}},{"id":"da34711d-a9cb-41df-82d5-347a2d99ad48","block_type":"box","text":"explained in detail and put to a shareholder vote.","page_number":192,"box":{"x":69,"y":93,"width":349,"height":11}},{"id":"0b379606-57fc-43f4-a711-1f6825fcaf61","block_type":"box","text":"We may vote against bylaw amendments that reduce shareholder rights and protections or introduce additional","page_number":192,"box":{"x":101,"y":112,"width":790,"height":11}},{"id":"b6e86bee-0b8f-4f87-9279-086187aa3118","block_type":"box","text":"burdens. We may vote against directors if material changes are made to the bylaws without shareholder approval.","page_number":192,"box":{"x":69,"y":126,"width":810,"height":12}},{"id":"57c7c64c-0536-4fa8-8670-e8532a0d3fca","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":192,"box":{"x":102,"y":145,"width":790,"height":11}},{"id":"099aa35d-206f-4723-93bd-683e0b0cf8b7","block_type":"box","text":"group, with a meaningful shareholding, the right to call a special meeting of shareholders. The shareholding required","page_number":192,"box":{"x":68,"y":160,"width":831,"height":11}},{"id":"b0c82366-ec6d-412d-a6de-f5b96641e730","block_type":"box","text":"to exercise this right should balance its utility with the cost to the company of holding special meetings.","page_number":192,"box":{"x":68,"y":175,"width":740,"height":11}},{"id":"03b0957e-abd3-4d10-aaba-dfb7ea4fedf2","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":192,"box":{"x":102,"y":193,"width":790,"height":12}},{"id":"42b51903-b2fd-48f9-8325-0554903dc472","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":192,"box":{"x":68,"y":208,"width":834,"height":12}},{"id":"e832ebd5-022b-4509-8947-422cfa0580dc","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":192,"box":{"x":69,"y":223,"width":758,"height":12}},{"id":"0df25a96-5155-4901-8243-da34add35c8a","block_type":"box","text":"nomination process.","page_number":192,"box":{"x":69,"y":238,"width":143,"height":11}},{"id":"6ef6e2be-081b-47d5-8eb0-7967e53ec44f","block_type":"box","text":"Whilst we would not use either of these rights ourselves, we see them as important accountability mechanisms.","page_number":192,"box":{"x":101,"y":257,"width":799,"height":11}},{"id":"91543ecb-7df4-43c5-b1f5-323faa86febc","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":192,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"fef1e78c-233a-4a89-a7a1-7532359d7498","block_type":"box","text":"Change of domicile","page_number":192,"box":{"x":69,"y":294,"width":139,"height":11}},{"id":"80682ab9-02a7-4883-b3c9-5f5c29654422","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":192,"box":{"x":101,"y":313,"width":778,"height":11}},{"id":"076cbff5-62b0-4be8-8270-2ac584932b0d","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":192,"box":{"x":69,"y":328,"width":766,"height":11}},{"id":"64a5908a-a925-4a2c-938e-fd7f8a7ee0fb","block_type":"box","text":"immaterial.","page_number":192,"box":{"x":70,"y":343,"width":77,"height":8}},{"id":"8df98142-8fc4-475a-a1d5-6cc504551276","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":192,"box":{"x":101,"y":361,"width":777,"height":11}},{"id":"334ba0b2-50ed-470b-a80b-adce784753cf","block_type":"box","text":"with our clients’ financial interests.","page_number":192,"box":{"x":68,"y":376,"width":249,"height":9}},{"id":"c0e62649-9568-4a35-8163-bbe1b333c08d","block_type":"box","text":"Changes to a company’s purpose or the nature of its business","page_number":192,"box":{"x":69,"y":398,"width":452,"height":11}},{"id":"4d820633-43c7-4230-b9b1-c9af19372dbe","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":192,"box":{"x":102,"y":417,"width":803,"height":11}},{"id":"26ddad96-263c-4573-afb7-e4728a80787c","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":192,"box":{"x":70,"y":432,"width":829,"height":11}},{"id":"8f2cc3fe-2269-4fff-8e96-0429f9ea63b4","block_type":"box","text":"on the suitability of a company for their investment strategy or portfolio.","page_number":192,"box":{"x":69,"y":447,"width":511,"height":11}},{"id":"9dae0f4f-7ab2-4b2a-96fe-fc2090f295f4","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":192,"box":{"x":101,"y":465,"width":792,"height":12}},{"id":"8dab5dea-12d4-4fa1-9322-0faf059bc494","block_type":"box","text":"the board has not provided a credible argument for change.","page_number":192,"box":{"x":68,"y":480,"width":424,"height":12}},{"id":"3f2fa706-e140-4f93-97eb-53eda5bbed91","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":192,"box":{"x":385,"y":510,"width":207,"height":9}},{"id":"6627eba3-7b4c-4e44-9b1c-63b07e49fabd","block_type":"box","text":"Shareholders in many markets, who meet certain eligibility criteria, have the right to submit proposals to the","page_number":192,"box":{"x":102,"y":529,"width":772,"height":11}},{"id":"8d9ac85d-7bd0-4a57-bea1-bc87278321f1","block_type":"box","text":"general shareholder meeting asking a company to take a particular course of action subject to the proposal being","page_number":192,"box":{"x":68,"y":544,"width":811,"height":11}},{"id":"fdf878df-acf6-482f-b73e-c0c28489f4f7","block_type":"box","text":"supported by a majority of votes cast at the meeting. The topics raised can address a range of matters that may be","page_number":192,"box":{"x":69,"y":559,"width":824,"height":11}},{"id":"28ad28eb-435c-4edd-b925-3151d6c4447d","block_type":"box","text":"relevant to a company’s business.","page_number":192,"box":{"x":69,"y":574,"width":243,"height":11}},{"id":"f2e06f10-c01e-4d4d-b907-e243fc873aff","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":192,"box":{"x":101,"y":592,"width":730,"height":11}},{"id":"0af24d22-7d07-4d8f-9a42-9373d98288a2","block_type":"box","text":"company’s business and its current approach, whether the actions sought are consistent with shareholders’","page_number":192,"box":{"x":69,"y":607,"width":772,"height":11}},{"id":"ab451eb5-a70d-4bfc-8ca6-47800f94e706","block_type":"box","text":"interests, and what impact the proposal being acted upon might have on financial performance.","page_number":192,"box":{"x":70,"y":622,"width":681,"height":11}},{"id":"e9ffb273-9861-4984-930d-6208130a7856","block_type":"box","text":"Our general approach where we have concerns about a company’s governance, disclosures or performance is to","page_number":192,"box":{"x":102,"y":641,"width":801,"height":11}},{"id":"76f244c6-b9d8-4763-b9e4-869ffd36e128","block_type":"box","text":"engage to understand the apparent difference in perspective. If we are concerned a company is not acting in","page_number":192,"box":{"x":69,"y":656,"width":774,"height":11}},{"id":"edbfab57-bde1-464c-8e90-f435e550970d","block_type":"box","text":"shareholders’ financial interests, we may vote against the election of directors. We may support a relevant","page_number":192,"box":{"x":69,"y":670,"width":761,"height":12}},{"id":"ee4fbc34-6d6e-4c80-a3ad-9bce62d693e2","block_type":"box","text":"shareholder proposal if doing so is aligned with our clients’ financial interests. We generally do not support","page_number":192,"box":{"x":69,"y":685,"width":764,"height":12}},{"id":"1ed8165b-065d-405d-8f31-e1716e21c5a0","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":192,"box":{"x":69,"y":700,"width":785,"height":11}},{"id":"4bacb8c4-7e8f-4758-95d3-6cfd2ba8cf77","block_type":"box","text":"operations, or are unrelated to how a company manages risk or generates financial returns.","page_number":192,"box":{"x":69,"y":715,"width":653,"height":11}},{"id":"7b6151d1-6f43-4fdc-95b4-4151c0127045","block_type":"box","text":"BlackRock is subject to rules, regulations, agency guidance and contractual agreements that place restrictions","page_number":192,"box":{"x":102,"y":734,"width":788,"height":11}},{"id":"7f20e6a2-3525-4084-b72e-3eba864a6da0","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":192,"box":{"x":69,"y":748,"width":822,"height":12}},{"id":"acc8fec9-fb9d-464f-a11d-196254a9a011","block_type":"box","text":"ability to submit shareholder proposals. We do not submit shareholder proposals but can vote, on behalf of clients","page_number":192,"box":{"x":69,"y":763,"width":817,"height":12}},{"id":"5dbdb153-7265-4f79-8955-5357325a14d3","block_type":"box","text":"who authorize us to do so, on proposals put forth by others.","page_number":192,"box":{"x":68,"y":778,"width":428,"height":11}},{"id":"f24a55c4-ee83-436c-812e-2e06d94f1a43","block_type":"box","text":"CORPORATE POLITICAL ACTIVITIES","page_number":192,"box":{"x":359,"y":808,"width":260,"height":9}},{"id":"30881319-c9e5-45fa-a73e-1105b6282b94","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":192,"box":{"x":101,"y":827,"width":795,"height":11}},{"id":"8adb81bb-19eb-4068-b8d2-43e7fa81ec06","block_type":"box","text":"in which they engage. When a corporation reports material financial risk related to policy and or regulatory changes,","page_number":192,"box":{"x":70,"y":842,"width":824,"height":11}},{"id":"b27b1587-6235-48ce-9a8d-6773b724e400","block_type":"box","text":"BAIS may seek to understand how it is addressing the material risk identified. We seek to understand how","page_number":192,"box":{"x":70,"y":857,"width":757,"height":11}},{"id":"9ffbb354-2f4f-4dfa-b5bd-6a8f7f34dc5a","block_type":"box","text":"companies engage in corporate political activities and ensure that their participation is consistent with their public","page_number":192,"box":{"x":69,"y":872,"width":814,"height":11}},{"id":"4bbc6e7d-d06a-406f-b915-461f7e8ab2ed","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":192,"box":{"x":69,"y":887,"width":780,"height":11}},{"id":"a38cd664-11da-4d67-995f-bb5824f3a485","block_type":"box","text":"approach taken by management on corporate political activities as there can be reputational risks arising from","page_number":192,"box":{"x":69,"y":901,"width":786,"height":12}},{"id":"f84b3ccc-1322-48eb-bb2d-6c467ff9b87a","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":192,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"a9ee174d-74fa-4ecb-8a11-2c0992e4ba6a","block_type":"box","text":"Global Engagement and Voting Guidelines | 12","page_number":192,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"f4793d68-9dd4-41f0-bf4e-830436150702","block_type":"box","text":"NM1026U-5979889-192/232","page_number":192,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"71034308-d05e-4c45-bb94-510585ff8ae2","block_type":"box","text":"inconsistencies between a company’s policy engagement and stated policy positions. Companies should, as a","page_number":193,"box":{"x":70,"y":45,"width":786,"height":11}},{"id":"54800eee-cb11-43cd-89e4-14976832eab7","block_type":"box","text":"minimum, meet all regulatory disclosure requirements on political activities. We may engage a company where we","page_number":193,"box":{"x":69,"y":60,"width":812,"height":11}},{"id":"d819937b-5e90-43ec-a2fb-dc6efa6aae4c","block_type":"box","text":"would like to better understand its approach to policy engagement, where relevant.","page_number":193,"box":{"x":68,"y":75,"width":590,"height":11}},{"id":"6093c1e6-641c-478b-8129-36be4ca1d491","block_type":"box","text":"To mitigate the risk of inconsistencies, companies may wish to assess the alignment between their policy","page_number":193,"box":{"x":101,"y":93,"width":753,"height":11}},{"id":"5d626d6b-ee29-4d4d-82d2-aef01325e35c","block_type":"box","text":"priorities and the policy positions of the trade associations of which they are active members and any engagements","page_number":193,"box":{"x":70,"y":108,"width":823,"height":11}},{"id":"64a2cd7c-3266-451f-9c8d-11da1aa04530","block_type":"box","text":"undertaken by trade associations on behalf of members.","page_number":193,"box":{"x":69,"y":123,"width":404,"height":11}},{"id":"5992b473-b32c-4d41-a5f7-63a24fa63d17","block_type":"box","text":"We may support a relevant shareholder proposal, or vote against directors, where a company’s disclosures are","page_number":193,"box":{"x":101,"y":142,"width":793,"height":11}},{"id":"ef0f52d6-8ed4-4812-b199-685845e7e1db","block_type":"box","text":"insufficient to address the material risk it has identified.","page_number":193,"box":{"x":70,"y":156,"width":400,"height":9}},{"id":"d945c714-b334-422b-b9f3-a1761963de44","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":193,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"53c8464b-0fa2-4e24-89e9-f61aab851a88","block_type":"box","text":"Global Engagement and Voting Guidelines | 13","page_number":193,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"81534a98-9428-4a0a-bc92-aef53ecf42b4","block_type":"box","text":"NM1026U-5979889-193/232","page_number":193,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"5a2d5f82-9c61-46d7-b490-e608aec2ca13","block_type":"box","text":"MATERIAL SUSTAINABILITY- RELATED RISKS AND OPPORTUNITIES","page_number":194,"box":{"x":245,"y":45,"width":489,"height":9}},{"id":"b96e72e3-0e58-4457-984b-958fdfcd312d","block_type":"box","text":"We seek to understand how companies manage the material risks and opportunities inherent in their business","page_number":194,"box":{"x":101,"y":64,"width":790,"height":11}},{"id":"a75aaebd-2e0e-417e-bff4-4b685d1083a7","block_type":"box","text":"operations. In our experience, sustainability-related factors","page_number":194,"box":{"x":69,"y":78,"width":418,"height":12}},{"id":"133bf138-b564-4cba-abc2-81c6d275eb2c","block_type":"box","text":"11","page_number":194,"box":{"x":488,"y":79,"width":9,"height":4}},{"id":"aa539c2d-f6fa-4f45-9450-8c2fd87bda9e","block_type":"box","text":"that are relevant to a company’s business or material to","page_number":194,"box":{"x":502,"y":79,"width":402,"height":11}},{"id":"473216c4-9497-4813-b6c4-d329d2ed3e2c","block_type":"box","text":"its financial performance, are generally operational considerations embedded into day-to-day management systems.","page_number":194,"box":{"x":70,"y":93,"width":824,"height":12}},{"id":"535d3f92-8598-4394-8827-a57f91ecfa34","block_type":"box","text":"Certain sustainability issues may also inform long-term strategic planning, for example, investing in product","page_number":194,"box":{"x":69,"y":108,"width":766,"height":11}},{"id":"9a5a2584-3ae0-48a6-8532-2fa1d7c28f5a","block_type":"box","text":"innovation in anticipation of changing consumer demand or adapting supply chains in response to changing","page_number":194,"box":{"x":70,"y":123,"width":764,"height":11}},{"id":"02d71bc2-c58e-427a-baf9-e5e478948702","block_type":"box","text":"regulatory requirements.","page_number":194,"box":{"x":69,"y":138,"width":174,"height":11}},{"id":"38aa41d1-c714-418c-a951-c154b4718d29","block_type":"box","text":"We recognize that the specific sustainability-related factors that may be financially material or business relevant","page_number":194,"box":{"x":101,"y":156,"width":798,"height":12}},{"id":"755e53ed-b79c-4fc5-804d-91fd0f562096","block_type":"box","text":"will vary by company business model, sector, key markets, and time horizon, amongst other considerations. From","page_number":194,"box":{"x":68,"y":172,"width":809,"height":11}},{"id":"dc935865-7b67-4d89-9f45-fdd9a8455aeb","block_type":"box","text":"company disclosures and our engagement, we aim to understand how management is identifying, assessing and","page_number":194,"box":{"x":69,"y":186,"width":803,"height":12}},{"id":"f9a889c9-a59c-4298-bbdd-054ab31a9da8","block_type":"box","text":"integrating material sustainability-related risks and opportunities into their business decision-making and practices.","page_number":194,"box":{"x":70,"y":201,"width":820,"height":11}},{"id":"c7c6d197-e064-471e-8d4d-0660ae1d1d24","block_type":"box","text":"Doing so helps us undertake a more holistic assessment of a company’s potential financial performance and the","page_number":194,"box":{"x":70,"y":216,"width":808,"height":11}},{"id":"39420516-c16c-4dbd-9928-1f985096c55a","block_type":"box","text":"likely risk-adjusted returns of an investment.","page_number":194,"box":{"x":70,"y":231,"width":313,"height":11}},{"id":"70b3e7ed-90d1-496a-a46e-7b3956b5168f","block_type":"box","text":"We may vote against directors or support a relevant shareholder proposal if we have concerns about how a","page_number":194,"box":{"x":101,"y":249,"width":764,"height":12}},{"id":"e803bffb-7426-4865-a6bf-e001e0ea74a2","block_type":"box","text":"company is managing or disclosing its approach to material sustainability-related risks that may impact financial","page_number":194,"box":{"x":69,"y":264,"width":798,"height":12}},{"id":"062477e3-9ff7-4391-bb6c-797548721ac8","block_type":"box","text":"returns.","page_number":194,"box":{"x":69,"y":280,"width":54,"height":8}},{"id":"92554eb7-db8d-4ead-8716-d07210ae497b","block_type":"box","text":"KEY STAKEHOLDERS","page_number":194,"box":{"x":414,"y":309,"width":151,"height":9}},{"id":"593e3131-2e25-4c8a-b2be-bc3c5a385fc5","block_type":"box","text":"In our view, companies should understand and take into consideration the interests of the various parties on","page_number":194,"box":{"x":102,"y":328,"width":774,"height":11}},{"id":"6a8fb1b5-6559-478c-be16-757f8374f928","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":194,"box":{"x":68,"y":343,"width":826,"height":11}},{"id":"3dafadc7-4f3f-4606-a87a-466f14996913","block_type":"box","text":"what is material to their business and long-term financial performance. For many companies, key stakeholders","page_number":194,"box":{"x":68,"y":358,"width":790,"height":11}},{"id":"2ddbacc0-b6ca-48ed-b1e0-b036a7bead52","block_type":"box","text":"include employees, business partners (such as suppliers and distributors), clients and consumers, regulators, and","page_number":194,"box":{"x":70,"y":373,"width":817,"height":11}},{"id":"33a72a45-87ef-466c-b4ee-f88f5d613c9d","block_type":"box","text":"the communities in which they operate. Companies that appropriately balance the interests of investors and other","page_number":194,"box":{"x":68,"y":387,"width":813,"height":12}},{"id":"2417bc89-0676-4e36-a633-54c7d024859a","block_type":"box","text":"stakeholders are, in our experience, more likely to be financially resilient over time.","page_number":194,"box":{"x":69,"y":402,"width":592,"height":12}},{"id":"95256ff0-c0cc-478e-89ad-1233329c116f","block_type":"box","text":"CLIMATE AND DECARBONIZATION INVESTMENT OBJECTIVES","page_number":194,"box":{"x":265,"y":432,"width":448,"height":9}},{"id":"2adcb9f8-70ca-4a9f-9287-6216eee12086","block_type":"box","text":"Certain active BlackRock funds have climate and decarbonization objectives in addition to financial objectives.","page_number":194,"box":{"x":102,"y":451,"width":784,"height":11}},{"id":"a0d59379-7722-4911-86a2-40e44382004d","block_type":"box","text":"Consistent with the objectives of those investment strategies, our stewardship activity in relation to the holdings in","page_number":194,"box":{"x":69,"y":466,"width":818,"height":11}},{"id":"4c909786-c76c-4fd1-a0fc-43f30956c786","block_type":"box","text":"those funds differs in some respects from BAIS’ benchmark guidelines, which are described above. Specifically, for","page_number":194,"box":{"x":68,"y":481,"width":823,"height":11}},{"id":"3927b1b1-fb75-47f7-8369-52eca58380ec","block_type":"box","text":"those funds’ holdings, we look to investee companies to demonstrate that they are aligned with a decarbonization","page_number":194,"box":{"x":68,"y":496,"width":814,"height":11}},{"id":"be8134f5-3bba-49a6-9ef6-1db01506603d","block_type":"box","text":"pathway that means their business model would be viable in a low-carbon economy,","page_number":194,"box":{"x":70,"y":511,"width":594,"height":11}},{"id":"2ef77d52-c1c6-44aa-825c-bc2ff22a62ca","block_type":"box","text":"i.e.","page_number":194,"box":{"x":672,"y":511,"width":20,"height":9}},{"id":"1bf7fdad-9800-4f81-9449-488c25dfe2ca","block_type":"box","text":", one in which global","page_number":194,"box":{"x":694,"y":511,"width":144,"height":11}},{"id":"b64b8d91-578d-4330-9b26-341242ebf6de","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":194,"box":{"x":68,"y":526,"width":821,"height":11}},{"id":"14461c01-0b01-4906-8497-08a8b1be5920","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":194,"box":{"x":69,"y":540,"width":839,"height":12}},{"id":"558c7ace-d940-48b1-aeb8-efcfb713cf5e","block_type":"box","text":"accounts, these guidelines are only implemented upon explicit selection and approval by the applicable fund board or","page_number":194,"box":{"x":69,"y":555,"width":837,"height":12}},{"id":"6c1606a4-dbe7-4e22-989e-67083b19903c","block_type":"box","text":"client.","page_number":194,"box":{"x":69,"y":570,"width":41,"height":9}},{"id":"9e298407-cb96-46ea-98a7-1afadc1c2895","block_type":"box","text":"These decarbonization stewardship guidelines focus on companies which produce goods and services that","page_number":194,"box":{"x":101,"y":589,"width":761,"height":11}},{"id":"e783048c-36dc-498f-8124-637baa90e27a","block_type":"box","text":"contribute to real world decarbonization or have a carbon intensive business model and face outsized impacts from","page_number":194,"box":{"x":69,"y":604,"width":821,"height":11}},{"id":"ed9961f2-95ac-4a98-9381-57f9b6f49fc6","block_type":"box","text":"the low carbon transition, based on reported and estimated scopes 1, 2, and 3 greenhouse gas emissions. These","page_number":194,"box":{"x":68,"y":619,"width":817,"height":11}},{"id":"65eed559-7100-404b-b9d9-c9c0f7441d02","block_type":"box","text":"companies should provide disclosures that set out their governance, strategy, risk management processes and","page_number":194,"box":{"x":69,"y":634,"width":792,"height":11}},{"id":"e3c24c27-5c2f-49be-ade0-38f2c1c28f83","block_type":"box","text":"metrics and targets relevant to decarbonization. It is helpful to investors’ understanding when these disclosures","page_number":194,"box":{"x":69,"y":648,"width":799,"height":12}},{"id":"fdce7d45-d477-440e-99e6-c4067122ee80","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":194,"box":{"x":70,"y":663,"width":812,"height":11}},{"id":"b0393728-a8fe-4bfd-8524-3fdb8f642d15","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":194,"box":{"x":68,"y":678,"width":831,"height":11}},{"id":"e21af470-a3a9-4b35-8235-cc298e3eebdb","block_type":"box","text":"1 and 2 emissions.","page_number":194,"box":{"x":70,"y":693,"width":135,"height":9}},{"id":"526f3ba6-f9b4-4a5c-835c-8a2bea9e37cd","block_type":"box","text":"Under these climate- and decarbonization-specific guidelines, BAIS may recommend a vote against directors or","page_number":194,"box":{"x":102,"y":711,"width":788,"height":12}},{"id":"4c3868b4-304a-4a8a-af97-673d3a86b8fa","block_type":"box","text":"support for a relevant shareholder proposal if a company does not appear to be adequately acting to address or","page_number":194,"box":{"x":69,"y":726,"width":800,"height":12}},{"id":"748b78e7-8e2a-43a6-82ed-c4222f32fa91","block_type":"box","text":"disclosing material climate-related risks, consistent with the parameters set out in these climate-and decarbonization","page_number":194,"box":{"x":69,"y":741,"width":839,"height":12}},{"id":"48ac0299-49c8-4150-b637-cfdabaae4d82","block_type":"box","text":"specific guidelines. We may recommend supporting shareholder proposals seeking information relevant to a","page_number":194,"box":{"x":69,"y":756,"width":771,"height":11}},{"id":"bb2f7c0f-855d-4e05-bdb5-98fc4d0cdfdd","block_type":"box","text":"11","page_number":194,"box":{"x":69,"y":786,"width":9,"height":4}},{"id":"ef163642-333f-44bb-84e0-3db1dda3a0a4","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in","page_number":194,"box":{"x":84,"y":785,"width":822,"height":11}},{"id":"673e07b4-12ab-441d-a554-327aa0f56b6c","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":194,"box":{"x":69,"y":800,"width":835,"height":12}},{"id":"e22aae14-30a9-47ee-bd8c-e61c116772ff","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":194,"box":{"x":70,"y":816,"width":827,"height":11}},{"id":"c0078238-9d7e-4e67-bf15-d048e8782956","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":194,"box":{"x":70,"y":831,"width":826,"height":11}},{"id":"1c517ef4-57b8-4c8c-9b51-8036e4a9fe66","block_type":"box","text":"operates, customer loyalty, and relationships with regulators. It is our view that well-managed companies will","page_number":194,"box":{"x":69,"y":846,"width":773,"height":11}},{"id":"b3d0767a-b007-4326-8d40-34d1aa0efb30","block_type":"box","text":"effectively evaluate and manage material sustainability-related risks and opportunities relevant to their businesses.","page_number":194,"box":{"x":69,"y":861,"width":823,"height":11}},{"id":"47c62349-8ba9-44fd-812a-497ca6fb9ce7","block_type":"box","text":"Governance is the core means by which boards can oversee the creation of durable financial value over time.","page_number":194,"box":{"x":69,"y":876,"width":777,"height":11}},{"id":"0a174158-d3e7-414b-94fa-118b2fe4aeb8","block_type":"box","text":"Appropriate risk oversight of business-relevant and material sustainability-related considerations is a component of a","page_number":194,"box":{"x":68,"y":891,"width":833,"height":11}},{"id":"e87ad5c9-59af-4322-8e63-e616734f2b32","block_type":"box","text":"sound governance framework.","page_number":194,"box":{"x":69,"y":906,"width":212,"height":12}},{"id":"7e5e58ad-2f69-4408-a400-751e44574e82","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":194,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"ca451281-a7a2-4d61-92a3-9e7d8ef08251","block_type":"box","text":"Global Engagement and Voting Guidelines | 14","page_number":194,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"5a8f3b5c-1a08-42bc-8d6b-91bea941e2d1","block_type":"box","text":"NM1026U-5979889-194/232","page_number":194,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"b483d7a2-a996-4f75-b7eb-3d5b2a15f2f9","block_type":"box","text":"company’s stated low-carbon transition strategy or targets that the company does not currently provide and that","page_number":195,"box":{"x":69,"y":45,"width":798,"height":11}},{"id":"8d8ac7d0-e16b-4062-aaf2-d0a4719a63c4","block_type":"box","text":"would be helpful to investment decision-making. We would not recommend support for shareholder proposals that","page_number":195,"box":{"x":68,"y":59,"width":814,"height":12}},{"id":"d452b6fd-bba2-434b-be61-2cd0f39d0e93","block_type":"box","text":"seek to constrain board or management decision-making or direct specific business or strategic decisions. As under","page_number":195,"box":{"x":69,"y":74,"width":828,"height":12}},{"id":"53f25aae-9a0a-4746-a9a1-73f64fe7b39c","block_type":"box","text":"the BAIS benchmark approach, the active portfolio managers are ultimately responsible for voting consistent with","page_number":195,"box":{"x":68,"y":89,"width":807,"height":12}},{"id":"2f7c1b0b-6a54-4f49-8f45-e1336dba93c8","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":195,"box":{"x":68,"y":104,"width":832,"height":11}},{"id":"fbb34302-d85d-41b8-a131-c121e0e0b981","block_type":"box","text":"climate risk and the energy transition is undertaken in line with BAIS’ benchmark guidelines.","page_number":195,"box":{"x":69,"y":119,"width":658,"height":11}},{"id":"42d1ae67-b375-4cc5-a88f-541629873aef","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":195,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"cbb6b55e-f28e-4df7-b1fc-87024b730907","block_type":"box","text":"Global Engagement and Voting Guidelines | 15","page_number":195,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"dc9e6420-f68f-436f-aa3c-c137060e9072","block_type":"box","text":"NM1026U-5979889-195/232","page_number":195,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9edb5567-cdc2-40b0-85f7-bbaa9e070c7a","block_type":"box","text":"APPENDIX 1: HOW WE FULFILL AND OVERSEE OUR INVESTMENT STEWARDSHIP RESPONSIBILITIES FOR NON","page_number":196,"box":{"x":83,"y":45,"width":812,"height":9}},{"id":"ea026dd9-62d2-431e-adcf-9a5a4f5b9876","block_type":"box","text":"INDEX EQUITY INVESTMENT STRATEGIES","page_number":196,"box":{"x":338,"y":60,"width":302,"height":10}},{"id":"e2c480c9-8d1c-45b4-9160-8c858729f243","block_type":"box","text":"Oversight","page_number":196,"box":{"x":69,"y":83,"width":68,"height":11}},{"id":"93d4a30d-71f3-4319-84ca-b378fe26cd3e","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":196,"box":{"x":101,"y":101,"width":793,"height":11}},{"id":"ba47aae6-6c61-4e01-b9e9-523e8dd09163","block_type":"box","text":"accordance with the BlackRock Active Investment Stewardship Global Engagement and Voting Guidelines (the","page_number":196,"box":{"x":69,"y":116,"width":778,"height":11}},{"id":"00392d6a-8691-4d91-acd9-0225e8a7a751","block_type":"box","text":"“Guidelines”), which require the application of professional judgment and consideration of each company’s unique","page_number":196,"box":{"x":70,"y":131,"width":814,"height":11}},{"id":"c627370e-c633-4579-bc21-27a01d55cea0","block_type":"box","text":"circumstances, as well as input from active investors. BAIS is independent from BlackRock Investment Stewardship","page_number":196,"box":{"x":69,"y":146,"width":825,"height":11}},{"id":"2bf7a122-b01a-4954-80a2-bcf58fc73ed9","block_type":"box","text":"in our engagement and voting activities, reporting lines, and oversight.","page_number":196,"box":{"x":70,"y":161,"width":500,"height":11}},{"id":"947a025e-2512-43ad-ad80-a61d715b4b99","block_type":"box","text":"The Stewardship Leaders Group, comprised of senior active investors and other relevant stakeholders in","page_number":196,"box":{"x":101,"y":179,"width":744,"height":11}},{"id":"43150e50-c50a-484f-984f-8acadc3ce04c","block_type":"box","text":"BlackRock’s legal, public policy, sustainability and communications teams, helps shape the firm’s approach to","page_number":196,"box":{"x":70,"y":194,"width":786,"height":11}},{"id":"c5061f89-168c-4259-af8c-d473c79b83f3","block_type":"box","text":"investment stewardship on non-index equity investment strategies. The Group may advise on and review amendments","page_number":196,"box":{"x":70,"y":209,"width":839,"height":11}},{"id":"c77c085d-4c10-4b3b-861f-c5ffe180356d","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":196,"box":{"x":68,"y":224,"width":822,"height":11}},{"id":"9a4a3be4-9e93-4244-8f7d-3ebe241cbe02","block_type":"box","text":"relevant active equity investors.","page_number":196,"box":{"x":69,"y":239,"width":223,"height":11}},{"id":"dccbea17-5e8f-4277-9d90-c72725e85ffe","block_type":"box","text":"BAIS carries out engagement with companies in collaboration with active investment colleagues, executes proxy","page_number":196,"box":{"x":102,"y":257,"width":797,"height":12}},{"id":"b1e6bd9b-11de-43de-abc0-6d9d02094c07","block_type":"box","text":"votes, and conducts vote operations (including maintaining records of votes cast) in a manner consistent with the","page_number":196,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"5242e89d-5357-471e-a97d-7be0a55aa603","block_type":"box","text":"Guidelines. BAIS also conducts research on corporate governance issues and participates in industry discussions to","page_number":196,"box":{"x":69,"y":287,"width":832,"height":11}},{"id":"f9352e2e-ac81-4673-b5d7-6dbe8e19c69d","block_type":"box","text":"contribute to and keep abreast of important developments in the corporate governance field. BAIS may use third","page_number":196,"box":{"x":69,"y":302,"width":801,"height":11}},{"id":"61bdedf2-2e80-4335-9855-74f336ae8d37","block_type":"box","text":"parties for certain of the foregoing activities and performs oversight of those third parties (see “Use and oversight of","page_number":196,"box":{"x":70,"y":317,"width":836,"height":11}},{"id":"13f2d1cb-eb9a-4ea5-bbbe-c08713b15699","block_type":"box","text":"third-party vote services providers” below).","page_number":196,"box":{"x":68,"y":332,"width":305,"height":11}},{"id":"cfd7d68c-a43c-4cf8-834b-0f88186c307c","block_type":"box","text":"Voting guidelines and vote execution","page_number":196,"box":{"x":68,"y":354,"width":269,"height":11}},{"id":"a3dfad2e-8f85-4fc3-81f4-df4f9290ebed","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":196,"box":{"x":102,"y":373,"width":790,"height":11}},{"id":"7666ba01-dfd3-4f45-b688-2ffc92070ae9","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":196,"box":{"x":69,"y":387,"width":838,"height":12}},{"id":"1a4a4adc-1ad1-48c9-81f2-625a90994593","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":196,"box":{"x":69,"y":402,"width":831,"height":12}},{"id":"7d03f064-92c5-490c-886e-58cd4816d1c3","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":196,"box":{"x":68,"y":417,"width":809,"height":12}},{"id":"35fa7dcc-df3a-4050-966f-e1d82026a949","block_type":"box","text":"judgment, and without regard to the relationship of the issuer (or any shareholder proponent or dissident","page_number":196,"box":{"x":67,"y":432,"width":749,"height":11}},{"id":"193569e9-e789-4b82-ae37-35cf6b5c2440","block_type":"box","text":"shareholder) to the Fund, the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees","page_number":196,"box":{"x":69,"y":447,"width":825,"height":11}},{"id":"407222ba-d902-4316-bbd3-f75e9ddb3898","block_type":"box","text":"(see “Conflicts management policies and procedures,” below).","page_number":196,"box":{"x":69,"y":462,"width":445,"height":11}},{"id":"6e7346a8-3c3f-4d23-bcbf-22d22cf01e4d","block_type":"box","text":"When exercising voting rights, BAIS will normally vote on specific proxy issues in accordance with the Guidelines,","page_number":196,"box":{"x":101,"y":480,"width":803,"height":12}},{"id":"bb78ddb9-63c5-4e3e-9905-06fbea0ab748","block_type":"box","text":"although portfolio managers have the right to vote differently on their holdings if they determine doing so is more","page_number":196,"box":{"x":69,"y":495,"width":806,"height":12}},{"id":"2f1ec37c-a615-40aa-875c-2d94329b2bcb","block_type":"box","text":"aligned with the investment objective and financial interests of clients invested in the funds they manage.","page_number":196,"box":{"x":69,"y":510,"width":752,"height":11}},{"id":"9f2bc511-20e9-46a5-9189-7d092d15f7df","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":196,"box":{"x":101,"y":529,"width":782,"height":11}},{"id":"ea442939-49ae-4f6a-9dec-2cb0c2cc9c00","block_type":"box","text":"context of the individual circumstances of each company and the specific issue under review. As such, the Guidelines","page_number":196,"box":{"x":69,"y":544,"width":837,"height":11}},{"id":"69aac9ff-cdce-41c8-9aae-e467222a77ec","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":196,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"76a57870-4033-4002-919a-8d57c0d80452","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":196,"box":{"x":68,"y":574,"width":838,"height":11}},{"id":"ff0e2f57-224f-4189-be90-a94d7fd98752","block_type":"box","text":"Guidelines are reviewed annually and updated as necessary to reflect changes in market practices, developments in","page_number":196,"box":{"x":69,"y":588,"width":829,"height":12}},{"id":"57eb917a-3dd8-4da7-812c-1804a2e4281e","block_type":"box","text":"corporate governance and feedback from companies and clients. 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We are not supportive of impediments to the","page_number":196,"box":{"x":70,"y":726,"width":806,"height":11}},{"id":"4a9030da-e55e-4e79-9613-13f2a232e317","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":196,"box":{"x":69,"y":741,"width":704,"height":11}},{"id":"81170a1e-ad99-45a8-b443-5cc140043f39","block_type":"box","text":"BlackRock votes proxies in these situations on a “best-efforts” basis. 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A company’s disclosures, our engagements and voting, investment colleagues’ insights and","page_number":197,"box":{"x":68,"y":268,"width":840,"height":11}},{"id":"f0bf94af-8964-4222-8867-1076de2c0601","block_type":"box","text":"our Guidelines are important inputs into our voting decisions on behalf of clients.","page_number":197,"box":{"x":69,"y":283,"width":578,"height":11}},{"id":"92ab1ff5-28f1-41d0-810c-d5dbc0156452","block_type":"box","text":"Given the large universe of actively held companies, BAIS employs the proxy services provider to streamline the","page_number":197,"box":{"x":102,"y":301,"width":795,"height":12}},{"id":"e58e3893-54f9-4fe9-b0ed-b926f63eae3d","block_type":"box","text":"voting process by making voting recommendations based on BAIS’ Guidelines when the items on a shareholder","page_number":197,"box":{"x":68,"y":316,"width":795,"height":12}},{"id":"6c1779f1-2071-44c3-88b9-f1ef151a8098","block_type":"box","text":"meeting agenda are routine. 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Both BAIS and the vote services provider actively","page_number":197,"box":{"x":68,"y":361,"width":785,"height":11}},{"id":"5f80a5af-735b-44a4-a474-8ce5ae912d2e","block_type":"box","text":"monitor securities filings, research reports, company announcements, and direct communications from companies to","page_number":197,"box":{"x":69,"y":376,"width":837,"height":11}},{"id":"3ce7e286-17a2-40d0-9254-1d5dcebc303a","block_type":"box","text":"ensure awareness of supplemental disclosures and proxy materials that may require a modification of votes.","page_number":197,"box":{"x":69,"y":390,"width":775,"height":12}},{"id":"8229f888-bf4a-4dee-8ed0-93aeddda7b9e","block_type":"box","text":"BAIS closely monitors the third-party vote services providers we contract with to ensure that they are meeting our","page_number":197,"box":{"x":102,"y":409,"width":807,"height":11}},{"id":"bc162603-4bcc-49ef-92e8-4df896d49811","block_type":"box","text":"service level expectations and have effective policies and procedures in place to manage potential conflicts of","page_number":197,"box":{"x":69,"y":424,"width":788,"height":11}},{"id":"6811ba42-7888-4180-bf6c-bc181c2f2858","block_type":"box","text":"interest. 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outlined in this Policy, as part of BlackRock’s authority to manage, acquire and dispose of account","page_number":200,"box":{"x":102,"y":375,"width":775,"height":12}},{"id":"fc4a6421-5299-465f-b0dd-cb20e4748160","block_type":"box","text":"assets, all as contemplated by the Funds’ respective investment management agreements.","page_number":200,"box":{"x":102,"y":391,"width":651,"height":11}},{"id":"e6f7a51b-a6e4-4770-9666-b3dbc3094c4f","block_type":"box","text":"BlackRock has adopted the BlackRock Investment Stewardship Global Benchmark Policy (as from time to","page_number":200,"box":{"x":135,"y":409,"width":748,"height":11}},{"id":"12287ceb-c44b-4a79-8701-2dd8a308acf8","block_type":"box","text":"time amended, the “Guidelines”) governing proxy voting by index equity Funds managed by BlackRock, except for","page_number":200,"box":{"x":101,"y":424,"width":804,"height":11}},{"id":"e3c3f290-d484-4e6c-9218-972e7e25ba6f","block_type":"box","text":"the iShares Core S&P 500 ETF. In addition, BlackRock has adopted guidelines and procedures (as from time to","page_number":200,"box":{"x":101,"y":439,"width":793,"height":11}},{"id":"a09e060c-7b43-496f-b443-2c1effdec321","block_type":"box","text":"time amended, the “BlackRock Climate and Decarbonization Stewardship Guidelines”) governing proxy voting for","page_number":200,"box":{"x":101,"y":454,"width":801,"height":11}},{"id":"edac7f75-0c8e-4084-9dae-7b12f41f90ea","block_type":"box","text":"matters covered in the BlackRock Climate and Decarbonization Stewardship Guidelines by the Funds listed in","page_number":200,"box":{"x":102,"y":469,"width":777,"height":11}},{"id":"1fb91a8c-4cc6-43eb-9c3a-4e34904a92be","block_type":"box","text":"Appendix A.","page_number":200,"box":{"x":101,"y":484,"width":82,"height":10}},{"id":"6c03b849-48bc-438e-87a5-4e9c3950b235","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":200,"box":{"x":135,"y":502,"width":751,"height":11}},{"id":"53eca282-115a-4bcf-91cd-2d5c95bb3f2c","block_type":"box","text":"respect of securities held by each such Fund (or may refrain from voting) in accordance with the Guidelines and","page_number":200,"box":{"x":102,"y":517,"width":791,"height":11}},{"id":"4ad78ac8-fba1-41ac-bed8-09493b091607","block_type":"box","text":"the BlackRock Climate and Decarbonization Stewardship Guidelines, as applicable.","page_number":200,"box":{"x":101,"y":532,"width":591,"height":11}},{"id":"552d32eb-b6d2-4bdf-9b5a-61e293d1ea4d","block_type":"box","text":"Conflicts Management","page_number":200,"box":{"x":101,"y":550,"width":165,"height":11}},{"id":"a0de9d98-8bf6-4c2d-b349-32bb0de3efd7","block_type":"box","text":"BlackRock Investment Stewardship (“BIS”) maintains policies and procedures that seek to prevent undue","page_number":200,"box":{"x":135,"y":569,"width":751,"height":11}},{"id":"eb80b332-0a10-4eb4-827e-d282020cbe47","block_type":"box","text":"influence on BlackRock’s proxy voting activity and to mitigate material conflicts of interest in the exercise of","page_number":200,"box":{"x":102,"y":584,"width":767,"height":11}},{"id":"d623f4d0-35f6-492a-ac0e-a3f439a4f6e5","block_type":"box","text":"proxy voting responsibilities. Potential material conflicts, and the resultant potential for undue influence, might","page_number":200,"box":{"x":102,"y":599,"width":787,"height":11}},{"id":"670874bc-2903-4762-8740-8dc10ca1762d","block_type":"box","text":"be due to a relationship between the investee company (or any shareholder proponent or dissident shareholder)","page_number":200,"box":{"x":102,"y":614,"width":797,"height":11}},{"id":"515a1be7-f2c3-4290-a229-b4db6cc14e7d","block_type":"box","text":"and BlackRock, BlackRock’s affiliates or employees, or a Fund or a Fund’s affiliates. BlackRock has taken","page_number":200,"box":{"x":102,"y":628,"width":756,"height":12}},{"id":"57205a7a-9624-41c2-a116-3eed341402e0","block_type":"box","text":"certain steps to mitigate potential conflicts, which are outlined in detail in the Guidelines. In mitigating conflicts,","page_number":200,"box":{"x":101,"y":643,"width":800,"height":12}},{"id":"9ba9e17f-d675-435f-9f96-31060dc19493","block_type":"box","text":"BIS will adhere to the Guidelines.","page_number":200,"box":{"x":102,"y":658,"width":235,"height":9}},{"id":"93f53232-10a5-443e-bd1d-7b7c5be80b87","block_type":"box","text":"In certain instances, BIS will engage an independent third-party voting service provider to make proxy voting","page_number":200,"box":{"x":135,"y":677,"width":769,"height":11}},{"id":"4f98939e-ec72-4198-bd0d-3b6e77747320","block_type":"box","text":"recommendations as a further safeguard to avoid potential conflicts of interest, to satisfy regulatory compliance","page_number":200,"box":{"x":102,"y":692,"width":800,"height":11}},{"id":"993cfaa4-2314-4775-a568-a69f185f3632","block_type":"box","text":"requirements, or as may be otherwise required by applicable law.","page_number":200,"box":{"x":102,"y":707,"width":463,"height":11}},{"id":"31d95b2c-1618-40b3-b586-9b09748ec968","block_type":"box","text":"With respect to the relationship between securities lending and proxy voting, shares on loan cannot be voted","page_number":200,"box":{"x":134,"y":725,"width":774,"height":11}},{"id":"9fdf6748-4134-4ab1-8ced-3ce6d8e921a5","block_type":"box","text":"and BlackRock may determine to recall them for voting, as guided by BlackRock’s fiduciary responsibility to act","page_number":200,"box":{"x":102,"y":740,"width":791,"height":11}},{"id":"85b3bbec-826f-4362-818b-7c2dce8e0eab","block_type":"box","text":"in clients’ financial interests. The Guidelines set forth BlackRock’s approach to recalling securities on loan in","page_number":200,"box":{"x":102,"y":755,"width":778,"height":11}},{"id":"97d3a7da-53a6-426e-8087-071711c58e9a","block_type":"box","text":"connection with proxy voting.","page_number":200,"box":{"x":101,"y":770,"width":203,"height":11}},{"id":"9acc9aef-f57f-45e8-99e4-16df1f09b585","block_type":"box","text":"Reports to the Board","page_number":200,"box":{"x":102,"y":789,"width":153,"height":10}},{"id":"3245712c-a248-4180-af12-cc7739df4f5a","block_type":"box","text":"BlackRock will report on an annual basis to the Directors on (1) a summary of the proxy voting process as","page_number":200,"box":{"x":135,"y":807,"width":755,"height":11}},{"id":"1486e7ee-b464-4a2e-89cb-5ede7155be40","block_type":"box","text":"applicable to the Funds covered by this policy in the preceding year together with a representation that all votes","page_number":200,"box":{"x":102,"y":822,"width":794,"height":11}},{"id":"c4aed0b8-4587-4e78-9df1-daf95e4ba163","block_type":"box","text":"were in accordance with the Guidelines and the BlackRock Climate and Decarbonization Stewardship Guidelines,","page_number":200,"box":{"x":101,"y":837,"width":802,"height":11}},{"id":"cebc8ec4-b7d7-4eba-9dfa-d98fff478c74","block_type":"box","text":"as applicable (2) any material changes to the Guidelines and the BlackRock Climate and Decarbonization","page_number":200,"box":{"x":102,"y":852,"width":747,"height":11}},{"id":"f26e9ea8-1e65-492d-817d-c672713a1140","block_type":"box","text":"Stewardship Guidelines, including material changes to conflicts management practices, that have not previously","page_number":200,"box":{"x":102,"y":866,"width":798,"height":12}},{"id":"c59faede-539a-43ed-8d49-8fe7f31222c4","block_type":"box","text":"been 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Reporting on our activities to inform clients","page_number":204,"box":{"x":69,"y":292,"width":351,"height":11}},{"id":"eefb2621-9543-494d-825e-818bba5e1dd2","block_type":"box","text":"about our stewardship efforts on their behalf through a range of","page_number":204,"box":{"x":426,"y":292,"width":457,"height":11}},{"id":"7dfff774-4915-4808-994a-74698e419eb5","block_type":"box","text":"publications on our website and direct client communications.","page_number":204,"box":{"x":102,"y":307,"width":439,"height":11}},{"id":"66f3c29d-85be-4c6e-b3cb-240a03128bd4","block_type":"box","text":"This document provides an overarching explanation of the principles that guide our approach to engaging and","page_number":204,"box":{"x":101,"y":329,"width":778,"height":12}},{"id":"f715d1f9-05e0-47d0-8b7c-5ab70e38beb7","block_type":"box","text":"voting on corporate governance matters and other material risks and opportunities under BIS’ Benchmark Policies.","page_number":204,"box":{"x":68,"y":345,"width":817,"height":11}},{"id":"6c879e38-7f28-4fe0-9628-c9e194fbbccf","block_type":"box","text":"The BIS Benchmark Policies – which are comprised of the BIS Global Principles, regional voting guidelines, and","page_number":204,"box":{"x":68,"y":360,"width":790,"height":11}},{"id":"f37007c9-4734-45a1-8376-890710b13e1d","block_type":"box","text":"Engagement Priorities – apply to clients’ assets invested through index equity strategies, take a financial materiality","page_number":204,"box":{"x":70,"y":375,"width":829,"height":11}},{"id":"589f8620-b155-4975-9bfa-da0f15b80d38","block_type":"box","text":"based approach, and are focused solely on advancing clients’ long-term financial interests.","page_number":204,"box":{"x":69,"y":390,"width":648,"height":11}},{"id":"38168560-049a-465b-b19a-720546fb06b6","block_type":"box","text":"2","page_number":204,"box":{"x":718,"y":390,"width":4,"height":5}},{"id":"00b11879-8ca9-41e2-9ade-f8ec3d7f6e0a","block_type":"box","text":"PHILOSOPHY ON INVESTMENT STEWARDSHIP","page_number":204,"box":{"x":321,"y":420,"width":337,"height":9}},{"id":"3195033c-7528-47f0-bb0a-855b448cc3f1","block_type":"box","text":"Sound governance is critical to a company’s ability to create long-term financial value. 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As a fiduciary, BlackRock is legally required to make proxy voting determinations in a manner that is","page_number":205,"box":{"x":68,"y":60,"width":805,"height":11}},{"id":"02a9ea76-216c-482f-8d76-11c8ed355e10","block_type":"box","text":"consistent with the investment objectives of clients who have delegated voting authority to us. BIS’ Benchmark","page_number":205,"box":{"x":69,"y":75,"width":790,"height":11}},{"id":"042501ca-fb7b-40ea-9c9e-5e79b8937950","block_type":"box","text":"Policies, and the vote decisions made consistent with those policies, reflect our reasonable and independent","page_number":205,"box":{"x":69,"y":90,"width":779,"height":11}},{"id":"2dc37031-3811-4ba3-9774-8f791f41e66c","block_type":"box","text":"judgment of what is in the long-term financial interests of clients. Our vote decisions are often informed by several","page_number":205,"box":{"x":67,"y":105,"width":816,"height":11}},{"id":"8e3bddc0-ce75-4613-a1a9-66967807e0fd","block_type":"box","text":"factors, including in-depth analysis of company disclosures, comparisons against industry peers, third-party research,","page_number":205,"box":{"x":68,"y":120,"width":839,"height":12}},{"id":"15e16e71-11ca-4d6a-b6da-66172773d1de","block_type":"box","text":"and, where appropriate, engagement with companies.","page_number":205,"box":{"x":69,"y":136,"width":381,"height":11}},{"id":"74b91531-d9c0-46a0-b11b-47bc1b753a36","block_type":"box","text":"Generally, BIS supports the vote recommendations of the board of directors and management at companies","page_number":205,"box":{"x":102,"y":158,"width":770,"height":11}},{"id":"0cc568ea-1788-4260-830b-29a30fd6efd0","block_type":"box","text":"which have sound corporate governance and deliver strong financial returns over time. When we determine it is in our","page_number":205,"box":{"x":68,"y":173,"width":838,"height":11}},{"id":"b0311558-3986-488a-aa81-248882dec877","block_type":"box","text":"clients’ financial interests to convey concern to companies through voting, we may do so in two forms: we might not","page_number":205,"box":{"x":69,"y":188,"width":827,"height":12}},{"id":"058ef1c9-0fce-4c2d-869f-d37c778551bd","block_type":"box","text":"support the election of directors or other management proposals, or we might not support management’s voting","page_number":205,"box":{"x":69,"y":203,"width":802,"height":12}},{"id":"7c72d27b-ccec-4b3f-8862-0b5ad6b5b5e1","block_type":"box","text":"recommendation on a shareholder proposal.","page_number":205,"box":{"x":69,"y":219,"width":315,"height":10}},{"id":"ea1c9f12-7a19-44d7-a8d5-1f3aac92d3cc","block_type":"box","text":"SHAREHOLDER RIGHTS","page_number":205,"box":{"x":403,"y":249,"width":172,"height":9}},{"id":"b5cba075-6b31-407d-bbda-b8ab83102fe1","block_type":"box","text":"BlackRock’s global approach as a shareholder on behalf of our clients is underpinned by certain rights attached","page_number":205,"box":{"x":102,"y":271,"width":796,"height":12}},{"id":"05f2dd00-0390-4a51-978f-0f9cd247eb59","block_type":"box","text":"to shareholding in most markets, as established by corporate laws, regulations, and listing rules.","page_number":205,"box":{"x":68,"y":287,"width":693,"height":11}},{"id":"b071ee12-ed76-4326-a3f1-176c93787fb1","block_type":"box","text":"3","page_number":205,"box":{"x":763,"y":287,"width":4,"height":4}},{"id":"b3fb35c5-aa66-4015-9277-c1d817f2a214","block_type":"box","text":"For example, in","page_number":205,"box":{"x":774,"y":287,"width":106,"height":10}},{"id":"2208842d-80ca-49b4-8e76-f925f15bc834","block_type":"box","text":"most markets, shareholders have the right to:","page_number":205,"box":{"x":69,"y":302,"width":326,"height":11}},{"id":"6d4e18e5-7613-41d8-be26-8e0121bed4d9","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":325,"width":6,"height":4}},{"id":"d6969191-e65b-406d-9829-e1e1564ed383","block_type":"box","text":"Vote to elect, remove, and nominate directors, approve the appointment of the auditor, and amend the corporate","page_number":205,"box":{"x":101,"y":322,"width":804,"height":11}},{"id":"78eb98a7-313b-4a1c-bebd-b6cb18a7ed4f","block_type":"box","text":"charter or bylaws.","page_number":205,"box":{"x":101,"y":337,"width":126,"height":11}},{"id":"18d73016-8577-43ef-bcf9-d65979c1791c","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":360,"width":6,"height":5}},{"id":"7afc42eb-962c-46e3-8157-dfd60ba3d039","block_type":"box","text":"Vote on key board decisions that are material to the protection of their investment, including but not limited to,","page_number":205,"box":{"x":101,"y":357,"width":789,"height":11}},{"id":"28c30839-24b9-4ca1-9b7a-7bffabda502c","block_type":"box","text":"changes to the purpose of the business, dilution levels, and pre-emptive rights.","page_number":205,"box":{"x":101,"y":372,"width":564,"height":11}},{"id":"12d0d456-9e44-4fed-84b3-3bb128b4959e","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":395,"width":6,"height":5}},{"id":"ddb68872-62ef-4065-91d7-a5f0dc923a38","block_type":"box","text":"Access sufficient and timely information on governance, strategic, and business matters — where such matters","page_number":205,"box":{"x":101,"y":392,"width":799,"height":12}},{"id":"b5aebe3a-9601-42d0-a5e5-ce189bb25391","block_type":"box","text":"are material — to make informed decisions.","page_number":205,"box":{"x":102,"y":407,"width":313,"height":9}},{"id":"be9676c8-a6fc-409d-a960-ec1cbe6e291c","block_type":"box","text":"KEY GOVERNANCE TOPICS","page_number":205,"box":{"x":391,"y":438,"width":196,"height":9}},{"id":"198d68fd-4618-43de-81ab-67d23ee5e26a","block_type":"box","text":"In our experience, there are certain globally applicable elements of corporate governance that contribute to a","page_number":205,"box":{"x":102,"y":460,"width":776,"height":12}},{"id":"d409a520-72cd-4fa1-b08a-9a06e61fdefc","block_type":"box","text":"company’s ability to create long-term financial value for shareholders. These are topics that shareholders may have","page_number":205,"box":{"x":69,"y":475,"width":822,"height":12}},{"id":"95567011-dc64-4edf-9491-49131bfc6a2d","block_type":"box","text":"the ability to vote on at shareholder meetings. These areas include:","page_number":205,"box":{"x":68,"y":491,"width":482,"height":11}},{"id":"bc026859-41d7-4300-8231-1bdfd5a7a300","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":514,"width":6,"height":4}},{"id":"7f3c4dd1-92f5-4c5f-8c57-da750faaf981","block_type":"box","text":"Boards and directors","page_number":205,"box":{"x":102,"y":511,"width":147,"height":9}},{"id":"18e28377-6400-4569-bb26-11322acae7c2","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":534,"width":6,"height":4}},{"id":"4b6e4e7b-c58f-4815-8bc7-87b54592383d","block_type":"box","text":"Auditors and audit-related issues","page_number":205,"box":{"x":101,"y":531,"width":234,"height":9}},{"id":"06c2ac5b-1840-4973-ac09-2541980007c0","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":554,"width":6,"height":5}},{"id":"f97fad66-fb74-4a8b-ae2c-495c5f4f3e3d","block_type":"box","text":"Capital structure, mergers, acquisitions, asset sales, and other special situations","page_number":205,"box":{"x":102,"y":551,"width":583,"height":11}},{"id":"fd6beebe-2307-4dcd-a3a2-5dc40a659a54","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":574,"width":6,"height":5}},{"id":"b534d2ed-843e-4b00-bfaf-120a3931849b","block_type":"box","text":"Executive compensation","page_number":205,"box":{"x":102,"y":571,"width":170,"height":11}},{"id":"09083d2b-a9dd-4480-8afe-c43834a9e51c","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":594,"width":6,"height":5}},{"id":"e7730eb7-cad1-4972-abfc-501c9b91de7d","block_type":"box","text":"Shareholder protections and other significant corporate governance matters","page_number":205,"box":{"x":102,"y":591,"width":539,"height":12}},{"id":"b84bb029-d14e-423b-a7ad-41c6dbcc2f1d","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":614,"width":6,"height":5}},{"id":"e701caa0-c79d-4bbc-8c0b-b635bf75207c","block_type":"box","text":"Shareholder proposals","page_number":205,"box":{"x":102,"y":612,"width":160,"height":11}},{"id":"9180ad85-e565-4212-94e4-7e3d65af0e4d","block_type":"box","text":"The BIS Benchmark Policies are not prescriptive but rather are applied on a pragmatic basis, taking into","page_number":205,"box":{"x":101,"y":634,"width":740,"height":12}},{"id":"cebd8622-bcae-4bc2-b515-0fa5ddbe2012","block_type":"box","text":"consideration a number of company-specific factors, including the sector, market, and business environment within","page_number":205,"box":{"x":69,"y":649,"width":819,"height":12}},{"id":"533815fe-9058-48b2-93ba-075619177c78","block_type":"box","text":"which companies operate.","page_number":205,"box":{"x":68,"y":665,"width":186,"height":10}},{"id":"251b8494-4df7-4692-bccc-d35328af745a","block_type":"box","text":"At the regional level, it is our view that companies should observe the accepted corporate governance standards","page_number":205,"box":{"x":101,"y":687,"width":803,"height":11}},{"id":"8bbd9d08-9f71-4db7-b25b-bef763f00362","block_type":"box","text":"in their domestic market at a minimum, and we ask that, if they do not, they explain how their approach better","page_number":205,"box":{"x":70,"y":702,"width":785,"height":11}},{"id":"83edf638-9fdd-4205-af7c-255e17ba2c2c","block_type":"box","text":"supports durable, long-term financial value creation. Our regional voting guidelines explain how the BIS Global","page_number":205,"box":{"x":69,"y":717,"width":781,"height":12}},{"id":"94111135-947d-42aa-8717-3f140906cf6b","block_type":"box","text":"Principles inform our voting decisions in relation to common ballot items for shareholder meetings in those markets.","page_number":205,"box":{"x":69,"y":732,"width":829,"height":12}},{"id":"43c2b98b-ffb0-4df6-b4e0-f5cbf98668f9","block_type":"box","text":"4","page_number":205,"box":{"x":899,"y":733,"width":5,"height":4}},{"id":"ac0659ce-ddef-4562-85e6-f2ed78968fbf","block_type":"box","text":"3","page_number":205,"box":{"x":69,"y":762,"width":4,"height":5}},{"id":"6ce0aeae-4ce3-40b5-bbc1-eb5d3c7b9bad","block_type":"box","text":"Examples include: Government of Canada, “Canada Business Corporations Act,” amended 2024; European Union,","page_number":205,"box":{"x":79,"y":762,"width":816,"height":11}},{"id":"96769fc4-1a90-46e5-8228-bf2aa2ca2bb8","block_type":"box","text":"“Shareholder Rights Directive II,” 2017; and the China Securities Regulatory Commission, “Code of Corporate","page_number":205,"box":{"x":70,"y":777,"width":784,"height":11}},{"id":"705dfe01-d795-4f03-818b-ed85712bea0a","block_type":"box","text":"Governance for Listed Companies in China,” 2001. Websites accessed in December 2025.","page_number":205,"box":{"x":69,"y":792,"width":650,"height":11}},{"id":"e945bfb3-58cf-4bab-b053-0c24063098c6","block_type":"box","text":"4","page_number":205,"box":{"x":69,"y":810,"width":4,"height":4}},{"id":"e4af41f0-3aea-48b0-8f3d-d856489bc84b","block_type":"box","text":"Our regional voting guidelines reflect these different market standards and norms. Depending on the market,","page_number":205,"box":{"x":79,"y":810,"width":776,"height":11}},{"id":"cddee8f4-e298-47a3-9ee7-60d8a8b8e4c9","block_type":"box","text":"generally accepted practice is informed by corporate law, market regulation, best practices, and industry initiatives,","page_number":205,"box":{"x":68,"y":825,"width":821,"height":11}},{"id":"373cf7f6-729a-46f9-b1b7-a53d782303a3","block_type":"box","text":"amongst other factors. BIS carries out engagement with companies, executes proxy votes, and conducts vote","page_number":205,"box":{"x":69,"y":840,"width":780,"height":11}},{"id":"cc3ab92e-bcdd-455b-9621-ca51eeeda141","block_type":"box","text":"operations (including maintaining records of votes cast) in a manner consistent with the relevant regional voting","page_number":205,"box":{"x":69,"y":855,"width":796,"height":11}},{"id":"d3218192-9705-425e-a77a-3e10d5fc2932","block_type":"box","text":"guidelines.","page_number":205,"box":{"x":68,"y":870,"width":76,"height":11}},{"id":"74964c7b-0fbd-4800-9e50-0393d2b28037","block_type":"box","text":"BlackRock Investment Stewardship","page_number":205,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"f40963e5-9ac1-4868-86ff-718799dd3449","block_type":"box","text":"Global Principles | 4","page_number":205,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"7e66101b-3954-4a46-9133-2314338595aa","block_type":"box","text":"NM1026U-5979889-205/232","page_number":205,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"5a8ebb8c-0410-4b46-a642-98bc99a7158e","block_type":"box","text":"BOARDS AND DIRECTORS","page_number":206,"box":{"x":394,"y":45,"width":190,"height":9}},{"id":"1b02dfad-24a1-4317-a93a-78e7ab95aff9","block_type":"box","text":"Oversight role of the board","page_number":206,"box":{"x":69,"y":75,"width":194,"height":11}},{"id":"87f84775-d5b1-4b69-8ce9-4d64b3fcbfed","block_type":"box","text":"Companies whose boards are comprised of appropriately qualified, engaged directors with professional","page_number":206,"box":{"x":102,"y":98,"width":734,"height":11}},{"id":"7e215e84-aaf2-48e8-8273-5f40c14b1062","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":206,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"0ec9c3d1-23e9-46bb-bf95-82bad76dd2e4","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":206,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"0bdae37b-eabc-496f-b789-9c1b2da6e4ee","block_type":"box","text":"advantage, providing valuable oversight and contributing to the most important management decisions that support","page_number":206,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"827355ca-e692-4a18-8dbc-613104cbb083","block_type":"box","text":"long-term financial performance.","page_number":206,"box":{"x":70,"y":158,"width":229,"height":11}},{"id":"f29f10c6-0403-4ac4-99cf-abc4994a237f","block_type":"box","text":"For this reason, our investment stewardship efforts focus on the effectiveness of the board of directors. We","page_number":206,"box":{"x":102,"y":181,"width":771,"height":11}},{"id":"7ad1ab0b-2886-4ede-bdc3-2aec3a6adf74","block_type":"box","text":"engage, as necessary, with members of the board’s nominating and/or governance committee to assess whether","page_number":206,"box":{"x":69,"y":196,"width":811,"height":11}},{"id":"e664eacc-555e-4864-9303-8cd15542e314","block_type":"box","text":"governance practices and board composition are effective given a company’s business model, sector, market, and","page_number":206,"box":{"x":68,"y":211,"width":817,"height":11}},{"id":"3032797c-b909-4b12-a9b1-19ae01b0a0e6","block_type":"box","text":"the business environment in which a company is operating.","page_number":206,"box":{"x":68,"y":226,"width":422,"height":11}},{"id":"f442e366-25b4-45d2-9a6b-49bfe0752c19","block_type":"box","text":"We consider it good practice when the board establishes and maintains a framework of robust and effective","page_number":206,"box":{"x":101,"y":249,"width":770,"height":11}},{"id":"c20c05c5-50f6-4081-b76b-0edd87e45faa","block_type":"box","text":"governance mechanisms that supports its oversight of the company’s strategy and operations, consistent with the","page_number":206,"box":{"x":68,"y":264,"width":817,"height":11}},{"id":"396c56d3-b4f9-4f27-8b51-6b970b89d7b6","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":206,"box":{"x":70,"y":279,"width":799,"height":11}},{"id":"d798b658-ce47-4730-bfd8-024ec66e1b2a","block_type":"box","text":"committees of the board and how directors engage with and oversee management, as well as disclosure of material","page_number":206,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"663feff3-01d6-4032-8f61-5365678affc7","block_type":"box","text":"risks that may affect a company’s long-term strategy and how management is effectively identifying, managing, and","page_number":206,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"080e88d2-31c6-4208-91fe-b1103bd9afe8","block_type":"box","text":"mitigating such risks.","page_number":206,"box":{"x":69,"y":325,"width":150,"height":11}},{"id":"7e8e7652-8445-4774-9da9-c4a303c28006","block_type":"box","text":"Understanding management’s long-term strategy and the milestones against which investors should assess its","page_number":206,"box":{"x":102,"y":347,"width":791,"height":11}},{"id":"2f0d7d65-6d66-4e76-9788-63303819fca9","block_type":"box","text":"implementation is central to our approach. If any strategic targets are significantly missed or materially restated, we","page_number":206,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"a87bc63f-d989-4154-8fa8-560fbb98bb8d","block_type":"box","text":"find it helpful when company disclosures provide a detailed explanation of the changes and an indication of the","page_number":206,"box":{"x":68,"y":377,"width":793,"height":12}},{"id":"7c8ec60e-b164-449d-b242-94db3707a306","block_type":"box","text":"board’s role in reviewing the revised targets. We look to the board to articulate the effectiveness of these","page_number":206,"box":{"x":69,"y":392,"width":755,"height":12}},{"id":"86daa28e-a27c-4603-9d94-12f257e6b6d4","block_type":"box","text":"mechanisms in overseeing the management of business risks and opportunities and the fulfillment of the company’s","page_number":206,"box":{"x":69,"y":407,"width":835,"height":12}},{"id":"8b18ca19-1aa8-4764-ac19-ccdbb7637bc7","block_type":"box","text":"strategy.","page_number":206,"box":{"x":69,"y":423,"width":58,"height":11}},{"id":"b39f1c7c-1dc2-49b8-9bae-65132008cabe","block_type":"box","text":"Where a company has not adequately disclosed or demonstrated that its board has fulfilled these corporate","page_number":206,"box":{"x":101,"y":445,"width":769,"height":11}},{"id":"5bfa9354-2fee-412a-aad4-ca07515ef32d","block_type":"box","text":"governance and risk oversight responsibilities, we may consider not supporting the election of directors who, in our","page_number":206,"box":{"x":68,"y":460,"width":823,"height":12}},{"id":"435f1201-06e2-4420-8df2-00f195f66927","block_type":"box","text":"assessment, have particular responsibility for the issues.","page_number":206,"box":{"x":69,"y":475,"width":409,"height":12}},{"id":"0f403cfe-b96a-4842-a2fd-5110dcd7aaec","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":206,"box":{"x":101,"y":498,"width":791,"height":11}},{"id":"3471556d-4a26-42f4-b163-8fb0476615a2","block_type":"box","text":"the board’s effectiveness as a group include the relevance of individual directors’ qualifications and skillsets, as well","page_number":206,"box":{"x":68,"y":513,"width":836,"height":12}},{"id":"a56f1607-2d6a-4441-9301-57f47a5b01fa","block_type":"box","text":"as directors’ capacity and other time commitments, and how these factors may contribute to the company’s financial","page_number":206,"box":{"x":69,"y":528,"width":833,"height":12}},{"id":"864d9dcc-988f-40c3-b1ef-5290766a1b42","block_type":"box","text":"performance. We look to boards to establish formal and transparent processes for nominating directors that reflect","page_number":206,"box":{"x":70,"y":543,"width":823,"height":12}},{"id":"1022d5bd-f785-4010-bd03-fc53623f23aa","block_type":"box","text":"the company’s long-term strategy and business model.","page_number":206,"box":{"x":68,"y":559,"width":390,"height":11}},{"id":"488bfc27-44a9-4a93-b7eb-ad8075a2441c","block_type":"box","text":"In the section titled “Board quality and effectiveness” below, we provide more detail about our approach to board","page_number":206,"box":{"x":102,"y":581,"width":807,"height":11}},{"id":"1ab3d5bd-04b2-4c56-80b0-754701f21eb4","block_type":"box","text":"composition and how it underpins board effectiveness and long-term financial value creation.","page_number":206,"box":{"x":69,"y":596,"width":662,"height":12}},{"id":"23c15d03-d2dc-4242-972b-fe5fadee4830","block_type":"box","text":"Regular accountability through director elections","page_number":206,"box":{"x":69,"y":627,"width":358,"height":11}},{"id":"a0ada31d-1e28-48a2-b08f-a97fa7f90e55","block_type":"box","text":"The election of directors to the board is a right of shareholders and an important signal of support for, or","page_number":206,"box":{"x":101,"y":649,"width":750,"height":12}},{"id":"3b17c3c5-60f5-4edf-bcfb-27a08501fd23","block_type":"box","text":"concern about, the performance of the board in overseeing and advising management. To ensure accountability for","page_number":206,"box":{"x":69,"y":664,"width":819,"height":12}},{"id":"26170b36-b938-4c0c-a41d-40bb73132964","block_type":"box","text":"their decisions on behalf of shareholders, directors should stand for election on a regular basis, ideally annually.","page_number":206,"box":{"x":68,"y":680,"width":802,"height":11}},{"id":"90802f65-8f3e-4385-bd62-745eb2d1749a","block_type":"box","text":"5","page_number":206,"box":{"x":872,"y":680,"width":4,"height":4}},{"id":"29d782e5-e74f-46bd-9c8d-1a1e3fd48128","block_type":"box","text":"Annual director elections allow shareholders to reaffirm their support for, or concerns about, board members’","page_number":206,"box":{"x":68,"y":695,"width":782,"height":11}},{"id":"73bbf362-d1f0-449a-93b7-ec2ad2eefa0e","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":206,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"0515b56b-acde-4f52-b25f-8c9814fae099","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":206,"box":{"x":68,"y":725,"width":832,"height":11}},{"id":"684b968e-3c07-4d98-bda3-65abdd872213","block_type":"box","text":"with a proportion of directors being put forward for election at each shareholder meeting.","page_number":206,"box":{"x":68,"y":740,"width":636,"height":11}},{"id":"cebe7931-463a-44b0-aa7f-0dff053c8673","block_type":"box","text":"BOARD QUALITY AND EFFECTIVENESS","page_number":206,"box":{"x":348,"y":770,"width":282,"height":11}},{"id":"4128c3f8-974c-4a07-98a5-3705ed51e580","block_type":"box","text":"Regular director elections also give boards the opportunity to adjust their composition in an orderly way to reflect","page_number":206,"box":{"x":102,"y":793,"width":805,"height":11}},{"id":"19cc1eb3-55c7-4bd0-9932-f6d0e751a452","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":206,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"860fb7fb-f1c1-4360-bd67-d252cfa0f9d6","block_type":"box","text":"be brought onto the board periodically to refresh the group’s thinking, while supporting both continuity and","page_number":206,"box":{"x":69,"y":823,"width":758,"height":12}},{"id":"e94edc91-513e-4143-8959-ee8b409e795a","block_type":"box","text":"5","page_number":206,"box":{"x":69,"y":853,"width":4,"height":4}},{"id":"1d1aafd8-496d-4f5d-a159-5479772529f9","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":206,"box":{"x":79,"y":852,"width":795,"height":12}},{"id":"93444f20-925f-4e46-8fb1-692c129ab998","block_type":"box","text":"market regulation or voluntary best practice.","page_number":206,"box":{"x":69,"y":868,"width":314,"height":11}},{"id":"f4515c4e-5e11-48d4-a508-a1e44c3eb653","block_type":"box","text":"BlackRock Investment Stewardship","page_number":206,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"78850fca-af5c-40d9-8d36-6140ac7f14da","block_type":"box","text":"Global Principles | 5","page_number":206,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"aa2dd997-fdc8-4a7c-aa1d-2c09036b9cef","block_type":"box","text":"NM1026U-5979889-206/232","page_number":206,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"462d0130-c9f8-45f3-b3e3-5b0574284616","block_type":"box","text":"appropriate succession planning. We consider the average overall tenure of the board and seek a balance between","page_number":207,"box":{"x":69,"y":45,"width":819,"height":11}},{"id":"52761f17-1444-4636-a423-1d46da74987e","block_type":"box","text":"the knowledge and experience of longer-serving directors and the fresh perspectives of directors who joined more","page_number":207,"box":{"x":68,"y":60,"width":809,"height":11}},{"id":"5f514084-5e3b-4132-a98f-a8240af6eda1","block_type":"box","text":"recently.","page_number":207,"box":{"x":69,"y":75,"width":57,"height":11}},{"id":"0de405f4-bf60-49ac-a1d3-efec0b8d9312","block_type":"box","text":"We appreciate when companies regularly review and assess how directors nominated for election contribute to","page_number":207,"box":{"x":101,"y":98,"width":789,"height":11}},{"id":"8285b646-a948-4b8b-8ce6-66fd63722a6a","block_type":"box","text":"the effectiveness of the board. In our view, the company’s assessment should consider a number of factors,","page_number":207,"box":{"x":68,"y":113,"width":774,"height":11}},{"id":"2fdced96-99c1-4351-a253-26060b07a6e7","block_type":"box","text":"including each director’s independence and time commitments, as well as the breadth and relevance of director","page_number":207,"box":{"x":70,"y":128,"width":798,"height":11}},{"id":"00ed6739-0ee9-4e96-8e2b-f3b2e342b534","block_type":"box","text":"experiences and skillsets, and how these collectively contribute to the board’s effectiveness in advising and","page_number":207,"box":{"x":69,"y":143,"width":770,"height":11}},{"id":"7d962717-132e-40ae-9090-477a51653bcb","block_type":"box","text":"overseeing management in delivering long-term financial returns.","page_number":207,"box":{"x":69,"y":158,"width":459,"height":11}},{"id":"7b5440ac-75be-4d09-9cb2-f22d4ff65109","block_type":"box","text":"Director independence","page_number":207,"box":{"x":69,"y":188,"width":164,"height":11}},{"id":"92b7db2b-e846-48c4-80ed-c96a52e80e9f","block_type":"box","text":"Director independence — from management, significant shareholders, or other related parties — is a central","page_number":207,"box":{"x":102,"y":211,"width":777,"height":11}},{"id":"9f60e4ec-4161-4cfa-9623-e901e9790c63","block_type":"box","text":"tenet of sound corporate governance across markets.","page_number":207,"box":{"x":68,"y":226,"width":382,"height":11}},{"id":"fde07099-594b-4725-99c8-a5ea2ee4bb57","block_type":"box","text":"6","page_number":207,"box":{"x":452,"y":226,"width":4,"height":5}},{"id":"6cf2e867-7f08-42d5-96dd-fc3c9fcb31fc","block_type":"box","text":"We look to boards to have a sufficient number of independent","page_number":207,"box":{"x":462,"y":226,"width":442,"height":11}},{"id":"3b9a3c8d-74ec-4d1c-bb1c-f135cb6c75db","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":207,"box":{"x":69,"y":241,"width":825,"height":11}},{"id":"716bea3d-165a-4549-aacf-4ca06a8dcff5","block_type":"box","text":"and its ability to oversee management. We generally consider it good practice for independent directors to make a","page_number":207,"box":{"x":69,"y":256,"width":813,"height":12}},{"id":"9c9ceb82-75b9-4cf8-aeb9-f2d88c9fa24f","block_type":"box","text":"majority of the board, or in the case of controlled companies, at least one-third.","page_number":207,"box":{"x":69,"y":271,"width":566,"height":12}},{"id":"a72872e2-0399-4e13-ad5c-2f7e572f9e2d","block_type":"box","text":"Common impediments to independence may include but are not limited to:","page_number":207,"box":{"x":102,"y":294,"width":531,"height":11}},{"id":"42c7fff9-f6b2-4f21-8949-dc5b565e9792","block_type":"box","text":"•","page_number":207,"box":{"x":69,"y":317,"width":6,"height":5}},{"id":"15c9fc20-0548-4bf8-8254-5417b0f8493d","block_type":"box","text":"Current or recent employment at the company or a subsidiary","page_number":207,"box":{"x":102,"y":314,"width":438,"height":11}},{"id":"df6d4528-467b-43ba-ac92-9be98a0bd5ff","block_type":"box","text":"•","page_number":207,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"ed5864c4-0d56-431a-9d5c-b126bda35e70","block_type":"box","text":"Being, or representing, a shareholder with a substantial shareholding in the company","page_number":207,"box":{"x":102,"y":335,"width":606,"height":11}},{"id":"e907e038-4b70-4fd6-aa05-ebb0a3e13199","block_type":"box","text":"•","page_number":207,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"ba223edb-0721-4cfc-928d-5f16444e7618","block_type":"box","text":"Interlocking directorates","page_number":207,"box":{"x":102,"y":355,"width":170,"height":11}},{"id":"01361fc7-4f49-41a6-bd40-7d6e61a487ce","block_type":"box","text":"•","page_number":207,"box":{"x":69,"y":378,"width":6,"height":4}},{"id":"c225b647-a6bf-4c85-b226-b293b6b44dcd","block_type":"box","text":"Having any other interest, business, or other relationship which could, or could reasonably be perceived to,","page_number":207,"box":{"x":102,"y":375,"width":761,"height":11}},{"id":"686c2cc2-11de-4e8b-ad5a-63376011e857","block_type":"box","text":"materially interfere with a director’s ability to act in the best interests of the company and shareholders","page_number":207,"box":{"x":102,"y":390,"width":738,"height":11}},{"id":"23453946-4a6d-47e7-bf9b-9d35cbc708dd","block_type":"box","text":"In our experience, boards are most effective at overseeing and advising management when there is a senior,","page_number":207,"box":{"x":102,"y":412,"width":775,"height":12}},{"id":"77e2a150-620f-4fd5-8bed-6d3ea115d918","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":207,"box":{"x":70,"y":428,"width":827,"height":11}},{"id":"8f5c0acc-d511-4265-8417-bdc62e07636d","block_type":"box","text":"independent), be designated as a lead independent director. The role of this director is to support independent board","page_number":207,"box":{"x":70,"y":443,"width":835,"height":11}},{"id":"0a138207-01ef-4461-a6aa-ead1e125318c","block_type":"box","text":"members in fulfilling their oversight responsibilities effectively by shaping the agenda, ensuring adequate information","page_number":207,"box":{"x":69,"y":458,"width":834,"height":11}},{"id":"1d8172ae-79f2-4569-8a19-25142b924d4a","block_type":"box","text":"is provided to the board, and encouraging independent director participation in board deliberations. We appreciate","page_number":207,"box":{"x":70,"y":473,"width":813,"height":11}},{"id":"9f028fd8-904e-407c-9e15-502dc935eb45","block_type":"box","text":"when the lead independent director or another appropriate director is available to meet with shareholders to explain","page_number":207,"box":{"x":68,"y":488,"width":826,"height":11}},{"id":"d1af9657-c883-4ea8-b90e-f4aa0fe6b5d4","block_type":"box","text":"and contextualize a company’s approach as a situation warrants.","page_number":207,"box":{"x":69,"y":503,"width":463,"height":11}},{"id":"8b935b39-9c2d-42d6-91ae-b2d4084b882b","block_type":"box","text":"Boards may face matters that could involve conflicts of interest for executives or affiliated directors, or that","page_number":207,"box":{"x":102,"y":526,"width":765,"height":11}},{"id":"7de0ae61-6d3c-4fd0-b690-53c33fea9631","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":207,"box":{"x":69,"y":541,"width":837,"height":11}},{"id":"9e10915b-04a4-4f01-80d5-21e261ca1b21","block_type":"box","text":"committees with a majority of independent directors, depending on market norms and a company’s ownership","page_number":207,"box":{"x":69,"y":556,"width":784,"height":11}},{"id":"ae5af4c9-09ba-4ed5-bb05-bf9fb62db5c2","block_type":"box","text":"structure. In many markets, these committees of the board specialize in audit, director nominations, and","page_number":207,"box":{"x":69,"y":571,"width":747,"height":11}},{"id":"789304b9-1276-45f4-bbeb-8838c850ff49","block_type":"box","text":"compensation matters, among others. An ad hoc committee might also be formed to decide on a special transaction,","page_number":207,"box":{"x":69,"y":586,"width":836,"height":12}},{"id":"aa32a429-f64d-4387-9614-fc88cce17645","block_type":"box","text":"particularly one involving a related party, or to investigate a significant adverse event.","page_number":207,"box":{"x":70,"y":601,"width":607,"height":12}},{"id":"f2dd3735-3c6f-4a7b-a048-d99473cccff4","block_type":"box","text":"Sufficient capacity","page_number":207,"box":{"x":68,"y":632,"width":137,"height":11}},{"id":"c3865107-aed9-452f-8e7c-0042a017cabb","block_type":"box","text":"As the role and expectations of a director are increasingly demanding, directors must be able to commit an","page_number":207,"box":{"x":101,"y":654,"width":763,"height":12}},{"id":"33625c87-7bc6-474b-bec0-2e35d553e2b4","block_type":"box","text":"appropriate amount of time to board and committee matters. It is important that directors have the capacity to meet","page_number":207,"box":{"x":69,"y":669,"width":830,"height":12}},{"id":"851896ce-7e28-44cd-bb3f-65933299f320","block_type":"box","text":"all of their responsibilities — including when there are unforeseen events — and therefore, we consider it best","page_number":207,"box":{"x":69,"y":685,"width":791,"height":11}},{"id":"5e284d47-2405-47b9-ba43-fbd643a5d51c","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":207,"box":{"x":70,"y":700,"width":804,"height":11}},{"id":"097155b3-b4fa-4797-b74b-c2f360fdf4b6","block_type":"box","text":"Board composition","page_number":207,"box":{"x":69,"y":730,"width":135,"height":11}},{"id":"a2a88248-a7c0-4d4a-905a-5e7b6d34f3bc","block_type":"box","text":"In assessing board composition, we take into account a company’s board size, business model, strategy, market","page_number":207,"box":{"x":102,"y":753,"width":806,"height":11}},{"id":"e93252d4-50e7-46de-8b3c-b51b6b70617f","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":207,"box":{"x":69,"y":768,"width":836,"height":11}},{"id":"e9919577-7961-4878-933c-0b13f0873e31","block_type":"box","text":"companies explain how their approach to board composition supports the company’s governance practices.","page_number":207,"box":{"x":69,"y":783,"width":767,"height":11}},{"id":"eb574402-9e8a-4943-89b9-5941653cee1c","block_type":"box","text":"When nominating directors to the board, we look to companies to provide sufficient information on the individual","page_number":207,"box":{"x":101,"y":806,"width":802,"height":11}},{"id":"7d563781-3919-4a27-935a-60e6bc672ef3","block_type":"box","text":"candidates so that shareholders can assess the capabilities and suitability of each individual nominee and their fit","page_number":207,"box":{"x":69,"y":821,"width":818,"height":11}},{"id":"6109b924-559e-48e1-99df-b12d0f7079c8","block_type":"box","text":"within overall board composition. These disclosures should explain how the collective experience and expertise of the","page_number":207,"box":{"x":68,"y":836,"width":840,"height":11}},{"id":"21e723e4-32eb-4dec-a01d-ecbb0df2f03b","block_type":"box","text":"board, as well as the particular skillsets of individual directors, aligns with the company’s long-term strategy. Highly","page_number":207,"box":{"x":69,"y":851,"width":823,"height":11}},{"id":"ddae767a-be21-4d85-bb65-623f529791e7","block_type":"box","text":"6","page_number":207,"box":{"x":69,"y":881,"width":4,"height":4}},{"id":"bf2215b3-9933-4bc2-81a7-db8694475a6a","block_type":"box","text":"For example, please see: Tokyo Stock Exchange, “Japan’s Corporate Governance Code,” June 11, 2021; Financial","page_number":207,"box":{"x":79,"y":880,"width":813,"height":11}},{"id":"9de0ff8a-6b93-4b04-b8b6-05fcc5285671","block_type":"box","text":"Reporting Council, “UK Corporate Governance Code,” January 2024, accessed in December 2025.","page_number":207,"box":{"x":70,"y":895,"width":704,"height":12}},{"id":"389ed2bc-4ea9-49b0-82d2-ca4857c7ea32","block_type":"box","text":"BlackRock Investment Stewardship","page_number":207,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"11f807c0-1eba-4b5d-ac59-ef2c7ee8902e","block_type":"box","text":"Global Principles | 6","page_number":207,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"ba91db96-592e-4553-a837-2f6596d9264f","block_type":"box","text":"NM1026U-5979889-207/232","page_number":207,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"b0967824-3e4c-4cf7-b147-a5d947a18e3a","block_type":"box","text":"qualified, engaged directors with professional characteristics relevant to a company’s business and strategy enhance","page_number":208,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"beaf57c6-2b8c-46e5-9a86-80f2d5846301","block_type":"box","text":"the ability of the board to add value and be the voice of shareholders in board discussions.","page_number":208,"box":{"x":68,"y":60,"width":650,"height":11}},{"id":"6d782250-6c61-4547-9091-fad5b9c7e106","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":208,"box":{"x":102,"y":82,"width":775,"height":12}},{"id":"dac9851a-9d81-4e66-9eb9-c9cde9e287c0","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":208,"box":{"x":69,"y":98,"width":806,"height":11}},{"id":"3fba7fca-75d1-4715-bde4-fb1bb1e64e7e","block_type":"box","text":"oversee management. We note that in many markets, policymakers have set board gender diversity goals which we","page_number":208,"box":{"x":69,"y":113,"width":820,"height":11}},{"id":"3dd34d1a-078d-46aa-8e5b-ab8529cb5e45","block_type":"box","text":"may discuss with companies, particularly if there is a risk their board composition may be misaligned.","page_number":208,"box":{"x":69,"y":128,"width":726,"height":11}},{"id":"26d15ba5-f560-48a0-b8e4-6ce9ec0d4e33","block_type":"box","text":"AUDITORS AND AUDIT-RELATED ISSUES","page_number":208,"box":{"x":342,"y":158,"width":293,"height":9}},{"id":"773b9aaf-0023-4d2f-b5e4-6e6284736190","block_type":"box","text":"BIS recognizes the critical importance of financial statements to provide a complete and accurate portrayal of a","page_number":208,"box":{"x":102,"y":181,"width":795,"height":11}},{"id":"85b36ee2-b878-49b9-b651-a88ec0556a0d","block_type":"box","text":"company’s financial condition. Accordingly, we look for the assumptions made by management, and reviewed by the","page_number":208,"box":{"x":69,"y":196,"width":825,"height":11}},{"id":"9c8ea5d8-429e-4f2a-a572-3ea69d9349a7","block_type":"box","text":"auditor in preparing the financial statements, to be reasonable and justified.","page_number":208,"box":{"x":69,"y":211,"width":543,"height":11}},{"id":"54677a03-0cc2-420c-aba9-42b31401d709","block_type":"box","text":"We view the audit committee, or its equivalent, as responsible for overseeing the management of the","page_number":208,"box":{"x":101,"y":234,"width":722,"height":11}},{"id":"d29a6456-6444-4577-b91e-35681c0f8fff","block_type":"box","text":"independent auditor and the internal audit function at a company. The committee plays an important role in a","page_number":208,"box":{"x":70,"y":249,"width":778,"height":11}},{"id":"9d0c4c5d-65c7-4a6a-b952-4f2653cf38ba","block_type":"box","text":"company’s financial reporting system by providing independent oversight of the accounts, material financial, and,","page_number":208,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"8d484ad2-14b9-4564-8a6a-16050c4425e3","block_type":"box","text":"where appropriate to the jurisdiction, non-financial information and internal control frameworks. Moreover, in the","page_number":208,"box":{"x":68,"y":279,"width":799,"height":11}},{"id":"e8cd254f-8633-4414-93fc-d964893d720f","block_type":"box","text":"absence of a dedicated risk committee, these committees can provide oversight of Enterprise Risk Management","page_number":208,"box":{"x":69,"y":294,"width":801,"height":11}},{"id":"9815dca7-3c95-4151-b144-000849e42203","block_type":"box","text":"systems.","page_number":208,"box":{"x":69,"y":310,"width":62,"height":10}},{"id":"97135c6a-9d0c-4ccf-8c2b-518d45dd2a1a","block_type":"box","text":"7","page_number":208,"box":{"x":133,"y":310,"width":4,"height":4}},{"id":"e4ccbf62-a094-4802-a959-a71c6eaf3817","block_type":"box","text":"In our view, effective audit committee oversight strengthens the quality and reliability of a company’s","page_number":208,"box":{"x":144,"y":309,"width":717,"height":11}},{"id":"2f6a874f-84c8-406a-9e71-d069eaa90f5b","block_type":"box","text":"financial statements and provides an important level of reassurance to shareholders.","page_number":208,"box":{"x":68,"y":324,"width":609,"height":11}},{"id":"3832d064-eb53-4810-a0b0-2891ac021c4e","block_type":"box","text":"We look to audit committees, or their equivalent, to have clearly articulated charters that set out their","page_number":208,"box":{"x":101,"y":347,"width":727,"height":11}},{"id":"a280955f-63b6-48c1-827e-2a9f24e63bc4","block_type":"box","text":"responsibilities. Additionally, having a rotation plan can periodically refresh the committee membership and introduce","page_number":208,"box":{"x":69,"y":362,"width":835,"height":11}},{"id":"ce81d4a7-8add-4299-8c84-345676953fa2","block_type":"box","text":"new perspectives. We recognize that audit committees will rely on management, internal audit, and the independent","page_number":208,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"60fb255f-3a84-419c-a239-788608a02fed","block_type":"box","text":"auditor to fulfill their responsibilities. However, we look to committee members to demonstrate they have relevant","page_number":208,"box":{"x":69,"y":392,"width":810,"height":12}},{"id":"05be1380-c966-48dd-bf25-97bfc7087689","block_type":"box","text":"expertise to monitor and oversee the audit process and related activities.","page_number":208,"box":{"x":69,"y":408,"width":523,"height":10}},{"id":"3a5e6e63-6cac-4059-91f5-b0db9f0e5810","block_type":"box","text":"We take particular note of unexplained changes in reporting methodology, cases involving significant financial","page_number":208,"box":{"x":101,"y":430,"width":780,"height":11}},{"id":"32b23181-f32e-4676-a12d-c712a0d2d378","block_type":"box","text":"restatements, or ad hoc notifications of material financial weakness. In this respect, we look to audit committees to","page_number":208,"box":{"x":69,"y":445,"width":828,"height":11}},{"id":"7601cfd2-0922-4516-abc6-5d55e754be65","block_type":"box","text":"provide timely disclosure on the remediation of key and critical audit matters identified either by the external auditor","page_number":208,"box":{"x":70,"y":460,"width":827,"height":12}},{"id":"f2046425-2009-44d5-8a7e-1611d3d9edec","block_type":"box","text":"or internal audit function.","page_number":208,"box":{"x":69,"y":475,"width":178,"height":9}},{"id":"28c6fff3-b9af-466f-ae14-d7e1bf1e9dd6","block_type":"box","text":"The integrity of financial statements depends on the auditor being free of any impediments that could","page_number":208,"box":{"x":101,"y":498,"width":723,"height":11}},{"id":"7d3f7094-c928-4f68-b53b-967a1a377f10","block_type":"box","text":"compromise its ability to serve as an effective check on management. To that end, it is important that auditors are,","page_number":208,"box":{"x":69,"y":513,"width":825,"height":12}},{"id":"69b7950d-16b3-4c46-8b50-d15c6d1af65f","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":208,"box":{"x":69,"y":528,"width":824,"height":12}},{"id":"4c90a300-e690-40ca-8ce8-2ff6e7023a71","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":208,"box":{"x":70,"y":543,"width":839,"height":11}},{"id":"db61b248-c373-4bb9-ad68-06be325273c4","block_type":"box","text":"assessing the independence of the auditor and the quality of the external audit process on an annual basis.","page_number":208,"box":{"x":69,"y":559,"width":770,"height":11}},{"id":"66180274-b5a5-4e7c-9521-46666ad22c22","block_type":"box","text":"Comprehensive disclosure provides investors with an understanding of the company’s long-term operational risk","page_number":208,"box":{"x":102,"y":581,"width":799,"height":12}},{"id":"428f557e-adc1-4a51-af14-b17d0f096575","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":208,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"acdb35b3-a3e9-421b-b16a-c54dc00760bc","block_type":"box","text":"to periodically review the company’s risk assessment and risk management policies and the significant risks and","page_number":208,"box":{"x":68,"y":612,"width":806,"height":11}},{"id":"3ffe97dc-57bb-41ac-9c0c-9dcde826d171","block_type":"box","text":"exposures identified by management, the internal auditors or the independent auditors, and management’s steps to","page_number":208,"box":{"x":69,"y":627,"width":829,"height":11}},{"id":"3dd54b8d-f672-4e33-8507-00f243810692","block_type":"box","text":"address them. In the absence of detailed disclosures, we may conclude that companies are not adequately managing","page_number":208,"box":{"x":69,"y":642,"width":840,"height":11}},{"id":"1b32153c-f4bc-45ec-827a-94b315a299b5","block_type":"box","text":"risk.","page_number":208,"box":{"x":69,"y":657,"width":28,"height":9}},{"id":"d0fb5ac2-4ba2-400f-a4e1-fdb1b576884b","block_type":"box","text":"CAPITAL STRUCTURE, MERGERS, ACQUISITIONS, ASSET SALES, AND OTHER SPECIAL SITUATIONS","page_number":208,"box":{"x":125,"y":687,"width":728,"height":11}},{"id":"06885c6c-f976-4c6d-bab8-13e68b4d9ff1","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":208,"box":{"x":101,"y":710,"width":798,"height":11}},{"id":"d54bf853-a95d-4b84-9e42-49e88105cafd","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":208,"box":{"x":70,"y":725,"width":824,"height":11}},{"id":"09e37f2c-5d43-4374-8fe8-15e622d2457c","block_type":"box","text":"protection for shareholders against the dilution of their interests.","page_number":208,"box":{"x":70,"y":740,"width":460,"height":11}},{"id":"967a73e4-6817-40eb-bc3f-51c5f68e49cf","block_type":"box","text":"In principle, we have concerns with the creation of a share class with equivalent economic exposure and","page_number":208,"box":{"x":102,"y":763,"width":743,"height":11}},{"id":"b8c8203c-b5ae-452c-84e7-9dd67221e058","block_type":"box","text":"differentiated voting rights. As a result, BIS generally supports bylaw amendments that introduce the adoption of","page_number":208,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"a31e58c6-5dc7-41d0-92db-5ecc80b06142","block_type":"box","text":"“one share, one vote” for registered shareholders.","page_number":208,"box":{"x":70,"y":793,"width":358,"height":11}},{"id":"465f6341-3782-4b0b-abab-ab1001333c31","block_type":"box","text":"7","page_number":208,"box":{"x":69,"y":823,"width":4,"height":4}},{"id":"ee45b82d-d1b4-4106-90a2-28cb0eb70be1","block_type":"box","text":"Enterprise Risk Management is a process, effected by the entity’s board of directors, management, and other","page_number":208,"box":{"x":79,"y":822,"width":784,"height":12}},{"id":"8e1af962-064c-4f3e-9d10-68cdbc1bf2f1","block_type":"box","text":"personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect","page_number":208,"box":{"x":70,"y":837,"width":834,"height":12}},{"id":"646f0024-0646-4650-adc6-9d77be0ba0c7","block_type":"box","text":"the entity, and manage risk to be within the risk appetite, to provide reasonable assurance regarding the achievement","page_number":208,"box":{"x":68,"y":853,"width":841,"height":11}},{"id":"03a38cb9-1af1-4973-b32c-6d749484e503","block_type":"box","text":"of objectives. Please see: The Committee of Sponsoring Organizations of the Treadway Commission (COSO),","page_number":208,"box":{"x":69,"y":868,"width":771,"height":11}},{"id":"87d2de62-6542-457d-9373-cfe58aec9fe5","block_type":"box","text":"“Enterprise Risk Management,” 2023, accessed in December 2025.","page_number":208,"box":{"x":70,"y":883,"width":488,"height":11}},{"id":"8d7bec5b-89a2-48d7-a366-9062b34f8d46","block_type":"box","text":"BlackRock Investment Stewardship","page_number":208,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"687d0a5f-d759-4d03-b006-7b6071cfdf0e","block_type":"box","text":"Global Principles | 7","page_number":208,"box":{"x":768,"y":942,"width":140,"height":13}},{"id":"4d0381aa-fa50-4daa-af3a-d3c0406b34f4","block_type":"box","text":"NM1026U-5979889-208/232","page_number":208,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1b75ecbe-66d3-4158-bcea-7a227c74aa30","block_type":"box","text":"However, we recognize that in certain markets, at least for a period of time, companies may have a valid reason","page_number":209,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"36e79825-41aa-42e9-a97c-7a25cc5c5dfa","block_type":"box","text":"for listing dual classes of shares with differentiated voting rights. In our view, such companies should review these","page_number":209,"box":{"x":68,"y":60,"width":818,"height":11}},{"id":"89024985-20b7-4041-82ff-471e80e12694","block_type":"box","text":"share class structures on a regular basis or as company circumstances change. Additionally, they should seek","page_number":209,"box":{"x":69,"y":75,"width":788,"height":11}},{"id":"37b760ea-f8f8-4514-bcfb-d684874bed34","block_type":"box","text":"shareholder approval of their capital structure on a periodic basis via a management proposal at the company’s","page_number":209,"box":{"x":69,"y":90,"width":797,"height":11}},{"id":"93c22c8b-dcf1-4c71-82a3-e8ab2dc152aa","block_type":"box","text":"shareholder meeting. The proposal should give unaffiliated shareholders the opportunity to affirm the current","page_number":209,"box":{"x":69,"y":105,"width":780,"height":11}},{"id":"630aa56f-9ce9-4579-8c41-ae8b043774c4","block_type":"box","text":"structure or establish mechanisms to end or phase out controlling structures at the appropriate time, while","page_number":209,"box":{"x":69,"y":120,"width":764,"height":12}},{"id":"4c40cf3d-45d5-48f4-9fa7-611cf38bba99","block_type":"box","text":"minimizing costs to shareholders.","page_number":209,"box":{"x":69,"y":136,"width":238,"height":11}},{"id":"86489886-7794-47c4-aad8-f578e132a932","block_type":"box","text":"In assessing mergers, asset sales, or other special situations, BIS’ primary consideration is the long-term","page_number":209,"box":{"x":102,"y":158,"width":756,"height":11}},{"id":"9eeb8565-6b5e-4e59-8af5-96e286cafde3","block_type":"box","text":"financial interests of our clients as shareholders, and so we will review any proposed transaction with that objective","page_number":209,"box":{"x":68,"y":173,"width":826,"height":11}},{"id":"09639d39-6787-4125-ae55-2e944981e9c5","block_type":"box","text":"in mind. Typically, we review factors such as whether the proposed transaction has the unanimous support of the","page_number":209,"box":{"x":70,"y":188,"width":806,"height":11}},{"id":"e4f8c71c-2687-40cd-98ad-6a29311e679e","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":209,"box":{"x":69,"y":204,"width":799,"height":11}},{"id":"f8913d8e-582e-4d64-a3c0-b793b216d482","block_type":"box","text":"economic and strategic rationale. We may also seek reassurance from the board that the financial interests of","page_number":209,"box":{"x":69,"y":218,"width":788,"height":12}},{"id":"46dcffa4-f45d-45d6-b858-5ccf85c3166a","block_type":"box","text":"executives and/or board members in a given transaction have not adversely affected their ability to place","page_number":209,"box":{"x":69,"y":234,"width":750,"height":11}},{"id":"7042e33d-bcf8-407f-94fc-bbd7a7eec074","block_type":"box","text":"shareholders’ interests before their own. Where the transaction involves related parties, the recommendation to","page_number":209,"box":{"x":69,"y":249,"width":801,"height":11}},{"id":"f146794c-86da-450d-adf4-d2d8892dcd40","block_type":"box","text":"support should come from the independent directors, a best practice in most markets, and ideally, the terms should","page_number":209,"box":{"x":69,"y":264,"width":830,"height":11}},{"id":"f3810793-fff2-44e8-a4af-b0e68dbff85b","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":209,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"7d9b45f7-dbb2-4157-ac72-137922e5a638","block_type":"box","text":"a separate vote of the non-conflicted parties.","page_number":209,"box":{"x":69,"y":294,"width":320,"height":11}},{"id":"d4cba18f-5a57-414e-97f8-e0a54813dcb4","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":209,"box":{"x":101,"y":317,"width":806,"height":11}},{"id":"dd8da397-6389-4261-9493-31d2b803ee9b","block_type":"box","text":"open market without unnecessary restriction. In our view, corporate mechanisms designed to limit shareholders’","page_number":209,"box":{"x":69,"y":332,"width":801,"height":11}},{"id":"a7e6abd7-1cfa-4d4b-80ce-7c4c2fd57162","block_type":"box","text":"ability to sell their shares are contrary to basic property rights. Such mechanisms can serve to protect and entrench","page_number":209,"box":{"x":69,"y":347,"width":829,"height":11}},{"id":"faee6c98-b839-45a7-bdf3-5027e828c0bc","block_type":"box","text":"interests other than those of the shareholders. In our view, shareholders are broadly capable of making decisions in","page_number":209,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"cce81efc-015f-4e9d-83f9-7ca31a4ef135","block_type":"box","text":"their own best interests. We encourage any shareholder rights plans proposed by a board to be subject to","page_number":209,"box":{"x":68,"y":377,"width":755,"height":12}},{"id":"f9d56edc-8ffc-4ca4-815a-30738eba411a","block_type":"box","text":"shareholder approval upon introduction and periodically thereafter.","page_number":209,"box":{"x":69,"y":392,"width":472,"height":12}},{"id":"4e30e8ec-b8b3-4421-bde1-52271d0bd921","block_type":"box","text":"EXECUTIVE COMPENSATION AND BENEFITS","page_number":209,"box":{"x":328,"y":423,"width":322,"height":9}},{"id":"ae46f3b7-9f81-4430-bd7c-438942eb81f4","block_type":"box","text":"Executive compensation is an important tool used by companies to support long-term financial value creation. A","page_number":209,"box":{"x":102,"y":445,"width":799,"height":12}},{"id":"44144921-4466-451c-bff0-fc898cc22b66","block_type":"box","text":"well-structured compensation policy rewards the successful delivery of strategic, operational, and/or financial goals;","page_number":209,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"4e934273-377a-45c9-af2d-8192b00c8fa4","block_type":"box","text":"encourages an appropriate risk appetite; and aligns the interests of shareholders and executives through equity","page_number":209,"box":{"x":69,"y":475,"width":797,"height":12}},{"id":"9f0d5ae6-f21c-488c-80b2-13bd24c2d959","block_type":"box","text":"ownership.","page_number":209,"box":{"x":69,"y":491,"width":75,"height":11}},{"id":"cea452a8-a642-41b6-8449-73250e6e9e30","block_type":"box","text":"8","page_number":209,"box":{"x":146,"y":491,"width":4,"height":4}},{"id":"59e54a29-aa32-47a4-b65f-805c035f55b7","block_type":"box","text":"We look for a clear link between variable pay and operational and financial performance that support sustained","page_number":209,"box":{"x":101,"y":513,"width":793,"height":11}},{"id":"b83812c5-ba75-4179-b355-73ac76d9bd9c","block_type":"box","text":"financial value creation for our clients as shareholders. We appreciate when performance targets incorporate","page_number":209,"box":{"x":68,"y":528,"width":778,"height":12}},{"id":"25317c62-e286-46e3-9828-cc03da87b908","block_type":"box","text":"ambitious objectives, and the corresponding metrics are aligned with the company’s strategy and business model.","page_number":209,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"bf09cb67-5bce-45c6-8155-39a7869437ca","block_type":"box","text":"BIS does not have a position on whether companies choose to use sustainability-related criteria in compensation","page_number":209,"box":{"x":70,"y":559,"width":804,"height":11}},{"id":"2766cd04-49d6-4fcb-b744-88393594ef43","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":209,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"0ef20d1f-fd82-4939-8ba4-b2d4efafad9e","block_type":"box","text":"financial or operational targets. We appreciate when long-term incentive plans encompass timeframes that: 1) are","page_number":209,"box":{"x":68,"y":589,"width":813,"height":11}},{"id":"08ede877-2350-4f2c-9746-b6f480c7bc6f","block_type":"box","text":"distinct from annual executive compensation structures and metrics, and 2) encourage the delivery of strong financial","page_number":209,"box":{"x":69,"y":604,"width":839,"height":11}},{"id":"609210d6-2a25-435c-97f0-62e814b43c95","block_type":"box","text":"results over a period of years.","page_number":209,"box":{"x":69,"y":619,"width":211,"height":11}},{"id":"83f1ffda-8d66-4fe0-a617-fd6a4a008a18","block_type":"box","text":"We consider it best practice when board members responsible for designing and approving executive","page_number":209,"box":{"x":101,"y":642,"width":718,"height":11}},{"id":"5ff54a3e-1d1d-4e12-89f5-bec80478a5c1","block_type":"box","text":"compensation carefully consider the company’s specific circumstances. Factors to consider may include the","page_number":209,"box":{"x":69,"y":657,"width":770,"height":11}},{"id":"bda36869-3226-4de7-a472-3a5567215803","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":209,"box":{"x":69,"y":672,"width":838,"height":11}},{"id":"cc66dae5-8b64-4726-8043-df86cb44e2b7","block_type":"box","text":"look to the compensation committees to guard against contractual arrangements that would entitle executives to","page_number":209,"box":{"x":70,"y":687,"width":804,"height":11}},{"id":"f4e7658e-c68c-4612-ad9f-e81ad1568733","block_type":"box","text":"material compensation for early termination of their employment. Finally, we look for pension contributions and other","page_number":209,"box":{"x":69,"y":702,"width":831,"height":11}},{"id":"037b2dc8-66d8-47eb-80b9-25f3c497f065","block_type":"box","text":"deferred compensation arrangements to be reasonable in light of market practices or the company’s business and","page_number":209,"box":{"x":69,"y":717,"width":817,"height":12}},{"id":"85b7ec3a-4cfd-4f9e-ac88-c3500d4d2bb0","block_type":"box","text":"executive compensation strategies.","page_number":209,"box":{"x":69,"y":733,"width":250,"height":11}},{"id":"e95d288f-7cbf-4655-bf1c-94d94b524b86","block_type":"box","text":"We are not supportive of one-off or special bonuses unrelated to company or individual performance. Where","page_number":209,"box":{"x":101,"y":755,"width":772,"height":11}},{"id":"b7663b93-feab-463b-886b-5cce4093b6b9","block_type":"box","text":"discretion has been used by the compensation committee, or its equivalent, we appreciate disclosure relating to how","page_number":209,"box":{"x":69,"y":771,"width":836,"height":11}},{"id":"ad77c518-3a0b-497f-8047-d5146636f747","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":209,"box":{"x":69,"y":785,"width":803,"height":12}},{"id":"67bdad3b-2512-474e-b7b7-0d96d3280539","block_type":"box","text":"addition, we acknowledge that the use of peer group evaluation by compensation committees can help ensure","page_number":209,"box":{"x":69,"y":801,"width":785,"height":11}},{"id":"d602825d-dee2-466a-b2a4-37a17b53de46","block_type":"box","text":"competitive pay. However, we encourage companies to clearly explain how compensation outcomes have rewarded","page_number":209,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"b982b50e-ba7d-4e38-b355-4b179adbd50a","block_type":"box","text":"performance rather than solely base increases in total compensation on peer benchmarking.","page_number":209,"box":{"x":70,"y":831,"width":659,"height":11}},{"id":"dd9343da-2242-41e5-bacd-8d0a2797cdb9","block_type":"box","text":"8","page_number":209,"box":{"x":69,"y":860,"width":4,"height":5}},{"id":"cb8ab359-5334-43e6-a497-4f48b5639f73","block_type":"box","text":"The terms “compensation,” “remuneration,” and “pay” are used interchangeably to describe the same concept in","page_number":209,"box":{"x":78,"y":860,"width":811,"height":11}},{"id":"0cdf1599-e9a2-4002-829a-1e2316f60fa0","block_type":"box","text":"different markets.","page_number":209,"box":{"x":69,"y":875,"width":126,"height":9}},{"id":"a9672276-cbf5-4dd7-9031-9657df6204e2","block_type":"box","text":"BlackRock Investment Stewardship","page_number":209,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"01b08e00-43d0-49e1-93c0-2ee3093ed5c7","block_type":"box","text":"Global Principles | 8","page_number":209,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"26458a96-e43b-4320-a892-e0bdde1b804c","block_type":"box","text":"NM1026U-5979889-209/232","page_number":209,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4508aa56-87a2-41dc-971a-0410c9dd33f2","block_type":"box","text":"We consider the inclusion of building clawback provisions into incentive plans as good practice. Such provisions","page_number":210,"box":{"x":101,"y":45,"width":797,"height":11}},{"id":"06194697-3ca4-43e2-854d-5644fccf34a7","block_type":"box","text":"could require executives to forgo awards when compensation was based on faulty financial statements or deceptive","page_number":210,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"469e1bd2-d234-4f77-9ced-1e8afde31881","block_type":"box","text":"business practices, or when their behavior caused material financial harm to shareholders, material reputational risk","page_number":210,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"4c538493-3882-4245-86f6-b1790fbabbf2","block_type":"box","text":"to the company, or resulted in a criminal investigation.","page_number":210,"box":{"x":68,"y":90,"width":386,"height":11}},{"id":"e48d5cb0-1d23-4157-85b7-68f35222e368","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":210,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"06c943ff-eff3-4dbb-93ee-a2dddfb7093e","block_type":"box","text":"effort expended in fulfilling their professional responsibilities. Additionally, these compensation arrangements should","page_number":210,"box":{"x":69,"y":128,"width":834,"height":11}},{"id":"10993cad-ce28-4d15-9367-698199bebe92","block_type":"box","text":"not risk compromising directors’ independence or aligning their interests too closely with those of the management,","page_number":210,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"6684ecb2-4b39-44a3-a6e6-4b06aef043ce","block_type":"box","text":"whom they are charged with overseeing.","page_number":210,"box":{"x":68,"y":158,"width":285,"height":11}},{"id":"75b1a431-a44b-47bf-b3cb-44e40308d38a","block_type":"box","text":"When assessing compensation proposals, BIS reviews companies’ disclosures to determine whether the board’s","page_number":210,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"e248b4d7-3dcc-4639-94f6-1c07658992ee","block_type":"box","text":"approach to executive compensation is rigorous in light of the company’s stated long-term corporate strategy and","page_number":210,"box":{"x":69,"y":196,"width":807,"height":11}},{"id":"629475dd-9cce-4735-b88e-b3b5804c0b72","block_type":"box","text":"specific circumstances, as well as local market and policy developments.","page_number":210,"box":{"x":69,"y":211,"width":521,"height":11}},{"id":"f0524132-e922-46ca-8a6f-bbe5b530e520","block_type":"box","text":"When our analysis indicates that executive compensation is misaligned with company performance, BIS may not","page_number":210,"box":{"x":101,"y":234,"width":802,"height":11}},{"id":"117a55ce-3a66-427e-b8c1-df0fdf77b899","block_type":"box","text":"support management’s proposals to approve compensation, where they are on the agenda. We may also not support","page_number":210,"box":{"x":69,"y":249,"width":838,"height":11}},{"id":"d15ec802-d76f-4d60-85b8-0fabd9804e10","block_type":"box","text":"members of the compensation committee or equivalent board members for poor compensation practices or","page_number":210,"box":{"x":69,"y":264,"width":766,"height":11}},{"id":"e8fbb389-abce-4ddf-ab28-4ce36e985414","block_type":"box","text":"structures.","page_number":210,"box":{"x":69,"y":280,"width":76,"height":8}},{"id":"3850b33d-41e5-4564-969c-0587a4dd53b3","block_type":"box","text":"SHAREHOLDER PROTECTIONS AND OTHER CORPORATE GOVERNANCE MATTERS","page_number":210,"box":{"x":191,"y":309,"width":595,"height":9}},{"id":"e9fec7a7-bd6b-4f0b-89ce-1656cc6e9bb2","block_type":"box","text":"Corporate form","page_number":210,"box":{"x":69,"y":339,"width":108,"height":11}},{"id":"add7c7fb-433e-4e37-8044-c2285beb4b32","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":210,"box":{"x":102,"y":362,"width":781,"height":11}},{"id":"4697ee7e-e23a-420a-91ee-85dfb63d1117","block_type":"box","text":"the company’s purpose and business model.","page_number":210,"box":{"x":68,"y":377,"width":320,"height":11}},{"id":"bb8610f7-02f6-40f1-a9e9-910073a02d72","block_type":"box","text":"9","page_number":210,"box":{"x":390,"y":378,"width":4,"height":4}},{"id":"e210c51c-43c9-4177-805a-47321ecf5d95","block_type":"box","text":"We look to companies proposing to change their corporate form to a","page_number":210,"box":{"x":399,"y":377,"width":487,"height":12}},{"id":"caa36ab1-6807-451f-8871-f485ede01b50","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":210,"box":{"x":70,"y":392,"width":791,"height":12}},{"id":"f9f991d3-e167-41d8-bf07-f25558cd1479","block_type":"box","text":"applicable law. We appreciate when supporting documentation from companies or shareholders proposing to alter the","page_number":210,"box":{"x":69,"y":407,"width":839,"height":12}},{"id":"96a44a98-bac5-4f00-bff5-cb2f251c145b","block_type":"box","text":"corporate form clearly explains how the interests of shareholders and different stakeholders would be impacted as","page_number":210,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"477d548f-5fa0-48d9-a430-250cbedf087a","block_type":"box","text":"well as the accountability and voting mechanisms that would be available to shareholders. We generally support","page_number":210,"box":{"x":68,"y":438,"width":800,"height":11}},{"id":"fc53585e-bb54-415a-8cde-4b5f2a4c9571","block_type":"box","text":"management proposals if our analysis indicates that shareholders’ financial interests are adequately protected.","page_number":210,"box":{"x":69,"y":453,"width":796,"height":11}},{"id":"39872e57-bf08-4119-b392-98019c280e22","block_type":"box","text":"Corporate form shareholder proposals are evaluated on a case-by-case basis.","page_number":210,"box":{"x":69,"y":468,"width":552,"height":11}},{"id":"12480337-b191-4126-935f-520251c94e22","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":210,"box":{"x":385,"y":498,"width":207,"height":9}},{"id":"3629e601-9fad-49ce-9f20-fb72e0c0b4b4","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":210,"box":{"x":102,"y":521,"width":777,"height":11}},{"id":"85c520ce-c58d-4999-b53d-827e70aac2fb","block_type":"box","text":"long as certain requirements are met. Shareholder proposals span a wide range of topics, including governance","page_number":210,"box":{"x":70,"y":536,"width":796,"height":11}},{"id":"60d7b1d0-9cf1-443d-93b3-fa2d03330cc9","block_type":"box","text":"reforms, capital management, and changes in the management or disclosure of sustainability-related risks. These","page_number":210,"box":{"x":69,"y":551,"width":813,"height":11}},{"id":"9f161ac0-925f-461d-b2f2-b60672fa1c2e","block_type":"box","text":"proposals have a varying degree of relevance for companies across sectors, locations, and business models.","page_number":210,"box":{"x":70,"y":566,"width":779,"height":11}},{"id":"a73e67f3-0119-4717-9191-e1c514300f70","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":210,"box":{"x":102,"y":589,"width":775,"height":11}},{"id":"83f93325-880c-4144-88b9-af593e31101e","block_type":"box","text":"proposal’s implications for long-term financial value creation for shareholders. Our analysis considers whether a","page_number":210,"box":{"x":70,"y":604,"width":796,"height":11}},{"id":"64d8c4cb-e18c-4097-a378-0fbd416d66c2","block_type":"box","text":"shareholder proposal addresses a material risk that may impact a company’s long-term financial performance. BIS","page_number":210,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"a081242e-80b4-4cc2-98ba-8f4df4e4816c","block_type":"box","text":"may support shareholder proposals that request disclosures that help us, as long-term investors on behalf of our","page_number":210,"box":{"x":69,"y":634,"width":809,"height":12}},{"id":"c5837ce4-7cdc-4b53-a763-b9f0d66f6389","block_type":"box","text":"clients, better understand the material risks and opportunities companies face and how they are managing them,","page_number":210,"box":{"x":69,"y":649,"width":807,"height":12}},{"id":"a4e1519c-2fb3-44e2-a2b6-9a242df413ea","block_type":"box","text":"especially where this information is additive given the company’s existing disclosures. We look for consistency","page_number":210,"box":{"x":69,"y":664,"width":787,"height":12}},{"id":"82f59c98-81fa-46c5-aeb4-2f17681d3f7f","block_type":"box","text":"between the specific request formally made in the proposal, the supporting documentation, and the proponents’","page_number":210,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"1725f9a1-161f-4338-8584-53b16fea7f1e","block_type":"box","text":"other communications on the issues. We also assess the company’s practices and disclosures and the costs and","page_number":210,"box":{"x":69,"y":695,"width":813,"height":11}},{"id":"facfb2f3-b7a1-4b47-a502-797ca1d24619","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":210,"box":{"x":69,"y":710,"width":791,"height":11}},{"id":"7891361a-29e7-4d45-8a3a-007ca20668bd","block_type":"box","text":"governance practices and disclosures against those of their peers.","page_number":210,"box":{"x":68,"y":725,"width":475,"height":11}},{"id":"66f68137-97a5-4ad0-9630-021c894d5c47","block_type":"box","text":"BIS does not support shareholder proposals that we view as inconsistent with long-term financial value or that","page_number":210,"box":{"x":102,"y":748,"width":787,"height":11}},{"id":"bf4e149f-77cf-4072-b8a2-f592e74d3b15","block_type":"box","text":"seek to micromanage companies. We take into consideration the legal effect of the proposal, as shareholder","page_number":210,"box":{"x":69,"y":763,"width":778,"height":11}},{"id":"289be180-2a0b-49bd-a6af-5f0856857ef3","block_type":"box","text":"proposals may be advisory or legally binding depending on the jurisdiction, while others may make requests that","page_number":210,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"33c24844-95f0-49e9-ac5c-d5b437cd9f94","block_type":"box","text":"would be deemed illegal in a given jurisdiction.","page_number":210,"box":{"x":68,"y":793,"width":331,"height":11}},{"id":"309c4d4c-b143-449b-9aab-ebd47d872cb9","block_type":"box","text":"In our experience, it is helpful when companies disclose the names of the proponent or organization that has","page_number":210,"box":{"x":102,"y":816,"width":777,"height":11}},{"id":"d8531b9d-fb7e-4505-8908-79907eb97fed","block_type":"box","text":"submitted or advised on the proposal. We recognize that some shareholder proposals bundle topics and/or specific","page_number":210,"box":{"x":69,"y":831,"width":825,"height":11}},{"id":"a455c622-f048-4328-ace2-7949db005378","block_type":"box","text":"requests. Further, the proponent’s supporting statement may refer to topics that are not directly related to the","page_number":210,"box":{"x":69,"y":846,"width":788,"height":11}},{"id":"402172aa-cb61-467a-8689-dc95745a8379","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":210,"box":{"x":69,"y":861,"width":820,"height":11}},{"id":"c58487bd-b6ad-4131-8a44-d4257706eb12","block_type":"box","text":"the proponent. Therefore, when we vote in support of a proposal, we are not necessarily endorsing every element of","page_number":210,"box":{"x":68,"y":876,"width":831,"height":11}},{"id":"e52e6bdb-54ce-4c9a-869c-82b1bb81ea5c","block_type":"box","text":"9","page_number":210,"box":{"x":69,"y":906,"width":4,"height":4}},{"id":"f9a829a1-cd69-4dfb-bbaf-8da9044c1eba","block_type":"box","text":"Corporate form refers to the legal structure by which a business is organized.","page_number":210,"box":{"x":79,"y":905,"width":550,"height":12}},{"id":"6a582e3e-a9c0-497c-a8fb-eae5dc0b49f2","block_type":"box","text":"BlackRock Investment Stewardship","page_number":210,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"7a08cc30-ae8a-43b7-9cff-6d1cc45c6f14","block_type":"box","text":"Global Principles | 9","page_number":210,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"c3fd67fb-d6f7-43a3-9927-9b0b1707cc5d","block_type":"box","text":"NM1026U-5979889-210/232","page_number":210,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2d85f6d5-ebe4-43d9-b2cd-24b1ccde8d22","block_type":"box","text":"the proposal or the reasoning, objectives, or supporting statement of the proponent. We may support a proposal for","page_number":211,"box":{"x":68,"y":45,"width":829,"height":11}},{"id":"b6fe2bd0-9bca-42aa-a470-a4986ebad034","block_type":"box","text":"different reasons than those put forth by the proponent, when we believe that overall it may advance our clients’","page_number":211,"box":{"x":69,"y":60,"width":802,"height":11}},{"id":"fa58d7c9-4be2-4fe8-bd12-eb698bf159a9","block_type":"box","text":"long-term financial interests.","page_number":211,"box":{"x":70,"y":75,"width":201,"height":11}},{"id":"0a3ac500-38cf-4601-8d4f-a0ad65e5f09c","block_type":"box","text":"BlackRock is subject to certain rules, regulations, agency guidance, and contractual agreements that place","page_number":211,"box":{"x":102,"y":98,"width":763,"height":11}},{"id":"859873c7-ea4d-499d-8e1d-700512895b43","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":211,"box":{"x":69,"y":113,"width":809,"height":11}},{"id":"d7e42294-555b-4f06-bc2c-c84c4b0fa2e5","block_type":"box","text":"clients. BlackRock does not nominate directors for board elections or submit shareholder proposals to companies.","page_number":211,"box":{"x":69,"y":128,"width":817,"height":11}},{"id":"448ec8f5-8bb3-407e-aff8-79570623779a","block_type":"box","text":"Non-compliance with these requirements could adversely affect BlackRock’s ability to serve its clients’ interests.","page_number":211,"box":{"x":70,"y":143,"width":803,"height":11}},{"id":"2117b7ae-5c18-4fec-87bc-da03c84eab7b","block_type":"box","text":"MATERIAL SUSTAINABILITY-RELATED RISKS AND OPPORTUNITIES","page_number":211,"box":{"x":247,"y":173,"width":484,"height":9}},{"id":"0b64e9a8-8b3c-4a19-8d12-bcb885b84dce","block_type":"box","text":"Appropriate oversight of material risks and opportunities, including material sustainability-related risks and","page_number":211,"box":{"x":101,"y":196,"width":760,"height":11}},{"id":"31a53c79-35c9-4968-84dc-d548b50546e9","block_type":"box","text":"opportunities, is an important component of having an effective governance framework that supports durable, long","page_number":211,"box":{"x":69,"y":211,"width":824,"height":11}},{"id":"d19d82ae-06f4-40ae-bc18-c0a6162727c0","block_type":"box","text":"term financial value creation.","page_number":211,"box":{"x":68,"y":226,"width":206,"height":9}},{"id":"9e69cd9f-c130-49f4-8a82-e332d22d0083","block_type":"box","text":"10","page_number":211,"box":{"x":276,"y":226,"width":9,"height":5}},{"id":"19866e23-65ee-4533-af78-1f6d29d2ed9a","block_type":"box","text":"We look to companies to provide robust disclosure that allows investors to effectively evaluate companies’","page_number":211,"box":{"x":101,"y":249,"width":761,"height":11}},{"id":"29f83e0b-6e2a-4418-b801-90a289f4e089","block_type":"box","text":"strategy and business practices related to material sustainability-related risks and opportunities. We find it helpful","page_number":211,"box":{"x":69,"y":264,"width":814,"height":11}},{"id":"d43c2600-5081-4da5-b239-0976bb3e23ed","block_type":"box","text":"when companies’ disclosures demonstrate that they have a resilient business model that integrates material","page_number":211,"box":{"x":68,"y":279,"width":777,"height":11}},{"id":"1e440efa-c230-4937-823b-78f2c3777e68","block_type":"box","text":"sustainability-related risks and opportunities into their strategy, risk management, and metrics and targets, including","page_number":211,"box":{"x":69,"y":294,"width":833,"height":11}},{"id":"90012ac6-b58d-466f-b65a-004eb4fbc00c","block_type":"box","text":"industry-specific metrics.","page_number":211,"box":{"x":70,"y":309,"width":175,"height":11}},{"id":"e95f9f4c-e103-418c-bd31-04a5b3b5f7b7","block_type":"box","text":"Standardized disclosure of sustainability-related data supports investors in making informed decisions. The","page_number":211,"box":{"x":102,"y":332,"width":765,"height":11}},{"id":"0134ecfa-7a55-44d7-a572-df22909afe3c","block_type":"box","text":"International Sustainability Standards Board (ISSB) standards, IFRS S1 and S2, represent one such approach to","page_number":211,"box":{"x":70,"y":347,"width":800,"height":11}},{"id":"92bec77c-1c0d-44cd-a296-442ff88120db","block_type":"box","text":"standardization that we find useful in our analysis.","page_number":211,"box":{"x":69,"y":362,"width":358,"height":11}},{"id":"72aad540-34e3-420c-a9f5-d338d3a70b35","block_type":"box","text":"11","page_number":211,"box":{"x":429,"y":363,"width":9,"height":4}},{"id":"4c4384cb-5138-4844-ad5b-3c68f2ed49a1","block_type":"box","text":"However, we do not mandate any specific disclosure framework","page_number":211,"box":{"x":444,"y":362,"width":451,"height":11}},{"id":"20043c3b-fac3-4460-ba1a-8717e1b32eeb","block_type":"box","text":"companies should use, and recognize that companies may report using different standards, some of which may be","page_number":211,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"e48753ff-c576-4578-bc74-4279d0909213","block_type":"box","text":"required by regulation. In such cases, we ask that companies highlight the metrics that are industry- or company","page_number":211,"box":{"x":69,"y":393,"width":806,"height":11}},{"id":"6edef853-58fc-4e9b-9798-f65bdb852728","block_type":"box","text":"specific.","page_number":211,"box":{"x":69,"y":407,"width":57,"height":11}},{"id":"54f43a10-5f35-4a04-b924-39440966d659","block_type":"box","text":"We also recognize that companies may be phasing in reporting over several years. We do not prescribe timelines","page_number":211,"box":{"x":101,"y":430,"width":805,"height":11}},{"id":"d4b13cd7-1de5-4a34-bf74-d2368d1daeb4","block_type":"box","text":"regarding when companies should make sustainability-related disclosures but appreciate it when companies produce","page_number":211,"box":{"x":69,"y":446,"width":833,"height":11}},{"id":"55f51d3a-cbf7-4c86-8831-4b3164f07556","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":211,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"cfdd1f17-040d-4802-9674-92d4e3d223d5","block_type":"box","text":"to assess the data and make informed voting decisions.","page_number":211,"box":{"x":68,"y":475,"width":401,"height":12}},{"id":"dbb0fcf1-ee27-405c-9ac5-f52c2f429230","block_type":"box","text":"Industry initiatives on managing specific operational risks may also provide useful guidance to companies on","page_number":211,"box":{"x":102,"y":498,"width":775,"height":11}},{"id":"cd613cc8-32f1-4c3e-a334-156a4533d127","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":211,"box":{"x":69,"y":513,"width":804,"height":12}},{"id":"0bc7e1f1-77a1-4cd1-b36f-bce1200fc904","block_type":"box","text":"when companies disclose any relevant global sustainability-related standards adopted, the industry initiatives in","page_number":211,"box":{"x":68,"y":529,"width":799,"height":11}},{"id":"1dc22c39-1063-4d6d-862d-7ef464fff929","block_type":"box","text":"which they participate, any peer group benchmarking undertaken, and any assurance processes to help investors","page_number":211,"box":{"x":68,"y":544,"width":810,"height":11}},{"id":"4cb78a2c-62ee-4a2a-918e-ab44c18e3dc1","block_type":"box","text":"understand their approach to sustainable and responsible business practices.","page_number":211,"box":{"x":69,"y":559,"width":556,"height":11}},{"id":"b9251746-b3cd-43c9-b43a-54dfaf9ec436","block_type":"box","text":"10","page_number":211,"box":{"x":69,"y":603,"width":9,"height":5}},{"id":"620e1955-4edd-4f21-b4ef-a2a5512a0492","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in","page_number":211,"box":{"x":84,"y":603,"width":822,"height":11}},{"id":"32a7fb60-9aea-4a46-843d-7183015bfb03","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":211,"box":{"x":69,"y":618,"width":835,"height":11}},{"id":"099f32a5-cf29-42d9-ad37-de69c48121dd","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":211,"box":{"x":70,"y":633,"width":827,"height":12}},{"id":"45cb46f8-c6fa-426a-90cd-ed62bd70d6f4","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":211,"box":{"x":70,"y":649,"width":826,"height":11}},{"id":"e75c4f3c-5a38-4a43-b2f5-17dd875560ab","block_type":"box","text":"operates, customer loyalty, and relationships with regulators.","page_number":211,"box":{"x":69,"y":664,"width":433,"height":11}},{"id":"2254b3f0-02be-4f2a-ad2d-8422d7192cc7","block_type":"box","text":"11","page_number":211,"box":{"x":69,"y":682,"width":9,"height":4}},{"id":"d4ce9339-98eb-4204-a0f6-ccf00e75716b","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards","page_number":211,"box":{"x":83,"y":681,"width":744,"height":11}},{"id":"d057a44e-0a03-4dd7-a5c2-9da9529e1fab","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":211,"box":{"x":69,"y":696,"width":828,"height":11}},{"id":"3091f13b-5262-43f5-871b-c876a1879df2","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":211,"box":{"x":69,"y":711,"width":830,"height":12}},{"id":"f013fbc0-9216-4d40-871f-9308d9609c7c","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":211,"box":{"x":69,"y":726,"width":809,"height":12}},{"id":"d9944e1e-fda9-49b3-9131-4f8db38c3be0","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":211,"box":{"x":70,"y":742,"width":778,"height":11}},{"id":"cf76d92e-b0e1-4dbe-bc67-5f536bc0235c","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":211,"box":{"x":70,"y":757,"width":380,"height":9}},{"id":"7d7b322b-4588-41ea-826c-b021a1f1af43","block_type":"box","text":"BlackRock Investment Stewardship","page_number":211,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"b8a5c1ba-708c-4416-a4ae-125b98a82c5b","block_type":"box","text":"Global Principles | 10","page_number":211,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"b52d72e7-52fa-43c3-8b07-5ef014864682","block_type":"box","text":"NM1026U-5979889-211/232","page_number":211,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"dd9bc460-c89a-446e-8cd7-df7eaad7acb1","block_type":"box","text":"CLIMATE AND NATURE-RELATED RISK","page_number":212,"box":{"x":351,"y":45,"width":277,"height":9}},{"id":"c1eeef07-8718-48d2-a17a-ce62ed794b14","block_type":"box","text":"Many companies are assessing how to navigate the low-carbon transition while delivering long-term financial","page_number":212,"box":{"x":102,"y":67,"width":769,"height":12}},{"id":"2b4ce0a2-247c-4444-aaf7-af98e1bd7793","block_type":"box","text":"value to investors. For companies facing material climate-related risks, we find it helpful when they publicly disclose,","page_number":212,"box":{"x":68,"y":82,"width":829,"height":12}},{"id":"b796075c-40fb-46c4-9614-2577439402f7","block_type":"box","text":"consistent with their business model and sector, how they intend to deliver long-term financial performance through","page_number":212,"box":{"x":69,"y":98,"width":824,"height":11}},{"id":"6f699ff0-582c-4a4d-8248-ec333f1ccdef","block_type":"box","text":"the low-carbon transition, including where available, their transition plan.","page_number":212,"box":{"x":68,"y":113,"width":514,"height":11}},{"id":"61a64ef0-bdd0-4823-8f87-e262c98c355c","block_type":"box","text":"12, 13","page_number":212,"box":{"x":584,"y":113,"width":26,"height":5}},{"id":"042ef7c6-537f-4370-92e0-543b3625d02a","block_type":"box","text":"From company disclosures and","page_number":212,"box":{"x":617,"y":113,"width":218,"height":11}},{"id":"6f596b1b-bb91-4efa-9638-50d0ca87ef97","block_type":"box","text":"engagement, we seek to understand the strategies companies have in place to manage material risks to, and","page_number":212,"box":{"x":69,"y":128,"width":782,"height":11}},{"id":"cf418b66-0106-440f-a254-54e7bf136451","block_type":"box","text":"opportunities for, their long-term business model associated with a range of climate-related scenarios.","page_number":212,"box":{"x":69,"y":143,"width":729,"height":11}},{"id":"793e6226-95c1-4260-b54a-3502c2cf0168","block_type":"box","text":"Recognizing the value of these disclosures, certain markets such as the European Union mandate large","page_number":212,"box":{"x":102,"y":166,"width":740,"height":11}},{"id":"8817ca66-7457-48fe-9882-16a6ed80ffc9","block_type":"box","text":"companies to disclose such climate-related financial information, while in other jurisdictions these disclosures are","page_number":212,"box":{"x":69,"y":181,"width":814,"height":11}},{"id":"d1ff8a82-3de7-474a-a2b9-7eae19b0058c","block_type":"box","text":"viewed as best practice in the market.","page_number":212,"box":{"x":68,"y":196,"width":271,"height":11}},{"id":"d07ec8a1-95ca-4e66-b3b1-35d122aecdc8","block_type":"box","text":"The ISSB standards provide one such framework that can assist investors in assessing company-specific","page_number":212,"box":{"x":101,"y":218,"width":749,"height":12}},{"id":"27e69430-6308-4a2e-adba-51576decf082","block_type":"box","text":"climate-related risks and opportunities, and informing investment decisions. Such disclosures also provide investors","page_number":212,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"4c1e900a-39b8-46a4-8c85-4e922932db51","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":212,"box":{"x":68,"y":249,"width":809,"height":11}},{"id":"784b5ccd-088d-4c4f-8bf5-38e37ca05395","block_type":"box","text":"managing their own carbon emissions or emissions intensities to the extent financially practicable.","page_number":212,"box":{"x":69,"y":264,"width":702,"height":11}},{"id":"5be03d68-bc77-480a-8949-512c2c8200c7","block_type":"box","text":"The ISSB standards, for example, contemplate disclosures on how companies are setting short-, medium- and","page_number":212,"box":{"x":101,"y":286,"width":786,"height":12}},{"id":"3daeff5c-a0e4-4057-85c9-8c79f3ff2c34","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":212,"box":{"x":70,"y":302,"width":834,"height":11}},{"id":"7c7db5a5-05e4-48d8-a80b-0a0b3d1c17ee","block_type":"box","text":"emissions (GHG) reductions and to demonstrate how their targets are consistent with the long-term financial","page_number":212,"box":{"x":69,"y":317,"width":773,"height":11}},{"id":"c56086c9-4008-4a13-9d51-598ef31a2c76","block_type":"box","text":"interests of their investors.","page_number":212,"box":{"x":70,"y":332,"width":190,"height":9}},{"id":"924d4391-433a-4093-9c38-895c7b3f7a02","block_type":"box","text":"While we recognize that regulators in some markets are moving to mandate certain disclosures, at this stage,","page_number":212,"box":{"x":101,"y":355,"width":784,"height":11}},{"id":"72bf1448-93d9-4ef1-96ca-13ce75e8e2c1","block_type":"box","text":"we view scope 3 emissions differently from scopes 1 and 2, given methodological complexity, regulatory uncertainty,","page_number":212,"box":{"x":68,"y":370,"width":832,"height":11}},{"id":"96143d3a-6b00-49c3-8841-c6cc3f416216","block_type":"box","text":"concerns about double-counting, and lack of direct control by companies. We welcome disclosures and commitments","page_number":212,"box":{"x":69,"y":385,"width":834,"height":11}},{"id":"532da2d6-59c6-4a8d-b2cd-44b6a8e28710","block_type":"box","text":"that companies choose to make regarding material scope 3 emissions and recognize that these are provided on a","page_number":212,"box":{"x":68,"y":400,"width":815,"height":11}},{"id":"e818c874-cd68-4e7d-95d8-0d3528a9e4b5","block_type":"box","text":"good-faith basis as methodology develops.","page_number":212,"box":{"x":68,"y":415,"width":303,"height":11}},{"id":"79805b06-0124-4c6f-96fe-e7dc5038a5aa","block_type":"box","text":"In addition to climate-related risks and opportunities, for companies whose strategies, operations or supply","page_number":212,"box":{"x":102,"y":438,"width":766,"height":11}},{"id":"266c8c33-e56a-4d4b-808b-f2fcbdaa3fa1","block_type":"box","text":"chains are materially reliant on natural capital, nature-related risks and opportunities may affect their ability to","page_number":212,"box":{"x":69,"y":453,"width":788,"height":11}},{"id":"91811eb4-c6b9-415b-805c-7f0cd21b37b1","block_type":"box","text":"generate long-term financial returns.","page_number":212,"box":{"x":68,"y":468,"width":258,"height":11}},{"id":"e003209d-207f-4bd9-becb-770df8693b1d","block_type":"box","text":"14","page_number":212,"box":{"x":328,"y":468,"width":9,"height":5}},{"id":"c4185941-925d-4d1b-9f80-59471a6eab30","block_type":"box","text":"For these companies, we rely on disclosures to understand how their","page_number":212,"box":{"x":344,"y":468,"width":490,"height":11}},{"id":"a7979ef7-47dc-49b5-a98d-6e64d27a0608","block_type":"box","text":"strategies consider nature-related impacts and dependencies and to assess how the board oversees these risks.","page_number":212,"box":{"x":69,"y":483,"width":807,"height":11}},{"id":"e3795ca3-b4e7-4a57-99c8-9ecda4e61b32","block_type":"box","text":"15","page_number":212,"box":{"x":878,"y":484,"width":9,"height":4}},{"id":"f85ad89d-e7d4-4811-a213-995978d67efd","block_type":"box","text":"COMPANIES’ IMPACT ON THEIR WORKFORCE, SUPPLY CHAINS, AND COMMUNITIES","page_number":212,"box":{"x":179,"y":513,"width":620,"height":11}},{"id":"f5557efa-d63a-4b8d-90a3-01761c4b86f0","block_type":"box","text":"Companies determine their key stakeholders based on what is material to their business and long-term financial","page_number":212,"box":{"x":102,"y":536,"width":799,"height":11}},{"id":"b60e010c-fa8f-455a-a1ce-5096f48963d8","block_type":"box","text":"performance. For many companies, key stakeholders include employees, business supply chains, clients and","page_number":212,"box":{"x":70,"y":551,"width":778,"height":11}},{"id":"15e41d8e-05dc-489c-a5f6-55d83da6bfd9","block_type":"box","text":"consumers, regulators, and the communities in which they operate.","page_number":212,"box":{"x":69,"y":566,"width":479,"height":11}},{"id":"c7fa576f-eec1-42cf-ac94-396c46206abb","block_type":"box","text":"In our experience, companies that invest in the relationships that are critical to their strategic objectives are","page_number":212,"box":{"x":102,"y":589,"width":770,"height":11}},{"id":"1cdd3c2e-ba11-4255-9e0a-b7163aecc407","block_type":"box","text":"more likely to deliver durable, long-term financial performance. By contrast, we have found that poor relationships","page_number":212,"box":{"x":69,"y":604,"width":810,"height":11}},{"id":"6a1c2324-044b-44c8-9422-766d094a1c15","block_type":"box","text":"12","page_number":212,"box":{"x":69,"y":634,"width":9,"height":4}},{"id":"a509459a-c136-4173-a02e-15cf874bdde0","block_type":"box","text":"We have observed that more companies are developing such plans, and public policymakers in certain markets are","page_number":212,"box":{"x":83,"y":633,"width":823,"height":12}},{"id":"3c4e4739-5591-48bd-b28c-eaea69f6a7a4","block_type":"box","text":"signaling their intentions to require them or already have requirements in place, such as Australia, Brazil, and the","page_number":212,"box":{"x":69,"y":649,"width":808,"height":11}},{"id":"6e3f435e-5944-4787-bdc4-15e7672e7c1b","block_type":"box","text":"European Union (please see the International Transition Plan Network for information). We view transition plans as a","page_number":212,"box":{"x":70,"y":663,"width":827,"height":11}},{"id":"eac07fcf-4e91-4245-9098-15d11a3a0c11","block_type":"box","text":"method for a company to both internally assess and externally communicate its long-term strategy, ambition,","page_number":212,"box":{"x":69,"y":679,"width":774,"height":11}},{"id":"5921c34e-68de-4862-aa11-b8384df36fdb","block_type":"box","text":"objectives, and actions to create financial value through the global transition towards a low-carbon economy. Across","page_number":212,"box":{"x":69,"y":694,"width":825,"height":11}},{"id":"16ec25cf-ce08-4a97-9766-62db03284239","block_type":"box","text":"the landscape there remains divergence on the objectives of such plans and the details they should contain. While","page_number":212,"box":{"x":68,"y":709,"width":819,"height":11}},{"id":"fc9a8717-48f2-4c75-97ef-881f2ba47ce4","block_type":"box","text":"transition plans can be helpful disclosure, BIS does not make the preparation and production of transition plans a","page_number":212,"box":{"x":68,"y":724,"width":813,"height":11}},{"id":"a36ce59e-f4ad-4259-bfd7-0ea6f0db604b","block_type":"box","text":"voting issue. BIS may engage companies that have chosen to publish a transition plan to understand their planned","page_number":212,"box":{"x":68,"y":739,"width":819,"height":11}},{"id":"95e753b4-bca4-40b0-afa7-11ac72101545","block_type":"box","text":"actions and resource implications. Website accessed in December 2025.","page_number":212,"box":{"x":69,"y":754,"width":522,"height":11}},{"id":"dbe8a0a0-f58b-40cb-a8d1-f064269a2f35","block_type":"box","text":"13","page_number":212,"box":{"x":69,"y":772,"width":9,"height":5}},{"id":"7de2f9a3-d033-4f1e-88d8-c26c21e4ea01","block_type":"box","text":"For more information, please see our commentary “Climate-related risks and a low-carbon transition,” December","page_number":212,"box":{"x":84,"y":772,"width":804,"height":11}},{"id":"5b1e4efd-b47c-4f45-b945-40cb43fdab52","block_type":"box","text":"2025.","page_number":212,"box":{"x":69,"y":787,"width":42,"height":9}},{"id":"ec41d262-67ec-489c-8c24-812505d77d72","block_type":"box","text":"14","page_number":212,"box":{"x":69,"y":805,"width":9,"height":4}},{"id":"e364b4dd-9954-43c3-a11b-e57c6a346b77","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on natural capital,” December","page_number":212,"box":{"x":84,"y":805,"width":796,"height":11}},{"id":"469842b9-3120-4d7b-844e-dbaa935b0eb2","block_type":"box","text":"2025.","page_number":212,"box":{"x":69,"y":820,"width":42,"height":9}},{"id":"738ce032-f408-422d-a45d-1291abd01e32","block_type":"box","text":"15","page_number":212,"box":{"x":69,"y":838,"width":9,"height":4}},{"id":"47f093db-f79c-4bc5-a1c2-26d55c219b9e","block_type":"box","text":"Given the growing awareness of the materiality of these issues for certain businesses, enhanced reporting on a","page_number":212,"box":{"x":84,"y":837,"width":797,"height":12}},{"id":"6b0ccc95-cebd-457b-bf93-a391e7077fa5","block_type":"box","text":"company’s natural capital dependencies and impacts would aid investors’ understanding. The recommendations of","page_number":212,"box":{"x":69,"y":852,"width":820,"height":12}},{"id":"523e3ee2-664a-4643-be78-1a3f96bc232d","block_type":"box","text":"the Taskforce on Nature-related Financial Disclosures (TNFD) may prove useful to some companies. We recognize that","page_number":212,"box":{"x":68,"y":868,"width":842,"height":11}},{"id":"228b27fd-4155-441b-9c64-cdc0e9c53994","block_type":"box","text":"some companies may report using different standards, which may be required by regulation, or one of a number of","page_number":212,"box":{"x":69,"y":883,"width":820,"height":11}},{"id":"7069c780-52e6-41fe-898d-1adcb8374905","block_type":"box","text":"other private sector standards. TNFD-aligned reporting is not a voting issue. Website accessed in December 2025.","page_number":212,"box":{"x":69,"y":898,"width":817,"height":11}},{"id":"f809ae4a-f2ac-45a3-acbf-d6d7eac31a3b","block_type":"box","text":"BlackRock Investment Stewardship","page_number":212,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"9bdbcfc8-053e-4639-95ba-6cbd6d813532","block_type":"box","text":"Global Principles | 11","page_number":212,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"cbe3354a-d322-46cc-b270-02c73020212e","block_type":"box","text":"NM1026U-5979889-212/232","page_number":212,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0ac73bd1-a0fe-4384-bf58-ad2e4f073fa1","block_type":"box","text":"may create adverse impacts that could expose companies to legal, regulatory, operational, and reputational risks.","page_number":213,"box":{"x":69,"y":45,"width":811,"height":11}},{"id":"a4bb8dce-4587-4699-b470-8d1e25b33e6e","block_type":"box","text":"This is particularly relevant to a company’s workforce, which is central to long-term financial value creation.","page_number":213,"box":{"x":68,"y":60,"width":764,"height":11}},{"id":"7b454703-ed88-45d1-9d6d-9a80f4398d40","block_type":"box","text":"16","page_number":213,"box":{"x":834,"y":60,"width":9,"height":5}},{"id":"72f5c05f-22dd-4138-b241-4a1855ac818c","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":213,"box":{"x":101,"y":82,"width":783,"height":12}},{"id":"2cba9345-69b0-43e5-b5bb-74c6531f0c63","block_type":"box","text":"identified their key stakeholders and considered their interests in business decision-making. In addition to","page_number":213,"box":{"x":70,"y":98,"width":755,"height":11}},{"id":"4d982909-0db9-4453-855d-3130ac60831f","block_type":"box","text":"understanding broader stakeholder relationships, BIS finds it helpful when companies discuss how they consider the","page_number":213,"box":{"x":69,"y":113,"width":831,"height":11}},{"id":"319a8e57-4d10-4622-b669-0ca0c8e58700","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":213,"box":{"x":69,"y":128,"width":809,"height":11}},{"id":"dadfc186-3239-44e7-b1cf-aa883bb49262","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":213,"box":{"x":69,"y":143,"width":821,"height":11}},{"id":"252e0286-b143-47d9-b71c-5655d4d28a76","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":213,"box":{"x":69,"y":158,"width":775,"height":11}},{"id":"992d034a-f4b9-4217-b16c-4f045192fdbc","block_type":"box","text":"company’s policies or practices, which are the responsibility of management and the board.","page_number":213,"box":{"x":69,"y":173,"width":653,"height":11}},{"id":"fd1a7eb5-0741-40a2-a9ba-0bbc31ab3a43","block_type":"box","text":"In addition, we find it helpful when companies disclose their approach to addressing material adverse impacts","page_number":213,"box":{"x":102,"y":196,"width":784,"height":11}},{"id":"88af6420-c6a2-4ab6-94dd-6c821857bf7c","block_type":"box","text":"that could arise from their business practices and affect critical relationships with their stakeholders. We encourage","page_number":213,"box":{"x":68,"y":211,"width":829,"height":11}},{"id":"5b7b077c-a38d-4948-b2a4-9d624d7762ae","block_type":"box","text":"companies to implement, to the extent appropriate, monitoring processes (often referred to as due diligence) to","page_number":213,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"063f4009-85fd-4f84-989d-c905f52ac825","block_type":"box","text":"identify and mitigate potential adverse impacts and grievance mechanisms to remediate any actual adverse material","page_number":213,"box":{"x":70,"y":241,"width":828,"height":11}},{"id":"f85daf67-f434-4e0d-af42-ab9d1fd88bda","block_type":"box","text":"impacts.","page_number":213,"box":{"x":70,"y":257,"width":58,"height":10}},{"id":"520c9307-976c-4cc7-a640-0218ad979c49","block_type":"box","text":"We look to boards to oversee management’s approach to addressing material risks related to key stakeholders","page_number":213,"box":{"x":101,"y":279,"width":794,"height":11}},{"id":"c1ebca3d-6cd8-498b-b483-bb4ee3283838","block_type":"box","text":"and may convey concerns about board oversight in our voting on director elections or supporting a business relevant","page_number":213,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"efa217c7-8698-47ca-b0f0-2c8fcb8a471d","block_type":"box","text":"shareholder proposal when, in our assessment, the board is not acting in shareholders’ long-term financial interests.","page_number":213,"box":{"x":69,"y":309,"width":834,"height":11}},{"id":"6cbe27fb-4841-44e0-866a-ddf622a67813","block_type":"box","text":"BLACKROCK’S OVERSIGHT OF ITS INVESTMENT STEWARDSHIP ACTIVITIES","page_number":213,"box":{"x":213,"y":340,"width":553,"height":8}},{"id":"aab2f173-4d59-4a2a-b820-d860a56452e5","block_type":"box","text":"BIS’ governance structure supports oversight and accountability of stewardship-related activities on behalf of","page_number":213,"box":{"x":102,"y":362,"width":778,"height":11}},{"id":"e17a2b17-6aa1-4182-b8c3-123887e12171","block_type":"box","text":"clients at the global and regional level.","page_number":213,"box":{"x":69,"y":377,"width":274,"height":12}},{"id":"a8f86822-9761-4b41-ba88-0b359d482652","block_type":"box","text":"At the top of this governance structure, the risk-focused BIS Global Oversight Committee (the Committee)","page_number":213,"box":{"x":101,"y":400,"width":751,"height":11}},{"id":"22f9e871-b568-4cad-b0f6-2c845721c127","block_type":"box","text":"supports BIS’ regulatory responsibilities in relation to proxy voting, including adherence to policies and procedures as","page_number":213,"box":{"x":69,"y":415,"width":840,"height":11}},{"id":"1a404b32-aede-4f78-82d0-cc6c651c8137","block_type":"box","text":"well as market-level stewardship requirements. The Committee reviews and approves amendments to the Global","page_number":213,"box":{"x":68,"y":430,"width":802,"height":11}},{"id":"9a82013c-ea8f-4c02-928a-1aa6638a5b5a","block_type":"box","text":"Principles and regional voting guidelines. The Committee also reviews periodic reports regarding the votes cast by","page_number":213,"box":{"x":69,"y":445,"width":813,"height":12}},{"id":"5071e721-7f5c-4fee-9cce-d95ae38bfd78","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":213,"box":{"x":70,"y":460,"width":835,"height":12}},{"id":"5c51d736-de61-4984-b378-634451d16e8c","block_type":"box","text":"considerations. The Committee is chaired by the Global Heads of the Investment Stewardship function and its","page_number":213,"box":{"x":69,"y":475,"width":783,"height":12}},{"id":"5c400651-60eb-46b3-aad1-9e93e55d47ff","block_type":"box","text":"members include senior BlackRock executives with legal, risk, and other experience relevant to team oversight who","page_number":213,"box":{"x":69,"y":491,"width":820,"height":11}},{"id":"9fe5dc6e-ac58-4f8f-8a75-70b169f3b895","block_type":"box","text":"are independent from the investment stewardship function.","page_number":213,"box":{"x":69,"y":506,"width":421,"height":11}},{"id":"7bc63def-00a5-4f5e-a165-2a523abde6be","block_type":"box","text":"The Global Heads have primary oversight of BIS’ activities globally, including voting in accordance with the Global","page_number":213,"box":{"x":101,"y":528,"width":804,"height":12}},{"id":"3499a70f-8de9-4ab0-8564-4b46c9413a71","block_type":"box","text":"Principles and regional voting guidelines. At the regional level, three regional Heads for the Americas, APAC, and","page_number":213,"box":{"x":69,"y":543,"width":798,"height":12}},{"id":"e67b4a5c-311f-481c-b157-58038fae61d1","block_type":"box","text":"EMEA oversee BIS’ activities for their specific markets.","page_number":213,"box":{"x":70,"y":559,"width":389,"height":11}},{"id":"2c8fe04d-b7fa-485b-a75c-139bcc6c81f2","block_type":"box","text":"VOTE EXECUTION","page_number":213,"box":{"x":424,"y":589,"width":129,"height":9}},{"id":"5994e606-511e-493d-a187-384d6f9ad411","block_type":"box","text":"BIS votes proxies on behalf of index equity funds and accounts when authorized by our clients. We have","page_number":213,"box":{"x":102,"y":612,"width":739,"height":11}},{"id":"c3e286a5-d352-4691-90e9-dfffb2b09ed7","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":213,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"6eb511c0-3fd3-448e-ae20-505f6cad27e0","block_type":"box","text":"from voting when logistical issues arise (see below). The BIS Benchmark Policies – and the vote decisions made","page_number":213,"box":{"x":68,"y":642,"width":801,"height":11}},{"id":"3ac456b0-8007-4d4b-b63b-3a66f9a058e4","block_type":"box","text":"consistent with those policies – reflect our reasonable and independent judgment and are made without regard to the","page_number":213,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"3bab7f5e-2200-439b-b9f8-bb634ba8da85","block_type":"box","text":"relationship between the issuer of the proxy (or any shareholder proponent or dissident shareholder) and the Fund,","page_number":213,"box":{"x":69,"y":672,"width":817,"height":11}},{"id":"cd507675-0318-4da8-9d4f-8cf446ddbd54","block_type":"box","text":"the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts","page_number":213,"box":{"x":68,"y":687,"width":751,"height":11}},{"id":"971a5c67-8a7d-4a24-8f45-9a98e0ab8276","block_type":"box","text":"management policies and procedures,” below).","page_number":213,"box":{"x":69,"y":703,"width":334,"height":11}},{"id":"4dbb1be5-0cbf-475f-b45a-d9add524a49d","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BIS’ ability to vote, as well as the cost","page_number":213,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"f471dd48-8a17-4922-84d1-7314cda4065b","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":213,"box":{"x":69,"y":740,"width":801,"height":11}},{"id":"efceda23-0141-4d7f-b67f-3da37645f9b5","block_type":"box","text":"shareholder meetings; 2) restrictions on a foreigner’s ability to exercise votes; 3) requirements to vote proxies in","page_number":213,"box":{"x":69,"y":755,"width":805,"height":11}},{"id":"ce82057c-7e55-4b42-b192-80d2f0700c54","block_type":"box","text":"person; 4) “share-blocking” (requirements that investors who exercise their voting rights surrender the right to","page_number":213,"box":{"x":70,"y":771,"width":783,"height":11}},{"id":"77487d7d-75d5-424d-ba3c-9f184f830731","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":213,"box":{"x":69,"y":785,"width":811,"height":12}},{"id":"3405f562-872d-4346-a0df-8f6c0c2adca8","block_type":"box","text":"has occurred); 5) potential difficulties in translating the proxy; 6) regulatory constraints; and 7) requirements to","page_number":213,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"6ca94ed6-a363-4022-a01a-e044f81ef253","block_type":"box","text":"provide local agents with powers of attorney to facilitate voting instructions. We are not supportive of impediments to","page_number":213,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"60a0532d-958b-4da7-b36d-fee49d190830","block_type":"box","text":"the exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":213,"box":{"x":68,"y":831,"width":732,"height":11}},{"id":"c000dde5-35b5-4164-9bb3-7ecdc60a20e5","block_type":"box","text":"16","page_number":213,"box":{"x":69,"y":860,"width":9,"height":5}},{"id":"f33f541a-6245-434f-bbf6-fec50edd0437","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on human capital management,”","page_number":213,"box":{"x":84,"y":860,"width":814,"height":11}},{"id":"28c6b949-50cd-4e6b-a44f-75ed761252f6","block_type":"box","text":"December 2025.","page_number":213,"box":{"x":70,"y":875,"width":118,"height":9}},{"id":"72549bdf-c814-497a-98f4-914c0f6a7ce9","block_type":"box","text":"BlackRock Investment Stewardship","page_number":213,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"2527cdf7-d60d-4285-b85d-9d28a1bea57b","block_type":"box","text":"Global Principles | 12","page_number":213,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"65802752-567a-4bb6-88c2-35b98533cbee","block_type":"box","text":"NM1026U-5979889-213/232","page_number":213,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"fb558879-db54-4019-8f34-910d41ef9dca","block_type":"box","text":"BIS votes proxies in these situations on a “best-efforts” basis. In addition, BIS may determine that it is generally","page_number":214,"box":{"x":102,"y":45,"width":807,"height":11}},{"id":"ab43db22-2916-4c23-93f0-1e35c206e5d5","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":214,"box":{"x":70,"y":60,"width":830,"height":11}},{"id":"3b30b2d0-4081-4eee-852a-9c5e3011b662","block_type":"box","text":"not limited to opportunity costs associated with share-blocking constraints) associated with exercising a vote are","page_number":214,"box":{"x":69,"y":75,"width":805,"height":11}},{"id":"63792afa-3326-457a-930a-6bc1091b3671","block_type":"box","text":"expected to outweigh the benefit the client would derive by voting on the proposal.","page_number":214,"box":{"x":69,"y":90,"width":585,"height":11}},{"id":"b0843b88-aa83-4bda-b15a-cdf25662a272","block_type":"box","text":"CONFLICTS MANAGEMENT POLICIES AND PROCEDURES","page_number":214,"box":{"x":281,"y":120,"width":416,"height":9}},{"id":"d7aac2c1-8ab8-4d81-aec1-7d5681cd629d","block_type":"box","text":"BIS is a dedicated function whose responsibilities are separate from BlackRock’s sales, business partnership or","page_number":214,"box":{"x":102,"y":143,"width":804,"height":11}},{"id":"a1ee6f53-bbec-4e29-9177-7caa91b6d9f6","block_type":"box","text":"enterprise-level vendor management activities.","page_number":214,"box":{"x":69,"y":158,"width":329,"height":11}},{"id":"e2cddf58-7fbe-4b2a-844c-460ffad3056e","block_type":"box","text":"BlackRock maintains policies and procedures that are designed to prevent undue influence on BIS’ proxy voting","page_number":214,"box":{"x":102,"y":181,"width":794,"height":11}},{"id":"a9d4b59e-2b27-410d-850e-9ce78b000e0e","block_type":"box","text":"activity. Such influence might stem from any relationship between the investee company (or any shareholder","page_number":214,"box":{"x":69,"y":196,"width":771,"height":11}},{"id":"785ec4c7-90e2-4d4b-835c-40d0a80a796f","block_type":"box","text":"proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates, a Fund or a Fund’s affiliates, or","page_number":214,"box":{"x":70,"y":211,"width":763,"height":11}},{"id":"36fd9d83-7ea4-4e1b-a763-559cce254c8c","block_type":"box","text":"BlackRock employees.","page_number":214,"box":{"x":70,"y":226,"width":157,"height":11}},{"id":"406e5f93-c20d-4e31-b91f-d139f5afa153","block_type":"box","text":"For information on how BIS manages conflicts of interest, please see our disclosure.","page_number":214,"box":{"x":102,"y":249,"width":602,"height":11}},{"id":"464df70b-d8ec-4345-ba9e-5c54556c6f0e","block_type":"box","text":"SECURITIES LENDING","page_number":214,"box":{"x":409,"y":279,"width":159,"height":9}},{"id":"2f4044e6-1965-4a1e-aa0f-bc6784c28e91","block_type":"box","text":"When authorized, BlackRock acts as a securities lending agent on behalf of its clients. Lending securities","page_number":214,"box":{"x":101,"y":302,"width":751,"height":11}},{"id":"e450c07a-17d1-4cca-b767-7e3f818c85f7","block_type":"box","text":"enables BlackRock to increase the returns in clients’ portfolios, and BlackRock’s lending agreements allow it to","page_number":214,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"2bf44f29-e3a8-407b-b184-9d7a5b588f02","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":214,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"402cf2b2-52a6-4406-90a1-128f1ae04605","block_type":"box","text":"out on loan. Entitlements associated with the lent securities (dividends, coupons, etc.), while on loan are paid back","page_number":214,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"7542d2c4-3fb6-4c68-ab2c-a40b50d9c47a","block_type":"box","text":"to the lender of the security as stipulated in industry standard legal agreements.","page_number":214,"box":{"x":68,"y":362,"width":575,"height":11}},{"id":"2b64dc50-a2e6-405d-b2d4-48aa8a7091be","block_type":"box","text":"With regard to the relationship between securities lending and proxy voting, BlackRock cannot vote shares on","page_number":214,"box":{"x":101,"y":385,"width":779,"height":11}},{"id":"7c0c39fe-a279-4a5a-990e-3fe1b175599a","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":214,"box":{"x":70,"y":400,"width":827,"height":11}},{"id":"b5e3dc6c-84cd-47f4-9e9a-8f81f0636aa7","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":214,"box":{"x":70,"y":415,"width":832,"height":11}},{"id":"3326ee8c-949c-4a33-9813-2114e75c93c5","block_type":"box","text":"recall securities on loan as part of BlackRock’s securities lending program in order to vote is based on an evaluation","page_number":214,"box":{"x":69,"y":430,"width":832,"height":11}},{"id":"b8fa2ec6-2e52-4f2d-95ed-0b74b977b7ae","block_type":"box","text":"of various factors that include, but are not limited to, assessing potential securities lending revenue alongside the","page_number":214,"box":{"x":69,"y":445,"width":814,"height":12}},{"id":"176d9f12-7d89-418e-b4f5-7c80cbf3ff94","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":214,"box":{"x":70,"y":460,"width":834,"height":12}},{"id":"29d7de98-3a41-4b1b-97cf-afbcee811dba","block_type":"box","text":"of recall consideration).","page_number":214,"box":{"x":69,"y":475,"width":166,"height":12}},{"id":"555e400d-0400-4879-a63c-156938bad8b9","block_type":"box","text":"17","page_number":214,"box":{"x":237,"y":476,"width":9,"height":4}},{"id":"dac8bf25-5fb0-40bc-b764-83edc15f5555","block_type":"box","text":"BIS works with colleagues in the Securities Lending and Risk and Quantitative Analysis","page_number":214,"box":{"x":252,"y":476,"width":617,"height":11}},{"id":"477ceea3-379c-484a-9002-32faa771a2a6","block_type":"box","text":"teams to evaluate the costs and benefits to clients of recalling shares on loan.","page_number":214,"box":{"x":68,"y":491,"width":563,"height":11}},{"id":"7b1db676-0529-46fb-ad62-f56a5ee5df44","block_type":"box","text":"In almost all instances, BlackRock anticipates that the potential long-term financial value to clients of voting","page_number":214,"box":{"x":102,"y":513,"width":770,"height":12}},{"id":"71984d18-aee0-45eb-bb18-c3aa6a5d6eac","block_type":"box","text":"shares would be less than the potential revenue the loan may provide clients. However, in certain instances,","page_number":214,"box":{"x":69,"y":529,"width":774,"height":11}},{"id":"b6e94350-85d4-4f85-b217-e15a509e7042","block_type":"box","text":"BlackRock may determine, in our independent business judgment as a fiduciary, that the value of voting outweighs","page_number":214,"box":{"x":70,"y":543,"width":816,"height":12}},{"id":"8033b765-d9ca-4677-88c8-319a1541a57b","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":214,"box":{"x":68,"y":559,"width":822,"height":11}},{"id":"4a0bcea9-0f38-4b7a-97a3-8ef0156f06db","block_type":"box","text":"important to note that the majority of lendable assets in the market at any given time are not out on loan.","page_number":214,"box":{"x":70,"y":574,"width":752,"height":11}},{"id":"c649acb7-3689-4133-8b6a-81d9f5d2d59e","block_type":"box","text":"Periodically, BlackRock reviews our process for determining whether to recall securities on loan in order to vote","page_number":214,"box":{"x":102,"y":596,"width":790,"height":12}},{"id":"4c906f4d-d90f-42b1-ad5b-9c947084ba08","block_type":"box","text":"and may modify it as necessary.","page_number":214,"box":{"x":69,"y":612,"width":228,"height":11}},{"id":"c719fe05-1c7b-4ffa-9d9c-ee4f7036ac18","block_type":"box","text":"VOTING CHOICE","page_number":214,"box":{"x":430,"y":642,"width":117,"height":9}},{"id":"d4cdc0ee-0a26-4ee1-a7dd-b049e7f3a4c2","block_type":"box","text":"BlackRock offers Voting Choice, a program that provides eligible clients with more opportunities to participate in","page_number":214,"box":{"x":102,"y":664,"width":800,"height":12}},{"id":"f71b2cf3-15cd-4292-b5ad-35be68de52b3","block_type":"box","text":"the proxy voting process, where legally and operationally viable.","page_number":214,"box":{"x":68,"y":680,"width":452,"height":11}},{"id":"fcef9e62-2416-4461-9e44-e66dbb623b77","block_type":"box","text":"18","page_number":214,"box":{"x":522,"y":680,"width":9,"height":4}},{"id":"c131413f-756f-4f86-b747-66c727bcdfe3","block_type":"box","text":"Voting Choice is currently available for eligible clients invested in certain institutional pooled funds in the U.S.,","page_number":214,"box":{"x":101,"y":702,"width":786,"height":12}},{"id":"73ef83bb-759c-4617-abf5-0c8a6ef04f49","block_type":"box","text":"UK, Ireland, Canada, and Switzerland that utilize index equity investment strategies, as well as eligible clients in","page_number":214,"box":{"x":70,"y":718,"width":797,"height":11}},{"id":"dbb38923-b04b-4381-bde1-b50a4fd5a253","block_type":"box","text":"17","page_number":214,"box":{"x":69,"y":747,"width":8,"height":4}},{"id":"8bf3950b-41c5-4723-af12-e8b0e9d53a60","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":214,"box":{"x":84,"y":747,"width":789,"height":11}},{"id":"43164a12-435b-42c4-9f6b-39865cbb0ef5","block_type":"box","text":"date of a shareholder meeting typically falls before the proxy statements are released. Accordingly, it is not","page_number":214,"box":{"x":69,"y":762,"width":763,"height":11}},{"id":"0b7438e2-9879-4f4f-9fe5-d7c82b840faa","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":214,"box":{"x":70,"y":777,"width":794,"height":11}},{"id":"408128ca-430d-418c-8ef8-8d6ff38dd5fd","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":214,"box":{"x":69,"y":792,"width":833,"height":11}},{"id":"3c4c04ce-03d8-4652-a9c7-5addea439ce0","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":214,"box":{"x":69,"y":807,"width":821,"height":11}},{"id":"d473b32d-8057-466d-9606-35a697c51255","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":214,"box":{"x":69,"y":822,"width":823,"height":12}},{"id":"e7296518-c447-421c-a918-dd1eb31d73aa","block_type":"box","text":"fund (thereby forgoing potential securities lending revenue for the fund’s shareholders) or leaving shares on loan to","page_number":214,"box":{"x":68,"y":837,"width":822,"height":12}},{"id":"8bbe4497-e540-4f9f-8704-37c45a2f07c8","block_type":"box","text":"potentially earn revenue for the fund (thereby forgoing the opportunity to vote).","page_number":214,"box":{"x":70,"y":852,"width":558,"height":12}},{"id":"75e1b4b4-cd88-40d9-b27c-7d4180b21b25","block_type":"box","text":"18","page_number":214,"box":{"x":69,"y":870,"width":9,"height":5}},{"id":"f602e29c-cdaf-4336-948d-316b981e9f53","block_type":"box","text":"BlackRock will determine eligibility criteria under this program based upon, among other things, local market","page_number":214,"box":{"x":84,"y":870,"width":771,"height":11}},{"id":"315316c7-8f3b-4ddd-9b2c-54cfaf2988b1","block_type":"box","text":"regulation and practice, cost considerations, operational risk and/or complexity, and financial considerations,","page_number":214,"box":{"x":69,"y":885,"width":779,"height":11}},{"id":"dc711166-543a-4927-855b-b8b6194e576b","block_type":"box","text":"including the decision to lend securities.","page_number":214,"box":{"x":70,"y":901,"width":285,"height":11}},{"id":"28202031-9181-46a0-9b3e-e37401aa933d","block_type":"box","text":"BlackRock Investment Stewardship","page_number":214,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"3258a6c3-aa51-470b-b4aa-bdebc950e399","block_type":"box","text":"Global Principles | 13","page_number":214,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"cf3c67cf-3fa1-41d8-9d67-cd091f0b0e88","block_type":"box","text":"NM1026U-5979889-214/232","page_number":214,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0444fb15-d25e-4982-94df-d0915b1a3a64","block_type":"box","text":"certain institutional pooled funds in the U.S., UK, Canada, and Switzerland that use systematic active equity","page_number":215,"box":{"x":69,"y":45,"width":772,"height":11}},{"id":"dd7bc074-b40a-44f3-927b-29cc17b19215","block_type":"box","text":"(SAE) strategies. In addition, institutional clients in separately managed accounts (SMAs) continue to be eligible for","page_number":215,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"25af154d-0036-4487-8c52-000d32ba141f","block_type":"box","text":"BlackRock Voting Choice regardless of their investment strategies.","page_number":215,"box":{"x":70,"y":75,"width":471,"height":11}},{"id":"6d61e0f8-0c4b-4903-aeaa-e553b7a99052","block_type":"box","text":"19","page_number":215,"box":{"x":543,"y":75,"width":9,"height":5}},{"id":"e8e47c08-e6f7-4ccb-a579-de099d69da86","block_type":"box","text":"Voting Choice is also available for eligible U.S.","page_number":215,"box":{"x":558,"y":75,"width":328,"height":11}},{"id":"86e50b5f-9c2c-4ffd-b3ef-f43fc446c26a","block_type":"box","text":"retail shareholder accounts invested in BlackRock’s largest U.S. exchange-traded fund.","page_number":215,"box":{"x":69,"y":90,"width":619,"height":11}},{"id":"e26914d1-51bf-4023-9ff6-82f4bed73379","block_type":"box","text":"20","page_number":215,"box":{"x":690,"y":90,"width":9,"height":5}},{"id":"9b1ed326-1cd6-450d-a0ab-726fbe4aa078","block_type":"box","text":"As a result, the shares attributed to BlackRock portfolios in company share registers may be voted differently","page_number":215,"box":{"x":101,"y":113,"width":782,"height":11}},{"id":"fb509524-2353-4de2-9411-183c7983ba55","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":215,"box":{"x":69,"y":128,"width":767,"height":11}},{"id":"978f0e54-d467-4ab6-91cc-459887589ae3","block_type":"box","text":"accordance with a third-party policy, or have elected to vote shares in accordance with their own policy. 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Further, the Guidelines consider the","page_number":221,"box":{"x":102,"y":45,"width":751,"height":11}},{"id":"04dcf6ad-4c4a-4bfb-83bc-5e2e76828994","block_type":"box","text":"differences between the actions and outcomes over which company management has influence, and those it","page_number":221,"box":{"x":101,"y":60,"width":778,"height":11}},{"id":"c1728881-1f1d-4822-8212-a833c3e28fe2","block_type":"box","text":"does not.","page_number":221,"box":{"x":101,"y":75,"width":66,"height":9}},{"id":"76b288aa-4a1f-427e-b1ef-0b088eeb20dc","block_type":"box","text":"•","page_number":221,"box":{"x":69,"y":98,"width":6,"height":4}},{"id":"ee448acd-4f5d-4520-a2e8-0efebb850008","block_type":"box","text":"Focus on useful, contextualized disclosures that help inform investors views, while recognizing data","page_number":221,"box":{"x":102,"y":95,"width":729,"height":11}},{"id":"a6e89476-2509-421d-9ee7-fcdf7798ffaa","block_type":"box","text":"limitations:","page_number":221,"box":{"x":102,"y":110,"width":80,"height":9}},{"id":"b92469af-a2ec-4545-9274-23d1db79422b","block_type":"box","text":"Under the Guidelines, the dedicated team looks for disclosures that outline key milestones and","page_number":221,"box":{"x":189,"y":110,"width":679,"height":11}},{"id":"00b7cd97-ebee-477c-b65a-b28723bc7c49","block_type":"box","text":"dependencies underpinning the company’s low-carbon transition strategy, explain the trade-offs required to adapt","page_number":221,"box":{"x":101,"y":125,"width":807,"height":12}},{"id":"2ae464be-85a4-48ca-bb88-24e47bddcf48","block_type":"box","text":"the business model, and include relevant data and narrative.","page_number":221,"box":{"x":101,"y":141,"width":433,"height":10}},{"id":"e47b0986-6340-4cb2-9880-ccd9dec26b23","block_type":"box","text":"•","page_number":221,"box":{"x":69,"y":163,"width":6,"height":5}},{"id":"21487e48-0c52-422a-80d6-e4cf31f99522","block_type":"box","text":"Consistency with the participating clients’ position as a minority investor:","page_number":221,"box":{"x":101,"y":161,"width":541,"height":11}},{"id":"5e31df59-cde4-4471-aaae-e711347c818d","block_type":"box","text":"The boards and executive leadership","page_number":221,"box":{"x":648,"y":161,"width":261,"height":11}},{"id":"e69ba8c8-6b4e-4280-ad29-9282e6054f68","block_type":"box","text":"of companies determine a company’s strategy and its implementation. Under the Guidelines, the dedicated team","page_number":221,"box":{"x":102,"y":176,"width":805,"height":11}},{"id":"3723dd92-4fa2-455b-8735-f0e2e0fbaf7e","block_type":"box","text":"makes decisions on how to engage companies and vote proxies independently, based on its professional","page_number":221,"box":{"x":102,"y":191,"width":748,"height":11}},{"id":"97eccad6-28f7-455b-9877-b7535fa055ec","block_type":"box","text":"judgment of the priorities and outcomes most aligned with participating clients’ investment objectives.","page_number":221,"box":{"x":100,"y":206,"width":730,"height":11}},{"id":"7854c353-a85e-411f-b197-157ede0e0aec","block_type":"box","text":"Voting approach under the Guidelines","page_number":221,"box":{"x":68,"y":236,"width":273,"height":11}},{"id":"66797f25-617d-4501-b336-74e4c03548ff","block_type":"box","text":"12","page_number":221,"box":{"x":342,"y":237,"width":9,"height":4}},{"id":"180eecab-06e6-4e85-868b-ef9844daec7f","block_type":"box","text":"When evaluating each voting item across management or shareholder proposals, the dedicated team applies a","page_number":221,"box":{"x":101,"y":259,"width":791,"height":11}},{"id":"b68f82ea-bf3c-4c2f-af38-f3fdcfe2c8b4","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":221,"box":{"x":69,"y":274,"width":813,"height":11}},{"id":"a3b54ab9-a200-4b69-b93f-1089e0ac6b5a","block_type":"box","text":"acknowledges the distinction between what company management can influence and what lies beyond its control. As","page_number":221,"box":{"x":69,"y":289,"width":833,"height":11}},{"id":"b8bec10f-b05b-4a30-94c4-0085d2658978","block_type":"box","text":"a result, voting decisions — on behalf of in-scope funds and SMAs — on similar proposals included on different","page_number":221,"box":{"x":69,"y":304,"width":799,"height":11}},{"id":"d5dabac8-5933-477d-8943-ac1ce3010354","block_type":"box","text":"companies’ shareholder meeting agendas may vary depending on company, sector, or market-specific circumstances.","page_number":221,"box":{"x":69,"y":319,"width":837,"height":12}},{"id":"ec2d957c-5c11-4581-9da4-16f337f9f82a","block_type":"box","text":"Consistent with the investment objective of each fund or account that has selected these Guidelines, the","page_number":221,"box":{"x":102,"y":342,"width":748,"height":11}},{"id":"0ca87e1a-3c23-4288-8680-62a2b71f3527","block_type":"box","text":"dedicated team will look to the companies to demonstrate the following:","page_number":221,"box":{"x":69,"y":357,"width":513,"height":11}},{"id":"a7e3e3cb-c6a1-4816-9122-b01c6947c6cc","block_type":"box","text":"Corporate Disclosures","page_number":221,"box":{"x":69,"y":387,"width":160,"height":11}},{"id":"0e08f8b5-7d29-49e0-b4a0-8f2bb52aa14b","block_type":"box","text":"13","page_number":221,"box":{"x":230,"y":388,"width":9,"height":4}},{"id":"cc2f4cb3-3a68-44cf-b9c9-415f52766939","block_type":"box","text":"In the context of these Guidelines, the dedicated team looks for companies to provide sufficient disclosure to","page_number":221,"box":{"x":102,"y":410,"width":781,"height":11}},{"id":"c5ffafac-821f-4d06-980f-69e781e6b274","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":221,"box":{"x":69,"y":425,"width":825,"height":11}},{"id":"bcd8e1bd-255a-4bad-9670-a775ba49b9c3","block_type":"box","text":"to companies that are important to the transition to a low-carbon economy to explain the strategy and governance","page_number":221,"box":{"x":68,"y":440,"width":812,"height":12}},{"id":"bfecd9b1-bbc8-4d7f-ad59-9d54fcaf454c","block_type":"box","text":"frameworks that they have determined most appropriate, which may include:","page_number":221,"box":{"x":68,"y":455,"width":545,"height":11}},{"id":"c7a28b39-1fbe-4889-9ae6-4f20d897fbcc","block_type":"box","text":"(1) a low-carbon transition strategy to demonstrate their alignment with the ambition to limit average global","page_number":221,"box":{"x":69,"y":476,"width":769,"height":11}},{"id":"0add0ea7-315e-4215-8d78-ac80744c23d7","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":221,"box":{"x":101,"y":491,"width":800,"height":11}},{"id":"e8353f5e-0cdb-4659-b42e-36eba27efb12","block_type":"box","text":"net-zero GHG emissions by 2050, with appropriate near- and medium-term milestones to assess their progress.","page_number":221,"box":{"x":102,"y":506,"width":796,"height":11}},{"id":"dbfededc-5092-45cd-97bc-92c6c672c1b8","block_type":"box","text":"(2) low-carbon transition-related reporting. Standardized disclosure of sustainability-related data supports investors","page_number":221,"box":{"x":69,"y":526,"width":828,"height":11}},{"id":"774cf984-994a-4413-b84e-896fb528de2b","block_type":"box","text":"in making informed decisions. The International Sustainability Standards Board (ISSB) standards, IFRS S1 and","page_number":221,"box":{"x":102,"y":541,"width":787,"height":11}},{"id":"d6d21f13-c120-4fc1-a6d4-7751f98e9921","block_type":"box","text":"S2, represent one such approach to standardization that the dedicated team finds useful in its analysis.","page_number":221,"box":{"x":102,"y":556,"width":741,"height":11}},{"id":"0029d00a-51ab-4e7c-bca9-687be4228392","block_type":"box","text":"14, 15","page_number":221,"box":{"x":845,"y":557,"width":25,"height":5}},{"id":"d4c75ca0-0c05-4c5d-b513-541814d64940","block_type":"box","text":"IFRS","page_number":221,"box":{"x":877,"y":556,"width":30,"height":9}},{"id":"0b1a3624-e823-4c18-ba0d-b1b27bd109ea","block_type":"box","text":"S1 addresses the general requirements of sustainability reporting and IFRS S2 sets out the disclosures that","page_number":221,"box":{"x":102,"y":571,"width":774,"height":12}},{"id":"15d66773-1dce-4116-938e-10f060fbbeae","block_type":"box","text":"provide investors with decision-useful information about a company’s most significant climate- and low-carbon","page_number":221,"box":{"x":102,"y":586,"width":781,"height":12}},{"id":"96e44c2f-9c1b-4376-9b69-a18280b73dbe","block_type":"box","text":"transition-related risks and opportunities. This includes receiving independent, third-party assurances, as audit","page_number":221,"box":{"x":101,"y":602,"width":792,"height":11}},{"id":"2292a794-62fe-4dae-98f8-7b7b7642bf9e","block_type":"box","text":"and assurance standards are developed.","page_number":221,"box":{"x":102,"y":617,"width":290,"height":11}},{"id":"744cc6ef-534e-48db-96c4-5c8e4175ee75","block_type":"box","text":"12","page_number":221,"box":{"x":69,"y":646,"width":9,"height":5}},{"id":"834bc634-8c66-4c94-8deb-ba50e8b096c3","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":221,"box":{"x":83,"y":646,"width":825,"height":11}},{"id":"2a51fb87-9308-4abd-a783-4d181fcfce17","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":221,"box":{"x":69,"y":661,"width":833,"height":11}},{"id":"f5924c7c-b48a-427b-9311-447c426ddefb","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":221,"box":{"x":68,"y":676,"width":830,"height":11}},{"id":"3791baa0-51a7-4805-8bfb-e19c47b03861","block_type":"box","text":"company, as well as individual ballot items at shareholder meetings.","page_number":221,"box":{"x":69,"y":691,"width":486,"height":11}},{"id":"b41e1d2f-62b2-419c-81a6-c2769c07fad2","block_type":"box","text":"13","page_number":221,"box":{"x":69,"y":709,"width":9,"height":5}},{"id":"e1ce32ec-bb8e-4363-9897-cbf1f8bdb648","block_type":"box","text":"Given data and measurement limitations, companies may need to provide estimated GHG emissions where","page_number":221,"box":{"x":84,"y":709,"width":764,"height":11}},{"id":"9395378f-2a33-4bdb-8a75-3f7a37136842","block_type":"box","text":"reporting methodologies are nascent. In addition, certain disclosures related to a company’s plans for adapting their","page_number":221,"box":{"x":69,"y":724,"width":834,"height":11}},{"id":"688572f8-3f46-4dcc-84f4-098cc2d7e222","block_type":"box","text":"business models through the low-carbon transition may require forward-looking statements.","page_number":221,"box":{"x":69,"y":739,"width":651,"height":11}},{"id":"495837a7-7272-4c71-acce-639a0757659b","block_type":"box","text":"14","page_number":221,"box":{"x":69,"y":757,"width":9,"height":4}},{"id":"e19ff8ff-4fe3-42b1-afcc-e3e29d39dec8","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards","page_number":221,"box":{"x":83,"y":757,"width":744,"height":11}},{"id":"8b03c60a-93a0-48ca-83a7-7bb18c271f5d","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":221,"box":{"x":69,"y":772,"width":828,"height":11}},{"id":"863a7389-d7be-496f-ac26-97bf16bb145a","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":221,"box":{"x":69,"y":787,"width":830,"height":11}},{"id":"b8e2e336-ed13-4475-882c-2a9904028f20","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":221,"box":{"x":69,"y":802,"width":809,"height":11}},{"id":"6edd9ef3-ae70-4dcc-8ce3-24d5ceff151b","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":221,"box":{"x":70,"y":817,"width":778,"height":11}},{"id":"4161cd3e-aae9-455d-b220-c8c65524523f","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":221,"box":{"x":70,"y":832,"width":380,"height":9}},{"id":"7d412128-2182-4b84-8210-2a0ff5c1be05","block_type":"box","text":"15","page_number":221,"box":{"x":69,"y":850,"width":9,"height":5}},{"id":"ba562330-514b-441d-9326-8c5e8b8f913e","block_type":"box","text":"A number of jurisdictions are consulting on adopting the standards issued to date or have already committed to","page_number":221,"box":{"x":83,"y":850,"width":795,"height":11}},{"id":"cd7aa678-1029-4ac5-888b-9d495dc1ca4c","block_type":"box","text":"doing so. BIS does not mandate any specific disclosure framework companies should use, and recognize that some","page_number":221,"box":{"x":69,"y":865,"width":826,"height":11}},{"id":"506e266a-46a9-488b-b8a3-064020301632","block_type":"box","text":"companies may report using different standards, some of which may be required by regulation. In such cases, we","page_number":221,"box":{"x":69,"y":880,"width":811,"height":11}},{"id":"339942fb-6e86-478c-a0a7-a35f54b99b7b","block_type":"box","text":"ask that companies highlight the metrics that are industry- or company-specific. We also recognize that companies","page_number":221,"box":{"x":69,"y":895,"width":816,"height":12}},{"id":"5fb28b7f-d711-4fe8-8994-810e4c535c58","block_type":"box","text":"may be phasing in reporting over several years. We do not prescribe timelines regarding when companies should","page_number":221,"box":{"x":69,"y":911,"width":803,"height":11}},{"id":"a1002c15-2ef9-4355-a86c-91abe6a4d63d","block_type":"box","text":"BlackRock Investment Stewardship","page_number":221,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"7f86ef66-e81e-4eb7-8237-b77d4f36afb0","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 5","page_number":221,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"4bee95e4-3914-4dd3-9e0b-5d73e92713b4","block_type":"box","text":"NM1026U-5979889-221/232","page_number":221,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"11d7b128-2b4a-4bf8-830b-b0ed5f37e655","block_type":"box","text":"(3) scope 1 and scope 2, and most significant scope 3 GHG emissions","page_number":222,"box":{"x":69,"y":45,"width":513,"height":11}},{"id":"d9fe1c2c-2b99-4aa5-bccb-b2d0577e3c69","block_type":"box","text":"16, 17","page_number":222,"box":{"x":583,"y":45,"width":26,"height":5}},{"id":"939bc163-2f4f-429d-b46e-9cc111bbb235","block_type":"box","text":"In addition, the dedicated team looks to","page_number":222,"box":{"x":615,"y":45,"width":283,"height":10}},{"id":"e6c579a5-d84a-488b-8507-258480e44586","block_type":"box","text":"companies to disclose their emissions reduction targets for scope 1 and 2 emissions, science-based where","page_number":222,"box":{"x":101,"y":60,"width":770,"height":11}},{"id":"dd305d21-f550-4171-97d9-2c0d695e0593","block_type":"box","text":"possible. The team welcomes disclosure of targets or indicative goals, where companies have set them, for","page_number":222,"box":{"x":102,"y":75,"width":768,"height":11}},{"id":"efaa0ca9-da18-47d0-aecb-eb2b8fe0929c","block_type":"box","text":"scope 3 emissions reductions. 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For some companies that play an important role in the low-carbon transition, scope","page_number":222,"box":{"x":101,"y":166,"width":807,"height":11}},{"id":"4d6c556f-9c64-4b0b-9b85-62c4570c5747","block_type":"box","text":"3 may represent their only significant source of GHG emissions in the value chain. While we do not believe","page_number":222,"box":{"x":102,"y":181,"width":759,"height":11}},{"id":"c22a725f-3944-4e26-bbec-a9695f021da3","block_type":"box","text":"companies should be required to enforce emissions reduction targets outside of their control, where relevant, we","page_number":222,"box":{"x":101,"y":196,"width":808,"height":11}},{"id":"98aa19ab-d554-4a40-911c-d55934d08855","block_type":"box","text":"look for disclosures on how the company approaches the low-carbon transition in these cases. This may include","page_number":222,"box":{"x":102,"y":211,"width":797,"height":11}},{"id":"fb83c1d7-530a-4555-94b1-684b5d3c67f2","block_type":"box","text":"plans and targets to grow businesses that contribute to real world decarbonization, forward-looking capital or","page_number":222,"box":{"x":102,"y":226,"width":777,"height":11}},{"id":"541702e0-8491-403c-a4bf-6af3d1bf7f81","block_type":"box","text":"procurement allocation plans to net-zero aligned activities or suppliers, and strategies to mitigate material","page_number":222,"box":{"x":102,"y":241,"width":755,"height":11}},{"id":"fcfa49e7-e7ef-4e6f-b50e-1a36d86cb071","block_type":"box","text":"transition risks.","page_number":222,"box":{"x":101,"y":257,"width":110,"height":8}},{"id":"fa58c9f1-9015-465f-ac5d-b8f028857e97","block_type":"box","text":"(4) where relevant, disclosures that describe the company’s exposure to climate-related physical risks—such as","page_number":222,"box":{"x":69,"y":277,"width":808,"height":11}},{"id":"a5b6ab70-f8af-4ff5-ac75-5b7f2e50a9d1","block_type":"box","text":"acute risks from extreme weather events or chronic risks from long-term shifts in climate patterns—and how","page_number":222,"box":{"x":102,"y":292,"width":773,"height":11}},{"id":"50a3649d-6779-44f7-9bd3-f210619988c5","block_type":"box","text":"these risks could reasonably be expected to affect the company’s operations, assets, or supply chains.","page_number":222,"box":{"x":101,"y":307,"width":739,"height":11}},{"id":"3d012998-363e-4f02-87fe-971c6ad2e0a0","block_type":"box","text":"Transition plans","page_number":222,"box":{"x":68,"y":337,"width":115,"height":11}},{"id":"81a429c8-806a-4661-b986-cf79ba3bb258","block_type":"box","text":"Some companies have published transition plans outlining how they intend to implement their low-carbon","page_number":222,"box":{"x":102,"y":360,"width":748,"height":11}},{"id":"01960c2b-749c-46e7-ab78-c7a1bf1f0d95","block_type":"box","text":"transition strategies. As defined by the ISSB, a transition plan “lays out the entity’s targets, actions or resources for","page_number":222,"box":{"x":68,"y":375,"width":831,"height":11}},{"id":"5efe9ba2-edd2-4fe1-8586-e0f45820428d","block_type":"box","text":"its transition towards a lower-carbon economy, including actions such as reducing its greenhouse gas emissions”","page_number":222,"box":{"x":70,"y":390,"width":805,"height":11}},{"id":"cb30e4d9-c596-4d69-80b4-d423a48f71cb","block_type":"box","text":"(see Appendix 1).","page_number":222,"box":{"x":69,"y":405,"width":122,"height":11}},{"id":"842e4bcb-f7ba-4f4e-a0c6-665e22ffbd43","block_type":"box","text":"19","page_number":222,"box":{"x":193,"y":405,"width":9,"height":5}},{"id":"b0612224-8df2-4675-810a-5fcf5167533e","block_type":"box","text":"Work is also underway in a number of jurisdictions on establishing a common approach in a market to corporate","page_number":222,"box":{"x":101,"y":428,"width":800,"height":11}},{"id":"3ee4d1e0-50fe-42ff-b0e0-819281d9dc35","block_type":"box","text":"transition plans.","page_number":222,"box":{"x":68,"y":443,"width":115,"height":11}},{"id":"446239d4-55f3-4b30-a41b-9c5628f45ffc","block_type":"box","text":"20","page_number":222,"box":{"x":184,"y":443,"width":9,"height":5}},{"id":"c43a68f3-0e26-4087-a903-8ad4865c8a85","block_type":"box","text":"Recent guidance from the ISSB on disclosures about transition plans highlights the convergence of","page_number":222,"box":{"x":200,"y":443,"width":706,"height":11}},{"id":"c5ab1574-82c6-471f-8931-e7fed6c89daf","block_type":"box","text":"reporting approaches.","page_number":222,"box":{"x":69,"y":458,"width":156,"height":11}},{"id":"f4400de5-700b-4370-8d5a-df91cdfa75f3","block_type":"box","text":"While the preparation of a transition plan, or lack thereof, is not, in itself, a voting issue, these disclosures","page_number":222,"box":{"x":101,"y":481,"width":762,"height":11}},{"id":"db2e748e-5f07-49a0-bf54-52e01f1bc0e7","block_type":"box","text":"typically provide valuable insights that inform the dedicated team’s approach to engaging and voting on matters","page_number":222,"box":{"x":68,"y":496,"width":796,"height":11}},{"id":"a0542abd-bcee-4694-be0d-a8009ef4a9d4","block_type":"box","text":"related to climate and transition risks on behalf of in-scope funds and accounts.","page_number":222,"box":{"x":69,"y":511,"width":570,"height":11}},{"id":"bd0a76d1-5e0a-41d8-8285-382ca23091d0","block_type":"box","text":"make sustainability-related disclosures but appreciate it when companies produce them sufficiently in advance of","page_number":222,"box":{"x":69,"y":537,"width":810,"height":12}},{"id":"b3a68f51-457f-477c-b072-600c043e99e2","block_type":"box","text":"their shareholder meeting, to the best of their abilities, to provide investors with time to assess the data and make","page_number":222,"box":{"x":68,"y":553,"width":822,"height":11}},{"id":"36786b10-5d08-4e99-92e7-9fac4f464b34","block_type":"box","text":"informed voting decisions.","page_number":222,"box":{"x":70,"y":568,"width":184,"height":11}},{"id":"e764ad55-3ea7-4377-9467-94db6ef92b85","block_type":"box","text":"16","page_number":222,"box":{"x":69,"y":586,"width":9,"height":4}},{"id":"0fc3fa8a-e4b9-4dbf-a1d1-33f5033eb9e2","block_type":"box","text":"FTSE Russell address the materiality of different categories of scope 3 GHG emissions by sector in a January 2024","page_number":222,"box":{"x":84,"y":585,"width":825,"height":12}},{"id":"1e7c6d5d-0f2c-4ff7-be1d-41561a5f93b1","block_type":"box","text":"paper: FTSE Russel, “Scope for improvement: Solving the Scope 3 conundrum,” January 2024, accessed in","page_number":222,"box":{"x":70,"y":600,"width":768,"height":12}},{"id":"95897b2b-9456-4e5a-8eb8-9f65436a2ee5","block_type":"box","text":"December 2025.","page_number":222,"box":{"x":70,"y":616,"width":118,"height":9}},{"id":"4e95ade3-29d4-4a53-8951-4d9d787e4c61","block_type":"box","text":"17","page_number":222,"box":{"x":69,"y":634,"width":8,"height":4}},{"id":"a492d746-41d0-4b8d-bd78-fff408606d61","block_type":"box","text":"Under this policy, the dedicated team looks for GHG emissions disclosures to be aligned with the Greenhouse Gas","page_number":222,"box":{"x":84,"y":633,"width":815,"height":12}},{"id":"5024d16b-8a5c-4865-ac89-58377bf3fda2","block_type":"box","text":"Protocol (GHG Protocol). The Protocol Standards and Guidance are currently being updated to ensure they continue to","page_number":222,"box":{"x":69,"y":648,"width":838,"height":12}},{"id":"64e7dbbf-aa88-4db1-b32b-06e9e13a8ea9","block_type":"box","text":"provide “a rigorous and credible accounting foundation for businesses to measure, plan and track progress toward","page_number":222,"box":{"x":70,"y":663,"width":816,"height":12}},{"id":"92df73a6-076a-4ec8-aab1-fe0ac0249fa1","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":222,"box":{"x":69,"y":679,"width":784,"height":11}},{"id":"f318497a-05fe-42e2-a1c0-94c86bdf80c5","block_type":"box","text":"18","page_number":222,"box":{"x":69,"y":697,"width":9,"height":4}},{"id":"1d697c74-ab31-471a-b990-829fe7036d65","block_type":"box","text":"The dedicated team does not believe the purpose of scope 3 disclosure requirements should be to push publicly","page_number":222,"box":{"x":83,"y":696,"width":804,"height":11}},{"id":"07d379f8-ec93-40a6-99cc-01a4f3c9485e","block_type":"box","text":"traded companies into the role of enforcing emission reduction targets outside of their control. Given methodological","page_number":222,"box":{"x":68,"y":711,"width":832,"height":12}},{"id":"13697226-4d16-4dde-9d20-0fa893bb1002","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":222,"box":{"x":69,"y":726,"width":832,"height":12}},{"id":"885e9671-f682-4d33-8744-629485f24315","block_type":"box","text":"useful when companies focus their disclosures on those of the fifteen scope 3 GHG Protocol categories that are","page_number":222,"box":{"x":69,"y":742,"width":800,"height":11}},{"id":"f7b716f4-2061-49ae-a0d7-b1f91182730f","block_type":"box","text":"material to their business models.","page_number":222,"box":{"x":69,"y":757,"width":243,"height":9}},{"id":"57e0adb2-8a47-4a98-a3d4-45c700f8d900","block_type":"box","text":"19","page_number":222,"box":{"x":69,"y":775,"width":9,"height":4}},{"id":"79d349e2-55da-4c11-a571-aa6337a91fed","block_type":"box","text":"International Financial Reporting Standards, “IFRS S2: Climate-related Disclosures,” June 2023, accessed in","page_number":222,"box":{"x":84,"y":774,"width":777,"height":12}},{"id":"ac7241d8-3aeb-4c36-b7f3-27377044d869","block_type":"box","text":"December 2025.","page_number":222,"box":{"x":70,"y":790,"width":118,"height":8}},{"id":"e3451ada-adaf-49a2-8275-5df13934fe2e","block_type":"box","text":"20","page_number":222,"box":{"x":69,"y":807,"width":9,"height":5}},{"id":"09040b2a-00fb-4450-b3ce-b3b144a2b52d","block_type":"box","text":"More companies are developing such plans, and public policymakers in certain markets are signaling their","page_number":222,"box":{"x":84,"y":807,"width":758,"height":11}},{"id":"99b79835-d2aa-4f46-a3f4-d072ad9938e5","block_type":"box","text":"intentions to require them or already have requirements in place, such as Australia, Brazil, and the European Union","page_number":222,"box":{"x":70,"y":822,"width":820,"height":11}},{"id":"33abae9b-3830-467f-8a8d-b5e7a8b67c9f","block_type":"box","text":"(please see the International Transition Plan Network for information). BlackRock views transition plans as a method","page_number":222,"box":{"x":69,"y":837,"width":829,"height":11}},{"id":"699d0942-668d-4c4f-b46c-18572fdb798a","block_type":"box","text":"for a company to both internally assess and externally communicate its long-term strategy, ambition, objectives, and","page_number":222,"box":{"x":68,"y":852,"width":829,"height":12}},{"id":"9d886f37-b9af-4755-bf2d-96983c7c7ce9","block_type":"box","text":"actions to create financial value through the global transition towards a low-carbon economy. Across the landscape","page_number":222,"box":{"x":69,"y":868,"width":818,"height":11}},{"id":"076aaa0a-7c0f-4b36-9fc9-f6696ab780af","block_type":"box","text":"there remains divergence on the objectives of such plans and the details they should contain. 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In assessing the role and effectiveness of the board in this regard, the dedicated team seeks to","page_number":223,"box":{"x":68,"y":98,"width":825,"height":11}},{"id":"452b3bcd-5959-4a04-8828-29f4a5755f1a","block_type":"box","text":"understand whether:","page_number":223,"box":{"x":69,"y":113,"width":145,"height":9}},{"id":"e9f504ca-53a5-41f8-8e13-aae137e4f24e","block_type":"box","text":"•","page_number":223,"box":{"x":69,"y":136,"width":6,"height":4}},{"id":"e76645a1-2ab2-47ec-954d-090dea59b084","block_type":"box","text":"The board has clear oversight responsibilities for climate and low-carbon transition-related risks and","page_number":223,"box":{"x":101,"y":133,"width":711,"height":11}},{"id":"e188b69c-9c33-451d-955d-be567e1390e5","block_type":"box","text":"opportunities in the company’s business model. 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Given forthcoming regulatory requirements in certain jurisdictions, some companies are voluntarily","page_number":223,"box":{"x":101,"y":420,"width":774,"height":11}},{"id":"9a3d1656-3071-4f68-920b-a1d33038a6f2","block_type":"box","text":"disclosing scope 3 emissions reductions targets and plans, setting out how they are working on decarbonization","page_number":223,"box":{"x":101,"y":435,"width":800,"height":11}},{"id":"f3fc181d-0e73-44a3-98b9-47051158fa69","block_type":"box","text":"with the different constituents in their value chain.","page_number":223,"box":{"x":101,"y":450,"width":358,"height":9}},{"id":"1e26ea9d-2936-43d9-b147-4aeacb130a0c","block_type":"box","text":"21","page_number":223,"box":{"x":461,"y":451,"width":9,"height":4}},{"id":"fe11c540-76a3-4349-b898-e9dd4c445c27","block_type":"box","text":"•","page_number":223,"box":{"x":69,"y":473,"width":6,"height":5}},{"id":"83b58731-dc46-4b45-9ba0-309af7a74690","block_type":"box","text":"The company’s governance and oversight processes for managing material risks associated with corporate","page_number":223,"box":{"x":101,"y":470,"width":761,"height":12}},{"id":"6fc29844-2b03-402e-a226-8f0babe4ad1b","block_type":"box","text":"political activities including applicable policies and procedures where relevant.","page_number":223,"box":{"x":102,"y":486,"width":556,"height":11}},{"id":"0b6db627-3982-4a71-ba39-e96100689a7f","block_type":"box","text":"22","page_number":223,"box":{"x":660,"y":486,"width":8,"height":4}},{"id":"6f9e9007-792d-460c-b8da-48a53f4f77a3","block_type":"box","text":"The dedicated team looks for","page_number":223,"box":{"x":674,"y":486,"width":208,"height":9}},{"id":"735133b9-9196-46ac-8d1c-711697c5f22d","block_type":"box","text":"public policy engagement to be consistent with a company’s stated strategic policy objectives, including those","page_number":223,"box":{"x":102,"y":501,"width":783,"height":11}},{"id":"f58248dc-9d75-48fb-9fc6-392231faa739","block_type":"box","text":"related to the low-carbon transition.","page_number":223,"box":{"x":102,"y":516,"width":251,"height":9}},{"id":"03c7d656-3cba-4d42-a51d-d0be3ab3f501","block_type":"box","text":"Voting against directors over concerns about climate risk","page_number":223,"box":{"x":68,"y":546,"width":420,"height":11}},{"id":"fe3cc9fc-7bda-44ce-a45f-5fe119ef6e0d","block_type":"box","text":"In implementing these Guidelines, the dedicated team generally supports non-executive directors standing for","page_number":223,"box":{"x":102,"y":569,"width":781,"height":11}},{"id":"31968bfa-18b8-400c-a392-07c97e888fea","block_type":"box","text":"election where, in its assessment based on company disclosures and engagement, a company is executing on its","page_number":223,"box":{"x":69,"y":584,"width":811,"height":11}},{"id":"72d64b67-a0f3-4824-b89d-aa9edd0ebd01","block_type":"box","text":"commitment to align with the transition to a low-carbon economy, as defined above. Where the dedicated team","page_number":223,"box":{"x":69,"y":599,"width":788,"height":11}},{"id":"ac3c0d80-6a2e-497d-bf43-1172e25dc175","block_type":"box","text":"determines this is not the case, it may vote against the election of one or more directors who the team identifies as","page_number":223,"box":{"x":69,"y":614,"width":828,"height":11}},{"id":"45cd21bb-f6c5-4d86-9d49-21e86c2621eb","block_type":"box","text":"having the most responsibility for the issue. The directors most likely to be in focus are the chair of the board","page_number":223,"box":{"x":69,"y":629,"width":780,"height":11}},{"id":"dee6a00d-3a99-436c-8295-33f1a9d57feb","block_type":"box","text":"committee with low-carbon transition, climate or sustainability risk oversight responsibilities, other members of the","page_number":223,"box":{"x":69,"y":644,"width":817,"height":12}},{"id":"435337ca-cb14-400d-89fe-533b518815eb","block_type":"box","text":"relevant committee, the lead independent director or the non-executive chair of the board. 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The Guidelines consider these","page_number":224,"box":{"x":69,"y":143,"width":782,"height":11}},{"id":"0403926e-25ba-489a-bd20-9ff0a1d217bf","block_type":"box","text":"proposals as a valuable governance mechanism that can enhance transparency, accountability, and investors’","page_number":224,"box":{"x":70,"y":158,"width":782,"height":11}},{"id":"38e558f7-885c-4947-88e4-9aa4d7b7dcf0","block_type":"box","text":"understanding of a company’s climate strategy. The dedicated team generally supports management’s climate","page_number":224,"box":{"x":69,"y":173,"width":787,"height":11}},{"id":"2b929bdc-de74-4cfd-bc4f-c07bf7d3a5c1","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":224,"box":{"x":69,"y":188,"width":838,"height":12}},{"id":"209a92fc-5ec1-46fb-8f0b-1de6d0b5ef72","block_type":"box","text":"transition. Similarly, the dedicated team generally supports management’s proposal on a progress report if the","page_number":224,"box":{"x":68,"y":203,"width":792,"height":12}},{"id":"bc99eea0-2e00-4907-93bc-d28513f7f8c3","block_type":"box","text":"company has clearly explained its progress against, and any deviations from or changes to, its stated low-carbon","page_number":224,"box":{"x":69,"y":218,"width":803,"height":12}},{"id":"39265965-1d35-4554-8764-2e05276120ce","block_type":"box","text":"transition plan and targets.","page_number":224,"box":{"x":68,"y":234,"width":193,"height":11}},{"id":"85506395-dfe2-451c-8d54-3b6612fecb7a","block_type":"box","text":"Shareholder proposals on climate and low-carbon transition matters","page_number":224,"box":{"x":68,"y":264,"width":495,"height":11}},{"id":"8f4c6180-e8bd-4d30-86bf-3cab0f899463","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":224,"box":{"x":102,"y":287,"width":777,"height":11}},{"id":"5901c241-2e97-4aeb-ba76-e4b9030fe08f","block_type":"box","text":"long as certain requirements are met. 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The dedicated team assesses the implications for, and the relevance to, the","page_number":224,"box":{"x":68,"y":407,"width":770,"height":12}},{"id":"2de6878b-353e-473c-be88-35bcc6fb9e65","block_type":"box","text":"company’s stated low-carbon transition strategy and targets. Under the Guidelines, the team may support","page_number":224,"box":{"x":69,"y":423,"width":754,"height":11}},{"id":"71a56b43-302e-4c5a-bbe6-fbef191da71b","block_type":"box","text":"shareholder proposals that, for example, ask a company to:","page_number":224,"box":{"x":69,"y":438,"width":425,"height":11}},{"id":"bf36fbbe-9ca3-4166-9823-c4260fe5eaf7","block_type":"box","text":"•","page_number":224,"box":{"x":69,"y":461,"width":6,"height":4}},{"id":"76f63777-0fac-450e-82fd-a2c37cdb0583","block_type":"box","text":"Publish a business plan, and related disclosures, consistent with the ambition to limit average global","page_number":224,"box":{"x":102,"y":458,"width":719,"height":11}},{"id":"bd323b99-1d79-4626-988e-62d2141ae914","block_type":"box","text":"temperature rise to no more than 1.5°C above pre-industrial levels","page_number":224,"box":{"x":101,"y":473,"width":474,"height":11}},{"id":"0a42858d-d8e6-44c8-b3ab-e9918336c467","block_type":"box","text":"•","page_number":224,"box":{"x":69,"y":496,"width":6,"height":5}},{"id":"e6ccbdeb-9cb1-4026-93e1-297604a1e049","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":224,"box":{"x":101,"y":493,"width":807,"height":11}},{"id":"d80b26f9-054f-4c27-b1f1-0acfaf90b993","block_type":"box","text":"goal of the company achieving net zero GHG emissions by 2050","page_number":224,"box":{"x":101,"y":508,"width":457,"height":12}},{"id":"de89ed51-da9c-446d-b606-dd7622ed4195","block_type":"box","text":"•","page_number":224,"box":{"x":69,"y":531,"width":6,"height":5}},{"id":"9dc390c4-817b-4852-ab70-b8ad9e35dc18","block_type":"box","text":"Disclose the categories of scope 3 GHG emissions most significant to a company’s business model","page_number":224,"box":{"x":102,"y":528,"width":712,"height":12}},{"id":"257e0cdd-7f6f-4182-8f5b-a0a9b67ac668","block_type":"box","text":"•","page_number":224,"box":{"x":69,"y":551,"width":6,"height":5}},{"id":"8eb52a15-cefd-4e61-b2c6-a017103d4530","block_type":"box","text":"Improve voluntary disclosures on the alignment of a company’s climate-related corporate political activities with","page_number":224,"box":{"x":102,"y":549,"width":794,"height":11}},{"id":"252c184d-dba4-4ddf-9eb8-03d263b2152c","block_type":"box","text":"its strategic policy positions, where existing disclosure is insufficient","page_number":224,"box":{"x":102,"y":564,"width":489,"height":11}},{"id":"3576671f-b51f-45f9-8dc3-dbddc7fd5522","block_type":"box","text":"25","page_number":224,"box":{"x":592,"y":564,"width":9,"height":5}},{"id":"66451bbc-779f-4bc2-9ec7-2ced974cc956","block_type":"box","text":"The dedicated team does not support shareholder proposals that seek to constrain board or management","page_number":224,"box":{"x":101,"y":587,"width":758,"height":11}},{"id":"81eab683-5687-4428-89a0-7bd49e6c0236","block_type":"box","text":"decision-making or direct specific business or strategic decisions.","page_number":224,"box":{"x":69,"y":601,"width":468,"height":12}},{"id":"05203d78-6560-420e-abcc-4cef31d9da89","block_type":"box","text":"RELATED MATTERS","page_number":224,"box":{"x":419,"y":632,"width":140,"height":9}},{"id":"f150cb81-f809-4053-961b-e2e0f81be6fa","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":224,"box":{"x":101,"y":655,"width":771,"height":11}},{"id":"f0075bac-3892-483e-81ec-b22545df95ae","block_type":"box","text":"matters relevant to the transition to a low-carbon economy. 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Some companies, in light of their long-term strategy, may decide to include relevant","page_number":224,"box":{"x":69,"y":768,"width":837,"height":11}},{"id":"650c0971-3250-4583-9c8e-6674d2b09baf","block_type":"box","text":"GHG emissions reduction targets or low-carbon transition-related metrics in their incentive plans. In such cases, the","page_number":224,"box":{"x":69,"y":783,"width":826,"height":11}},{"id":"b6f0ac5e-d343-48e6-9fe1-3a0aee2ff76f","block_type":"box","text":"dedicated team would engage to understand the alignment between those metrics and the company’s stated climate","page_number":224,"box":{"x":69,"y":798,"width":834,"height":11}},{"id":"d3b89123-3eb0-4394-9d4e-06ed55d6f03e","block_type":"box","text":"24","page_number":224,"box":{"x":69,"y":828,"width":9,"height":4}},{"id":"2e161e63-8e43-4b17-9807-11d04ef80b84","block_type":"box","text":"While the dedicated team may escalate voting by not supporting additional management proposals, principally","page_number":224,"box":{"x":83,"y":827,"width":787,"height":12}},{"id":"ded69816-8cb1-4ea3-8ab9-2840fd82a25c","block_type":"box","text":"director elections, the team does not consider filing shareholder proposals, preannouncing voting intentions or using","page_number":224,"box":{"x":69,"y":842,"width":832,"height":12}},{"id":"5c0aafc0-341a-4e69-a8f8-4f7dba070d75","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":225,"box":{"x":69,"y":45,"width":821,"height":11}},{"id":"4faabac2-84df-48be-8ebf-c0732d5248af","block_type":"box","text":"strategy and risk management.","page_number":225,"box":{"x":69,"y":60,"width":219,"height":11}},{"id":"80bc4985-08ae-4c4f-b7ad-28a82ca9dd65","block_type":"box","text":"Auditors and audit-related issues","page_number":225,"box":{"x":68,"y":90,"width":240,"height":9}},{"id":"f1c276d4-fefc-49e1-b7fb-f34bd5b2962c","block_type":"box","text":"For companies with material climate or transition risks or opportunities in their business models, the dedicated","page_number":225,"box":{"x":102,"y":113,"width":793,"height":11}},{"id":"4037a30f-d580-46d7-82a5-10ea8c35cb0d","block_type":"box","text":"team is interested in understanding whether the company considers and, if relevant, quantifies, and accounts for","page_number":225,"box":{"x":68,"y":128,"width":807,"height":11}},{"id":"f47a60e1-d065-4e81-ada4-0fef1c63713e","block_type":"box","text":"material climate-related risks in its financial statements, including if the company explains such risks within the","page_number":225,"box":{"x":69,"y":143,"width":794,"height":11}},{"id":"34b8d06c-8c35-471d-88dd-2b2ec5ec7eab","block_type":"box","text":"context of its audit report. The team notes that assurance of corporate disclosures related to climate risk and the","page_number":225,"box":{"x":69,"y":158,"width":812,"height":11}},{"id":"8cbfa09d-8696-4f23-bdb7-acdcb2d9b35c","block_type":"box","text":"transition to a low-carbon economy is still nascent.","page_number":225,"box":{"x":68,"y":173,"width":361,"height":11}},{"id":"6ed181e9-7574-4828-9443-250d5d76a9e6","block_type":"box","text":"Mergers, acquisitions, asset sales, and other special situations","page_number":225,"box":{"x":69,"y":203,"width":463,"height":11}},{"id":"346238a1-8e52-4546-8e72-9d179ad4f925","block_type":"box","text":"Special situations will be considered on their financial merits, but the dedicated team may engage on climate","page_number":225,"box":{"x":102,"y":226,"width":783,"height":11}},{"id":"3d1667c9-3519-4672-8835-aefceaac39aa","block_type":"box","text":"related factors under these Guidelines where a transaction may significantly alter a company’s climate strategy or a","page_number":225,"box":{"x":69,"y":241,"width":824,"height":11}},{"id":"43e2d27c-ba88-45c7-abc6-0c6f2d5d9434","block_type":"box","text":"shareholder activist has proposed governance, strategic or operational changes that may impact its climate strategy.","page_number":225,"box":{"x":69,"y":257,"width":831,"height":11}},{"id":"2f1921e7-3751-4491-ac44-0635fe65920c","block_type":"box","text":"The dedicated team does not promote changes in corporate control or engage in shareholder activism.","page_number":225,"box":{"x":68,"y":272,"width":731,"height":11}},{"id":"a5fd2ebb-894f-4242-a617-e64b6c9fd259","block_type":"box","text":"Other business relevant sustainability-related risks and opportunities","page_number":225,"box":{"x":69,"y":302,"width":503,"height":11}},{"id":"79df7d3a-28e0-466f-b11e-5c45faf46df4","block_type":"box","text":"Climate risk and the transition to a low-carbon economy are interconnected with a number of other material","page_number":225,"box":{"x":102,"y":324,"width":762,"height":11}},{"id":"f74247a6-5ce2-481e-98d4-0c723fff9357","block_type":"box","text":"sustainability-related risks and opportunities that may be relevant to a company’s business model and long-term","page_number":225,"box":{"x":69,"y":340,"width":802,"height":11}},{"id":"6373a8cc-1c39-4161-9a0f-704002b5a4e8","block_type":"box","text":"financial performance. These include a company’s impacts or dependencies on natural capital and key","page_number":225,"box":{"x":68,"y":355,"width":734,"height":11}},{"id":"3ac37f34-5760-484a-b12f-cae944ff6752","block_type":"box","text":"stakeholders.","page_number":225,"box":{"x":69,"y":370,"width":95,"height":9}},{"id":"ef37cf7d-82b8-4caa-a46e-751eaf6257b1","block_type":"box","text":"26","page_number":225,"box":{"x":166,"y":370,"width":9,"height":5}},{"id":"e1a1d3f6-cbe1-40f1-8103-ab315e0fad67","block_type":"box","text":"In the context of these Guidelines, the dedicated team may engage companies to better understand","page_number":225,"box":{"x":182,"y":370,"width":710,"height":11}},{"id":"d5cee2e6-1b6f-4727-bb1f-de5ec45aa75b","block_type":"box","text":"how they are managing the impact on people (e.g., employees, suppliers, customers and communities) of any","page_number":225,"box":{"x":69,"y":385,"width":783,"height":11}},{"id":"25d1d5af-a908-4f4d-9c65-caa2a43ec09b","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":225,"box":{"x":69,"y":400,"width":832,"height":11}},{"id":"f7c94781-d5f2-4643-b7d4-83a2a4f94a27","block_type":"box","text":"team may engage companies that face risks and opportunities related to land use and deforestation, access to fresh","page_number":225,"box":{"x":68,"y":415,"width":838,"height":11}},{"id":"21534b40-747f-4764-bea2-53f0813a5a91","block_type":"box","text":"water, or the ability to secure scarce resources critical to the transition to a low-carbon economy.","page_number":225,"box":{"x":68,"y":430,"width":690,"height":11}},{"id":"130d2696-4bd8-47f3-a030-b38f2eea6bfb","block_type":"box","text":"26","page_number":225,"box":{"x":69,"y":475,"width":9,"height":4}},{"id":"d1540ad5-6c26-4632-9287-d8fa102386cf","block_type":"box","text":"Engagement with companies on these issues is informed by BIS’ commentaries on natural capital, human capital","page_number":225,"box":{"x":84,"y":474,"width":807,"height":12}},{"id":"f8f5568c-5837-4046-9e2d-76cc118c53e3","block_type":"box","text":"management, and corporate human rights risks, December 2025.","page_number":225,"box":{"x":69,"y":490,"width":468,"height":11}},{"id":"7a73e104-021b-462e-b25a-5f40762ffb7f","block_type":"box","text":"BlackRock Investment Stewardship","page_number":225,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"0261385e-3f80-4c16-927a-790392ecbcf1","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 9","page_number":225,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"77a2fd17-420d-41fa-b500-d3706c329c00","block_type":"box","text":"NM1026U-5979889-225/232","page_number":225,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"40b86795-c1db-4278-9c5a-09143a7fa4ad","block_type":"box","text":"Appendix 1","page_number":226,"box":{"x":68,"y":45,"width":82,"height":11}},{"id":"f405e13f-09e3-4411-bd1a-c491e83a90af","block_type":"box","text":"Terminology","page_number":226,"box":{"x":68,"y":75,"width":87,"height":11}},{"id":"a4471f47-1b2b-4cbb-8e69-1a986b461994","block_type":"box","text":"We understand the key concepts referred to within these Guidelines as follows:","page_number":226,"box":{"x":101,"y":98,"width":565,"height":11}},{"id":"23cde876-c64a-4318-a9c2-f4644bdcb6cf","block_type":"box","text":"Climate risk:","page_number":226,"box":{"x":101,"y":120,"width":92,"height":9}},{"id":"09096dc5-01b4-4fef-86c0-96389337758c","block_type":"box","text":"Includes physical risk, the increased risk to companies’ assets and activities caused by the direct","page_number":226,"box":{"x":200,"y":120,"width":698,"height":11}},{"id":"dd454a99-53f6-4335-ab35-8f08f3881a7a","block_type":"box","text":"impact of changing weather patterns and natural catastrophes, and transition risk, the impact of the transition to a","page_number":226,"box":{"x":70,"y":135,"width":818,"height":12}},{"id":"934b47e0-b573-4c0d-ab55-05a751effd7a","block_type":"box","text":"low-carbon economy on a company’s long-term profitability.","page_number":226,"box":{"x":70,"y":150,"width":416,"height":12}},{"id":"8affea45-c415-4eae-a097-82a363209733","block_type":"box","text":"Transition to a low-carbon economy (“low-carbon transition”):","page_number":226,"box":{"x":101,"y":173,"width":449,"height":11}},{"id":"1a08e126-1cc0-4a2f-94a8-4f0b21be573f","block_type":"box","text":"The global economic shift toward lower","page_number":226,"box":{"x":556,"y":173,"width":278,"height":11}},{"id":"b071c4e9-33a9-489a-8967-9842c5be18ac","block_type":"box","text":"emissions across many sectors and business models. The economic transformation is being driven by changes in","page_number":226,"box":{"x":69,"y":188,"width":811,"height":12}},{"id":"c06128c4-88a4-45d8-acf6-bb1892e511e5","block_type":"box","text":"government policy, technology, and consumer and investor preferences, as well as the physical effects of climate","page_number":226,"box":{"x":68,"y":203,"width":807,"height":12}},{"id":"01e77145-a234-43f9-97c2-7e5dc7b8d077","block_type":"box","text":"change (e.g., extreme weather), and can potentially have a material impact on clients’ investments and portfolios.","page_number":226,"box":{"x":69,"y":218,"width":812,"height":12}},{"id":"afb1f2dd-4140-41a8-a8b8-2e28d5bbb8c5","block_type":"box","text":"Decarbonization:","page_number":226,"box":{"x":102,"y":241,"width":120,"height":9}},{"id":"fec4e1e7-658f-49df-9134-941c302c10cd","block_type":"box","text":"the process of reducing or eliminating emissions of carbon dioxide (CO2) from human activity","page_number":226,"box":{"x":228,"y":241,"width":664,"height":11}},{"id":"fc39a6fa-6c6b-476b-bdbf-0357055dfd91","block_type":"box","text":"and removing carbon currently in the atmosphere. This can be carried out by countries, companies and even","page_number":226,"box":{"x":69,"y":257,"width":771,"height":11}},{"id":"06a9dd7c-8e6d-45a9-9d8f-c6523fe9c009","block_type":"box","text":"individual consumers. Sometimes the concept is understood to include the reduction and elimination of other GHG,","page_number":226,"box":{"x":70,"y":271,"width":820,"height":11}},{"id":"b41b1179-d3db-42c2-9a17-2464ea393d5b","block_type":"box","text":"e.g., methane.","page_number":226,"box":{"x":69,"y":287,"width":102,"height":11}},{"id":"f50d9c43-8092-4c36-a355-a1532e7ff202","block_type":"box","text":"Climate-related risks and opportunities:","page_number":226,"box":{"x":101,"y":309,"width":289,"height":11}},{"id":"10eadbc8-3358-4359-954c-218df7646ef1","block_type":"box","text":"The investment opportunities and risks associated with the transition","page_number":226,"box":{"x":396,"y":309,"width":495,"height":11}},{"id":"36e2dab2-e95e-4e6a-90d7-2181cd8dec97","block_type":"box","text":"to a low-carbon economy, including transition risks and opportunities and physical risks and opportunities in adapting","page_number":226,"box":{"x":68,"y":325,"width":838,"height":11}},{"id":"1a10e3cd-eb24-402f-8bd3-e09a38f271af","block_type":"box","text":"to physical climate change.","page_number":226,"box":{"x":68,"y":340,"width":193,"height":11}},{"id":"5bd2f8d6-7d85-4037-9e89-e9420a7aa64f","block_type":"box","text":"Climate-related transition plan:","page_number":226,"box":{"x":101,"y":362,"width":226,"height":11}},{"id":"9d337ef7-fec7-41c7-8f12-20a4f67764a6","block_type":"box","text":"“An aspect of an entity’s overall strategy that lays out the entity’s targets,","page_number":226,"box":{"x":334,"y":362,"width":525,"height":11}},{"id":"902db171-c489-45ee-9fa0-2817a91c1acd","block_type":"box","text":"actions or resources for its transition towards a lower-carbon economy, including actions such as reducing its","page_number":226,"box":{"x":69,"y":377,"width":778,"height":12}},{"id":"8db3e805-732c-4397-ada0-c1c2e5af05c1","block_type":"box","text":"greenhouse gas emissions.”","page_number":226,"box":{"x":68,"y":393,"width":203,"height":11}},{"id":"43eaa2b5-36cc-4aa4-95c0-2355b8f3584e","block_type":"box","text":"27","page_number":226,"box":{"x":273,"y":393,"width":9,"height":4}},{"id":"dd27ad57-86e8-4c86-b32c-58c3097df3fa","block_type":"box","text":"Science-based GHG emissions reduction targets:","page_number":226,"box":{"x":101,"y":415,"width":356,"height":11}},{"id":"006975c0-f492-4a35-8330-ee2879ac849b","block_type":"box","text":"Targets that “","page_number":226,"box":{"x":463,"y":415,"width":96,"height":11}},{"id":"7a37b558-7d73-4e75-9e70-2a04535f4435","block_type":"box","text":"are in line with what the latest climate science","page_number":226,"box":{"x":569,"y":415,"width":331,"height":9}},{"id":"c5d28bb6-aeda-49ef-b0b3-a6395886a2a0","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":226,"box":{"x":69,"y":430,"width":822,"height":11}},{"id":"eac5fe19-f578-416a-8887-6b78f28061ad","block_type":"box","text":"levels. Science-based targets give companies a clearly defined path to reduce GHG emissions in line with limiting","page_number":226,"box":{"x":70,"y":445,"width":806,"height":12}},{"id":"11ead8a5-701f-4704-b195-8b60ead23ff6","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":226,"box":{"x":68,"y":460,"width":824,"height":12}},{"id":"2afff564-4e6b-4c48-a7a4-d735e05dc17c","block_type":"box","text":"with the Paris Agreement goals.”","page_number":226,"box":{"x":68,"y":476,"width":232,"height":11}},{"id":"d00c19c7-c5aa-48e4-a3e3-13485009331f","block_type":"box","text":"28","page_number":226,"box":{"x":302,"y":476,"width":9,"height":4}},{"id":"e38cf007-93ad-4d1f-b4e9-487dfcf6fc4c","block_type":"box","text":"Scope 1:","page_number":226,"box":{"x":101,"y":498,"width":63,"height":11}},{"id":"ef3e7540-1063-44e5-9901-4a252e037cc1","block_type":"box","text":"Direct GHG emissions. Direct GHG emissions occur from sources that are owned or controlled by the","page_number":226,"box":{"x":172,"y":498,"width":718,"height":11}},{"id":"af418eac-feaf-43ae-828a-eb6e1aadaf86","block_type":"box","text":"company, for example, emissions from combustion in owned or controlled boilers, furnaces, vehicles, etc.; emissions","page_number":226,"box":{"x":69,"y":513,"width":836,"height":11}},{"id":"bf6a2da5-4d2e-4022-8297-aed9fd6bca46","block_type":"box","text":"from chemical production in owned or controlled process equipment.","page_number":226,"box":{"x":68,"y":528,"width":489,"height":11}},{"id":"5530c323-0fed-4da9-b2cf-ee2f814ea282","block_type":"box","text":"29","page_number":226,"box":{"x":559,"y":529,"width":9,"height":4}},{"id":"d5878d5f-9d5f-4a97-9ed8-31caec3f161d","block_type":"box","text":"Scope 2","page_number":226,"box":{"x":101,"y":551,"width":59,"height":11}},{"id":"e0b2c3c6-074c-4fab-8bc2-461b637b794c","block_type":"box","text":": Electricity indirect GHG emissions Scope 2 accounts for GHG emissions from the generation of","page_number":226,"box":{"x":162,"y":551,"width":685,"height":11}},{"id":"2d88893a-d6d1-4415-ba07-033bc95fe568","block_type":"box","text":"purchased electricity [steam, and heating/cooling] consumed by the company. [It] is defined as electricity [steam,","page_number":226,"box":{"x":70,"y":566,"width":807,"height":11}},{"id":"9d97125a-d7ae-472d-8c54-15f8ecb500a6","block_type":"box","text":"and heating/cooling] that is purchased or otherwise brought into the organizational boundary of the company.","page_number":226,"box":{"x":69,"y":581,"width":781,"height":12}},{"id":"7e5bd6f0-0ec1-4cee-aa57-64a28be9c0a9","block_type":"box","text":"30","page_number":226,"box":{"x":852,"y":582,"width":9,"height":4}},{"id":"89822e9a-2060-4151-bd21-2c16ad2fc149","block_type":"box","text":"Scope 3:","page_number":226,"box":{"x":101,"y":604,"width":63,"height":11}},{"id":"e6ea0242-7c9a-4682-86c7-af09985b03c4","block_type":"box","text":"Other indirect GHG emissions. Scope 3 is an optional reporting category that allows for the treatment","page_number":226,"box":{"x":171,"y":604,"width":725,"height":11}},{"id":"f69b1c5f-47ea-461f-a9c6-bd69156c38d4","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":226,"box":{"x":69,"y":619,"width":803,"height":11}},{"id":"1e454be6-fd89-4a7a-ab82-104f2de124be","block_type":"box","text":"from sources not owned or controlled by the company.","page_number":226,"box":{"x":68,"y":634,"width":386,"height":11}},{"id":"c41a149f-a8e3-4f20-afc8-a7626f325d7b","block_type":"box","text":"31","page_number":226,"box":{"x":456,"y":635,"width":9,"height":4}},{"id":"5790b8a1-76fc-47e9-9737-0458f1e5951c","block_type":"box","text":"27","page_number":226,"box":{"x":69,"y":679,"width":8,"height":4}},{"id":"c9ee4fed-73bb-4723-8281-67cd95bd2da2","block_type":"box","text":"As defined by the International Financial Reporting Standards, “IFRS S2: Climate-related Disclosures,” June 2023..","page_number":226,"box":{"x":83,"y":679,"width":821,"height":11}},{"id":"3ab82ba4-305f-4a4e-bf4a-444e77b313a1","block_type":"box","text":"Several jurisdictions are basing their own transition plan disclosure frameworks on the IFRS S2 definition. We","page_number":226,"box":{"x":69,"y":694,"width":779,"height":11}},{"id":"cd75a9e9-1bb7-44e0-b141-6075e71bd169","block_type":"box","text":"anticipate transition plan disclosure becoming mandatory in an increasing number of jurisdictions over the near term.","page_number":226,"box":{"x":69,"y":709,"width":836,"height":11}},{"id":"32a1f316-ce4b-4d05-9630-f0237e0c9e0b","block_type":"box","text":"28","page_number":226,"box":{"x":69,"y":727,"width":9,"height":4}},{"id":"66623f58-868f-4974-83d0-fb0475c15143","block_type":"box","text":"As defined by the Science Based Targets initiative (SBTi). SBTi “is a corporate climate action organization that","page_number":226,"box":{"x":83,"y":726,"width":785,"height":12}},{"id":"ccf5c35b-97b0-44df-8a3e-abff1dae424b","block_type":"box","text":"enables companies and financial institutions worldwide to play their part in combating the climate crisis. We develop","page_number":226,"box":{"x":69,"y":742,"width":831,"height":11}},{"id":"fe7d0281-7ec4-4dcd-bc41-050e6d28a27e","block_type":"box","text":"standards, tools and guidance which allow companies to set greenhouse gas (GHG) emissions reductions targets in","page_number":226,"box":{"x":69,"y":757,"width":826,"height":11}},{"id":"4a343418-0eab-4712-98c3-d69dd50ab0a4","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":226,"box":{"x":70,"y":772,"width":795,"height":11}},{"id":"a3cec9b2-7728-4d4a-9b6d-bfef307d8756","block_type":"box","text":"Source: Science Based Targets initiative, “About Us.” Websites accessed in December 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