As filed with the Securities and Exchange Commission on February 27, 1998.
File No. 811-9098
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT
UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 3
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AMR INVESTMENT SERVICES TRUST
(Exact Name of Registrant as Specified in Charter)
4333 Amon Carter Boulevard
Fort Worth, Texas 76155
(Address of principal executive offices)
Registrant's Telephone Number, including Area Code: (817) 967-3509
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WILLIAM F. QUINN, PRESIDENT
4333 Amon Carter Boulevard
Fort Worth, Texas 76155
(Name and address of agent for service)
Copies to:
ROBERT J. ZUTZ, ESQ.
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W., 2nd Floor
Washington, D.C. 20036-1800
Telephone: (202) 778-9000
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EXPLANATORY NOTE
This Registration Statement is being filed by the Registrant pursuant to
Section 8(b) of the Investment Company Act of 1940, as amended. Beneficial
interests in the series of the Registrant are not being registered under the
Securities Act of 1933, as amended, because such interests are issued solely in
private placement transactions that do not involve any "public offering" within
the meaning of Section 4(2) of that act. Investments in the Registrant's series
may only be made by certain institutional investors, whether organized within or
without the United States (excluding individuals, S corporations, partnerships,
and grantor trusts beneficially owned by any individuals, S corporations, or
partnerships). This Registration Statement, as amended, does not constitute an
offer to sell, or the solicitation of an offer to buy, any beneficial interests
in any series of the Registrant.
The purpose of this amendment is to change the name of one series of the
Registrant, from the Limited-Term Income Portfolio to the Short-Term Bond
Portfolio, and to provide annual updated information with respect to the
Registrant.
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PART A
Responses to Items 1, 2, 3 and 5A have been omitted pursuant to paragraph
4 of Instruction F of the General Instructions to Form N-1A.
Responses to certain Items required to be included in Part A of this
Registration Statement are incorporated herein by reference to Post-Effective
Amendment No. 6 to the Registration Statement of American AAdvantage Mileage
Funds ("Mileage Trust") (1940 Act File No. 811-9018, EDGAR Accession No.
0000950134-98-001602), as filed with the Securities and Exchange Commission
("Commission") on February 27, 1998 ("Mileage Trust Registration Statement").
Part A of the Mileage Trust Registration Statement includes a joint prospectus
of American AAdvantage Balanced Mileage Fund, American AAdvantage Growth and
Income Mileage Fund, American AAdvantage International Equity Mileage Fund,
American AAdvantage S&P 500 Index Mileage Fund, American AAdvantage Intermediate
Bond Mileage Fund, American AAdvantage Short-Term Bond Mileage Fund, American
AAdvantage Money Market Mileage Fund, American AAdvantage Municipal Money Market
Mileage Fund and American AAdvantage U.S. Government Money Market Mileage Fund
(each a "Fund") (the "Feeder's Part A"). The American AAdvantage S&P 500 Index
Mileage Fund ("S&P Fund") does not invest in a corresponding portfolio of the
AMR Trust. Accordingly, information relating to the S&P Fund contained in the
Feeder's Part A is not incorporated by reference herein.
ITEM 4. GENERAL DESCRIPTION OF REGISTRANT.
AMR Investment Services Trust ("AMR Trust") is a diversified, open-end
management investment company that was organized as a New York common law trust
pursuant to a Declaration of Trust dated as of June 27, 1995, and amended as of
August 11, 1995.
Beneficial interests in AMR Trust are divided into eight separate
diversified subtrusts or "series," each having a distinct investment objective
and distinct investment policies. Seven of these series -- the Balanced
Portfolio, the Growth and Income Portfolio, the International Equity Portfolio,
the Short-Term Bond Portfolio (formerly, Limited-Term Income Portfolio), the
Money Market Portfolio, the Municipal Money Market Portfolio, and the U.S.
Government Money Market Portfolio (formerly, U.S. Treasury Money Market
Portfolio) (each a "Portfolio") commenced operations on November 1, 1995. The
Intermediate Bond Portfolio (also a "Portfolio") commenced operations on
September 15, 1997. The assets of each Portfolio belong only to that Portfolio,
and the assets belonging to a Portfolio shall be charged with the liabilities of
that Portfolio and all expenses, costs, charges and reserves attributable to
that Portfolio. AMR Trust is empowered to establish, without investor approval,
additional portfolios that may have different investment objectives and
policies.
Beneficial interests in the Portfolios will be offered solely in private
placement transactions that do not involve any "public offering" within the
meaning of Section 4(2) of the Securities Act of 1933, as amended ("1933 Act").
Investments in the Portfolios may only be made by certain institutional
investors, whether organized within or without the United States (excluding
individuals, S corporations, partnerships, and grantor trusts beneficially owned
by any individuals, S corporations, or partnerships). At no time during any
Portfolio's existence will it have more than 500 investors. This Registration
Statement, as amended, does not constitute an offer to sell, or the solicitation
of an offer to buy, any "security" within the meaning of the 1933 Act.
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AMR Investment Services, Inc. (the "Manager") provides investment
management and administrative services to the Portfolios. The assets of the
Balanced Portfolio, the Growth and Income Portfolio and the International Equity
Portfolio are allocated by the Manager among investment advisers designated for
each of those Portfolios. The assets of the Intermediate Bond Portfolio are
allocated by the Manager between the Manager and the investment adviser
designated for that Portfolio. Investment decisions for the Short-Term Bond
Portfolio, the Money Market Portfolio, the Municipal Money Market Portfolio and
the U.S. Government Money Market Portfolio are made directly by the Manager. See
Item 5 below. The Manager and each investment adviser have discretion to
purchase and sell portfolio securities within the respective portion of a
Portfolio's assets allocated to them in accordance with that Portfolio's
investment objective, policies and restrictions. Information on each Portfolio's
investment objective, policies, and risks is incorporated herein by reference
from the sections entitled "Investment Objective, Policies and Risks" and
"Investment Restrictions" in the Feeder's Part A. Additional investment
techniques, features, and limitations concerning each Portfolio's investment
programs are described in Part B of this Registration Statement.
ITEM 5. MANAGEMENT OF THE PORTFOLIOS.
TRUSTEES AND OFFICERS
The AMR Trustees have general supervisory responsibility over the AMR
Trust's affairs. See Item 14 of Part B for a complete description of the AMR
Trustees.
EXPENSES
AMR Trust is responsible for expenses not otherwise assumed by the
Manager, including the following expenses: audits by independent auditors;
transfer agency and custodian services; obtaining quotations for calculating the
value of each Portfolio's share price; taxes, if any, and the preparation of
each Portfolio's tax returns; brokerage fees and commissions; interest; costs of
AMR Trustees and investor meetings; fees for filing reports with regulatory
bodies and the maintenance of the AMR Trust's existence as a New York trust;
legal fees; fees and expenses of AMR Trustees (who are not directors, officers,
employees or stockholders of the Manager or its affiliates); insurance and
fidelity bond premiums; fees paid to consultants providing reports regarding
adherence by investment advisers to the investment style of a Portfolio; and any
extraordinary expenses of a nonrecurring nature.
OTHER INFORMATION
A further description of how the business of the AMR Trust is managed is
incorporated herein by reference from various sections of the Feeder's Part A.
The following list identifies the specific sections of the Feeder's Part A under
which the further information required by Item 5 of Form N-1A may be found; each
listed section is incorporated herein by reference.
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Item 5(b) Management and Administration of the Trusts; Investment
Advisers
Item 5(c) Investment Advisers
Item 5(d) Management and Administration of the Trusts
Item 5(e) Management and Administration of the Trusts - Custodian and
Transfer Agent
Item 5(g) Investment Objectives, Policies and Risks - Brokerage
Practices and Portfolio Turnover
ITEM 6. CAPITAL STOCK AND OTHER SECURITIES.
AMR Trust was organized as a common law trust under New York law on June
27, 1995. Under the Declaration of Trust, the AMR Trustees are authorized to
issue beneficial interests in separate subtrusts or "series" of AMR Trust. AMR
Trust currently has eight series. AMR Trust reserves the right to create and
issue additional series.
Each investor in a Portfolio is entitled to participate equally in the
Portfolio's earnings and assets and to a vote in proportion to the amount of its
investment in the Portfolio. Investment in a Portfolio may not be transferred,
but an investor may withdraw all or any portion of its investment at any time at
the next share price calculated after the Portfolio has received and accepted
the withdrawal request. Each investor in a Portfolio is liable for all
obligations of the Portfolio. However, because a Portfolio will indemnify each
investor therein with respect to any liability to which the investor may become
subject by reason of being such an investor, the risk of an investor in a
Portfolio incurring financial loss on account of such liability would be limited
to circumstances in which the Portfolio had inadequate insurance and was unable
to meet its obligations (including indemnification obligations) out of its
assets.
Investments in a Portfolio have no preemptive or conversion rights. Each
investor in a Portfolio is entitled to vote in proportion to its relative
beneficial interest in the Portfolio. A Portfolio normally will not hold
meetings of investors except as required under the 1940 Act. AMR Trust would be
required to hold a meeting of investors in the event that at any time less than
a majority of its AMR Trustees holding office had been elected by investors.
Investors holding a 10% interest in AMR Trust may call a meeting of investors
for the purpose of removing any AMR Trustee. An AMR Trustee may be removed upon
a majority vote of investors qualified to vote in the election. The 1940 Act
requires each Portfolio to assist investors in calling such a meeting.
As of the date of this Registration Statement, the American AAdvantage
Balanced Fund, American AAdvantage Growth and Income Fund, American AAdvantage
International Equity Fund, American AAdvantage Short-Term Bond Fund, American
AAdvantage Intermediate Bond Fund, American AAdvantage Money Market Fund,
American AAdvantage Municipal Money Market Fund and American AAdvantage U.S.
Government Money Market Fund each own a majority interest in its corresponding
Portfolio of the AMR Trust. However, each Fund has undertaken that, with respect
to most matters on which the AMR Trust seeks a vote of its interestholders, each
Fund will seek a vote of its shareholders and will vote its entire interest in
the AMR Trust or its corresponding Portfolio in proportion to the votes cast by
that Fund's shareholders.
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The price of each share ("share price") of the Balanced, Growth and
Income, International Equity, Short-Term Bond and Intermediate Bond Portfolios
are determined as of the close of the New York Stock Exchange (the "Exchange"),
generally 4:00 p.m. Eastern time, on each day the Exchange is open for trading,
which excludes the following business holidays: New Year's Day, Martin Luther
King's Birthday, President's Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day ("Business Day"). The share price
of the Money Market, Municipal Money Market and U.S. Government Money Market
Portfolios is determined as of the close of the Exchange, generally 4:00 p.m.
Eastern time, on each day the Exchange is open for business except for Columbus
Day and Veteran's Day ("Money Market Business Day"). The share price of each
investor's interest in a Portfolio will be determined by computing that
Portfolio's total assets, subtracting all of that Portfolio's liabilities, and
dividing the result by all the investors' beneficial interest in that Portfolio
outstanding at such time.
A Portfolio's net income consists of (1) all dividends, accrued interest
(including earned discount, both original issue and market discount), and other
income, including any net realized gains on the Portfolio's assets, less (2) all
actual and accrued expenses of the Portfolio, and amortization of any premium,
and net realized losses on the Portfolio's assets, all as determined in
accordance with generally accepted accounting principles. All of a Portfolio's
net income is allocated pro rata among the investors in that Portfolio. A
Portfolio's net income generally is not distributed to the investors in the
Portfolio, except as determined by the AMR Trustees from time to time, but
instead is included in the share price of the investors' respective beneficial
interests in that Portfolio.
Under the current method of the Portfolios' operations, no Portfolio is
subject to any income tax. However, each investor in a Portfolio is taxable on
its share (as determined in accordance with the AMR Trust's Declaration of Trust
and the Internal Revenue Code of 1986, as amended ("Code"), and the regulations
promulgated thereunder) of that Portfolio's ordinary income and capital gain.
The Manager intends to manage each Portfolio's assets, income and distributions
in such a way that an investment company investing in the Portfolio will be able
to satisfy the requirements of Subchapter M of the Code, assuming that the
investment company invested all of its assets in the Portfolio. See Item 20 in
Part B.
Investor inquiries may be directed to the Manager.
ITEM 7. PURCHASE OF SECURITIES.
Beneficial interests in the Portfolios are issued solely in private
placement transactions that do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. See Item 4, "General Description of
Registrant." Beneficial interests are purchased at the next share price
calculated after an investment is received and accepted.
Additional information on the time and method of valuation of the
Portfolios' assets is incorporated herein by reference from the section entitled
"Purchase, Redemption and Valuation of Shares -- Valuation of Shares" in the
Feeder's Part A.
There is no minimum initial or subsequent investment in a Portfolio.
However, since each Portfolio intends to be as fully invested at all times as is
reasonably practicable in order to enhance the return on its assets, investments
must be made in federal funds (I.E., monies credited to the account of the AMR
Trust's custodian by a Federal Reserve Bank).
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AMR Trust reserves the right to cease accepting investments in a Portfolio
at any time or to reject any investment order.
ITEM 8. REDEMPTION OR REPURCHASE.
An investor in any Portfolio may withdraw all or any portion of its
investment in the Portfolio at the share price next calculated after the
applicable Portfolio has received and accepted the redemption request. Proceeds
of a withdrawal will be paid by the Portfolio in federal funds normally on the
Business Day the withdrawal is effected, but in any event within seven days,
except as extension may be permitted by law.
The right of any investor to receive payment with respect to any
withdrawal may be suspended, or the payment of the withdrawal proceeds
postponed, during any period in which the Exchange is closed (other than
weekends or holidays) or trading on the Exchange is restricted or to the extent
otherwise permitted by the 1940 Act.
ITEM 9. PENDING LEGAL PROCEEDINGS.
Not applicable.
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PART B
ITEM 10. COVER PAGE.
Part A contains information about the investment objective and policies of
the Balanced Portfolio, the Growth and Income Portfolio, the Short-Term Bond
Portfolio (formerly, Limited-Term Income Portfolio), the International Equity
Portfolio, the Intermediate Bond Portfolio, the Money Market Portfolio, the
Municipal Money Market Portfolio and the U.S. Government Money Market Portfolio
(formerly, U.S. Treasury Money Market Portfolio) (individually, "Portfolio";
collectively, "Portfolios"), each a subtrust or "series" of the AMR Investment
Services Trust ("AMR Trust"). This Part B should only be read in conjunction
with Part A. This section contains supplemental information concerning the
investment policies and portfolio strategies that AMR Trust may utilize, the
types of securities and other instruments in which the Portfolios may invest and
certain risks attendant to those investment policies and strategies. Capitalized
terms used in Part B and not otherwise defined herein have the meanings given
them in Part A of this Registration Statement.
Responses to certain Items required to be included in Part B of this
Registration Statement are incorporated herein by reference to the Mileage Trust
Registration Statement. Part B of the Mileage Trust Registration Statement
includes the joint statement of additional information ("SAI") for the American
AAdvantage Balanced Mileage Fund, the American AAdvantage Growth and Income
Mileage Fund, the American AAdvantage International Equity Mileage Fund, the
American AAdvantage Intermediate Bond Mileage Fund, the American AAdvantage S&P
500 Index Mileage Fund, the American AAdvantage Short-Term Bond Mileage Fund,
the American AAdvantage Money Market Mileage Fund, the American AAdvantage
Municipal Money Market Mileage Fund and the American AAdvantage U.S. Government
Money Market Mileage Fund (each a "Fund") (the "Feeder's Part B"). The American
AAdvantage S&P 500 Index Mileage Fund ("S&P Fund") does not invest in a
corresponding portfolio of the AMR Trust. Accordingly, information relating to
the S&P Fund contained in the Feeder's Part B is not incorporated by reference
herein.
ITEM 11. TABLE OF CONTENTS.
PAGE
General Information and History......................................B-1
Investment Objective and Policies....................................B-2
Management of the Portfolios.........................................B-2
Control Persons and Principal Holders of Securities..................B-2
Investment Advisory and Other Services...............................B-3
Brokerage Allocation and Other Practices.............................B-4
Capital Stock and Other Securities...................................B-4
Purchase, Redemption and Pricing of Interests........................B-5
Tax Status...........................................................B-5
Underwriters.........................................................B-5
Calculation of Performance Data......................................B-5
Financial Statements.................................................B-5
ITEM 12. GENERAL INFORMATION AND HISTORY.
Prior to March 1, 1997, the name of the U.S. Government Money Market
Portfolio was "U.S. Treasury Money Market Portfolio." Prior to March 1,
1998, the name of the Short-Term Bond Portfolio was "Limited-Term Income
Portfolio."
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ITEM 13. INVESTMENT OBJECTIVE AND POLICIES.
Part A contains basic information about the investment objective, policies
and limitations of each Portfolio. This section supplements the discussion in
Part A of the investment objective, policies and limitations of each Portfolio.
Information on the fundamental investment limitations and the
non-fundamental investment policies and limitations of each Portfolio, the types
of securities bought and investment techniques used by each Portfolio, and
certain risks attendant thereto, as well as other information on the Portfolios'
investment program, is incorporated herein by reference to the sections entitled
"Investment Restrictions" in the Feeder's Part A and "Investment Restrictions",
"Approach to Stock Selection" and "Other Information" in the Feeder's Part B.
ITEM 14. MANAGEMENT OF THE PORTFOLIOS.
The AMR Trustees provide broad supervision over AMR Trust's affairs. The
Manager is responsible for the management of Trust assets, and AMR Trust's
officers are responsible for the Trust's operations. Information about the
Trustees and officers of AMR Trust is incorporated herein by reference to the
section entitled "Trustees and Officers of the Trust and the AMR Trust" in the
Feeder's Part B.
As compensation for their service to the AMR Trust, each AMR Trustee who
is not an "interested" person of AMR Trust as defined by the 1940 Act
("Independent Trustee") and their spouses receive free air travel from American
Airlines, Inc., an affiliate of the Manager. AMR Trust does not pay for these
travel arrangements. However, AMR Trust compensates each Trustee with payments
in an amount equal to the Trustees' income tax on the value of this free airline
travel. Mr. O'Sullivan, whom as a retiree of American Airlines, Inc. already
receives free airline travel, receives compensation annually of up to three
round trip airline tickets for each of his three adult children. Trustees are
also reimbursed for any expenses incurred in attending Board meetings.
ITEM 15. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES.
As of January 31, 1998, each Portfolio could be deemed to be under the
control of its corresponding series of the American AAdvantage Funds
("AAdvantage Trust"), feeder funds that invest all of their investable assets in
the AMR Trust. As of that date, the following series of the AAdvantage Trust
owned the indicated value of the outstanding interests in their corresponding
Portfolios: American AAdvantage Balanced Fund owned 100% of the value of the
outstanding interests in the Balanced Portfolio, the American AAdvantage Growth
and Income Fund owned 99% of the value of the outstanding interests in the
Growth and Income Portfolio, the American AAdvantage International Equity Fund
owned 94% of the value of the outstanding interests in the International Equity
Portfolio, the American AAdvantage Intermediate Bond Fund owned 100% of the
value of the outstanding interests in the Intermediate Bond Portfolio, the
American AAdvantage Short-Term Bond Fund owned 99% of the value of the
outstanding interests in the Short-Term Bond Portfolio, the American AAdvantage
Money Market Fund owned 92% of the value of the outstanding interests in the
Money Market Portfolio, the American AAdvantage Municipal Money Market Fund
owned 75% of the value of the outstanding interests in the Municipal Money
Market Portfolio and the American AAdvantage U.S. Government Money Market Fund
owned 77% of the value of the outstanding interests in the U.S. Government Money
Market Portfolio.
As of January 31, 1998, the following series of the Mileage Trust owned
the indicated value of the outstanding interests in their corresponding
Portfolios: the American AAdvantage Money Market Mileage Fund owned 8% of the
value of the outstanding interests in the Money Market Portfolio, the American
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AAdvantage Municipal Money Market Mileage Fund owned 25% of the value of the
outstanding interests in the Municipal Money Market Portfolio and the American
AAdvantage U.S. Government Money Market Mileage Fund owned 23% of the value of
the outstanding interests in the U.S. Government Money Market Portfolio.
The address of each of the above-described control persons or principal
holders of securities is 4333 Amon Carter Boulevard, MD 5645, Fort Worth, Texas
76155.
In addition, as of January 31, 1998, the INTRUST Funds Trust --
International Multi-Manager Stock Fund, 3435 Stelzer Road, Columbus, Ohio 43219,
owned 5% of the value of the outstanding interests in the International Equity
Portfolio.
So long as a Fund owns more than 50% of the value of the outstanding
interests in its corresponding Portfolio, the Fund may require the Portfolio to
take certain actions without the approval of any other registered investment
company that invests in the Portfolio. However, where the action requires a vote
of the Portfolio's interestholders, the power of the Fund to control such action
may depend on the vote of the Fund's shareholders.
The AAdvantage Trust and the Mileage Trust have informed the AMR Trust
that, in most cases where a Fund is requested to vote on matters pertaining to
its corresponding Portfolio, the Fund will solicit proxies from its shareholders
and will vote its entire interest in the Portfolio in proportion to the votes
cast by the Fund's shareholders. It is anticipated that any other registered
investment company investing in a Portfolio will follow the same or a similar
practice.
ITEM 16. INVESTMENT ADVISORY AND OTHER SERVICES.
The Manager serves as investment manager and administrator to AMR Trust
pursuant to a Management Agreement dated October 1, 1995, which obligates the
Manager to provide and oversee all administrative, investment advisory and
portfolio management services for AMR Trust.
As described more fully in Item 5 in Part A, the Manager is paid a
management fee as compensation for providing or overseeing the provision of all
administrative, investment advisory and portfolio management services for AMR
Trust. The Manager allocates the assets of the Balanced Portfolio, the Growth
and Income Portfolio and the International Equity Portfolio among investment
advisers designated for each of those Portfolios. The Manager allocates the
assets of the Intermediate Bond Portfolio between itself and the investment
adviser designated for that Portfolio. Investment decisions for the Short-Term
Bond Portfolio, the Money Market Portfolio, the Municipal Money Market Portfolio
and the U.S. Government Money Market Portfolio are made directly by the Manager.
See Item 5 in Part A.
State Street Bank & Trust Company ("State Street"), Boston, Massachusetts,
serves as the custodian and transfer agent for AMR Trust.
Ernst & Young LLP, Dallas, Texas, serves as the independent auditor of AMR
Trust.
Further information on the investment management and other services
provided for or on behalf of each Portfolio is incorporated herein by reference
to the sections entitled "Management, Administrative Services and Distribution
Fees," and "Investment Advisory Agreements" in the Feeder's Part B. The
following list identifies the specific sections in the Feeder's Part B under
which the information required by Item 16 of Form N-1A may be found; each listed
section is incorporated herein by reference.
Item 16(a) Management, Administrative Services and Distribution Fees;
Investment Advisory Agreements
Item 16(b) Management, Administrative Services and Distribution Fees;
Investment Advisory Agreements
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Item 16(c) Not applicable
Item 16(d) Not applicable
Item 16(e) Not applicable
Item 16(f) Not applicable
Item 16(g) Not applicable
Item 16(i) Not applicable
The total management fee paid to the Manager under the Management
Agreement for the fiscal year ended October 31, 1997 was $13,730,443, of which
approximately $7,061,014 was paid by the Manager to the other investment
advisers. Fees in the amount of approximately $7,309 were waived by the Manager.
ITEM 17. BROKERAGE ALLOCATION AND OTHER PRACTICES.
A description of the Portfolio's brokerage allocation and other practices
is incorporated herein by reference to the section entitled "Portfolio
Securities Transactions" in the Feeder's Part B.
ITEM 18. CAPITAL STOCK AND OTHER SECURITIES.
Each investor in a Portfolio is entitled to a vote in proportion to the
amount of its investment therein. Investors in a Portfolio will vote together in
certain circumstances (e.g., election of AMR Trustees and ratification of the
selection of auditors, as required by the 1940 Act and the rules thereunder).
One or more of the Portfolios in AMR Trust could control the outcome of these
votes. Investors do not have cumulative voting rights, and investors holding
more than 50% of the aggregate beneficial interests in AMR Trust or in a
Portfolio, as the case may be, may control the outcome of votes. The Trust is
not required and does not currently intend to hold annual meetings of investors,
but the Trust will hold special meetings of investors when a majority of AMR
Trustees determines to do so or investors holding at least 10% of the interests
in the Trust (or a Portfolio) request in writing a meeting of investors in AMR
Trust (or Portfolio).
The Trust or any series may enter into a merger or consolidation, or sell
all or substantially all of its assets, if approved by the AMR Trustees. A
Portfolio may be terminated (1) upon liquidation and distribution of its assets,
(2) if approved by the vote of at least two-thirds of its investors, or (3) by
the AMR Trustees on written notice to the Portfolio's investors.
AMR Trust is organized as a common law trust under the laws of the State
of New York. Investors in a Portfolio may be held personally liable for its
obligations and liabilities, subject, however, to indemnification by the Trust
in the event that there is imposed upon an investor a greater portion of the
liabilities and obligations than its proportionate beneficial interest. The
Declaration of Trust also provides that AMR Trust shall maintain appropriate
insurance for the protection of each Portfolio, investors, AMR Trustees,
officers, employees, and agents covering possible tort and other liabilities.
Thus, the risk of an investor incurring financial loss on account of such
liability is limited to circumstances in which a Portfolio had inadequate
insurance and was unable to meet its obligations out of its assets.
The Declaration of Trust further provides that obligations of a Portfolio
are not binding upon the AMR Trustees individually but only upon the property of
that Portfolio and the AMR Trustees will not be liable for any action or failure
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to act, but nothing in the Declaration of Trust protects a Trustee against any
liability to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence, or reckless disregard of the duties
involved in the conduct of his office.
Upon liquidation or dissolution of any Portfolio, the investors therein
would be entitled to share pro rata in its net assets available for distribution
to investors.
ITEM 19. PURCHASE, REDEMPTION AND PRICING OF INTERESTS.
Beneficial interests in the Portfolios will be issued solely in private
placement transactions that do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. See Items 4, 7 and 8 in Part A.
The share price of each Portfolio is computed each Business Day or Money
Market Business Day, as applicable, (defined in Item 7 in Part A) on which
shares are offered and orders accepted or upon receipt of a redemption request
as outlined in Part A.
It is the policy of the Money Market Portfolio, the Municipal Money Market
Portfolio and the U.S. Government Money Market Portfolio to attempt to maintain
a constant price per share of $1.00. There can be no assurance that a $1.00 net
asset value per share will be maintained. These Portfolios' investment
securities are valued based on the amortized cost valuation technique pursuant
to Rule 2a-7 under the 1940 Act. This technique involves valuing an instrument
at its cost and thereafter assuming a constant amortization to maturity of any
discount or premium, even though the portfolio security may increase or decrease
in market value. Such market fluctuations are generally in response to changes
in interest rates. Use of the amortized cost valuation method requires these
Portfolios to purchase instruments having remaining maturities of 397 days or
less, to maintain a dollar weighted average portfolio maturity of 90 days or
less, and to invest only in securities determined by the AMR Trustees to be of
high quality with minimal credit risk.
ITEM 20. TAX STATUS.
Information on the taxation of the Portfolios is incorporated herein by
reference from the section entitled "Tax Information - Taxation of the
Portfolios" in the Feeder's Part B, substituting for "Fund" whenever used
therein either "investor in a Portfolio" or "RIC investor" (i.e., an investor in
a Portfolio that intends to qualify as a regulated investment company ("RIC")
for federal income tax purposes), as the context requires.
ITEM 21. UNDERWRITERS.
Not applicable.
ITEM 22. CALCULATIONS OF PERFORMANCE DATA.
Not applicable.
ITEM 23. FINANCIAL STATEMENTS.
The audited financial statements for seven of the Portfolios for the
fiscal year ended October 31, 1997, the audited financial statements of the
Intermediate Bond Portfolio for the period from September 15, 1997 to October
31, 1997, and the reports of Ernst & Young LLP, independent auditors, with
respect to such audited financial statements of each Portfolio are incorporated
by reference to the American AAdvantage Funds' Annual Report to Shareholders for
the period ended October 31, 1997, File Nos. 33-11387 and 811-4984, EDGAR
Accession No. 0000950134-97-009599, as filed with Securities and Exchange
Commission on December 30, 1997.
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PART C
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements included as a part of this Registration
Statement:
Audited financial statements for the fiscal year ended October 31,
1997 for seven series of the AMR Investment Services Trust the
Balanced Portfolio, the Growth and Income Portfolio, the
International Equity Portfolio, the Short-Term Bond Portfolio, the
Money Market Portfolio, the Municipal Money Market Portfolio and the
U.S. Government Money Market Portfolio - and audited financial
statements for the Intermediate Bond Portfolio for the period
September 15, 1997 to October 31, 1997 are incorporated into Part B
by reference to the Annual Report to Shareholders of American
AAdvantage Funds for the period ended October 31, 1997, File Nos.
33-11387 and 811-4984, EDGAR Accession No. 0000950134-97-009599, as
filed with the Securities and Exchange Commission ("Commission")on
December 30, 1997.
(b) Exhibits:
(1) Amended and Restated Declaration of Trust*
(2) Bylaws -- none
(3) Voting trust agreement -- none
(4) Certificate of Interest Holder -- none
(5) (a) (i) Management Agreement with AMR Investment
Services, Inc.**
(ii) Supplemental Terms and Conditions to Management
Agreement with AMR Investment Services, Inc. A
substantially similar copy of which was filed as Exhibit
5(a) with the Post-Effective Amendment No. 4 to
Registration Statement of American AAdvantage Funds, File
Nos. 33-91058 and 811-9018, EDGAR Accession No.
0000950134-97-001003, and is incorporated by reference.
(This document differs only with respect to the names of
the parties.)
(iii) Supplemental Terms and Conditions to Management
Agreement with AMR Investment Services, Inc. A
substantially similar copy of which was filed as Exhibit
5(a) with the Post-Effective Amendment No. 20 to
Registration Statement of American AAdvantage Funds, File
Nos. 33-11387 and 811-4984, EDGAR Accession No.
0000809593-97-000034, and is incorporated by reference.
(This document differs only with respect to the names of
the parties.)
(b) (i) Investment Advisory Agreements with Subadvisers*
(ii) Investment Advisory Agreement with Hotchkis and
Wiley. A substantially similar copy of which was filed as
Exhibit 5(b) with the Post-Effective Amendment No. 4 to
Registration Statement of American AAdvantage Funds, File
Nos. 33-91058 and 811-9018, EDGAR Accession No.
0000950134-97-001003, and is incorporated by reference.
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<PAGE>
(This document differs only with respect to the names of
the parties and does not contain a statement that to the
extent a Fund invests all of its investable assets in
another investment company, no portion of the advisory
fee attributable to that Fund shall be paid for the
period that such Fund's assets are so invested.)
(iii) Investment Advisory Agreement with Brandywine Asset
Management, Inc. A substantially similar copy of which
was filed as Exhibit 5(b) with the Post-Effective
Amendment No. 6 to Registration Statement of American
AAdvantage Mileage Funds, File Nos. 33-91058 and
811-9018, EDGAR Accession No. 0000950134-98-001602, as
filed with the Commission on February 27, 1998, and is
incorporated by reference. (This document differs only
with respect to the names of the parties and does not
contain a statement that to the extent a Fund invests all
of its investable assets in another investment company,
no portion of the advisory fee attributable to that Fund
shall be paid for the period that such Fund's assets are
so invested.)
(6) Distribution Agreement -- none
(7) Bonus, profit sharing or pension plans -- none
(8) Custodian Agreement with State Street Bank & Trust Company. A
substantially similar copy of which was filed as Exhibit 8
with the Post-Effective Amendment No. 6 to Registration
Statement of American AAdvantage Mileage Funds, File Nos.
33-91058 and 811-9018, EDGAR Accession No.
0000950134-98-001602, as filed with the Commission on February
27, 1998, and is incorporated by reference. (This document
differs only with respect to the names of the parties.)
(9) (a) Transfer Agency Agreement with State Street Bank & Trust
Company. A substantially similar copy of which was filed
as Exhibit 9(a) with the Post-Effective Amendment No. 6
to Registration Statement of American AAdvantage Mileage
Funds, File Nos. 33-91058 and 811-9018, EDGAR Accession
No. 0000950134-98-001602, as filed with the Commission
on February 27, 1998, and is incorporated by reference.
(This document differs only with respect to the names of
the parties.)
(b) Securities Lending Authorization Agreement with State
Street Bank & Trust Company. A substantially similar
copy of which was filed as Exhibit 9(b) with the
Post-Effective Amendment No. 6 to Registration Statement
of American AAdvantage Mileage Funds, File Nos. 33-91058
and 811-9018, EDGAR Accession No. 0000950134-98-001602,
as filed with the Commission on February 27, 1998, and
is incorporated by reference. (This document differs
only with respect to the names of the parties.)
(10) Opinion and consent of counsel -- not applicable
(11) Consent of Independent Auditors - not applicable
(12) Financial statements omitted from prospectus -- none
(13) Letter of investment intent -- none
(14) Prototype retirement plan -- none
(15) Plan pursuant to Rule 12b-1 -- none
(16) Schedule for Computation of Performance Quotations -- not
applicable
(17) Financial Data Schedules -- none
(18) Plan pursuant to Rule 18f-3 - none
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<PAGE>
* Incorporated by reference to the initial Registration Statement of the
Registrant on Form N-1A as filed with the Securities and Exchange
Commission on September 29, 1995.
** Incorporated by reference to the Post-Effective Amendment No. 1 to the
Registration Statement of the Registrant on Form N-1A as filed with the
Securities and Exchange Commission on February 28, 1997 via EDGAR,
Accession No. 0000898432-97-000184.
ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
No person is controlled by or under common control with the Registrant.
ITEM 26. NUMBER OF HOLDERS OF SECURITIES
Number of Record Holders
Portfolio As Of January 31, 1998
--------- ----- ------- --------
Balanced Portfolio 4
Growth and Income 4
Portfolio
Limited-Term Income 4
Portfolio
International Equity 6
Portfolio
Money Market Portfolio 4
Municipal Money Market 4
Portfolio
U.S. Government Money 4
Market Portfolio
Intermediate Bond Portfolio 2
ITEM 27. INDEMNIFICATION
Article VI, Section 6.4 of the Declaration of Trust of the AMR Trust
provides that:
The Trust shall indemnify, to the fullest extent permitted by law
(including the 1940 Act), each Trustee, officer or employee of the Trust
(including any Person who serves at the Trust's request as a director, officer
or trustee of another organization in which the Trust has any interest as a
shareholder, creditor or otherwise) against all liabilities and expenses
(including amounts paid in satisfaction of judgments, in compromise, as fines
and penalties, and as counsel fees) reasonably incurred by such Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, in which such Person may be involved or
with which such Person may be threatened, while in office or thereafter, by
reason of such Person being or having been such a Trustee, officer or employee,
except with respect to any matter as to which such Person shall have been
adjudicated to have acted in bad faith, willful misfeasance, gross negligence or
reckless disregard of such Person's duties; provided, however, that as to any
matter disposed of by a compromise payment by such Person, pursuant to a consent
decree or otherwise, no indemnification either for such payment or for any other
expenses shall be provided unless there has been a determination that such
Person did not engage in willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of such Person's office
(a) by the court or other body approving the settlement or other disposition;
(b) by a reasonable determination, based upon a review of readily available
facts as opposed to a full trial-type inquiry), that such Person did not engage
in such conduct by written opinion from independent legal counsel approved by
the Trustees; or (c) by a majority of the Trustees who are neither Interested
Persons of the Trust nor parties to the matter based upon a review of readily
available facts (as opposed to a full trial-type inquiry). The rights accruing
to any Person under these provisions shall not exclude any other right to which
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<PAGE>
such Person may be lawfully entitled; provided that no Person may satisfy any
right of indemnity or reimbursement granted in this Section 6.4 or in Section
6.2 hereof or to which such Person may be otherwise entitled except out of the
Trust Property.
According to Article VI, Section 6.5 of the Declaration of Trust, the
Trustees may make advance payments in connection with indemnification under
Section 6.4, provided that the following conditions are satisfied: (i) the
advances must be limited to amounts used, or to be used, for the preparation or
presentation of a defense to the action, including costs connected with the
preparation of a settlement; (ii) advances may be made only upon receipt of a
written promise by, or on behalf of, the recipient to repay the amount of the
advance which exceeds the amount which it is ultimately determined that he is
entitled to receive from the Trust by reason of indemnification; and (iii) (a)
such promise must be secured by a surety bond, other suitable insurance or an
equivalent form of security which assures that any repayment may be obtained by
the Trust without delay or litigation, which bond, insurance or other form of
security must be provided by the recipient of the advance, or (b) a majority of
a quorum of the Trust's disinterested, non-party Trustees, or an independent
legal counsel in a written opinion, shall determine, based upon a review of
readily available facts (as opposed to a trial-type inquiry or full
investigation), that there is reason to believe that the recipient of the
advance ultimately will not be disqualified from indemnification under Section
6.4.
Section 8 of the Management Agreement between the Registrant and AMR
Investment Services, Inc. ("Manager") provides that the Manager shall not be
liable for any error of judgment or mistake of law or for any loss suffered by
the Registrant or any portfolio in connection with the matters to which the
Management Agreement relate except a loss resulting from the willful
misfeasance, bad faith or gross negligence on its part in the performance of its
duties or from reckless disregard by it of its obligations and duties under the
Management Agreement.
Section 8 of each Advisory Agreement between the Manager and each
Portfolio's investment subadviser ("Subadviser") states that no provision of the
Advisory Agreement shall be deemed to protect the Subadviser against any
liability to the Registrant or its shareholders to which it might otherwise be
subject by reason of any willful misfeasance, bad faith, or gross negligence in
the performance of its duties or the reckless disregard of its obligations under
an Advisory Agreement.
ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT MANAGER AND
INVESTMENT SUBADVISER
Information as to any other business, profession, vocation or employment
of a substantial nature in which each director or officer of the Manager and
each principal of a Subadviser is, or at any time during the past two years has
been, engaged for his or her own account or in the capacity of director,
officer, employee, partner or trustee is incorporated herein by reference from
Item 28 in Part C of the Post-Effective Amendment No. 23 to the Registration
Statement on Form N-1A of American AAdvantage Funds (1940 Act File No. 811-4984,
EDGAR Accession No. 0000950134-97-009393), as filed with the Commission on
December 18, 1997.
ITEM 29. PRINCIPAL UNDERWRITER
Not applicable.
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
The books and other documents required by Rule 31a-1 under the Investment
Company Act of 1940 are maintained in the physical possession of the AMR Trust's
custodian, Manager, transfer agent or investment advisers.
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<PAGE>
ITEM 31. MANAGEMENT SERVICES
Other than as set forth in Parts A and B of this Registration Statement,
the Registrant is not a party to any management-related service contract.
ITEM 32. UNDERTAKINGS
None.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Investment Company Act of 1940, as
amended, the Registrant has duly caused this Amendment No. 3 to its Registration
Statement on Form N-1A to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Fort Worth and the State of Texas on February
27, 1998.
AMR INVESTMENT SERVICES TRUST
/s/ William F. Quinn
--------------------
By: William F. Quinn
President
<PAGE>
AMR INVESTMENT SERVICES TRUST
REGISTRATION STATEMENT ON FORM N-1A
INDEX TO EXHIBITS
Exhibit
Number Description Page
- ------ ----------- ----
1 Amended and Restated Declaration of Trust*
2 Bylaws -- none N.A.
3 Voting trust agreement -- none N.A.
4 Certificate of Interest Holder -- none N.A.
5 (a) (i) Management Agreement with AMR Investment
Services, Inc.**
(ii) Supplemental Terms and Conditions to Management
Agreement with AMR Investment Services, Inc. A
substantially similar copy of which was filed as Exhibit
5(a) with the Post-Effective Amendment No. 4 to
Registration Statement of American AAdvantage Funds, File
Nos. 33-91058 and 811-9018, EDGAR Accession No.
0000950134-97-001003, and is incorporated by reference.
(This document differs only with respect to the names of
the parties.)
(iii) Supplemental Terms and Conditions to Management
Agreement with AMR Investment Services, Inc. A
substantially similar copy of which was filed as Exhibit
5(a) with the Post-Effective Amendment No. 20 to
Registration Statement of American AAdvantage Funds, File
Nos. 33-11387 and 811-4984, EDGAR Accession No.
0000809593-97-000034, and is incorporated by reference.
(This document differs only with respect to the names of
the parties.)
(b) (i) Investment Advisory Agreements with Subadvisers*
(ii) Investment Advisory Agreement with Hotchkis and
Wiley. A substantially similar copy of which was filed as
Exhibit 5(b) with the Post-Effective Amendment No. 4 to
Registration Statement of American AAdvantage Funds, File
Nos. 33-91058 and 811-9018, EDGAR Accession No.
0000950134-97-001003, and is incorporated by reference.
(This document differs only with respect to the names of
the parties and does not contain a statement that to the
extent a Fund invests all of its investable assets in
another investment company, no portion of the advisory fee
attributable to that Fund shall be paid for the period
that such Fund's assets are so invested.)
(iii) Investment Advisory Agreement with Brandywine Asset
Management, Inc. A substantially similar copy of which was
filed as Exhibit 5(b) with the Post-Effective Amendment
No. 6 to Registration Statement of American AAdvantage
Mileage Funds, File Nos. 33-91058 and 811-9018, EDGAR
Accession No. 0000950134-98-001602, as filed with the
Commission on February 27, 1998, and is incorporated by
reference. (This document differs only with respect to the
names of the parties and does not contain a statement that
to the extent a Fund invests all of its investable assets
in another investment company, no portion of the advisory
fee attributable to that Fund shall be paid for the period
that such Fund's assets are so invested.)
6 Distribution Agreement - none N.A.
7 Bonus, profit sharing or pension plans - none N.A.
<PAGE>
8 Custodian Agreement with State Street Bank & Trust
Company. A substantially similar copy of which was filed
as Exhibit 8 with the Post-Effective Amendment No. 6 to
Registration Statement of American AAdvantage Mileage
Funds, File Nos. 33-91058 and 811-9018, EDGAR Accession
No. 0000950134-98-001602, as filed with the Commission on
February 27, 1998, and is incorporated by reference. (This
document differs only with respect to the names of the
parties.)
9 (a) Transfer Agency Agreement with State Street Bank & Trust
Company. A substantially similar copy of which was filed
as Exhibit 9(a) with the Post-Effective Amendment No. 6 to
Registration Statement of American AAdvantage Mileage
Funds, File Nos. 33-91058 and 811-9018, EDGAR Accession
No. 0000950134-98-001602, as filed with the Commission on
February 27, 1998, and is incorporated by reference. (This
document differs only with respect to the names of the
parties.)
(b) Securities Lending Authorization Agreement with State
Street Bank & Trust Company. A substantially similar copy
of which was filed as Exhibit 9(b) with the Post-Effective
Amendment No. 6 to Registration Statement of American
AAdvantage Mileage Funds, File Nos. 33-91058 and 811-9018,
EDGAR Accession No. 0000950134-98-001602, as filed with
the Commission on February 27, 1998, and is incorporated
by reference. (This document differs only with respect to
the names of the parties.)
10 Opinion and consent of counsel -- not applicable N.A.
11 Consent of Independent Auditors - not applicable N.A.
12 Financial statements omitted from prospectus - none N.A.
13 Letter of investment intent - none N.A.
14 Prototype retirement plan - none N.A.
15 Plan pursuant to Rule 12b-1 - none N.A.
16 Schedule for Computation of Performance Quotations -- not
applicable N.A.
17 Financial Data Schedules - none N.A.
18 Plan pursuant to Rule 18f-3 - none N.A.
* Incorporated by reference to the initial Registration Statement of the
Registrant on Form N-1A as filed with the Securities and Exchange
Commission on September 29, 1995.
** Incorporated by reference to the Post-Effective Amendment No.1 to the
initial Registration Statement of the Registrant on Form N-1A as filed
with the Securities and Exchange Commission on February 28, 1997 via
EDGAR, Accession No. 0000898432-97-000184.
