<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 28, 2000
1933 Act File No. 033-63493
1940 Act File No. 811-07367
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
[ ] Pre-Effective Amendment No.
[X] Post-Effective Amendment No. 8
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
[ ] Amendment No. 9
(Check appropriate box or boxes)
BERGER INSTITUTIONAL PRODUCTS TRUST
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
210 University Boulevard, Suite 900, Denver, Colorado 80206
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (303) 329-0200
----------------------------
Jack R. Thompson, 210 University Boulevard, Suite 900, Denver, CO 80206
- --------------------------------------------------------------------------------
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering: As soon as practicable after this
post-effective amendment becomes effective.
It is proposed that this filing will become effective: (check appropriate box)
[ ] immediately upon filing pursuant to paragraph (b)
[X] on May 1, 2000 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on May 1, 1999, pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] on (date) pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
[ ] this post-effective amendment designates a new effective date
for a previously filed post-effective amendment.
Title of Securities Being Registered Shares of Beneficial Interest of the Berger
IPT - Growth Fund, the Berger IPT - Growth and Income Fund, the Berger IPT -
Small Company Growth Fund, the Berger/BIAM IPT - International Fund and the
Berger IPT - New Generation Fund
<PAGE> 2
EXPLANATORY NOTE
This amendment to the Registration Statement of the Berger
Institutional Products Trust (the "Trust") contains the following:
One Prospectus for the Berger IPT - Growth Fund, Berger IPT - Growth and Income
Fund, Berger IPT - Small Company Growth Fund, Berger/BIAM IPT - International
Fund and Berger IPT - New Generation Fund, being all the series currently in
existence in the Trust.
One Statement of Additional Information for the Berger IPT - Growth Fund, Berger
IPT - Growth and Income Fund, Berger IPT - Small Company Growth Fund,
Berger/BIAM IPT - International Fund and Berger IPT - New Generation Fund, being
all the series currently in existence in the Trust.
One Part C
<PAGE> 3
May 1, 2000
Berger IPT Funds
Prospectus
[BERGER FUNDS LOGO]
BERGER IPT - NEW GENERATION FUND
BERGER IPT - SMALL COMPANY GROWTH FUND
BERGER IPT - GROWTH FUND
BERGER/BIAM IPT - INTERNATIONAL FUND
BERGER IPT - GROWTH AND INCOME FUND
The Securities and Exchange Commission has not approved or disapproved any
shares offered in this prospectus or determined whether this prospectus is
accurate or complete. Anyone who tells you otherwise is committing a crime.
Like all mutual funds, an investment in the Berger IPT Funds is not a bank
deposit and is not insured or guaranteed by the FDIC or any other government
agency. There is no guarantee that the Funds will meet their investment goals,
and although you have the potential to make money, you could also lose money in
the Funds.
<PAGE> 4
Berger IPT - Small Company Growth Fund, Berger IPT - Growth and Income Fund and
the Berger Mountain logo are registered trademarks of Berger LLC; Berger IPT -
New Generation Fund, Berger/BIAM IPT - International Fund and Berger IPT -
Growth Fund are trademarks of Berger LLC; and other marks referred to herein are
the trademarks or registered trademarks of the respective owners thereof.
<PAGE> 5
CONTENTS
The BERGER IPT FUNDS are no-load mutual funds. A mutual fund pools money from
shareholders and invests in a portfolio of securities. Each of the following
sections introduces a Fund, its goal(s), principal investment strategies and
principal risks. They also contain expense and performance information.
<TABLE>
<S> <C>
Berger IPT - New Generation Fund(TM) 4
Berger IPT - Small Company Growth Fund(R) 6
Berger IPT- Growth Fund(TM) 8
Berger/BIAM IPT - International Fund(TM) 10
Berger IPT - Growth and Income Fund(R) 12
Investment Techniques, Securities and Associated Risks 14
Risk and Investment Table 15
Risk and Investment Glossary 16
Buying and Selling (Redeeming) Shares 18
Fund Share Price 18
Other Information 18
Distributions and Taxes 19
Organization of the Funds 20
Investment Managers 20
Financial Highlights 24
Berger IPT - New Generation Fund 24
Berger IPT - Small Company Growth Fund 24
Berger IPT- Growth Fund 25
Berger/BIAM IPT - International Fund 26
Berger IPT - Growth and Income Fund 27
</TABLE>
You may not invest in shares of the Funds directly. You may invest in shares of
the Funds by purchasing a variable annuity or variable life insurance contract
from a participating insurance company. A participating insurance company is one
that has arranged to make the Funds available as an investment option under
their variable insurance contracts. You may also invest in shares of the Funds
if you participate in a qualified retirement plan and your employer has arranged
to make one or more of the Funds available as an investment option under that
plan.
3
<PAGE> 6
BERGER IPT - NEW GENERATION FUND
The Fund's Goals and Principal Investment Strategies
The Fund aims for capital appreciation. In pursuing that goal, the Fund
primarily invests in the common stocks of companies with potential for
significant earnings growth.
The Fund focuses on leading-edge companies with new ideas, technologies or
methods of doing business. Its investment manager seeks companies it believes
have the potential to change the direction or dynamics of the industries in
which they operate or significantly influence the way businesses or consumers
conduct their affairs.
The Fund's investment manager generally looks for companies:
o In business sectors characterized by rapid change, regardless of the
company's size
o With favorable long-term growth potential due to their new or
innovative products or services
o With management and financial strength to fulfill their vision and
grow their business.
The Fund invests in common stocks, both domestic and foreign, and other
securities with equity features, such as convertible securities and preferred
stocks. Due to the Fund's focus on companies with the characteristics described
above, the Fund generally is weighted toward small market capitalization
companies, although it is free to invest in companies with larger market
capitalizations as well. The Fund's investment manager will generally sell a
security when it no longer meets the manager's investment criteria or when it
has met the manager's expectations for appreciation. The Fund's investment
manager may actively trade the portfolio in pursuit of the Fund's goal.
Principal Risks
You may be interested in the Fund if you are comfortable with above-average risk
and intend to make a long-term investment commitment. Like all managed funds,
there is a risk that the investment manager's strategy for managing the Fund may
not achieve the desired results. In addition, the price of common stock moves up
and down in response to corporate earnings and developments, economic and market
conditions and anticipated events. As a result, the price of the Fund's
investments may go down and you could lose money on your investment.
Given the Fund's weighting toward small companies in rapidly changing
industries, its share price may fluctuate more than that of funds invested in
larger companies or more stable industries. Small companies may pose greater
market, liquidity and information risks due to narrow product lines, limited
financial resources, less depth in management or a limited trading market for
their stocks. In addition, products and services in rapidly changing industries
may be subject to intense competition and rapid obsolescence and may require
regulatory approvals prior to their use. The Fund's investments are often
focused in a small number of business sectors, which may pose greater market and
liquidity risks. In addition, the Fund's active trading will cause the Fund to
have an increased portfolio turnover rate. Higher turnover rates may result in
higher brokerage costs to the Fund and in higher net taxable gains for you as an
investor.
See "Investment Techniques, Securities and Associated Risks" later in
this prospectus for more information on principal risks and other risks.
The Fund's Past Performance
Since the Fund did not become available until May 1, 2000, it has no past
performance.
Fund Expenses
The Fund does not impose any sales load, redemption or exchange fees. However,
you do bear indirectly Annual Fund Operating Expenses, which vary from year to
year.
ANNUAL FUND OPERATING EXPENSES
(deducted directly from the Fund)%
- --------------------------------------------------------------------------------
Management fee(1) .85%
Other expenses(2) 2.10%
- --------------------------------------------------------------------------------
Total Annual Fund Operating Expenses 2.95%
Fee Waiver and Reimbursement(3) (1.80)%
- --------------------------------------------------------------------------------
Net Expenses 1.15%
- --------------------------------------------------------------------------------
1. Investment advisory fees are charged to the Fund at the following rates of
average daily net assets: 0.85% of the first $500 million; 0.80% on the next
$500 million and 0.75% in excess of $1 billion.
2. Based on estimates for the Fund's first full year of operations.
3. Under a written contract, the Fund's investment advisor waives its fee and
reimburses the Fund to the extent that, at any time during the life of the Fund,
the Fund's annual operating expenses exceed 1.15%. The contract may not be
terminated or amended except by a vote of the Fund's Board of Trustees.
UNDERSTANDING EXPENSES
Annual Fund operating expenses are paid by the Fund. As a result, they reduce
the Fund's return. Fund expenses include management fees and administrative
costs such as recordkeeping and reports and custodian and pricing services. They
do not include any charges or expenses deducted by your variable insurance
contract or retirement plan, which would increase expenses. Refer to your
variable contract prospectus or retirement plan documents for an explanation of
those charges and expenses.
Berger IPT Funds May 1, 2000 Combined Prospectus
4
<PAGE> 7
Example Costs
The following example helps you compare the cost of investing in the Fund to the
cost of investing in other mutual funds by showing what your costs may be over
time. It uses the same assumptions that other funds use in their prospectuses:
o $10,000 initial investment
o 5% total return for each year
o Fund operating expenses remain the same for each period
o Redemption after the end of each period
Your actual costs may be higher or lower, so this example should be used for
comparison only. Based on these assumptions your costs at the end of each period
would be:
Years $
- --------------------------------------------------------------------------------
One 117
Three 365
- --------------------------------------------------------------------------------
Berger IPT Funds May 1, 2000 Combined Prospectus
5
<PAGE> 8
BERGER IPT - SMALL COMPANY GROWTH FUND
The Fund's Goal and Principal Investment Strategies
The Fund aims for capital appreciation. In pursuing that goal, the Fund
primarily invests in the common stocks of small companies with the potential for
rapid earnings growth.
The Fund's stock selection focuses on companies that either occupy a dominant
position in an emerging industry or have a growing market share in a larger,
fragmented industry.
The Fund's investment manager generally looks for companies with:
o A proprietary technology, product or service that may enable the company to
be a market share leader
o Strong entrepreneurial management with clearly defined strategies for
growth
o Relatively strong balance sheets.
Under normal circumstances, the Fund invests at least 65% of its assets in
equity securities of companies whose market capitalization, at the time of
initial purchase, is less than the 12-month average of the maximum market
capitalization for companies included in the Russell 2000 Index (Russell 2000).
This average is updated monthly. The Fund's investment manager will generally
sell a security when it no longer meets the manager's investment criteria or
when it has met the manager's expectations for appreciation. The Fund's
investment manager may actively trade the portfolio in pursuit of the Fund's
goal.
Principal Risks
You may be interested in the Fund if you are comfortable with above-average risk
and intend to make a long-term investment commitment. Like all managed funds,
there is a risk that the investment manager's strategy for managing the Fund may
not achieve the desired results. In addition, the price of common stock moves up
and down in response to corporate earnings and developments, economic and market
conditions and anticipated events. As a result, the price of the Fund's
investments may go down and you could lose money on your investment.
The Fund's share price may fluctuate more than that of funds primarily invested
in stocks of mid-sized and large companies. Small company securities may
underperform as compared to the securities of larger companies. They may also
pose greater market, liquidity and information risks due to narrow product
lines, limited financial resources, less depth in management or a limited
trading market for their stocks. The Fund's investments are often focused in a
small number of business sectors, which may pose greater market and liquidity
risks. In addition, the Fund's active trading will cause the Fund to have an
increased portfolio turnover rate. Higher turnover rates may result in higher
brokerage costs to the Fund.
See "Investment Techniques, Securities and Associated Risks" later in this
prospectus for more information on principal risks and other risks.
The Fund's Past Performance
The information below shows the Fund's performance since it began operations
through December 31, 1999. These returns include reinvestment of all dividends
and capital gains distributions and reflect Fund expenses. They do not, however,
reflect charges and expenses deducted by your particular variable insurance
contract or retirement plan, which would lower performance. Therefore, they
should only be considered along with the total return information provided by
your contract or plan that reflects those charges and expenses. As with all
mutual funds, past performance does not guarantee future results.
Year-by-year returns show you how the Fund's performance has varied by
illustrating the differences for each full calendar year since the Fund began.
YEAR-BY-YEAR TOTAL RETURN AS OF DECEMBER 31
CHART
1997 - 21.21%
1998 - 1.87%
1999 - 91.45%
<TABLE>
<S> <C>
BEST QUARTER:12/31/99 55.28%
WORST QUARTER:9/30/98 (26.82)%
</TABLE>
Average annual total return is a measure of the Fund's performance over time.
The Fund's average annual return is compared with the Russell 2000. While the
Fund does not seek to match the returns of the Russell 2000, this index is a
good indicator of small company stock market performance. You may not invest in
the Russell 2000 and unlike the Fund, it does not incur fees or charges.
Berger IPT Funds May 1, 2000 Combined Prospectus
6
<PAGE> 9
AVERAGE ANNUAL RETURNS AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
Life of the Fund
1 Year 3 Year (May 1, 1996)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
The Fund 91.45% 33.21% 26.24%
Russell 2000 21.26% 13.08% 13.64%
- --------------------------------------------------------------------------------
</TABLE>
Fund Expenses
The Fund does not impose any sales load, redemption or exchange fees. However,
you do bear indirectly Annual Fund Operating Expenses, which vary from year to
year.
ANNUAL FUND OPERATING EXPENSES
(deducted directly from the Fund)%
- --------------------------------------------------------------------------------
Management fee(1) .85%
Other expenses(2) .64%
- --------------------------------------------------------------------------------
Total Annual Fund Operating Expenses 1.49%
Fee Waiver and Reimbursement(3) (.34)%
Net Expenses 1.15%
- --------------------------------------------------------------------------------
1. Effective October 1, 1999, the investment advisory fee charged to the Fund
was reduced to the following rates of average daily net assets: 0.85% of the
first $500 million; 0.80% of the next $500 million and 0.75% in excess of $1
billion. The amount shown reflects the restated advisory fees.
2. Effective October 1, 1999, Berger LLC eliminated the administrative fee
charged to the Fund. The fee amount shown reflects the restated expenses.
3. Under a written contract, the Fund's investment advisor waives its fee and
reimburses the Fund to the extent that, at any time during the life of the Fund,
the Fund's annual operating expenses exceed 1.15%. The contract may not be
terminated or amended except by a vote of the Fund's Board of Trustees.
Understanding Expenses
Annual Fund operating expenses are paid by the Fund. As a result, they reduce
the Fund's return. Fund expenses include management fees and administrative
costs such as recordkeeping and reports and custodian and pricing services. They
do not include any charges or expenses deducted by your variable insurance
contract or retirement plan, which would increase expenses. Refer to your
variable contract prospectus or retirement plan documents for an explanation of
those charges and expenses.
Example Costs
The following example helps you compare the cost of investing in the Fund to the
cost of investing in other mutual funds by showing what your costs may be over
time. It uses the same assumptions that other funds use in their prospectuses:
o $10,000 initial investment
o 5% total return for each year
o Fund operating expenses remain the same for each period
o Redemption after the end of each period
Your actual costs may be higher or lower, so this example should be used
for comparison only. Based on these assumptions your costs at the end of each
period would be:
YEARS $
- --------------------------------------------------------------------------------
One 117
Three 365
Five 633
Ten 1,398
- --------------------------------------------------------------------------------
Berger IPT Funds May 1, 2000 Combined Prospectus
7
<PAGE> 10
BERGER IPT - GROWTH FUND
The Fund's Goal and Principal Investment Strategies
The Fund aims for long-term capital appreciation. In pursuing that goal, the
Fund primarily invests in the common stocks of established companies with the
potential for growth.
Stock selection by the Fund's investment manager focuses on mid-sized to large
capitalization companies believed to have strong growth potential.
The Fund's investment manager generally looks for companies with:
o Opportunities for rapid revenue and earnings growth
o Large market potential for their products and services
o Strong, capable management teams that have the vision necessary to increase
their market share in growing industries.
The Fund's investment manager will generally sell a security when it no longer
meets the manager's investment criteria or when it has met the manager's
expectations for appreciation. The Fund's investment manager may actively trade
the portfolio in pursuit of the Fund's goal.
Principal Risks
You may be interested in the Fund if you are comfortable with the risks of
equity investing and intend to make a long-term investment commitment. Like all
managed funds, there is a risk that the investment manager's strategy for
managing the Fund may not achieve the desired results. In addition, the price of
common stock moves up and down in response to corporate earnings and
developments, economic and market conditions and anticipated events. As a
result, the price of the Fund's investments may go down and you could lose money
on your investment.
The Fund's investments may focus in a small number of business sectors, which
may pose greater market and liquidity risks. In addition, the Fund's active
trading will cause the Fund to have an increased portfolio turnover rate. Higher
turnover rates may result in higher brokerage costs to the Fund.
See "Investment Techniques, Securities and Associated Risks" later in this
prospectus for more information on principal risks and other risks.
The Fund's Past Performance
The information below shows the Fund's performance since it began operations
through December 31, 1999. These returns include reinvestment of all dividends
and capital gain distributions and reflect Fund expenses. They do not, however,
reflect charges and expenses deducted by your particular variable insurance
contract or retirement plan, which would lower performance. Therefore, they
should only be considered along with the total return information provided by
your contract or plan that reflects those charges and expenses. As with all
mutual funds, past performance does not guarantee future results.
Year-by-year returns show you how the Fund's performance has varied by
illustrating the differences for each full calendar year since the Fund began.
YEAR-BY-YEAR TOTAL RETURN AS OF DECEMBER 31
CHART
1997 - 13.76%
1998 - 16.29%
1999 - 49.13%
<TABLE>
<S> <C>
BEST QUARTER: 12/31/99 42.08%
WORST QUARTER: 9/30/98 (19.09)%
</TABLE>
Average annual total return is a measure of the Fund's performance over time.
The Fund's average annual return is compared with the Standard & Poor's 500
Index (S&P 500). While the Fund does not seek to match the returns of the S&P
500, this index is a good indicator of general stock market performance. You may
not invest in the S&P 500 and unlike the Fund, it does not incur fees or
charges.
AVERAGE ANNUAL RETURNS AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
Life of the Fund
1 Year 3 Year (May 1, 1996)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
The Fund 49.13% 25.42% 21.60%
S&P 500 21.03% 27.56% 26.75%
- --------------------------------------------------------------------------------
</TABLE>
Berger IPT Funds May 1, 2000 Combined Prospectus
8
<PAGE> 11
Fund Expenses
The Fund does not impose any sales load, redemption or exchange fees. However,
you do bear indirectly Annual Fund Operating Expenses, which vary from year to
year.
ANNUAL FUND OPERATING EXPENSES
(deducted directly from the Fund)%
- --------------------------------------------------------------------------------
Management fee(1) .75%
Other expenses(2) 1.43%
- --------------------------------------------------------------------------------
Total Annual Fund Operating Expenses 2.18%
Fee Waiver and Reimbursement(3) (1.18)%
Net Expenses 1.00%
- --------------------------------------------------------------------------------
1. Effective October 1, 1999, the investment advisory fee charged to the Fund
was reduced to the following rates of average daily net assets; 0.75% of the
first $500 million; 0.70% of the next $500 million and 0.65% in excess of $1
billion. The amount shown reflects the restated advisory fees.
2. Effective October 1, 1999, Berger LLC eliminated the administrative fee
charged to the Fund. The fee amount shown reflects the restated expenses.
3. Under a written contract, the Fund's investment advisor waives its fee and
reimburses the Fund to the extent that, at any time during the life of the Fund,
the Fund's annual operating expenses exceed 1.00%. The contract may not be
terminated or amended except by a vote of the Fund's Board of Trustees.
Understanding Expenses
Annual Fund operating expenses are paid by the Fund. As a result, they reduce
the Fund's return. Fund expenses include management fees and administrative
costs such as recordkeeping and reports and custodian and pricing services. They
do not include any charges or expenses deducted by your variable insurance
contract or retirement plan, which would increase expenses. Refer to your
variable contract prospectus or retirement plan documents for an explanation of
those charges and expenses.
Example Costs
The following example helps you compare the cost of investing in the Fund to the
cost of investing in other mutual funds by showing what your costs may be over
time. It uses the same assumptions that other funds use in their prospectuses:
o $10,000 initial investment
o 5% total return for each year
o Fund operating expenses remain the same for each period
o Redemption after the end of each period
Your actual costs may be higher or lower, so this example should be used for
comparison only. Based on these assumptions your costs at the end of each period
would be:
<TABLE>
<CAPTION>
Years $
- --------------------------------------------------------------------------------
<S> <C>
One 102
Three 318
Five 552
Ten 1,225
- --------------------------------------------------------------------------------
</TABLE>
Berger IPT Funds May 1, 2000 Combined Prospectus
9
<PAGE> 12
BERGER/BIAM IPT - INTERNATIONAL FUND
The Fund's Goal and Principal Investment Strategies
The Fund aims for long-term capital appreciation. In pursuing that goal, the
Fund primarily invests in a portfolio consisting of common stocks of
well-established foreign companies.
The Fund's investment manager first identifies economic and business themes that
it believes provide a favorable framework for selecting stocks. Using
fundamental analysis, the investment manager then selects individual companies
best positioned to take advantage of opportunities presented by these themes.
The Fund's investment manager generally looks for companies with:
o Securities that are fundamentally undervalued relative to their
long-term prospective earnings growth rates, their historic valuation
levels and their competitors
o Business operations predominantly in well-regulated and more stable
foreign markets
o Substantial size and liquidity, strong balance sheets, proven
management and diversified earnings.
The Fund invests primarily in common stocks with 65% of its total assets in
securities of companies located in at least five different countries outside the
United States. Recently, the Fund has been weighted toward countries in Western
Europe, Australia and the Far East. However, it may also invest in other foreign
countries, including developing countries. A majority of the Fund's assets are
invested in mid-sized to large capitalization companies. The Fund's investment
manager will generally sell a security when it no longer meets the manager's
investment criteria or when it has met the manager's expectations for
appreciation.
Principal Risks
You may be interested in the Fund if you are comfortable with the risks of
international investing and intend to make a long-term investment commitment.
Like all managed funds, there is a risk that the investment manager's strategy
for managing the Fund may not achieve the desired results. In addition, the
price of common stock moves up and down in response to corporate earnings and
developments, economic and market conditions and anticipated events. As a
result, the price of the Fund's investments may go down and you could lose money
on your investment. There are additional risks with investing in foreign
countries, especially in developing countries -- specifically, economic,
currency, liquidity, information, political and transaction risks. As a result
of these additional risks, the Fund may be more volatile than a domestic stock
fund. In addition, foreign stocks may not move in concert with the U.S. markets.
The Fund's investments are often focused in a small number of business sectors,
which may pose greater market and liquidity risks. In addition, the Fund may
invest in certain securities with unique risks, such as forward foreign currency
contracts, which may present hedging, credit, correlation, opportunity and
leverage risks.
See "Investment Techniques, Securities and Associated Risks" later in this
prospectus for more information on principal risks and other risks.
The Fund's Past Performance
The information below shows the Fund's performance since it began operations
through December 31, 1999. These returns include reinvestment of all dividends
and capital gains distributions and reflect Fund expenses. They do not, however,
reflect charges and expenses deducted by your particular variable insurance
contract or retirement plan, which would lower performance. Therefore, they
should only be considered along with the total return information provided by
your contract or plan that reflects those charges and expenses. As with all
mutual funds, past performance does not guarantee future results.
Year-by-year returns show you how the Fund's performance has varied by
illustrating the differences for each full calendar year since the Fund began.
Berger IPT Funds May 1, 2000 Combined Prospectus
10
<PAGE> 13
YEAR-BY-YEAR TOTAL RETURN AS OF DECEMBER 31
CHART
1998 - 16.13%
1999 - 31.24%
<TABLE>
<S> <C>
BEST QUARTER: 12/31/99 21.19%
Worst quarter: 9/30/98 (16.53)%
</TABLE>
Average annual total return is a measure of the Fund's performance over time.
The Fund's average annual return is compared with the Morgan Stanley Capital
International Europe, Australasia and the Far East Index (EAFE Index). While the
Fund does not seek to match the returns of the EAFE Index, this index is a good
indicator of foreign stock markets. You may not invest in the EAFE Index and
unlike the Fund, it does not incur fees or charges.
AVERAGE ANNUAL RETURNS AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
Life of the Fund
1 Year (May 1, 1997)
- --------------------------------------------------------------------------------
<S> <C> <C>
The Fund 31.24% 16.17%
EAFE Index 27.30% 18.64%
- --------------------------------------------------------------------------------
</TABLE>
Fund Expenses
The Fund does not impose any sales load, redemption or exchange fees. However,
you do bear indirectly Annual Fund Operating Expenses, which vary from year to
year.
ANNUAL FUND OPERATING EXPENSES
(deducted directly from the Fund)%
- --------------------------------------------------------------------------------
Management fee .90%
Other expenses(1) 1.55%
- --------------------------------------------------------------------------------
Total Annual Fund Operating Expenses 2.45%
Fee Waiver and Reimbursement(2) (1.25)%
Net Expenses 1.20%
- --------------------------------------------------------------------------------
1. Effective October 1, 1999, BBOI Worldwide LLC eliminated the 0.01%
administrative fee charged to the Fund. The fee amount shown reflects the
restated expenses.
2. Under a written contract, the Fund's investment advisor waives its fee and
reimburses the Fund to the extent that, at any time during the life of the Fund,
the Fund's annual operating expenses exceed 1.20%. The contract may not be
terminated or amended except by a vote of the Fund's Board of Trustees.
Understanding Expenses
Annual Fund operating expenses are paid by the Fund. As a result, they reduce
the Fund's return. Fund expenses include management fees and administrative
costs such as recordkeeping and reports and custodian and pricing services. They
do not include any charges or expenses deducted by your variable insurance
contract or retirement plan, which would increase expenses. Refer to your
variable contract prospectus or retirement plan documents for an explanation of
those charges and expenses.
Example Costs
The following example helps you compare the cost of investing in the Fund to the
cost of investing in other mutual funds by showing what your costs may be over
time. It uses the same assumptions that other funds use in their prospectuses:
o $10,000 initial investment
o 5% total return for each year
o Fund operating expenses remain the same for each period
o Redemption after the end of each period
Your actual costs may be higher or lower, so this example should be used for
comparison only. Based on these assumptions your costs at the end of each period
would be:
<TABLE>
<CAPTION>
Years $
- --------------------------------------------------------------------------------
<S> <C>
One 122
Three 381
Five 660
Ten 1,455
- --------------------------------------------------------------------------------
</TABLE>
Berger IPT Funds May 1, 2000 Combined Prospectus
11
<PAGE> 14
BERGER IPT - GROWTH AND INCOME FUND
The Fund's Goal and Principal Investment Strategies
The Fund aims for capital appreciation and has a secondary goal of investing in
securities that produce current income for the portfolio. In pursuing these
goals, the Fund primarily invests in the securities of well-established, growing
companies. The Fund's secondary goal may be changed at any time without a
shareholder vote.
Security selection focuses on the common stocks, convertible securities and
preferred stocks of companies that have demonstrated a pattern of growth and
stability and are also expected to provide current income.
The Fund's investment manager generally looks for companies with:
o Opportunities for good revenue and earnings growth
o Strong market positions for their products and services
o Strong, seasoned management teams with well-established and clearly
defined strategies.
Common stock of companies with mid-sized to large market capitalizations usually
constitutes a majority of the Fund's investments. The Fund primarily invests in
income producing securities to provide a level of protection from price
volatility that may not be present when income is not a consideration. The Fund
may invest up to 20% of its assets in convertible securities rated below
investment grade (BB or lower by S&P, Ba or lower by Moody's). The Fund's
investment manager will generally sell a security when it no longer meets the
manager's investment criteria or when it has met the manager's expectations for
appreciation. The Fund's investment manager may actively trade the portfolio in
pursuit of the Fund's goal.
Principal Risks
You may be interested in the Fund if you are comfortable with the risks of
equity and fixed-income investing and intend to make a long-term investment
commitment. Like all managed funds, there is a risk that the investment
manager's strategy for managing the Fund may not achieve the desired results. In
addition, the price of common stock moves up and down in response to corporate
earnings and developments, interest rate movements, economic and market
conditions and anticipated events. As a result, the price of the Fund's
investments may go down and you could lose money on your investment.
To the extent the Fund invests in fixed-income securities it takes on different
risks, including movements in interest rates and default on payment of principal
or interest. In addition, the Fund may invest in convertible securities rated
below investment grade, which may pose greater market, interest rate, prepayment
and credit risk. These issuers are less financially secure, and are more likely
to be hurt by interest rate movements. When dividend yields and interest rates
are low, the Fund's income distributions may be reduced or eliminated. In
addition, the Fund's active trading will cause the Fund to have an increased
portfolio turnover rate. Higher turnover rates may result in higher brokerage
costs to the Fund.
See "Investment Techniques, Securities and Associated Risks" later in this
prospectus for more information on principal risks and other risks.
The Fund's Past Performance
The information below shows the Fund's performance since it began operations
through December 31, 1999. These returns include reinvestment of all dividends
and capital gains distributions and reflect Fund expenses. They do not, however,
reflect charges and expenses deducted by your particular variable insurance
contract or retirement plan, which would lower performance. Therefore, they
should only be considered along with the total return information provided by
your contract or plan that reflects those charges and expenses. As with all
mutual funds, past performance does not guarantee future results.
Year-by-year returns show you how the Fund's performance has varied by
illustrating the differences for each full calendar year since the Fund began.
Berger IPT Funds May 1, 2000 Combined Prospectus
12
<PAGE> 15
YEAR-BY-YEAR TOTAL RETURN AS OF DECEMBER 31
CHART
1997 - 24.99%
1998 - 25.03%
1999 - 59.05%
<TABLE>
<S> <C>
BEST QUARTER: 12/31/99 39.65%
WORST QUARTER: 9/30/98 (7.45)%
</TABLE>
Average annual total return is a measure of the Fund's performance over time.
The Fund's average annual return is compared with the Standard & Poor's 500
Index (S&P 500). While the Fund does not seek to match the returns of the S&P
500, this index is a good indicator of general stock market performance. You may
not invest in the S&P 500 and unlike the Fund, it does not incur fees or
charges.
AVERAGE ANNUAL RETURNS AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
Life of the Fund
1 Year 3 Year (May 1, 1996)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
The Fund 59.05% 35.46% 31.98%
S&P 500 21.03% 27.56% 26.75%
- --------------------------------------------------------------------------------
</TABLE>
Fund Expenses
The Fund does not impose any sales load, redemption or exchange fees. However,
you do bear indirectly Annual Fund Operating Expenses, which vary from year to
year.
ANNUAL FUND OPERATING EXPENSES
(deducted directly from the Fund)%
- --------------------------------------------------------------------------------
Management fee(1) .75%
Other expenses(2) .43%
- --------------------------------------------------------------------------------
Total Annual Fund Operating Expenses 1.18%
Fee Waiver and Reimbursement(3) (.18)%
Net Expenses 1.00%
- --------------------------------------------------------------------------------
1. Effective October 1, 1999, the investment advisory fee charged to the Fund
was reduced to the following rates of average daily net assets; 0.75% of the
first $500 million; 0.70% of the next $500 million and 0.65% in excess of $1
billion. The amount shown reflects the restated advisory fees.
2. Effective October 1, 1999, Berger LLC eliminated the administrative fee
charged to the Fund. The fee amount shown reflects the restated expenses.
3. Under a written contract, the Fund's investment advisor waives its fee and
reimburses the Fund to the extent that, at any time during the life of the Fund,
the Fund's annual operating expenses exceed 1.00%. The contract may not be
terminated or amended except by a vote of the Fund's Board of Trustees.
Understanding Expenses
Annual Fund operating expenses are paid by the Fund. As a result, they reduce
the Fund's return. Fund expenses include management fees and administrative
costs such as recordkeeping and reports and custodian and pricing services. They
do not include any charges or expenses deducted by your variable insurance
contract or retirement plan, which would increase expenses. Refer to your
variable contract prospectus or retirement plan documents for an explanation of
those charges and expenses.
Example Costs
The following example helps you compare the cost of investing in the Fund to the
cost of investing in other mutual funds by showing what your costs may be over
time. It uses the same assumptions that other funds use in their prospectuses:
o $10,000 initial investment
o 5% total return for each year
o Fund operating expenses remain the same for each period
o Redemption after the end of each period
Your actual costs may be higher or lower, so this example should be used for
comparison only. Based on these assumptions your costs at the end of each period
would be:
<TABLE>
<CAPTION>
Years $
- --------------------------------------------------------------------------------
<S> <C>
One 102
Three 318
Five 552
Ten 1,225
- --------------------------------------------------------------------------------
</TABLE>
Berger IPT Funds May 1, 2000 Combined Prospectus
13
<PAGE> 16
INVESTMENT TECHNIQUES, SECURITIES AND ASSOCIATED RISKS
Before you invest. . .
in any of the Funds, make sure you understand the risks involved. All
investments involve risk. Generally, the greater the risk, the greater the
potential for return. The reverse is also generally true, the lower the risk,
the lower the potential for return.
Like all mutual funds, an investment in the Funds is not a bank deposit and is
not insured or guaranteed by the FDIC or any other government agency. The Funds
are not a complete investment program, but may serve to diversify other types of
investments in your portfolio. There is no guarantee that the Funds will meet
their investment goals, and although you have the potential to make money, you
could also lose money by investing in the Funds.
The table on the opposite page will help you further understand the risks the
Funds take by investing in certain securities and the investment techniques used
by the Funds. A glossary follows the table. You may get more detailed
information about the risks of investing in the Funds in the Statement of
Additional Information (SAI), including a discussion of debt security ratings in
Appendix A to the SAI.
Key to table
Follow down the columns under the name of the Fund in which you are interested.
The boxes will tell you:
Y Yes, the security or technique is permitted by a Fund and is emphasized by a
Fund.
< (Note: character is a hollow Y) Yes, the security or technique is permitted by
a Fund.
N No, the security or technique is not permitted by a Fund.
F The restriction is fundamental to a Fund. (Fundamental restrictions cannot be
changed without a shareholder vote.)
5 Use of a security or technique is permitted, but subject to a restriction of
up to 5% of total assets.
25 Use of a security or technique is permitted, but subject to a restriction of
up to 25% of total assets.
33.3 Use of a security or technique is permitted, but subject to a restriction
of up to 331/3% of total assets.
[ ] (Note: character is a hollow 5) Use of a security or technique is permitted,
but subject to a restriction of up to 5% of net assets.
[ ][ ] (Note: character is a hollow 15) Use of a security or technique is
permitted, but subject to a restriction of up to 15% of net assets.
Notes to table:
1. The Funds have no minimum quality standards for convertible securities,
although they will not invest in defaulted securities. They also will not
invest 20% or more of their assets in convertible securities rated below
investment grade or in unrated convertible securities that the advisor
considers to be below investment grade.
2. The Funds may use futures, forwards and options only for hedging. Not more
than 5% of a Fund's net assets may be used for initial margins for futures
and premiums for options, although a Fund may have more at risk under these
contracts than the initial margin or premium. However, a Fund's aggregate
obligations under these contracts may not exceed the total market value of
the assets being hedged, such as some or all of the value of the Fund's
equity securities.
Berger IPT Funds May 1, 2000 Combined Prospectus
14
<PAGE> 17
<TABLE>
<CAPTION>
Berger Berger
Berger IPT - IPT -
IPT - Small Berger Berger/BIAM Growth
New Company IPT - IPT - and
Generation Growth Growth International Income
Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C>
Risk and Investment Table
Diversification F F F F F
Small and mid-sized company securities Y Y < < <
Market, liquidity and information risk
- -----------------------------------------------------------------------------------------------------------------------------
Foreign securities < < < Y <
Market, currency, transaction, liquidity, information and political risk
- -----------------------------------------------------------------------------------------------------------------------------
Sector focus Y Y Y Y <
Market and liquidity risk
- -----------------------------------------------------------------------------------------------------------------------------
Convertible securities(1) < < < < Y
Market, interest rate, prepayment and credit risk
- -----------------------------------------------------------------------------------------------------------------------------
Investment grade bonds (nonconvertible) < < < < <
Interest rate, market, call and credit risk
- -----------------------------------------------------------------------------------------------------------------------------
Companies with limited operating histories Y Y 5F Y 5F
Market, liquidity and information risk
- -----------------------------------------------------------------------------------------------------------------------------
Illiquid and restricted securities [ ][ ] [ ][ ] [ ][ ] [ ][ ] [ ][ ]
Market, liquidity and transaction risk
- -----------------------------------------------------------------------------------------------------------------------------
Special situations < < < < <
Market and information risk
- -----------------------------------------------------------------------------------------------------------------------------
Initial Public Offerings (IPOs) < < < < <
Market, liquidity and information risk
- -----------------------------------------------------------------------------------------------------------------------------
Temporary defensive measures < < < N <
Opportunity risk
- -----------------------------------------------------------------------------------------------------------------------------
Lending portfolio securities 33.3 33.3 33.3 33.3 33.3
Credit risk
- -----------------------------------------------------------------------------------------------------------------------------
Borrowing 25F 25F 5F 25F 5F
Leverage risk
- -----------------------------------------------------------------------------------------------------------------------------
Hedging Strategies
Financial futures(2) [ ] [ ] [ ] N [ ]
Hedging, correlation, opportunity and leverage risk
- -----------------------------------------------------------------------------------------------------------------------------
Forward foreign currency contracts(2) < < < Y <
Hedging, credit, correlation, opportunity and leverage risk
- -----------------------------------------------------------------------------------------------------------------------------
Options(2) (exchange-traded and over-the-counter) [ ] [ ] [ ] N [ ]
Hedging, credit, correlation and leverage risk
- -----------------------------------------------------------------------------------------------------------------------------
Writing (selling) covered call options(2) 25 25 25 N 25
(exchange-traded and over-the-counter)
Opportunity, credit and leverage risk
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
Berger IPT Funds May 1, 2000 Combined Prospectus
15
<PAGE> 18
RISK AND INVESTMENT GLOSSARY
Borrowing refers to a loan of money from a bank or other financial institution
undertaken by a Fund for temporary or emergency reasons only.
Call risk is the possibility that an issuer may redeem or "call" a fixed-income
security before maturity at a price below its current market price. An increased
likelihood of a call may reduce the security's price.
Common stock is a share of ownership (equity) interest in a company.
Companies with limited operating histories are securities issued by companies
that have been in continuous operation for less than three years. Sometimes
called "unseasoned" issuers.
Convertible securities are debt or equity securities which may be converted on
specified terms into stock of the issuer.
Correlation risk occurs when a Fund "hedges" - uses one investment to offset the
Fund's position in another. If the two investments do not behave in relation to
one another the way Fund managers expect them to, then unexpected results may
occur.
Credit risk means that the issuer of a security or the counterparty to an
investment contract may default or become unable to pay its obligations when
due.
Currency risk means that the issuer of a security or the counterparty to an
investment contract may default or become unable to pay its obligations when
due.
Diversification means a diversified fund may not, with respect to at least 75%
of its assets, invest more than 5% in the securities of one company. A
nondiversified fund may be more volatile than a diversified fund because it
invests more of its assets in a smaller number of companies and the gains or
losses on a single stock will therefore have a greater impact on the Fund's
share price. All of the Funds are diversified funds.
Financial futures are exchange-traded contracts on securities, securities
indexes or foreign currencies that obligate the holder to take or make future
delivery of a specified quantity of those underlying securities or currencies on
a predetermined future date at a predetermined price.
Foreign securities are issued by companies located outside of the United States.
A Fund considers a company to be located outside the United States if the
principal securities trading market for its equity securities is located outside
the U.S. or it is organized under the laws of, and has a principal office in, a
country other than the U.S.
Forward foreign currency contracts are privately negotiated contracts committing
the holder to purchase or sell a specified quantity of a foreign currency on a
predetermined future date at a predetermined price.
Hedging risk comes into play when a Fund uses a security whose value is based on
an underlying security or index to "offset" the Fund's position in another
security or currency. The objective of hedging is to offset potential losses in
one security with gains in the hedge. But a hedge can eliminate or reduce gains
as well as offset losses. (Also see "Correlation risk.")
Illiquid and restricted securities are securities which, by rules of their issue
or by their nature, cannot be sold readily. These do not include liquid Rule
144A securities.
Information risk means that information about a security or issuer might not be
available, complete, accurate or comparable.
Initial public offering (IPO) is the sale of a company's securities to the
public for the first time. IPO companies can be small and have limited operating
histories. The price of IPO securities can be highly unstable due to prevailing
market psychology and the small number of shares available. In addition, the
quality and number of IPOs available for purchase may diminish in the future,
and their contribution to Fund performance may be less significant as a Fund
grows in size.
Interest rate risk is the risk that changes in interest rates will adversely
affect the value of an investor's securities. When interest rates rise, the
value of fixed-income securities will generally fall. Conversely, a drop in
interest rates will generally cause an increase in the value of fixed-income
securities. Longer-term securities are subject to greater interest rate risk.
Investment grade bonds are rated BBB (Standard & Poor's) or Baa (Moody's) or
above. Bonds rated below investment grade are subject to greater credit risk
than investment grade bonds.
Lending portfolio securities to qualified financial institutions is undertaken
in order to earn income. The Funds lend securities only on a fully
collateralized.
Leverage risk occurs in some securities or techniques that tend to magnify the
effect of small changes in an index or a market. This can result in a loss that
exceeds the amount that was invested in the contract.
Berger IPT Funds May 1, 2000 Combined Prospectus
16
<PAGE> 19
Liquidity risk occurs when investments cannot be sold readily. A Fund may have
to accept a less-than-desirable price to complete the sale of an illiquid
security or may not be able to sell it at all.
Market capitalization is the total current market value of a company's
outstanding common stock.
Market risk exists in all mutual funds and means the risk that the prices of
securities in a market, a sector, or an industry will fluctuate, and that such
movements might reduce an investment's value.
Opportunity risk means missing out on an investment opportunity because the
assets necessary to take advantage of it are committed to less advantageous
investments or strategies.
Options are contracts giving the holder the right but not the obligation to
purchase or sell a security on or before a predetermined future date at a fixed
price. Options on securities indexes are similar, but settle in cash.
Political risk comes into play with investments, particularly foreign
investments, which may be adversely affected by nationalization, taxation, war,
government instability or other economic or political actions or factors.
Prepayment risk is the risk that, as interest rates fall, borrowers are more
likely to refinance their debts. As a result, the principal on certain
fixed-income securities may be paid earlier than expected, which could cause
investment losses and cause prepaid amounts to have to be reinvested at a
relatively lower interest rate.
Sector focus occurs when a significant portion of a Fund's assets are invested
in a relatively small number of related industries. The Funds will not
concentrate more than 25% of their total assets in any one industry. Sector
focus may increase both market and liquidity risk.
Small and mid-sized company securities securities are securities issued by small
or mid-sized companies, as measured by their market capitalization. The market
capitalization range targeted by each of the Funds investing primarily in small
or mid-sized companies varies by Fund and appears in the description for those
Funds under the heading "The Fund's Goal and Principal Investment Strategies."
In general, the smaller the company, the greater its risks.
Special situations are companies about to undergo a structural, financial or
management change which may significantly affect the value of their securities.
Temporary defensive measures may be taken when a Fund's investment manager
believes they are warranted due to market conditions. When this happens, the
Fund may increase its investment in government securities and other short-term
securities without regard to the Fund's investment restrictions, policies or
normal investment emphasis.
Transaction risk means that a Fund may be delayed or unable to settle a
transaction or that commissions and settlement expenses may be higher than
usual.
Writing (selling) covered call options is the selling of a contract to another
party which gives them the right but not the obligation to buy a particular
security from you. A Fund will write call options only if it already owns the
security (if it is "covered").
Berger IPT Funds May 1, 2000 Combined Prospectus
17
<PAGE> 20
BUYING AND SELLING (REDEEMING) SHARES
The Funds sell their shares to variable contract accounts of participating
insurance companies or to qualified retirement plans. You may invest in shares
of the Funds only through this type of variable insurance contract or retirement
plan. If you invest through a variable insurance contract, your variable
contract account prospectus will explain how you can purchase or surrender a
contract, withdraw a portion of your investment, allocate to one or more of the
Funds or change existing allocations among investment alternatives. If you
invest through a retirement plan, your retirement plan documents will explain
this information. Not all of the Funds may be available under a particular
contract or plan, and certain contracts or plans may limit allocations among the
Funds.
The Funds do not impose any sales charges, commissions or redemption fees for
the sale or redemption of Fund shares. However, your participating insurance
company may impose a sales charge or other charge when you purchase a variable
insurance contract. If you invest through a retirement plan, your retirement
plan administrator may impose charges when you participate in the plan. In
addition, variable insurance contracts and retirement plans may involve other
charges and expenses not described in this prospectus. These charges and
expenses are described in your variable contract account prospectus or plan
document.
Fund Share Price
The price at which Fund shares are sold and redeemed is the share price or net
asset value (NAV). The share price for each Fund is determined by adding the
value of that Fund's investments, cash and other assets, deducting liabilities,
and then dividing that value by the total number of that Fund's shares
outstanding.
Each Fund's share price is calculated at the close of the regular trading
session of the New York Stock Exchange (normally 4:00 p.m. New York time) each
day that the Exchange is open. Share price is not calculated on the days that
the Exchange is closed.
Fund shares are purchased or redeemed at the share price next calculated after a
purchase or redemption request is received in good order and accepted by the
Fund, or by any participating insurance company or retirement plan administrator
who has been authorized by the Fund to accept requests on its behalf. To receive
a specific day's share price for your purchase or redemption request, your
request must be received before the close of the New York Stock Exchange on that
day.
Payment for redeemed shares generally will be made within three business days
following the date of the redemption request. However, payment may be postponed
under unusual circumstances, such as when normal trading is not taking place on
the New York Stock Exchange, an emergency as defined by the Securities and
Exchange Commission exists, or as permitted by the Securities and Exchange
Commission.
When the Funds calculate their share price, they value the securities they hold
at market value. Sometimes market quotes for some securities are not available
or are not representative of market value. Examples would be when events occur
that materially affect the value of a security at a time when the security is
not trading or when the securities are illiquid. In that case, securities may be
valued in good faith at fair value, using consistently applied procedures
decided on by the trustees. Money market instruments maturing within 60 days are
valued at amortized cost, which approximates market value. Assets and
liabilities expressed in foreign currencies are converted into U.S. dollars at
the prevailing market rates quoted by one or more banks or dealers shortly
before the close of the Exchange.
A Fund's foreign securities may trade on days that the Exchange is closed and
the Fund's daily share price is not calculated. As a result, the Fund's daily
share price may be affected and you will not be able to purchase or redeem
shares.
Other Information
DATE-RELATED INFORMATION
Mutual funds and businesses around the world could be adversely affected if
computers do not properly process date-related information. The Funds' advisors
are addressing these issues for their computers and are getting reasonable
assurances from the Funds' other major service providers that they too are
addressing these issues to preserve smooth functioning of the Funds' trading,
pricing, shareholder account, custodial and other operations. There can be no
assurances, however, that all problems will be avoided.
These computer problems could also adversely affect the Funds' investments.
Improperly functioning computers may disrupt securities markets generally or
result in overall economic uncertainty. Individual companies may also be
adversely affected by the cost of fixing their computers, which could be
substantial. The Funds' investment managers consider these issues when
evaluating investments for the Funds.
Berger IPT Funds May 1, 2000 Combined Prospectus
18
<PAGE> 21
REDEMPTIONS IN-KIND
Each Fund intends to redeem its shares only for cash, although in order to
protect the interest of remaining shareholders, it retains the right to redeem
its shares in-kind under unusual circumstances. In-kind payment means payment
will be made in portfolio securities rather than cash. If this occurs,
transaction costs will be incurred if the securities are sold for cash. It may
be difficult selling the securities and recovering the amount of the redemption
if the securities are illiquid.
Distributions and Taxes
The Funds generally make two different kinds of distributions:
o Capital gains from the sale of portfolio securities held by a Fund.
o Net investment income from interest or dividends received on securities
held by a Fund.
Distributions made by the Funds will normally be capital gains. The Berger IPT -
Growth and Income Fund normally will also distribute net investment income. The
other Funds generally will not distribute net investment income, although any
net investment income that is generated as a by-product of managing their
portfolios will be distributed.
Each of the Funds intends to declare dividends representing the Fund's net
investment income annually, normally in December. It is also the present policy
of each Fund to distribute annually all of its net realized capital gains.
All distributions are reinvested automatically in Fund shares unless an election
is made on behalf of a variable contract account or retirement plan to receive
distributions in cash.
As a variable insurance contract owner or retirement plan participant, you
typically would not owe taxes on any distributions of income or capital gains
made by the Funds that are attributed to your account. You may owe taxes if you
make a withdrawal from your account, however, depending on the applicable tax
laws. You should refer to the appropriate variable contract account prospectus
or plan documents for further information on the Federal income tax treatment of
the owners of variable insurance contracts and qualified plan participants.
Whether participating insurance companies are subject to taxes on the Funds'
distributions depends on their tax status. Participating insurance companies
should consult their own tax advisors concerning whether distributions are
subject to federal income taxes if retained as part of contract reserves.
Berger IPT Funds May 1, 2000 Combined Prospectus
19
<PAGE> 22
ORGANIZATION OF THE FUNDS
INVESTMENT MANAGERS
The following companies provide investment management and administrative
services to the Funds. The advisory fees paid to them for the most recent fiscal
year are shown in the following table as a percentage of each Fund's average
daily net assets.
Effective October 1, 1999, the advisory fee for certain Funds was reduced and
the administrative fee charged to these Funds was eliminated. These fee
reductions are reflected earlier in this prospectus in the expense information
for each Fund.
Berger LLC (210 University Blvd., Suite 900, Denver, CO 80206) serves as
investment advisor, sub-advisor, administrator or sub-administrator to mutual
funds and institutional investors. Berger LLC has been in the investment
advisory business for 25 years. When acting as investment advisor, Berger LLC is
responsible for managing the investment operations of the Funds. Berger LLC also
provides administrative services to the Funds.
BBOI Worldwide LLC (210 University Blvd., Suite 700, Denver, CO 80206) was
formed in 1996 as a joint venture between Berger LLC and Bank of Ireland Asset
Management (U.S.) Limited (BIAM). As investment advisor to the Berger/BIAM
IPT-International Fund, BBOI oversees, evaluates and monitors the investment
advisory services provided by BIAM as sub-advisor. BBOI also provides
administrative services to the Berger/BIAM IPT-International Fund.
Berger LLC and BIAM entered into an agreement to dissolve BBOI Worldwide. The
dissolution of BBOI will have no effect on the investment advisory services
provided to the Berger/BIAM IPT-International Fund and the fees borne by the
Fund for advisory services are proposed to be decreased. Contingent upon
shareholder approval, when BBOI Worldwide is dissolved, Berger LLC will become
the Fund's advisor and BIAM will continue to be responsible for day-to-day
management of the Fund's portfolio as sub-advisor. A Special Meeting of
Shareholders of the Fund has been scheduled for May 5, 2000. Shareholders of the
Fund of record at the close of business on March 6, 2000 (the record date) are
entitled to attend and vote at the meeting and at any and all adjournments of
the meeting. If approved by shareholders, these advisory changes are expected to
take place within ten business days following shareholder approval.
Bank of Ireland Asset Management (U.S.) Limited (BIAM) (75 Holly Hill Lane,
Greenwich, CT 06830 [representative office]; 26 Fitzwilliam Place, Dublin 2,
Ireland [main office]) serves as investment advisor or sub-advisor to pension
and profit-sharing plans and other institutional investors and mutual funds.
Bank of Ireland's investment management group was founded in 1966. As
sub-advisor, BIAM provides day-to-day management of the investment operations of
the Berger/BIAM IPT-International Fund.
Berger IPT Funds May 1, 2000 Combined Prospectus
20
<PAGE> 23
<TABLE>
<CAPTION>
FUND ADVISORY FEE PAID THE FUND'S INVESTMENT MANAGER
BY THE FUND
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Berger IPT - New N/A(1) Mark S. Sunderhuse, Senior Vice President of Berger LLC.
Generation Fund Mr. Sunderhuse joined Berger LLC in January 1998 and
assumed management of the Fund at its inception in May
2000. Mr. Sunderhuse is also the investment manager of the
Berger New Generation Fund, co-manager of the Berger
Select Fund and interim manager of the Berger Balanced
Fund investment team. Mr. Sunderhuse has more than eleven
years of experience in the investment management industry.
- ----------------------------------------------------------------------------------------------------------------------
Berger IPT - Small 0.88% paid to Amy K. Selner, Vice President of Berger LLC. Ms. Selner
Company Growth Berger LLC(2) joined Berger LLC as a senior technology analyst in April
Fund 1996 and assumed management of the Fund in November
1998. Ms. Selner is also the investment manager of the
Berger Small Company Growth Fund and Berger Mid Cap
Growth Fund, co-manager of the Berger Select Fund and
interim manager of the Berger Balanced Fund investment
team. Ms. Selner has more than eight years of experience in
the investment industry.
- ----------------------------------------------------------------------------------------------------------------------
Berger IPT - 0.75% paid to Tino Sellitto, Vice President of Berger LLC. Mr. Sellitto
Growth Fund Berger LLC(2) joined Berger as a senior equity analyst in January 1998 and
assumed management of the Fund in November 1998. Mr.
Sellitto is also the investment manager of the Berger Growth
and Income Fund and Berger Growth Fund, co-manager of
the Berger Select Fund and interim manager of the Berger
Balanced Fund investment team. Mr. Sellitto has more than 5
years of experience in the investment industry.
- ----------------------------------------------------------------------------------------------------------------------
Berger/BIAM IPT - 0.90% paid to BIAM, using a team approach, has been the investment man-
International Fund BBOI Worldwide(2) ager for the Fund since its inception in 1997. BIAM is the
sub-advisor to the Fund and is part of Bank of Ireland's
asset management group, established in 1966. BIAM is also
the investment manager for the Berger/BIAM International
Portfolio. Most of the team of investment professionals have
been with the group for at least ten years.
- ----------------------------------------------------------------------------------------------------------------------
Berger IPT - 0.75% paid to Tino Sellitto - see Berger IPT - Growth Fund.
Growth and Income Berger LLC(2)
Fund
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
1. The Berger IPT - New Generation Fund did not commence operations until May
2000.
2. After waivers, advisory fees paid were; Berger IPT-Small Company Growth Fund
0.55%; Berger IPT-Growth Fund 0.00%; Berger/BIAM IPT - International Fund 0.00%;
and Berger IPT-Growth and Income Fund 0.60%.
Berger IPT Funds May 1, 2000 Combined Prospectus
21
<PAGE> 24
Past Performance of Similar Funds
Each Fund's investment manager also acts as the investment manager for a
corresponding retail Berger Fund, which has the same investment objective and
substantially the same investment strategies and policies as the Fund. Set out
below is performance information for each Fund and/or its corresponding retail
Berger Fund. This information is provided so you can consider the performance
history of the Funds' investment managers with funds substantially similar to
the Funds.
You should not consider the performance information for the corresponding retail
Berger Funds as a substitute for the performance of the Funds, nor as an
indication of the past or future performance of the Funds.
Despite their similarity, there are differences between the Funds and their
corresponding retail Berger Funds, and their performance is expected to differ.
The following should be noted in considering the performance information below:
o Each of the Funds is smaller than its corresponding retail Berger Fund and
cash flows vary significantly. Differences in asset size and in cash flow
resulting from purchases and redemption of Fund shares may result in
different security selections, differences in the relative weightings of
securities or differences in the prices paid for particular portfolio
holdings.
o The performance information below for the Berger IPT - Small Company Growth
Fund, Berger IPT - Growth Fund, Berger/BIAM IPT - International Fund and
Berger IPT - Growth and Income Fund each reflect fee waivers and expense
reimbursements by the Funds' advisor, without which performance would be
lower.
o The information below does not reflect the deduction of charges or expenses
attributable to the variable insurance contract or retirement plan through
which you would be purchasing your Fund shares, which would lower your
returns.
Average Annual Total Returns of the Funds and Similar Funds (as of December 31,
1999)
<TABLE>
<CAPTION>
Berger IPT - Berger New
New Generation Generation
Fund(1) Fund
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1 Year N/A 144.20% (2)(3)
Since Inception of the Berger
New Generation Fund (3/29/96) N/A 47.50%
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Berger IPT - New Generation Fund is newly organized and does not have a
performance history of its own.
(2) As of December 31, 1999, the retail Berger New Generation Fund had assets of
approximately $620,512,000.
(3) IPOs constituted a significant portion of the performance of the Berger New
Generation Fund during the last year. However, there can be no assurance that
IPOs will continue to have such a significant impact if the quality or number of
available IPOs diminishes or if the fund grows in size and IPOs become an
insignificant part of the fund's total portfolio.
<TABLE>
<CAPTION>
Berger IPT - Berger
Small Company Small Company
Growth Fund Growth Fund(1)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1 Year 91.45% 104.39%
Since Inception of the Berger IPT -
Small Company Growth Fund (5/1/96) 26.24% 27.16%
5 Year N/A 30.79%
Since Inception of the Berger
Small Company Growth Fund (12/30/93) N/A 27.78%
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) As of December 31, 1999, the retail Berger Small Company Growth Fund had
assets of approximately 1,162,259,000.
<TABLE>
<CAPTION>
Berger IPT - Berger
Growth Growth
Fund Fund(1)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1 Year 49.13% 52.28%
Since Inception of the
Berger IPT - Growth Fund (5/1/96) 21.60% 21.86%
5 Year N/A 22.64%
10 Year N/A 19.76%(2)
Since Inception of the
Berger Growth Fund (9/30/74)(3) N/A 16.35%(2)
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) As of December 31, 1999, the retail Berger Growth Fund had assets of
approximately $1,816,330,000.
(2) Since the 12b-1 fees applicable to the Berger Growth Fund did not take
effect until June 19, 1990, the performance figures do not reflect the deduction
of the 12b-1 fees for the full length of the ten-year and longer periods shown.
(3) Inception date is September 30, 1974, immediately prior to Berger LLC
assuming the duties as the investment advisor for the Fund.
Berger IPT Funds May 1, 2000 Combined Prospectus
22
<PAGE> 25
<TABLE>
<CAPTION>
Berger/BIAM Berger/BIAM
IPT-International International
Fund Fund(1)(3)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1 Year 31.24% 30.90%
Since Inception of the Berger/BIAM
IPT - International Fund (5/1/97) 16.17% 17.78%
5 Year N/A 16.86%
10 Year N/A 12.60%
Since Inception of the Berger/BIAM
International Fund (7/31/89) N/A 14.21%
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) As of December 31, 1999, the retail Berger/BIAM International Fund had
assets of approximately $25,487,000.
(2) Predecessor Performance: Performance figures for the retail Berger/BIAM
International Fund covering periods prior to October 11, 1996, include the
performance of a pool of assets advised by that Fund's investment manager for
periods before that Fund began operations. This performance was adjusted to
reflect the increased expenses expected in operating that Fund, net of fee
waivers. The asset pool was not registered with the SEC and was not subject to
the investment restrictions imposed on mutual funds. If the pool had been
registered, its performance might have been adversely affected.
<TABLE>
<CAPTION>
Berger IPT - Berger
Growth and Growth and
Income Fund Income Fund(1)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1 Year 59.05% 61.32%
Since Inception of the Berger IPT -
Growth and Income Fund (5/1/96) 31.98% 30.39%
5 Year N/A 28.28%
10 Year N/A 19.74%(2)
Since Inception of the Berger
Growth and Income Fund (9/30/74)(3) N/A 15.99%(2)
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) As of December 31, 1999, the retail Berger Growth and Income Fund had assets
of approximately $557,351,000.
(2) Since the 12b-1 fees applicable to the Berger Growth and Income Fund did not
take effect until June 19, 1990, the performance figures do not reflect the
deduction of the 12b-1 fees for the full length of the ten-year and longer
periods shown.
(3) Inception date is September 30, 1974, immediately prior to Berger LLC
assuming the duties as the investment advisor for the Fund.
Portfolio turnover
Portfolio changes are made whenever the Fund's investment manager believes that
the Fund's goal could be better achieved by investment in another security,
regardless of portfolio turnover. At times, portfolio turnover for a Fund may
exceed 100% per year. A turnover rate of 100% means the securities owned by a
Fund were replaced once during the year. Higher turnover rates may result in
higher brokerage costs to the Funds. The portfolio turnover rate for each Fund
then in existence can be found under the heading "Financial Highlights."
Berger IPT Funds May 1, 2000 Combined Prospectus
23
<PAGE> 26
FINANCIAL HIGHLIGHTS
The financial highlights will help you understand each Fund's financial
performance for the periods indicated. Certain information reflects financial
results for a single Fund share. Total return shows how much your investment in
the Fund increased or decreased during each period, assuming you reinvested all
dividends and distributions, but does not reflect charges and expenses deducted
by your variable insurance contract or retirement plan. PricewaterhouseCoopers
LLP, independent accountants, audited this information. Their report is included
in the Funds' annual report, which is available without charge upon request.
Berger IPT - New Generation Fund
Since the Berger IPT - New Generation Fund was not established until May 1,
2000, no financial highlights are shown for that Fund.
<TABLE>
<CAPTION>
Berger IPT - Small Company Growth Fund
For a Share Outstanding Throughout the Periods Years Ended December 31,
------------------------
1999 1998 1997 1996(1)
---------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 12.28 $ 12.06 $ 9.95 $ 10.00
---------------------------------------------------------
From investment operations
Net investment income (loss) -- -- (0.00)(6) 0.01
---------------------------------------------------------
Net realized and unrealized gains (losses) from
investments and foreign currency transactions 11.23 0.23 2.11 (0.06)
---------------------------------------------------------
Total from investment operations 11.23 0.23 2.11 (0.05)
---------------------------------------------------------
Less dividends and distributions
Dividends (in excess of net investment income) -- (0.01) -- --
---------------------------------------------------------
Total dividends and distributions -- (0.01) -- --
---------------------------------------------------------
Net asset value, end of period $ 23.51 $ 12.28 $ 12.06 $ 9.95
---------------------------------------------------------
Total Return(2) 91.45% 1.87% 21.21% (0.50)%
---------------------------------------------------------
Ratios/Supplemental Data:
Net assets, end of period $41,334,809 $9,858,303 $2,719,559 $291,362
---------------------------------------------------------
Net expense ratio to average net assets(3) 1.15% 1.15% 1.15%(5) 1.15%(4)(5)
---------------------------------------------------------
Ratio of net income (loss) to average net assets (0.56)% (0.11)% 0.05% 0.14%(4)
---------------------------------------------------------
Gross expense ratio to average net assets 1.53% 2.19% 5.81% 8.57%(4)
---------------------------------------------------------
Portfolio turnover rate(2) 179% 147% 194% 80%
---------------------------------------------------------
</TABLE>
(1) For the period from May 1, 1996 (commencement of investment operations) to
December 31, 1996.
(2) Not annualized.
(3) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Advisor. Gross and net expenses do not include the deduction
of any charges attributable to any particular variable insurance contract.
(4) Annualized.
(5) Restated to conform with new presentation standards.
(6) Amount represents less than $0.01 per share.
Berger IPT Funds May 1, 2000 Combined Prospectus
24
<PAGE> 27
Berger IPT - Growth Fund
<TABLE>
<CAPTION>
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS YEARS ENDED DECEMBER 31,
------------------------
1999 1998 1997 1996(1)
----------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 12.89 $ 11.11 $ 10.39 $ 10.00
----------------------------------------------------------
From investment operations
Net investment income (loss) -- 0.02 0.01 0.03
----------------------------------------------------------
Net realized and unrealized gains (losses) from
investments and foreign currency transactions 6.33 1.79 1.39 0.36
----------------------------------------------------------
Total from investment operations 6.33 1.81 1.40 0.39
----------------------------------------------------------
Less dividends and distributions
Dividends (from net investment income) (0.00)(6) (0.02) (0.04) --
----------------------------------------------------------
Distributions (from capital gains) -- -- (0.64) --
----------------------------------------------------------
Distributions (in excess of capital gains) -- (0.01) -- --
----------------------------------------------------------
Total dividends and distributions -- (0.03) (0.68) --
----------------------------------------------------------
Net asset value, end of period $ 19.22 $ 12.89 $ 11.11 $ 10.39
----------------------------------------------------------
Total Return(2) 49.13% 16.29% 13.76% 3.90%
----------------------------------------------------------
Ratios/Supplemental Data:
Net assets, end of period $6,665,664 $3,710,109 $1,233,892 $331,296
----------------------------------------------------------
Net expense ratio to average net assets(3) 1.00% 1.00% 1.00%(5) 1.00%(4)(5)
----------------------------------------------------------
Ratio of net income (loss) to average net assets (0.05)% 0.29% 0.51% 0.50%(4)
----------------------------------------------------------
Gross expense ratio to average net assets 2.19% 2.88% 9.18% 7.69%(4)
----------------------------------------------------------
Portfolio turnover rate(2) 231% 258% 246% 56%
----------------------------------------------------------
</TABLE>
(1) For the period from May 1, 1996 (commencement of investment operations) to
December 31, 1996.
(2) Not annualized.
(3) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Advisor. Gross and net expenses do not include the deduction
of any charges attributable to any particular variable insurance contract.
(4) Annualized.
(5) Restated to conform with new presentation standards.
(6) Dividends from net investment income and distributions in excess of net
investment income amounted to less than $0.01 per share.
Berger IPT Funds May 1, 2000 Combined Prospectus
25
<PAGE> 28
Berger/BIAM IPT - International Fund
For a Share Outstanding Throughout the Periods
<TABLE>
<CAPTION>
Years Ended December 31,
1999 1998 1997(1)
------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 11.21 $ 9.79 $ 10.00
------------------------------------------
From investment operations
Net investment income (loss) 0.03 0.08 0.05
------------------------------------------
Net realized and unrealized gains (losses) from
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS 3.47 1.50 (0.26)
------------------------------------------
Total from investment operations 3.50 1.58 (0.21)
------------------------------------------
Less dividends and distributions
Dividends (from net investment income) (0.08) (0.14) --
------------------------------------------
Distributions (in excess of capital gains) -- (0.02) --
------------------------------------------
Total dividends and distributions (0.08) (0.16) --
------------------------------------------
Net asset value, end of period $ 14.63 $ 11.21 $ 9.79
------------------------------------------
Total Return(2) 31.24% 16.13% (2.10)%
------------------------------------------
Ratios/Supplemental Data:
Net assets, end of period $6,122,261 $5,430,076 $2,705,831
------------------------------------------
Net expense ratio to average net assets(3) 1.20% 1.20% 1.20%(4)(5)
------------------------------------------
Ratio of net income (loss) to average net assets 0.51% 2.85% 0.86%(4)
------------------------------------------
Gross expense ratio to average net assets 2.46% 2.85% 3.83%(4)
------------------------------------------
Portfolio turnover rate(2) 26% 20% 14%
------------------------------------------
</TABLE>
(1) For the period from May 1, 1997 (commencement of investment operations) to
December 31, 1997.
(2) Not annualized.
(3) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Advisor. Gross and net expenses do not include the deduction
of any charges attributable to any particular variable insurance contract.
(4) Annualized.
(5) Restated to conform with new presentation standards.
Berger IPT Funds May 1, 2000 Combined Prospectus
26
<PAGE> 29
<TABLE>
<CAPTION>
Berger IPT - Growth and Income Fund
For a Share Outstanding Throughout the Periods Years Ended December 31,
------------------------
1999 1998 1997 1996(1)
----------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 16.63 $ 13.39 $ 11.14 $ 10.00
----------------------------------------------------------
From investment operations
Net investment income (loss) 0.02 0.10 0.01 0.10
----------------------------------------------------------
Net realized and unrealized gains (losses) from
investments and foreign currency transactions 9.80 3.25 2.75 1.04
----------------------------------------------------------
Total from investment operations 9.82 3.35 2.76 1.14
----------------------------------------------------------
Less dividends and distributions
Dividends (from net investment income) -- (0.11)(6) (0.10) --
----------------------------------------------------------
Distributions (from capital gains) -- -- (0.39) --
----------------------------------------------------------
Distributions (in excess of capital gains) -- -- (0.02) --
----------------------------------------------------------
Total dividends and distributions -- (0.11) (0.51) --
----------------------------------------------------------
Net asset value, end of period $ 26.45 $ 16.63 $ 13.39 $ 11.14
----------------------------------------------------------
Total Return(2) 59.05% 25.03% 24.99% 11.40%
----------------------------------------------------------
Ratios/Supplemental Data:
Net assets, end of period $24,871,949 $9,084,022 $1,501,118 $344,373
----------------------------------------------------------
Net expense ratio to average net assets(3) 1.00% 1.00% 1.00%(5) 1.00%(4)(5)
----------------------------------------------------------
Ratio of net income (loss) to average net assets 0.10% 1.10% 1.39% 1.80%(4)
----------------------------------------------------------
Gross expense ratio to average net assets 1.19% 1.99% 9.62% 7.70%(4)
----------------------------------------------------------
Portfolio turnover rate(2) 149% 426% 215% 60%
----------------------------------------------------------
</TABLE>
(1) For the period from May 1, 1996 (commencement of investment operations) to
December 31, 1996.
(2) Not annualized.
(3) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Advisor. Gross and net expenses do not include the deduction
of any charges attributable to any particular variable insurance contract.
(4) Annualized.
(5) Restated to conform with new presentation standards.
(6) Distributions in excess of net investment income for the year ended December
31, 1998, amounted to less than $0.01 per share.
Berger IPT Funds May 1, 2000 Combined Prospectus
27
<PAGE> 30
FOR MORE INFORMATION:
Additional information about the Funds' investments is available in the Funds'
semi-annual and annual reports to shareholders. The Funds' annual report
contains a discussion of the market conditions and investment strategies that
affected the Funds' performance over the past year.
You may wish to read the Statement of Additional Information (SAI) for more
information on the Funds and the securities they invest in. The SAI is
incorporated into this prospectus by reference, which means that it is
considered to be part of the prospectus.
You can get free copies of the annual and semi-annual reports and the SAI,
request other information or get answers to your questions about the Funds by
calling or writing either a participating insurance company or the Funds at:
Berger Funds
P.O. Box 5005
Denver, CO 80217
(800) 259-2820
bergerfunds.com
Text-only versions of Fund documents can be viewed online or downloaded from the
EDGAR database on the SEC's web site at sec.gov.
You can also obtain copies by visiting the SEC's Public Reference Room in
Washington D.C. For information on the operation of the Public Reference Room,
call 1-202-942-8090. Copies of documents may also be obtained, after paying a
duplicating fee, by sending your request to the following e-mail address:
[email protected]. or by writing to the SEC's Public Reference Section,
Washington, DC 20549-6009.
INVESTMENT COMPANY ACT FILE NUMBER:
Berger Institutional Products Trust 811-07367
o Berger IPT - New Generation Fund
o Berger IPT - Small Company Growth Fund
o Berger IPT - Growth Fund
o Berger/BIAM IPT - International Fund
o Berger IPT - Growth and Income Fund
4/00IPT PROS
<PAGE> 31
BERGER IPT - NEW GENERATION FUND
BERGER IPT - SMALL COMPANY GROWTH FUND
BERGER IPT - GROWTH FUND
BERGER/BIAM IPT - INTERNATIONAL FUND
BERGER IPT - GROWTH AND INCOME FUND
STATEMENT OF ADDITIONAL INFORMATION
This Statement of Additional Information ("SAI") is not a
prospectus. It should be read in conjunction with the Prospectus for the five
Funds listed above (the "Funds"), dated May 1, 2000, as it may be amended or
supplemented from time to time, which may be obtained by writing the Funds at
P.O. Box 5005, Denver, Colorado 80217, or calling 1-800-259-2820. Each of the
Funds is a series of Berger Institutional Products Trust (the "Trust").
Shares of the Funds are not offered directly to the public,
but are sold only in connection with investment in and payments under variable
annuity contracts and variable life insurance contracts (collectively "variable
insurance contracts") issued by life insurance companies ("Participating
Insurance Companies"), as well as to certain qualified retirement plans.
The financial statements of each of the Funds then in
existence for the fiscal year ended December 31, 1999, and the related Report of
Independent Accountants on those statements, are incorporated into this SAI by
reference from the Funds' 1999 Annual Report to Shareholders dated December 31,
1999. A copy of that Annual Report is available, without charge, upon request,
by calling 1-800-259-2820, or by contacting a Participating Insurance Company.
MAY 1, 2000
<PAGE> 32
TABLE OF CONTENTS
&
CROSS-REFERENCES TO PROSPECTUS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
SECTION PAGE CROSS-REFERENCES TO
NO. RELATED DISCLOSURES
IN PROSPECTUS
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Introduction 1 Contents
- ----------------------------------------------------------------------------------------------------------------------
1. Investment Strategies and Risks of the Funds 1 Berger IPT Funds;
Investment Techniques, Securities and
Associated Risks
- ----------------------------------------------------------------------------------------------------------------------
2. Investment Restrictions 13 Berger IPT Funds;
Investment Techniques, Securities and
Associated Risks
- ----------------------------------------------------------------------------------------------------------------------
3. Management of the Funds 18 Organization of the Funds
- ----------------------------------------------------------------------------------------------------------------------
4. Investment Advisors and Sub-Advisor 22 Organization of the Funds
- ----------------------------------------------------------------------------------------------------------------------
5. Expenses of the Funds 26 Berger IPT Funds;
Organization of the Funds; Financial
Highlights
- ----------------------------------------------------------------------------------------------------------------------
6. Brokerage Policy 29 Organization of the Funds
- ----------------------------------------------------------------------------------------------------------------------
7. How To Purchase and Redeem Shares In the Funds 32 Buying and Selling (Redeeming) Shares
- ----------------------------------------------------------------------------------------------------------------------
8. Suspension of Redemption Rights 32 Buying and Selling (Redeeming) Shares
- ----------------------------------------------------------------------------------------------------------------------
9. How the Net Asset Value is Determined 32 Fund Share Price
- ----------------------------------------------------------------------------------------------------------------------
10. Income Dividends, Capital Gains Distributions and Tax 33 Distributions and Taxes
Treatment
- ----------------------------------------------------------------------------------------------------------------------
11. Performance Information 33 Berger IPT Funds; Financial Highlights
- ----------------------------------------------------------------------------------------------------------------------
12. Additional Information 35 Other Information
- ----------------------------------------------------------------------------------------------------------------------
Financial Statements 38 Financial Highlights
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 33
INTRODUCTION
The Funds are diversified portfolios or series of the Berger
Institutional Products Trust, an open-end, management investment company.
Although each Fund is offering only its own shares and is not participating in
the sale of the shares of the other Funds, it is possible that a Fund might
become liable for any misstatement, inaccuracy or incomplete disclosure in the
Prospectus or SAI concerning the other Funds.
1. INVESTMENT STRATEGIES AND RISKS OF THE FUNDS
The Prospectus describes the investment objective of each of
the Funds and the principal investment policies and strategies used to achieve
that objective. It also describes the principal risks of investing in each Fund.
This section contains supplemental information concerning the
types of securities and other instruments in which the Funds may invest, the
investment policies and portfolio strategies that the Funds may utilize and
certain risks attendant to those investments, policies and strategies.
COMMON AND PREFERRED STOCKS. Stocks represent shares of
ownership in a company. Generally, preferred stock has a specified dividend and
ranks after bonds and before common stocks in its claim on income for dividend
payments and on assets should the company be liquidated. After other claims are
satisfied, common stockholders participate in company profits on a pro-rata
basis. Profits may be paid out in dividends or reinvested in the company to help
it grow. Increases and decreases in earnings are usually reflected in a
company's stock price, so common stocks generally have the greatest appreciation
and depreciation potential of all corporate securities. While most preferred
stocks pay dividends, any of the Funds may purchase preferred stock where the
issuer has omitted, or is in danger of omitting, payment of its dividends. Such
investments would be made primarily for their capital appreciation potential.
All investments in stocks are subject to market risk, meaning that their prices
may move up and down with the general stock market, and that such movements
might reduce their value.
DEBT SECURITIES. Debt securities (such as bonds or debentures)
are fixed-income securities which bear interest and are issued by corporations
or governments. The issuer has a contractual obligation to pay interest at a
stated rate on specific dates and to repay principal on a specific maturity
date. In addition to market risk, debt securities are generally subject to two
other kinds of risk: credit risk and interest rate risk. Credit risk refers to
the ability of the issuer to meet interest or principal payments as they come
due. The lower the rating given a security by a rating service (such as Moody's
Investor Service ("Moody's") and Standard & Poor's ("S&P")), the greater the
credit risk the rating service perceives with respect to that security. None of
the Funds will purchase any nonconvertible securities rated below investment
grade (Ba or lower by Moody's, BB or lower by S&P). In cases where the ratings
assigned by more than one rating agency differ, the Funds will consider the
security as rated in the higher category. If nonconvertible securities purchased
by a Fund are downgraded to below investment grade following purchase, the
trustees of the Fund, in consultation with the Fund's advisor or sub-advisor,
will determine what action, if any, is appropriate in light of all relevant
circumstances. For a further discussion of debt security ratings, see Appendix A
to this Statement of Additional Information.
Interest rate risk refers to the fact that the value of
fixed-income securities (like debt securities) generally fluctuates in response
to changes in interest rates. A decrease in interest rates will generally result
in an increase in the price of fixed-income securities held by a Fund.
Conversely, during periods of rising interest rates, the value of fixed-income
securities held by a Fund will generally decline. Longer-term securities are
generally more sensitive to interest rate changes and are more volatile than
shorter-term securities, but they generally offer higher yields to compensate
investors for the associated risks.
Certain debt securities can also present prepayment risk. For
example, a security may contain redemption and call provisions. If an issuer
exercises these provisions when interest rates are declining, the Fund could
sustain investment losses as well as have to reinvest the proceeds from the
security at lower interest rates, resulting in a decreased return for the Fund.
FOREIGN SECURITIES. Each Fund may invest in foreign
securities, which may be traded in foreign markets and denominated in foreign
currency. The Funds' investments may also include American Depositary Receipts
(ADRs), European Depositary Receipts (EDRs) which are similar to ADRs, in bearer
form, designed for use in the European securities markets, and in Global
Depositary Receipts (GDRs).
-1-
<PAGE> 34
Investments in foreign securities involve some risks that are
different from the risks of investing in securities of U.S. issuers, such as the
risk of adverse political, social, diplomatic and economic developments and,
with respect to certain countries, the possibility of expropriation, taxes
imposed by foreign countries or limitations on the removal of monies or other
assets of the Funds. Moreover, the economies of individual foreign countries
will vary in comparison to the U.S. economy in such respects as growth of gross
domestic product, rate of inflation, capital reinvestment, resources,
self-sufficiency and balance of payments position. Securities of some foreign
companies, particularly those in developing countries, are less liquid and more
volatile than securities of comparable domestic companies. A developing country
generally is considered to be in the initial stages of its industrialization
cycle. Investing in the securities of developing countries may involve exposure
to economic structures that are less diverse and mature, and to political
systems that can be expected to have less stability than developed countries.
There also may be less publicly available information about
foreign issuers and securities than domestic issuers and securities, and foreign
issuers generally are not subject to accounting, auditing and financial
reporting standards, requirements and practices comparable to those applicable
to domestic issuers. Also, there is generally less government supervision and
regulation of exchanges, brokers, financial institutions and issuers in foreign
countries than there is in the U.S. Foreign financial markets typically have
substantially less volume than U.S. markets. Foreign markets also have different
clearance and settlement procedures and, in certain markets, delays or other
factors could make it difficult to effect transactions, potentially causing a
Fund to experience losses or miss investment opportunities.
Costs associated with transactions in foreign securities are
generally higher than with transactions in U.S. securities. A Fund will incur
greater costs in maintaining assets in foreign jurisdictions and in buying and
selling foreign securities generally, resulting in part from converting foreign
currencies into U.S. dollars. In addition, a Fund might have greater difficulty
taking appropriate legal action with respect to foreign investments in non-U.S.
courts than with respect to domestic issuers in U.S. courts, which may heighten
the risk of possible losses through the holding of securities by custodians and
securities depositories in foreign countries.
For any Fund invested in securities denominated or quoted in
currencies other than the U.S. dollar, changes in foreign currency exchange
rates will affect the value of the investments in its portfolio and the
unrealized appreciation or depreciation of investments insofar as U.S. investors
are concerned. If the foreign currency in which a security is denominated
appreciates against the U.S. dollar, the dollar value of the security will
increase. Conversely, a decline in the exchange rate of the foreign currency
against the U.S. dollar would adversely affect the dollar value of the foreign
securities. Foreign currency exchange rates are determined by forces of supply
and demand on the foreign exchange markets, which are in turn affected by the
international balance of payments and other economic and financial conditions,
government intervention, speculation and other factors.
PASSIVE FOREIGN INVESTMENT COMPANIES (PFICS). The Funds may
purchase the securities of certain companies considered Passive Foreign
Investment Companies (PFICs) under U.S. tax laws. For certain types of PFICs, in
addition to bearing their proportionate share of a Fund's expenses (management
fees and operating expenses), shareholders will also indirectly bear similar
expenses of such PFIC. PFIC investments also may be subject to less favorable
U.S. tax treatment, as discussed in Section 10 below.
SECURITIES OF SMALLER COMPANIES. All of the Funds may invest
in, and the portfolio of the Berger IPT - Small Company Growth Fund will be
weighted toward, securities of companies with small- or mid-sized market
capitalizations. Market capitalization is defined as total current market value
of a company's outstanding common stock. Investments in companies with smaller
market capitalizations may involve greater risks and price volatility (that is,
more abrupt or erratic price movements) than investments in larger, more mature
companies since smaller companies may be at an earlier stage of development and
may have limited product lines, reduced market liquidity for their shares,
limited financial resources or less depth in management than larger or more
established companies. Smaller companies also may be less significant factors
within their industries and may have difficulty withstanding competition from
larger companies. While smaller companies may be subject to these additional
risks, they may also realize more substantial growth than larger or more
established companies.
-2-
<PAGE> 35
SPECIAL SITUATIONS. Each Fund may also invest in "special
situations." Special situations are companies that have recently experienced or
are anticipated to experience a significant change in structure, management,
products or services which may significantly affect the value of their
securities. Examples of special situations are companies being reorganized or
merged, companies emerging from bankruptcy, companies introducing unusual new
products or which enjoy particular tax advantages. Other examples are companies
experiencing changes in senior management, extraordinary corporate events,
significant changes in cost or capital structure or which are believed to be
probable takeover candidates. The opportunity to invest in special situations,
however, is limited and depends in part on the market's assessment of these
companies and their circumstances. By its nature, a "special situation" company
involves to some degree a break with the company's past experience. This creates
greater uncertainty and potential risk of loss than if the company were
operating according to long-established patterns. In addition, stocks of
companies in special situations may decline or not appreciate as expected if an
anticipated change or development does not occur or is not assessed by the
market as favorably as expected.
HEDGING TRANSACTIONS. Each Fund except the Berger/BIAM IPT -
International Fund is authorized to make limited use of certain types of
futures, forwards and/or options, but only for the purpose of hedging, that is,
protecting against market risk due to market movements that may adversely affect
the value of a Fund's securities or the price of securities that a Fund is
considering purchasing. The utilization of futures, forwards and options is also
subject to policies and procedures which may be established by the trustees from
time to time. In addition, none of the Funds is required to hedge. Decisions
regarding hedging are subject to the advisor's or sub-advisor's judgment of the
cost of the hedge, its potential effectiveness and other factors the advisor or
sub-advisor considers pertinent.
Currently, the Berger IPT -International Fund is authorized to
invest only in forward contracts for hedging purposes and is not permitted to
invest in futures or options. If the trustees ever authorize the Berger/BIAM IPT
- - International Fund to invest in futures or options, such investments would be
permitted solely for hedging purposes, and the Fund would not be permitted to
invest more than 5% of its net assets at the time of purchase in initial margins
for financial futures transactions and premiums for options. In addition, the
advisor or sub-advisor for the Berger/BIAM IPT - International Fund may be
required to obtain bank regulatory approval before the Fund engages in futures
and options transactions. The following information about the Funds' hedging
transactions using futures, forwards and options should be read to exclude the
Berger/BIAM IPT - International Fund, except to the extent the information
relates to forward contracts.
A hedging transaction may partially protect a Fund from a
decline in the value of a particular security or its portfolio generally,
although hedging may also limit a Fund's opportunity to profit from favorable
price movements, and the cost of the transaction will reduce the potential
return on the security or the portfolio. Use of these instruments by a Fund
involves the potential for a loss that may exceed the amount of initial margin
the Fund would be permitted to commit to the contracts under its investment
limitation, or in the case of a call option written by the Fund, may exceed the
premium received for the option. However, a Fund is permitted to use such
instruments for hedging purposes only, and only if the aggregate amount of its
obligations under these contracts does not exceed the total market value of the
assets the Fund is attempting to hedge, such as a portion or all of its exposure
to equity securities or its holding in a specific foreign currency. To help
ensure that the Fund will be able to meet its obligations under its futures and
forward contracts and its obligations under options written by that Fund, the
Fund will be required to maintain liquid assets in a segregated account with its
custodian bank or to set aside portfolio securities to "cover" its position in
these contracts.
The principal risks of a Fund utilizing futures transactions,
forward contracts and options are: (a) losses resulting from market movements
not anticipated by the Fund; (b) possible imperfect correlation between
movements in the prices of futures, forwards and options and movements in the
prices of the securities or currencies hedged or used to cover such positions;
(c) lack of assurance that a liquid secondary market will exist for any
particular futures or options at any particular time, and possible
exchange-imposed price fluctuation limits, either of which may make it difficult
or impossible to close a position when so desired; (d) lack of assurance that
the counterparty to a forward contract would be willing to negotiate an offset
or termination of the contract when so desired; and (e) the need for additional
information and skills beyond those required for the management of a portfolio
of traditional securities. In addition, when the Fund enters into an
over-the-counter contract with a counterparty, the Fund will assume counterparty
credit risk, that is, the risk that the counterparty will fail to perform its
obligations, in which case the Fund could be worse off than if the contract had
not been entered into.
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Following is additional information concerning the futures,
forwards and options which the Funds may utilize, provided that no more than 5%
of the Fund's net assets at the time the contract is entered into may be used
for initial margins for financial futures transactions and premiums paid for the
purchase of options. In addition, a Fund may only write call options that are
covered and only up to 25% of the Fund's total assets. The following information
should be read in conjunction with the information concerning the Funds' use of
futures, forwards and options and the risks of such instruments contained in the
Prospectus.
Futures Contracts. Financial futures contracts are
exchange-traded contracts on financial instruments (such as securities and
foreign currencies) and securities indices that obligate the holder to take or
make delivery of a specified quantity of the underlying financial instrument, or
the cash value of an index, at a future date. Although futures contracts by
their terms call for the delivery or acquisition of the underlying instruments
or a cash payment based on the mark-to-market value of the underlying
instruments, in most cases the contractual obligation will be offset before the
delivery date by buying (in the case of an obligation to sell) or selling (in
the case of an obligation to buy) an identical futures contract. Such a
transaction cancels the original obligation to make or take delivery of the
instruments.
Each Fund may enter into contracts for the purchase or sale
for future delivery of financial instruments, such as securities and foreign
currencies, or contracts based on financial indices including indices of U.S.
Government securities, foreign government securities or equity securities. U.S.
futures contracts are traded on exchanges which have been designated "contract
markets" by the Commodity Futures Trading Commission ("CFTC") and must be
executed through a futures commission merchant (an "FCM"), or brokerage firm,
which is a member of the relevant contract market. Through their clearing
corporations, the exchanges guarantee performance of the contracts as between
the clearing members of the exchange.
Both the buyer and seller are required to deposit "initial
margin" for the benefit of the FCM when a futures contract is entered into.
Initial margin deposits are equal to a percentage of the contract's value, as
set by the exchange on which the contract is traded, and may be maintained in
cash or other liquid assets. If the value of either party's position declines,
that party will be required to make additional "variation margin" payments to
the other party to settle the change in value on a daily basis. Initial and
variation margin payments are similar to good faith deposits or performance
bonds or party-to-party payments resulting from daily changes in the value of
the contract, unlike margin extended by a securities broker, and would be
released or credited to the Funds upon termination of the futures contract,
assuming all contractual obligations have been satisfied. Unlike margin extended
by a securities broker, initial and variation margin payments do not constitute
purchasing securities on margin for purposes of a Fund's investment limitations.
A Fund will incur brokerage fees when it buys or sells futures contracts.
In the event of the bankruptcy of the FCM that holds margin on
behalf of a Fund, the Fund may be entitled to return of margin owed to the Fund
only in proportion to the amount received by the FCM's other customers. A Fund
will attempt to minimize this risk by careful monitoring of the creditworthiness
of the FCMs with which the Fund does business and by depositing margin payments
in a segregated account with the Fund's custodian for the benefit of the FCM
when practical or otherwise required by law.
Each Fund intends to comply with guidelines of eligibility for
exclusion from the definition of the term "commodity pool operator" with the
CFTC and the National Futures Association, which regulate trading in the futures
markets. Accordingly, a Fund will not enter into any futures contract or option
on a futures contract if, as a result, the aggregate initial margin and premiums
required to establish such positions would exceed 5% of the Fund's net assets.
Although a Fund will hold cash and liquid assets in a
segregated account with a mark-to-market value sufficient to cover the Fund's
open futures obligations, the segregated assets will be available to the Fund
immediately upon closing out the futures position.
The acquisition or sale of a futures contract may occur, for
example, when a Fund is considering purchasing or holds equity securities and
seeks to protect itself from fluctuations in prices without buying or selling
those securities. For example, if prices were expected to decrease, the Fund
might sell equity index futures contracts, thereby hoping to offset a potential
decline in the value of equity securities in the portfolio by a
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corresponding increase in the value of the futures contract position held by the
Fund and thereby preventing the Fund's net asset value from declining as much as
it otherwise would have. A Fund also could protect against potential price
declines by selling portfolio securities and investing in money market
instruments. However, the use of futures contracts as a hedging technique allows
a Fund to maintain a defensive position without having to sell portfolio
securities.
Similarly, when prices of equity securities are expected to
increase, futures contracts may be bought to attempt to hedge against the
possibility of having to buy equity securities at higher prices. This technique
is sometimes known as an anticipatory hedge. Since the fluctuations in the value
of futures contracts should be similar to those of equity securities, a Fund
could take advantage of the potential rise in the value of equity securities
without buying them until the market has stabilized. At that time, the futures
contracts could be liquidated and the Fund could buy equity securities on the
cash market.
The ordinary spreads between prices in the cash and futures
markets, due to differences in the nature of those markets, are subject to
distortions. First, all participants in the futures market are subject to
initial margin and variation margin requirements. Rather than meeting additional
variation margin requirements, investors may close out futures contracts through
offsetting transactions which could distort the normal price relationship
between the cash and futures markets. Second, the liquidity of the futures
market depends on participants entering into offsetting transactions rather than
making or taking delivery. To the extent participants decide to make or take
delivery, liquidity in the futures market could be reduced and prices in the
futures market distorted. Third, from the point of view of speculators, the
margin deposit requirements in the futures market are less than margin
requirements in the securities market. Therefore, increased participation by
speculators in the futures market may cause temporary price distortions. Due to
the possibility of the foregoing distortions, a correct forecast of general
price trends by a Fund still may not result in a successful use of futures.
Futures contracts entail additional risks. Although a Fund
will only utilize futures contracts when it believes that use of such contracts
will benefit the Fund, if the Fund's investment judgment is incorrect, the
Fund's overall performance could be worse than if the Fund had not entered into
futures contracts. For example, if the Fund has hedged against the effects of a
possible decrease in prices of securities held in the Fund's portfolio and
prices increase instead, the Fund will lose part or all of the benefit of the
increased value of these securities because of offsetting losses in the Fund's
futures positions. In addition, if the Fund has insufficient cash, it may have
to sell securities from its portfolio to meet daily variation margin
requirements. Those sales may be, but will not necessarily be, at increased
prices which reflect the rising market and may occur at a time when the sales
are disadvantageous to the Fund. Although the buyer of an option cannot lose
more than the amount of the premium plus related transaction costs, a buyer or
seller of futures contracts could lose amounts substantially in excess of any
initial margin deposits made, due to the potential for adverse price movements
resulting in additional variation margin being required by such positions.
However, each Fund intends to monitor its investments closely and will attempt
to close its positions when the risk of loss to the Fund becomes unacceptably
high.
The prices of futures contracts depend primarily on the value
of their underlying instruments. Because there are a limited number of types of
futures contracts, it is possible that the standardized futures contracts
available to a Fund will not match exactly the Fund's current or potential
investments. A Fund may buy and sell futures contracts based on underlying
instruments with different characteristics from the securities in which it
typically invests -- for example, by hedging investments in portfolio securities
with a futures contract based on a broad index of securities -- which involves a
risk that the futures position will not correlate precisely with the performance
of the Fund's investments.
Futures prices can also diverge from the prices of their
underlying instruments, even if the underlying instruments closely correlate
with a Fund's investments. Futures prices are affected by such factors as
current and anticipated short-term interest rates, changes in volatility of the
underlying instruments and the time remaining until expiration of the contract.
Those factors may affect securities prices differently from futures prices.
Imperfect correlations between a Fund's investments and its futures positions
may also result from differing levels of demand in the futures markets and the
securities markets, from structural differences in how futures and securities
are traded, and from imposition of daily price fluctuation limits for futures
contracts. A Fund may buy or sell futures contracts with a value less than or
equal to the securities it wishes to hedge or is considering purchasing. If
price changes in a Fund's futures positions are poorly correlated with its other
investments, its
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<PAGE> 38
futures positions may fail to produce desired gains or result in losses that are
not offset by the gains in the Fund's other investments.
Because futures contracts are generally settled within a day
from the date they are closed out, compared with a longer settlement period for
most types of securities, the futures markets can provide superior liquidity to
the securities markets. Nevertheless, there is no assurance a liquid secondary
market will exist for any particular futures contract at any particular time. In
addition, futures exchanges may establish daily price fluctuation limits for
futures contracts and may halt trading if a contract's price moves upward or
downward more than the limit in a given day. On volatile trading days when the
price fluctuation limit is reached, it may be impossible for a Fund to enter
into new positions or close out existing positions. If the secondary market for
a futures contract is not liquid because of price fluctuation limits or
otherwise, a Fund may not be able to promptly liquidate unfavorable futures
positions and potentially could be required to continue to hold a futures
position until the delivery date, regardless of changes in its value. As a
result, a Fund's access to other assets held to cover its futures positions also
could be impaired.
Options on Futures Contracts. Each Fund may buy and write
options on futures contracts for hedging purposes. An option on a futures
contract gives a Fund the right (but not the obligation) to buy or sell a
futures contract at a specified price on or before a specified date. The
purchase of a call option on a futures contract is similar in some respects to
the purchase of a call option on an individual security. Depending on the
pricing of the option compared to either the price of the futures contract upon
which it is based or the price of the underlying instrument, ownership of the
option may or may not be less risky than ownership of the futures contract or
the underlying instrument. As with the purchase of futures contracts, a Fund may
buy a call option on a futures contract to hedge against a market advance, and a
Fund might buy a put option on a futures contract to hedge against a market
decline.
The writing of a call option on a futures contract constitutes
a partial hedge against declining prices of the security or foreign currency
which is deliverable under, or of the index comprising, the futures contract. If
the futures price at the expiration of the call option is below the exercise
price, a Fund will retain the full amount of the option premium which provides a
partial hedge against any decline that may have occurred in the Fund's portfolio
holdings. If a call option a Fund has written is exercised, the Fund will incur
a loss which will be reduced by the amount of the premium it received. Depending
on the degree of correlation between change in the value of its portfolio
securities and changes in the value of the futures positions, a Fund's losses
from existing options on futures may to some extent be reduced or increased by
changes in the value of portfolio securities.
The purchase of a put option on a futures contract is similar
in some respects to the purchase of protective put options on portfolio
securities. For example, a Fund may buy a put option on a futures contract to
hedge the Fund's portfolio against the risk of falling prices.
The amount of risk a Fund assumes when it buys an option on a
futures contract is the premium paid for the option plus related transaction
costs. In addition to the correlation risks discussed above, the purchase of an
option also entails the risk that changes in the value of the underlying futures
contract will not be fully reflected in the value of the options bought.
Forward Foreign Currency Exchange Contracts. A forward
contract is a privately negotiated agreement between two parties in which one
party is obligated to deliver a stated amount of a stated asset at a specified
time in the future and the other party is obligated to pay a specified invoice
amount for the assets at the time of delivery. The Funds currently intend that
they will only use forward contracts or commitments for hedging purposes and
will only use forward foreign currency exchange contracts, although a Fund may
enter into additional forms of forward contracts or commitments in the future if
they become available and advisable in light of the Fund's objectives and
investment policies. Forward contracts generally are negotiated in an interbank
market conducted directly between traders (usually large commercial banks) and
their customers. Unlike futures contracts, which are standardized
exchange-traded contracts, forward contracts can be specifically drawn to meet
the needs of the parties that enter into them. The parties to a forward contract
may agree to offset or terminate the contract before its maturity, or may hold
the contract to maturity and complete the contemplated exchange.
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<PAGE> 39
The following discussion summarizes the Funds' principal uses
of forward foreign currency exchange contracts ("forward currency contracts"). A
Fund may enter into forward currency contracts with stated contract values of up
to the value of the Fund's assets. A forward currency contract is an obligation
to buy or sell an amount of a specified currency for an agreed price (which may
be in U.S. dollars or a foreign currency) on a specified date. A Fund will
exchange foreign currencies for U.S. dollars and for other foreign currencies in
the normal course of business and may buy and sell currencies through forward
currency contracts in order to fix a price (in terms of a specified currency)
for securities it has agreed to buy or sell ("transaction hedge"). A Fund also
may hedge some or all of its investments denominated in foreign currency against
a decline in the value of that currency (or a proxy currency whose price
movements are expected to have a high degree of correlation with the currency
being hedged) relative to the U.S. dollar by entering into forward currency
contracts to sell an amount of that currency approximating the value of some or
all of its portfolio securities denominated in that currency ("position hedge")
or by participating in futures contracts (or options on such futures) with
respect to the currency. A Fund also may enter into a forward currency contract
with respect to a currency where the Fund is considering the purchase or sale of
investments denominated in that currency but has not yet selected the specific
investments ("anticipatory hedge").
These types of hedging minimize the effect of currency
appreciation as well as depreciation, but do not eliminate fluctuations in the
underlying U.S. dollar equivalent value of the proceeds of or rates of return on
a Fund's foreign currency denominated portfolio securities. The matching of the
increase in value of a forward contract and the decline in the U.S. dollar
equivalent value of the foreign currency denominated asset that is the subject
of the hedge generally will not be precise. Shifting a Fund's currency exposure
from one foreign currency to another limits that Fund's opportunity to profit
from increases in the value of the original currency and involves a risk of
increased losses to such Fund if its investment manager's projection of future
exchange rates is inaccurate. Unforeseen changes in currency prices may result
in poorer overall performance for a Fund than if it had not entered into such
contracts.
A Fund will cover outstanding forward currency contracts by
maintaining liquid portfolio securities denominated in the currency underlying
the forward contract or the currency being hedged. To the extent that a Fund is
not able to cover its forward currency positions with underlying portfolio
securities, the Funds' custodian will segregate cash or liquid assets having a
value equal to the aggregate amount of such Fund's commitments under forward
contracts entered into. If the value of the securities used to cover a position
or the value of segregated assets declines, the Fund must find alternative cover
or segregate additional cash or liquid assets on a daily basis so that the value
of the covered and segregated assets will be equal to the amount of a Fund's
commitments with respect to such contracts.
While forward contracts are not currently regulated by the
CFTC, the CFTC may in the future assert authority to regulate forward contracts.
In such event, the Funds' ability to utilize forward contracts may be
restricted. A Fund may not always be able to enter into forward contracts at
attractive prices and may be limited in its ability to use these contracts to
hedge Fund assets. In addition, when a Fund enters into a privately negotiated
forward contract with a counterparty, the Fund assumes counterparty credit risk,
that is, the risk that the counterparty will fail to perform its obligations, in
which case the Fund could be worse off than if the contract had not been entered
into. Unlike many exchange-traded futures contracts and options on futures,
there are no daily price fluctuation limits with respect to forward contracts
and other negotiated or over-the-counter instruments, and with respect to those
contracts, adverse market movements could therefore continue to an unlimited
extent over a period of time. However, each Fund intends to monitor its
investments closely and will attempt to renegotiate or close its positions when
the risk of loss to the Fund becomes unacceptably high.
Options on Securities and Securities Indices. A Fund may buy
or sell put or call options and write covered call options on securities that
are traded on United States or foreign securities exchanges or over-the-counter.
Buying an option involves the risk that, during the option period, the price of
the underlying security will not increase (in the case of a call) to above the
exercise price, or will not decrease (in the case of a put) to below the
exercise price, in which case the option will expire without being exercised and
the holder would lose the amount of the premium. Writing a call option involves
the risk of an increase in the market value of the underlying security, in which
case the option could be exercised and the underlying security would then be
sold by a Fund to the option holder at a lower price than its current market
value and the Fund's potential for capital appreciation on the security would be
limited to the exercise price. Moreover, when a Fund writes a call option on a
securities index, the Fund bears the risk of loss resulting from imperfect
correlation between movements in the price of the
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<PAGE> 40
index and the price of the securities set aside to cover such position. Although
they entitle the holder to buy equity securities, call options to purchase
equity securities do not entitle the holder to dividends or voting rights with
respect to the underlying securities, nor do they represent any rights in the
assets of the issuer of those securities.
A call option written by a Fund is "covered" if the Fund owns
the underlying security covered by the call or has an absolute and immediate
right to acquire that security without additional cash consideration (or for
additional cash consideration held in a segregated account by its custodian)
upon conversion or exchange of other securities held in its portfolio. A call
option is also deemed to be covered if a Fund holds a call on the same security
and in the same principal amount as the call written and the exercise price of
the call held (i) is equal to or less than the exercise price of the call
written or (ii) is greater than the exercise price of the call written if the
difference is maintained by the Fund in liquid assets in a segregated account
with its custodian.
The writer of a call option may have no control when the
underlying securities must be sold. Whether or not an option expires
unexercised, the writer retains the amount of the premium. This amount, of
course, may, in the case of a covered call option, be offset by a decline in the
market value of the underlying security during the option period.
The writer of an exchange-traded call option that wishes to
terminate its obligation may effect a "closing purchase transaction." This is
accomplished by buying an option of the same series as the option previously
written. The effect of the purchase is that the writer's position will be
canceled by the clearing corporation. If a Fund desires to sell a particular
security from the Fund's portfolio on which the Fund has written a call option,
the Fund will effect a closing transaction prior to or concurrent with the sale
of the security. However, a writer may not effect a closing purchase transaction
after being notified of the exercise of an option. An investor who is the holder
of an exchange-traded option may liquidate its position by effecting a "closing
sale transaction." This is accomplished by selling an option of the same series
as the option previously bought. There is no guarantee that either a closing
purchase or a closing sale transaction can be effected.
A Fund will realize a profit from a closing transaction if the
price of the purchase transaction is less than the premium received from writing
the option or the price received from a sale transaction is more than the
premium paid to buy the option; the Fund will realize a loss from a closing
transaction if the price of the purchase transaction is more than the premium
received from writing the option or the price received from a sale transaction
is less than the premium paid to buy the option. Because increases in the market
price of a call option will generally reflect increases in the market price of
the underlying security, any loss resulting from the repurchase of a call option
is likely to be offset in whole or in part by appreciation of the underlying
security owned by the Fund.
An option position may be closed out only where there exists a
secondary market for an option of the same series. If a secondary market does
not exist, it might not be possible to effect closing transactions in particular
options with the result that a Fund would have to exercise the options in order
to realize any profit. If a Fund is unable to effect a closing purchase
transaction in a secondary market, it will not be able to sell the underlying
security until the option expires or the Fund delivers the underlying security
upon exercise. Reasons for the absence of a liquid secondary market may include
the following: (i) there may be insufficient trading interest in certain
options, (ii) restrictions may be imposed by a national securities exchange on
which the option is traded ("Exchange") on opening or closing transactions or
both, (iii) trading halts, suspensions or other restrictions may be imposed with
respect to particular classes or series of options or underlying securities,
(iv) unusual or unforeseen circumstances may interrupt normal operations on an
Exchange, (v) the facilities of an Exchange or of the Options Clearing
Corporation ("OCC") may not at all times be adequate to handle current trading
volume, or (vi) one or more Exchanges could, for economic or other reasons,
decide or be compelled at some future date to discontinue the trading of options
(or a particular class or series of options), in which event the secondary
market on that Exchange (or in that class or series of options) would cease to
exist, although outstanding options on that Exchange that had been issued by the
OCC as a result of trades on that Exchange would continue to be exercisable in
accordance with their terms.
In addition, when a Fund enters into an over-the-counter
option contract with a counterparty, the Fund assumes counterparty credit risk,
that is, the risk that the counterparty will fail to perform its obligations, in
which case the Fund could be worse off than if the contract had not been entered
into.
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<PAGE> 41
An option on a securities index is similar to an option on a
security except that, rather than the right to take or make delivery of a
security at a specified price, an option on a securities index gives the holder
the right to receive, on exercise of the option, an amount of cash if the
closing level of the securities index on which the option is based is greater
than, in the case of a call, or less than, in the case of a put, the exercise
price of the option.
A Fund may buy call options on securities or securities
indices to hedge against an increase in the price of a security or securities
that the Fund may buy in the future. The premium paid for the call option plus
any transaction costs will reduce the benefit, if any, realized by a Fund upon
exercise of the option, and, unless the price of the underlying security or
index rises sufficiently, the option may expire and become worthless to the
Fund. A Fund may buy put options to hedge against a decline in the value of a
security or its portfolio. The premium paid for the put option plus any
transaction costs will reduce the benefit, if any, realized by a Fund upon
exercise of the option, and, unless the price of the underlying security or
index declines sufficiently, the option may expire and become worthless to the
Fund.
An example of a hedging transaction using an index option
would be if a Fund were to purchase a put on a stock index, in order to protect
the Fund against a decline in the value of all securities held by it to the
extent that the stock index moves in a similar pattern to the prices of the
securities held. While the correlation between stock indices and price movements
of the stocks in which the Funds will generally invest may be imperfect, the
Funds expect, nonetheless, that the use of put options that relate to such
indices will, in certain circumstances, protect against declines in values of
specific portfolio securities or the Fund's portfolio generally. Although the
purchase of a put option may partially protect a Fund from a decline in the
value of a particular security or its portfolio generally, the cost of a put
will reduce the potential return on the security or the portfolio.
CONVERTIBLE SECURITIES. Each Fund may also purchase debt or
equity securities which are convertible into common stock when the Fund's
advisor or sub-advisor believes they offer the potential for a higher total
return than nonconvertible securities. While fixed-income securities generally
have a priority claim on a corporation's assets over that of common stock, some
of the convertible securities which the Funds may hold are high-yield/high-risk
securities that are subject to special risks, including the risk of default in
interest or principal payments which could result in a loss of income to the
Funds or a decline in the market value of the securities. Convertible securities
often display a degree of market price volatility that is comparable to common
stocks. The credit risk associated with convertible securities generally is
reflected by their ratings assigned by organizations such as Moody's Investors
Service, Inc., and Standard & Poor's Corporation, or a similar determination of
creditworthiness by the advisor or sub-advisor. The Funds have no
pre-established minimum quality standards for convertible securities and may
invest in convertible securities of any quality, including lower rated or
unrated securities. However, none of the Funds will invest in any security in
default at the time of purchase or in any nonconvertible debt securities rated
below investment grade, and each Fund will invest less than 20% of the market
value of its assets at the time of purchase in convertible securities rated
below investment grade. If convertible securities purchased by a Fund are
downgraded following purchase, or if other circumstances cause 20% or more of a
Fund's assets to be invested in convertible securities rated below investment
grade, the trustees of the Trust, in consultation with the advisor or
sub-advisor will determine what action, if any, is appropriate in light of all
relevant circumstances. For a further discussion of debt security ratings, see
Appendix A to this Statement of Additional Information.
SECURITIES OF COMPANIES WITH LIMITED OPERATING HISTORIES. Each
of the Funds may invest in securities of companies with limited operating
histories. The Funds consider these to be securities of companies with a record
of less than three years' continuous operation, even including the operations of
any predecessors and parents. (These are sometimes referred to as "unseasoned
issuers.") These companies by their nature have only a limited operating history
which can be used for evaluating the company's growth prospects. As a result,
investment decisions for these securities may place a greater emphasis on
current or planned product lines and the reputation and experience of the
company's management and less emphasis on fundamental valuation factors than
would be the case for more mature companies. In addition, many of these
companies may also be small companies and involve the risks and price volatility
associated with smaller companies. The Berger IPT - Growth Fund and the Berger
IPT - Growth and Income Fund each may invest up to 5% of their total assets in
such securities.
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INITIAL PUBLIC OFFERINGS. The Funds may invest in a company's
securities at the time the company first offers securities to the public, that
is, at the time of the company's initial public offering or IPO. Although
companies can be any age or size at the time of their IPOs, they are often
smaller and have a limited operating history, which involve a greater potential
for the value of their securities to be impaired following the IPO. See
"Securities of Smaller Companies" and "Securities of Companies with Limited
Operating Histories" above.
Investors in IPOs can be adversely affected by substantial
dilution in the value of their shares, by sales of additional shares and by
concentration of control in existing management and principal shareholders. In
addition, all of the factors that affect stock market performance may have a
greater impact on the shares of IPO companies.
The price of a company's securities may be highly unstable at
the time of its IPO and for a period thereafter due to market psychology
prevailing at the time of the IPO, the absence of a prior public market, the
small number of shares available and limited availability of investor
information. As a result of this or other factors, a Fund's advisor or
sub-advisor might decide to sell an IPO security more quickly than it would
otherwise, which may result in a significant gain or loss and greater
transaction costs to the Fund. In addition, IPO securities may be subject to
varying patterns of trading volume and may, at times, be difficult to sell
without an unfavorable impact on prevailing prices.
The effect of an IPO investment can have a magnified impact on
a Fund's performance when the Fund's asset base is small. Consequently, IPOs may
constitute a significant portion of a Fund's returns particularly when the Fund
is small. Since the number of securities issued in an IPO is limited, it is
likely that IPO securities will represent a smaller component of a Fund's assets
as it increases in size, and therefore have a more limited effect on the Fund's
performance.
There can be no assurance that IPOs will continue to be
available for any of the Funds to purchase. The number or quality of IPOs
available for purchase by a Fund may vary, decrease or entirely disappear. In
some cases, a Fund may not be able to purchase IPOs at the offering price, but
may have to purchase the shares in the aftermarket at a price greatly exceeding
the offering price, making it more difficult for the Fund to realize a profit.
The advisor's or sub-advisor's IPO trade allocation procedures
govern which Funds and other advised accounts participate in the allocation of
any IPO. See the heading "Trade Allocations" under Section 4 below. Under the
IPO allocation procedures of Berger LLC, a Fund generally will not participate
in an IPO if the securities available for allocation to the Fund or its
corresponding retail Berger Fund (see below under Section 11 Performance
Information)are insignificant relative to that fund's net assets. As a result,
any Fund (such as the Berger IPT - Growth Fund) whose assets, or whose
corresponding retail assets, are very large is not likely to participate in the
allocation of many IPOs.
ZEROS/STRIPS. The Berger IPT - Growth Fund and the Berger IPT
- - Growth and Income Fund may each invest in zero coupon bonds or in "strips."
Zero coupon bonds do not make regular interest payments; rather, they are sold
at a discount from face value. Principal and accreted discount (representing
interest accrued but not paid) are paid at maturity. "Strips" are debt
securities that are stripped of their interest coupon after the securities are
issued, but otherwise are comparable to zero coupon bonds. The market values of
"strips" and zero coupon bonds generally fluctuate in response to changes in
interest rates to a greater degree than do interest-paying securities of
comparable term and quality. None of the Funds will invest in mortgage-backed or
other asset-backed securities.
LENDING OF SECURITIES. Each Fund may lend its securities to
qualified institutional investors who need to borrow securities in order to
complete certain transactions, such as covering short sales, avoiding failures
to deliver securities, or completing arbitrage operations. By lending its
securities, a Fund will be attempting to generate income through the receipt of
interest on the loan which, in turn, can be invested in additional securities to
pursue the Fund's investment objective. Any gain or loss in the market price of
the securities loaned that might occur during the term of the loan would be for
the account of a Fund. A Fund may lend its portfolio securities to qualified
brokers, dealers, banks or other financial institutions, so long as the terms,
the structure and the aggregate amount of such loans are not inconsistent with
the Investment Company Act of 1940, or the Rules and Regulations or
interpretations of the Securities and Exchange Commission (the "Commission")
thereunder, which
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currently require that (a) the borrower pledge and maintain with the Fund
collateral consisting of cash, an irrevocable letter of credit or securities
issued or guaranteed by the United States government having a value at all times
not less than 100% of the value of the securities loaned, (b) the borrower add
to such collateral whenever the price of the securities loaned rises (i.e., the
borrower "marks to the market" on a daily basis), (c) the loan be made subject
to termination by the Fund at any time and (d) the Fund receive reasonable
interest on the loan, which interest may include the Fund's investing cash
collateral in interest bearing short-term investments, and (e) the Fund receive
all dividends and distributions on the loaned securities and any increase in the
market value of the loaned securities.
A Fund bears a risk of loss in the event that the other party
to a securities lending transaction defaults on its obligations and the Fund is
delayed in or prevented from exercising its rights to dispose of the collateral,
including the risk of a possible decline in the value of the collateral
securities during the period in which the Fund seeks to assert these rights, the
risk of incurring expenses associated with asserting these rights and the risk
of losing all or a part of the income from the transaction. None of the Funds
will lend its portfolio securities if, as a result, the aggregate value of such
loans would exceed 33-1/3% of the value of the Fund's total assets. Loan
arrangements made by a Fund will comply with all other applicable regulatory
requirements, including the rules of the New York Stock Exchange, which rules
presently require the borrower, after notice, to redeliver the securities within
the normal settlement time of three business days. All relevant facts and
circumstances, including creditworthiness of the broker, dealer or institution,
will be considered in making decisions with respect to the lending of
securities, subject to review by the Fund's trustees.
ILLIQUID AND RESTRICTED SECURITIES. Each of the Funds is
authorized to invest in securities which are illiquid or not readily marketable
because they are subject to restrictions on their resale ("restricted
securities") or because, based upon their nature or the market for such
securities, no ready market is available. However, none of the Funds will
purchase any such security, the purchase of which would cause the Fund to invest
more than 15% of its net assets, measured at the time of purchase, in illiquid
securities. Investments in illiquid securities involve certain risks to the
extent that a Fund may be unable to dispose of such a security at the time
desired or at a reasonable price or, in some cases, may be unable to dispose of
it at all. In addition, in order to resell a restricted security, a Fund might
have to incur the potentially substantial expense and delay associated with
effecting registration. If securities become illiquid following purchase or
other circumstances cause more than 15% of a Fund's net assets to be invested in
illiquid securities, the trustees of that Fund, in consultation with the Fund's
advisor or sub-advisor, will determine what action, if any, is appropriate in
light of all relevant circumstances.
Repurchase agreements maturing in more than seven days will be
considered as illiquid for purposes of this restriction. Pursuant to guidelines
established by the trustees, the Funds' advisor or sub-advisor will determine
whether securities eligible for resale to qualified institutional buyers
pursuant to SEC Rule 144A under the Securities Act of 1933 should be treated as
illiquid investments considering, among other things, the following factors: (1)
the frequency of trades and quotes for the security; (2) the number of dealers
wanting to purchase or sell the security and the number of other potential
purchasers; (3) dealer undertakings to make a market in the security; and (4)
the nature of the security and the marketplace trades (e.g., the time needed to
dispose of the security, the method of soliciting offers, and the mechanics of
the transfer). The liquidity of a Fund's investments in Rule 144A securities
could be impaired if qualified institutional buyers become uninterested in
purchasing these securities.
REPURCHASE AGREEMENTS. Each Fund may invest in repurchase
agreements with various financial organizations, including commercial banks,
registered broker-dealers and registered government securities dealers. A
repurchase agreement is an agreement under which a Fund acquires a debt security
(generally a debt security issued or guaranteed by the U.S. government or an
agency thereof, a banker's acceptance or a certificate of deposit) from a
commercial bank, broker or dealer, subject to resale to the seller at an agreed
upon price and date (normally, the next business day). A repurchase agreement
may be considered a loan collateralized by securities. The resale price reflects
an agreed upon interest rate effective for the period the instrument is held by
a Fund and is unrelated to the interest rate on the underlying instrument. In
these transactions, the securities acquired by a Fund (including accrued
interest earned thereon) must have a total value equal to or in excess of the
value of the repurchase agreement and are held by the Fund's custodian bank
until repurchased. In addition, the trustees will establish guidelines and
standards for review by the investment advisor or sub-advisor of the
creditworthiness of any bank, broker or dealer party to a repurchase agreement
with a Fund.
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<PAGE> 44
None of the Funds will enter into a repurchase agreement maturing in more than
seven days if as a result more than 15% of the Fund's net assets would be
invested in such repurchase agreements and other illiquid securities.
These transactions must be fully collateralized at all times
by debt securities (generally a security issued or guaranteed by the U.S.
Government or an agency thereof, a banker's acceptance or a certificate of
deposit), but involve certain risks, such as credit risk to a Fund if the other
party defaults on its obligation and the Fund is delayed or prevented from
liquidating the collateral. For example, if the other party to the agreement
defaults on its obligation to repurchase the underlying security at a time when
the value of the security has declined, a Fund may incur a loss upon disposition
of the security. If the other party to the agreement becomes insolvent and
subject to liquidation or reorganization under the Bankruptcy Code or other
laws, a court may determine that the underlying security is collateral for a
loan by a Fund not within the control of the Fund and therefore the realization
by the Fund on such collateral may automatically be stayed and delayed. Further,
it is possible that a Fund may not be able to substantiate its interest in the
underlying security and may be deemed an unsecured creditor of the other party
to the agreement. The Funds expect that these risks can be controlled through
careful monitoring procedures.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES. Each Fund may
purchase and sell securities on a when-issued or delayed delivery basis.
However, none of the Funds currently intends to purchase or sell securities on a
when-issued or delayed delivery basis, if as a result more than 5% of its total
assets taken at market value at the time of purchase would be invested in such
securities. When-issued or delayed delivery transactions arise when securities
(normally, equity obligations of issuers eligible for investment by a Fund) are
purchased or sold by the Fund with payment and delivery taking place in the
future in order to secure what is considered to be an advantageous price or
yield. However, the yield available on a comparable security when delivery takes
place may vary from the yield on the security at the time that the when-issued
or delayed delivery transaction was entered into. Any failure to consummate a
when-issued or delayed delivery transaction may result in a Fund missing the
opportunity of obtaining a price or yield considered to be advantageous.
When-issued and delayed delivery transactions may generally be expected to
settle within one month from the date the transactions are entered into, but in
no event later than 90 days. However, no payment or delivery is made by a Fund
until it receives delivery or payment from the other party to the transaction.
When a Fund purchases securities on a when-issued basis, it
will maintain in a segregated account with its custodian cash, U.S. government
securities or other liquid assets having an aggregate value equal to the amount
of such purchase commitments, until payment is made. If necessary, additional
assets will be placed in the account daily so that the value of the account will
equal or exceed the amount of the Fund's purchase commitments.
SHORT SALES. Each Fund other than the Berger/BIAM IPT -
International Fund currently is only permitted to engage in short sales if, at
the time of the short sale, the Fund owns or has the right to acquire an
equivalent kind and amount of the security being sold short at no additional
cost (i.e., short sales "against the box").
In a short sale, the seller does not immediately deliver the
securities sold and is said to have a short position in those securities until
delivery occurs. To make delivery to the purchaser, the executing broker borrows
the securities being sold short on behalf of the seller. While the short
position is maintained, the seller collateralizes its obligation to deliver the
securities sold short in an amount equal to the proceeds of the short sale plus
an additional margin amount established by the Board of Governors of the Federal
Reserve. If a Fund engages in a short sale, the collateral account will be
maintained by the Fund's custodian. While the short sale is open, the Fund will
maintain in a segregated custodial account an amount of securities convertible
into or exchangeable for such equivalent securities at no additional cost. These
securities would constitute the Fund's long position.
In the past, a Fund could have made a short sale, as described
above, when it wanted to sell a security it owned at a current attractive price,
but also wished to defer recognition of gain or loss for Federal income tax
purposes and for purposes of satisfying certain tests applicable to regulated
investment companies under the Internal Revenue Code. However, federal tax
legislation has since eliminated the ability to defer recognition of gain or
loss in short sales against the box and accordingly, it is not anticipated that
any of the Funds will be engaging in these transactions unless there are further
legislative changes.
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<PAGE> 45
TEMPORARY DEFENSIVE MEASURES. Each of the Funds (except the
Berger/BIAM IPT - International Fund) may increase its investment in government
securities, and other short-term, interest-bearing securities without regard to
the Fund's otherwise applicable percentage limits, policies or its normal
investment emphasis when its advisor or sub-advisor believes market conditions
warrant a temporary defensive position. Taking larger positions in such
short-term investments may serve as a means of preserving capital in unfavorable
market conditions. When in a defensive position, a Fund could miss the
opportunity to participate in any stock or bond market advances that occur
during those periods, which the Fund might have been able to participate in if
it had remained more fully invested.
PORTFOLIO TURNOVER. The portfolio turnover rates of each of
the Funds are shown in the Financial Highlights tables included in the
Prospectus. The annual portfolio turnover rates of some of the Funds at times
have exceeded 100%. A 100% annual turnover rate results, for example, if the
equivalent of all of the securities in the Fund's portfolio are replaced in a
period of one year. The Funds anticipate that their portfolio turnover rates in
future years may exceed 100%, and investment changes will be made whenever
management deems them appropriate even if this results in a higher portfolio
turnover rate. In addition, portfolio turnover for all the Funds may increase as
a result of large amounts of purchases and redemptions of shares of the Funds
due to economic, market or other factors that are not within the control of
management.
Higher portfolio turnover will necessarily result in
correspondingly higher brokerage costs for the Funds. The Funds' brokerage
policy is discussed further below under Section 6 -- Brokerage Policy, and
additional information concerning income taxes is located under Section 10 --
Income Dividends, Capital Gains Distributions and Tax Treatment.
2. INVESTMENT RESTRICTIONS
As indicated in the Prospectus, the investment objective of
each of the Funds is as follows:
<TABLE>
<CAPTION>
FUND INVESTMENT OBJECTIVE
-------------------------------------------------------- ------------------------------------------
<S> <C>
Berger IPT - New Generation Fund capital appreciation
-------------------------------------------------------- ------------------------------------------
Berger IPT - Growth Fund Long-term capital appreciation
-------------------------------------------------------- ------------------------------------------
Berger IPT - Growth and Income Fund Primary investment objective: capital
appreciation
secondary investment objective:
investing in securities that produce
current income for the portfolio
-------------------------------------------------------- ------------------------------------------
Berger IPT - Small Company Growth Fund capital appreciation
-------------------------------------------------------- ------------------------------------------
Berger/BIAM IPT - International Fund Long-term capital appreciation
-------------------------------------------------------- ------------------------------------------
</TABLE>
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<PAGE> 46
The investment objective of the Berger IPT - New Generation
Fund, Berger IPT - Growth Fund, the Berger IPT - Small Company Growth Fund and
the Berger/BIAM IPT - International Fund, and the primary investment objective
of the Berger IPT - Growth and Income Fund, are considered fundamental, meaning
that they cannot be changed without a shareholders' vote. The secondary
investment objective of the Berger IPT - Growth and Income Fund is not
considered fundamental, and therefore may be changed in the future by action of
the trustees without shareholder vote. However, the Berger IPT - Growth and
Income Fund will not change its secondary investment objective without giving
its shareholders such notice as may be required by law. If the Berger IPT -
Growth and Income Fund changes its secondary investment objective, shareholders
should consider whether the Fund remains an appropriate investment in light of
their then current financial position and needs. There can be no assurance that
any of the Funds' investment objectives will be realized.
Each Fund has also adopted certain investment policies,
strategies, guidelines and procedures in pursuing its objective. These may be
changed without a shareholder vote. The principal policies and strategies used
by the Funds are described in the Prospectus.
Each Fund has adopted certain fundamental and non-fundamental
restrictions on its investments and other activities, which are listed below.
Fundamental restrictions may not be changed without the approval of (i) 67% or
more of the voting securities of the Fund present at a meeting of shareholders
thereof if the holders of more than 50% of the outstanding voting securities are
present or represented by proxy, or (ii) more than 50% of the outstanding voting
securities of the Fund. Non-fundamental restrictions may be changed in the
future by action of the directors or trustees without shareholder vote.
BERGER IPT - NEW GENERATION FUND AND BERGER IPT - SMALL COMPANY GROWTH FUND
The following fundamental restrictions apply to each of the
Berger IPT - New Generation Fund and Berger IPT - Small Company Growth Fund. The
Fund may not:
1. With respect to 75% of the Fund's total assets, purchase
the securities of any one issuer (except U.S. government securities) if
immediately after and as a result of such purchase (a) the value of the holdings
of the Fund in the securities of such issuer exceeds 5% of the value of the
Fund's total assets or (b) the Fund owns more than 10% of the outstanding voting
securities of such issuer.
2. Invest in any one industry (other than U.S. government
securities) more than 25% of the value of its total assets at the time of such
investment.
3. Borrow money, except from banks for temporary or emergency
purposes in amounts not to exceed 25% of the Fund's total assets (including the
amount borrowed) taken at market value, nor pledge, mortgage or hypothecate its
assets, except to secure permitted indebtedness and then only if such pledging,
mortgaging or hypothecating does not exceed 25% of the Fund's total assets taken
at market value. When borrowings exceed 5% of the Fund's total assets, the Fund
will not purchase portfolio securities.
4. Act as a securities underwriter (except to the extent the
Fund may be deemed an underwriter under the Securities Act of 1933 in disposing
of a security), issue senior securities (except to the extent permitted under
the Investment Company Act of 1940), invest in real estate (although it may
purchase shares of a real estate investment trust), or invest in commodities or
commodity contracts except financial futures transactions, futures contracts on
securities and securities indices and options on such futures, forward foreign
currency exchange contracts, forward commitments or securities index put or call
options.
5. Make loans, except that the Fund may enter into repurchase
agreements and may lend portfolio securities in accordance with the Fund's
investment policies. The Fund does not, for this purpose, consider the purchase
of all or a portion of an issue of publicly distributed bonds, bank loan
participation
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<PAGE> 47
agreements, bank certificates of deposit, bankers' acceptances, debentures or
other securities, whether or not the purchase is made upon the original issuance
of the securities, to be the making of a loan.
In applying the industry concentration investment restriction
(no. 2 above), the Funds use the industry groups used in the Data Monitor
Portfolio Monitoring System of William O'Neil & Co. Incorporated. Further, in
implementing that restriction, each Fund intends not to invest in any one
industry 25% or more of the value of its total assets at the time of such
investment.
The trustees have adopted additional non-fundamental
investment restrictions for the Berger IPT - New Generation Fund and Berger IPT
- - Small Company Growth Fund. These limitations may be changed by the trustees
without a shareholder vote. The non-fundamental investment restrictions include
the following:
1. The Fund may not purchase securities on margin from a
broker or dealer, except that the Fund may obtain such short-term credits as may
be necessary for the clearance of transactions, and may not make short sales of
securities, except that the Fund may make short sales if, at the time of the
short sale, the Fund owns or has the right to acquire an equivalent kind and
amount of the security being sold short at no additional cost (i.e., short sales
"against the box"). This limitation shall not prohibit or restrict the Fund from
entering into futures, forwards and options contracts or from making margin
payments and other deposits in connection therewith.
2. The Fund may not purchase the securities of any other
investment company, except by purchase in the open market involving no
commission or profit to a sponsor or dealer (other than the customary broker's
commission).
3. The Fund may not invest in companies for the purposes of
exercising control of management.
4. The Fund may not purchase any security, including any
repurchase agreement maturing in more than seven days, which is not readily
marketable, if more than 15% of the net assets of the Fund, taken at market
value at the time of purchase would be invested in such securities.
5. Only for the purpose of hedging, the Fund may purchase and
sell financial futures, forward foreign currency exchange contracts and put and
call options, but no more than 5% of the Fund's net assets at the time of
purchase may be invested in initial margins for financial futures transactions
and premiums for options. The Fund may only write call options that are covered
and only up to 25% of the Fund's total assets.
6. The Fund may not purchase or sell securities on a
when-issued or delayed delivery basis, if as a result more than 5% of its total
assets taken at market value at the time of purchase would be invested in such
securities.
BERGER IPT - GROWTH FUND AND BERGER IPT - GROWTH AND INCOME FUND
The following fundamental restrictions apply to each of the
Berger IPT - Growth Fund and the Berger IPT - Growth and Income Fund. A Fund may
not:
1. Purchase the securities of any one issuer (except U.S.
Government securities) if immediately after and as a result of such purchase (a)
the value of the holdings of the Fund in the securities of such issuer exceeds
5% of the value of the Fund's total assets or (b) the Fund owns more than 10% of
the outstanding voting securities or of any class of securities of such issuer.
2. Purchase securities of any company with a record of less
than three years' continuous operation (including that of predecessors) if such
purchase would cause the Fund's investments in all such companies taken at cost
to exceed 5% of the value of the Fund's total assets.
3. Invest in any one industry more than 25% of the value of
its total assets at the time of such investment.
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<PAGE> 48
4. Make loans, except that the Fund may enter into repurchase
agreements and may lend portfolio securities in accordance with the Fund's
investment policies. The Fund does not, for this purpose, consider the purchase
of all or a portion of an issue of publicly distributed bonds, bank loan
participation agreements, bank certificates of deposit, bankers' acceptances,
debentures or other securities, whether or not the purchase is made upon the
original issuance of the securities, to be the making of a loan.
5. Borrow in excess of 5% of the value of its total assets, or
pledge, mortgage, or hypothecate its assets taken at market value to an extent
greater than 10% of the Fund's total assets taken at cost (and no borrowing may
be undertaken except from banks as a temporary measure for extraordinary or
emergency purposes). This limitation shall not prohibit or restrict short sales
or deposits of assets to margin or guarantee positions in futures, options or
forward contracts, or the segregation of assets in connection with any of such
transactions.
6. Purchase or retain the securities of any issuer if those
officers and trustees of the Fund or its investment advisor owning individually
more than 1/2 of 1% of the securities of such issuer together own more than 5%
of the securities of such issuer.
7. Purchase the securities of any other investment company,
except by purchase in the open market involving no commission or profit to a
sponsor or dealer (other than the customary broker's commission).
8. Act as a securities underwriter (except to the extent the
Fund may be deemed an underwriter under the Securities Act of 1933 in disposing
of a security) or invest in real estate (although it may purchase shares of a
real estate investment trust), or invest in commodities or commodity contracts
except, only for the purpose of hedging, (i) financial futures transactions,
including futures contracts on securities, securities indices and foreign
currencies, and options on any such futures, (ii) forward foreign currency
exchange contracts and other forward commitments and (iii) securities index put
or call options.
9. Participate on a joint or joint and several basis in any
securities trading account.
10. Invest in companies for the purposes of exercising control
of management.
In applying the industry concentration investment restriction
(no. 3 above), the Funds use the industry groups used in the Data Monitor
Portfolio Monitoring System of William O'Neil & Co. Incorporated. Further, in
implementing that restriction, each Fund intends not to invest in any one
industry 25% or more of the value of its total assets at the time of such
investment.
The trustees have adopted additional non-fundamental
investment restrictions for each of the Berger IPT - Growth Fund and the Berger
IPT - Growth and Income Fund. These limitations may be changed by the trustees
without a shareholder vote. The non-fundamental investment restrictions include
the following:
1. Only for the purpose of hedging, the Fund may purchase and
sell financial futures, forward foreign currency exchange contracts and put and
call options, but no more than 5% of the Fund's net assets at the time of
purchase may be invested in initial margins for financial futures transactions
and premiums for options. The Fund may only write call options that are covered
and only up to 25% of the Fund's total assets.
2. The Fund may not purchase or sell securities on a
when-issued or delayed delivery basis, if as a result more than 5% of its total
assets taken at market value at the time of purchase would be invested in such
securities.
3. The Fund may not purchase any security, including any
repurchase agreement maturing in more than seven days, which is not readily
marketable, if more than 15% of the net assets of the Fund, taken at market
value at the time of purchase would be invested in such securities.
4. The Fund may not purchase securities on margin from a
broker or dealer, except that the Fund may obtain such short-term credits as may
be necessary for the clearance of transactions, and may not make short sales of
securities, except that the Fund may make short sales if, at the time of the
short sale, the
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<PAGE> 49
Fund owns or has the right to acquire an equivalent kind and amount of the
security being sold short at no additional cost (i.e., short sales "against the
box"). This limitation shall not prohibit or restrict the Fund from entering
into futures, forwards and options contracts or from making margin payments and
other deposits in connection therewith.
BERGER/BIAM IPT - INTERNATIONAL FUND
The following fundamental restrictions apply to the
Berger/BIAM IPT - International Fund. The Fund may not:
1. With respect to 75% of the Fund's total assets, purchase
the securities of any one issuer (except U.S. government securities) if
immediately after and as a result of such purchase (a) the value of the holdings
of the Fund in the securities of such issuer exceeds 5% of the value of the
Fund's total assets or (b) the Fund owns more than 10% of the outstanding voting
securities of such issuer.
2. Invest in any one industry (other than U.S. government
securities) 25% or more of the value of its total assets at the time of such
investment.
3. Borrow money, except from banks for temporary or emergency
purposes in amounts not to exceed 25% of the Fund's total assets (including the
amount borrowed) taken at market value, nor pledge, mortgage or hypothecate its
assets, except to secure permitted indebtedness and then only if such pledging,
mortgaging or hypothecating does not exceed 25% of the Fund's total assets taken
at market value. When borrowings exceed 5% of the Fund's total assets, the Fund
will not purchase portfolio securities.
4. Act as a securities underwriter (except to the extent the
Fund may be deemed an underwriter under the Securities Act of 1933 in disposing
of a security), issue senior securities (except to the extent permitted under
the Investment Company Act of 1940), invest in real estate (although it may
purchase shares of a real estate investment trust), or invest in commodities or
commodity contracts except financial futures transactions, futures contracts on
securities and securities indices and options on such futures, forward foreign
currency exchange contracts, forward commitments or securities index put or call
options.
5. Make loans, except that the Fund may enter into repurchase
agreements and may lend portfolio securities in accordance with the Fund's
investment policies. The Fund does not, for this purpose, consider the purchase
of all or a portion of an issue of publicly distributed bonds, bank loan
participation agreements, bank certificates of deposit, bankers' acceptances,
debentures or other securities, whether or not the purchase is made upon the
original issuance of the securities, to be the making of a loan.
In applying the industry concentration investment restriction
(no. 2 above), the Fund uses the industry groups designated by the Financial
Times World Index Service.
The trustees have adopted additional non-fundamental
investment restrictions for the Berger/BIAM IPT - International Fund. These
limitations may be changed by the trustees without a shareholder vote. The
non-fundamental investment restrictions include the following:
1. With respect to 100% of the Fund's total assets, the Fund
may not purchase the securities of any one issuer (except U.S. government
securities) if immediately after and as a result of such purchase (a) the value
of the holdings of the Fund in the securities of such issuer exceeds 5% of the
value of the Fund's total assets or (b) the Fund owns more than 10% of the
outstanding voting securities of such issuer.
2. The Fund may not purchase securities on margin from a
broker or dealer, except that the Fund may obtain such short-term credits as may
be necessary for the clearance of transactions, and may not make short sales of
securities. This limitation shall not prohibit or restrict the Fund from
entering into futures, forwards and options contracts or from making margin
payments and other deposits in connection therewith.
3. The Fund may not purchase the securities of any other
investment company, except by purchase in the open market involving no
commission or profit to a sponsor or dealer (other than the customary broker's
commission).
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<PAGE> 50
4. The Fund may not invest in companies for the purposes of
exercising control of management.
5. The Fund may not purchase any security, including any
repurchase agreement maturing in more than seven days, which is not readily
marketable, if more than 15% of the net assets of the Fund, taken at market
value at the time of purchase would be invested in such securities.
6. The Fund may not enter into any futures, forwards or
options, except that only for the purpose of hedging, the Fund may enter into
forward foreign currency exchange contracts with stated contract values of up to
the value of the Fund's assets.
7. The Fund may not purchase or sell securities on a
when-issued or delayed delivery basis, if as a result more than 5% of its net
assets taken at market value at the time of purchase would be invested in such
securities.
On behalf of the Trust, an undertaking has been given to the
State of California Department of Insurance that limits borrowings of each Fund
(to the extent such borrowings are allowed by the Fund's investment policies) to
10% of the Fund's total assets, except that a Fund may borrow up to 25% of its
total assets when such borrowing is necessary to meet Fund redemptions.
In addition, the undertaking to the State of California
Department of Insurance requires each Fund when investing in foreign securities
(to the extent consistent with the Fund's investment policies) to invest in a
minimum of five different foreign countries, provided that this minimum may be
reduced to four when foreign country investments comprise less than 80% of the
Fund's assets, to three when less than 60% of such assets, to two when less than
40% of such assets, or to one when less than 20% of such assets. Additionally,
no more than 20% of a Fund's assets may be invested in securities of issuers
located in any one foreign country, except that a Fund may have an additional
15% of its assets in securities of issuers located in any one of the following
countries: Australia, Canada, France, Japan, the United Kingdom or Germany.
3. MANAGEMENT OF THE FUNDS
Each Fund is supervised by trustees who are responsible for
major decisions about the Funds' policies and overall Fund oversight. Each
Fund's board hires the companies that run day-to-day Fund operations, such as
the investment advisor, administrator, transfer agent and custodian.
The trustees and executive officers of each of the Funds are
listed below, together with information which includes their principal
occupations during the past five years and other principal business
affiliations.
MICHAEL OWEN, 114A Gallatin Dr., Bozeman, MT 59718, DOB: 1937.
Self-employed as a financial and management consultant, and in real
estate development. From 1993 to June 1999, Dean, and from 1989 to
1993, a member of the Finance faculty of the College of Business,
Montana State University. Formerly (1976-1989), Chairman and Chief
Executive Officer of Royal Gold, Inc. (mining). Chairman of the Board
of Berger Growth Fund and Berger Growth and Income Fund. Chairman of
the Trustees of Berger Investment Portfolio Trust, Berger
Institutional Products Trust, Berger/BIAM Worldwide Funds Trust,
Berger/BIAM Worldwide Portfolios Trust and Berger Omni Investment
Trust.
DENNIS E. BALDWIN, 3481 South Race Street, Englewood, CO 80110, DOB: 1928.
President, Baldwin Financial Counseling. Formerly (1978-1990), Vice
President and Denver Office Manager of Merrill Lynch Capital Markets.
Director of Berger Growth Fund and Berger Growth and Income Fund.
Trustee of Berger Investment Portfolio Trust, Berger Institutional
Products Trust, Berger/BIAM Worldwide Funds Trust, Berger/BIAM
Worldwide Portfolios Trust and Berger Omni Investment Trust.
LOUIS R. BINDNER, 1075 South Fox, Denver, CO 80223, DOB: 1925. President,
Climate Engineering, Inc. (building environmental systems). Director
of Berger Growth Fund and Berger Growth and Income
-18-
<PAGE> 51
Fund. Trustee of Berger Investment Portfolio Trust, Berger
Institutional Products Trust, Berger/BIAM Worldwide Funds Trust,
Berger/BIAM Worldwide Portfolios Trust and Berger Omni Investment
Trust.
KATHERINE A. CATTANACH, 672 South Gaylord, Denver, CO 80209, DOB: 1945.
Managing Principal, Sovereign Financial Services, Inc. (investment
consulting firm). Formerly (1981-1988), Executive Vice President,
Captiva Corporation, Denver, Colorado (private investment management
firm). Ph.D. in Finance (Arizona State University); Chartered
Financial Analyst (CFA). Director of Berger Growth Fund and Berger
Growth and Income Fund. Trustee of Berger Investment Portfolio Trust,
Berger Institutional Products Trust, Berger/BIAM Worldwide Funds
Trust, Berger/BIAM Worldwide Portfolios Trust and Berger Omni
Investment Trust.
PAUL R. KNAPP, 33 North LaSalle Street, Suite 1900, Chicago, IL 60602,
DOB: 1945. Since 1991, Chairman, President, Chief Executive Officer
and a director of Catalyst Institute (international public policy
research organization focused primarily on financial markets and
institutions). Since September 1997, President, Chief Executive
Officer and a director of DST Catalyst, Inc. (international financial
markets consulting, software and computer services company, an 81%
owned subsidiary of DST Systems, Inc.) Director (since February 1998)
and a Vice President (February 1998 - November 1998) of West Side
Investments, Inc. (investments), a wholly-owned subsidiary of DST
Systems, Inc. Previously (1991 - September 1997), Chairman,
President, Chief Executive Officer and a director of Catalyst
Consulting (international financial institutions business consulting
firm). Prior thereto (1988-1991), President, Chief Executive Officer
and a director of Kessler Asher Group (brokerage, clearing and
trading firm). Director of Berger Growth Fund and Berger Growth and
Income Fund. Trustee of Berger Investment Portfolio Trust, Berger
Institutional Products Trust, Berger/BIAM Worldwide Funds Trust,
Berger/BIAM Worldwide Portfolios Trust and Berger Omni Investment
Trust.
HARRY T. LEWIS, JR., 370 17th Street, Suite 3560, Denver, CO 80202, DOB:
1933. Self-employed as a private investor. Formerly (1981-1988),
Senior Vice President, Rocky Mountain Region, of Dain Bosworth
Incorporated and member of that firm's Management Committee. Director
of J.D. Edwards & Co. (computer software company) since 1995.
Director of Berger 100 Fund and Berger Growth and Income Fund.
Trustee of Berger Investment Portfolio Trust, Berger Institutional
Products Trust, Berger/BIAM Worldwide Funds Trust, Berger/BIAM
Worldwide Portfolios Trust and Berger Omni Investment Trust.
WILLIAM SINCLAIRE, 3049 S. Perry Park Road, Sedalia, CO 80135, DOB: 1928.
President, Santa Clara LLC (privately owned agriculture company).
Director of Berger Growth Fund and Berger Growth and Income Fund.
Trustee of Berger Investment Portfolio Trust, Berger Institutional
Products Trust, Berger/BIAM Worldwide Funds Trust, Berger/BIAM
Worldwide Portfolios Trust and Berger Omni Investment Trust.
* ANTHONY (TINO) R. SELLITTO III, 210 University Boulevard, Suite 900,
Denver, CO 80206, DOB: 1964. Vice President and portfolio manager
since January 2000 of the Berger Growth Fund and the Berger IPT-
Growth Fund (co-portfolio manager May 1999 to January 2000), and Vice
President and co-portfolio manager of the Berger Select Fund since
May 1999. Vice President and portfolio manager of the Berger Growth
and Income Fund and the Berger IPT - Growth and Income Fund since
November 1998. Vice President (since September 1998) and senior
equity analyst (January 1998 to September 1998) with Berger LLC.
Interim portfolio manager since January 2000 of the Berger Balanced
Fund investment team. Formerly, Vice President and Assistant
Portfolio Manager at Crestone Capital Management, Inc. (August 1995
to January 1998), Portfolio Manager at Hawaiian Trust Company
(September 1994 to August 1995) and Account Executive at W.W.
Grainger Inc. (distributor of industrial equipment) (October 1991 to
September 1994).
* AMY K. SELNER, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1968. Vice President and portfolio manager of the Berger Mid Cap
Growth Fund since its inception in December 1997. Vice President and
portfolio manager of the Berger Small Company Growth Fund and the
Berger IPT - Small Company Growth Fund since November 1998. Vice
President and co-portfolio manager since May 1999 of the Berger
Select Fund. Interim portfolio manager since January 2000 of the
Berger
-19-
<PAGE> 52
Balanced Fund investment team. Vice President (since December 1997)
and senior research analyst (April 1996 through December 1997) with
Berger LLC. Formerly, Assistant Portfolio Manager and Research
Analyst with INVESCO Trust Company from March 1991 through March
1996.
* MARK S. SUNDERHUSE, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1961. Vice President (since February 1999) and portfolio manager
(since January 1999) of the Berger New Generation Fund. Vice
President and co-portfolio manager since May 1999 of the Berger
Select Fund. Interim portfolio manager since January 2000 of the
Berger Balanced Fund investment team. Portfolio manager of the Berger
IPT - New Generation Fund since its inception in May 2000. Senior
Vice President (since January 1998) and portfolio manager (since
January 1999) with Berger LLC. Formerly, Senior Vice President and
Assistant Portfolio Manager with Crestone Capital Management, Inc.
(from January 1991 through January 1998); Investment Officer with
United Bank of Denver (from April 1989 through January 1991); and
officer and registered representative with Boettcher & Company, Inc.
(investment banking) (from May 1985 through April 1989).
* JACK R. THOMPSON, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1949. President and a director since May 1999 (Executive Vice
President from February 1999 to May 1999) of Berger Growth Fund and
Berger Growth and Income Fund. President and a trustee since May 1999
(Executive Vice President from February 1999 to May 1999) of Berger
Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust, Berger/BIAM Worldwide Portfolios
Trust and Berger Omni Investment Trust. President and Director since
June, 1999 (Executive Vice President from February 1999 to June 1999)
of Berger LLC. Audit Committee Member of the Public Employees'
Retirement Association of Colorado (pension plan) since November
1997. Self-employed as a consultant from July 1995 through February
1999. Director of Wasatch Advisors (investment management) from
February 1997 to February 1999. Director of Janus Capital Corporation
(investment management) from June 1984 through June 1995, and
Executive Vice President of the Corporation from April 1989 through
June 1995. Treasurer of Janus Capital Corporation from November 1983
through October 1989. Trustee of the Janus Investment Funds from
December 1990 through June 1995, and Senior Vice President of the
Trust from May 1993 through June 1995. President and a director of
Janus Service Corporation (transfer agent) from January 1987 through
June 1995. President and a director of Fillmore Agency, Inc.
(advertising agency), from January 1990 through June 1995. Executive
Vice President and a director of Janus Capital International, Ltd.
(investment advisor) from September 1994 through June 1995. President
and a director of Janus Distributors, Inc. (broker/dealer), from May
1991 through June 1995. Director of IDEX Management, Inc. (investment
management), from January 1985 through June 1995. Trustee and Senior
Vice President of the of Janus Aspen Series from May 1993 through
June 1995.
* JANICE M. TEAGUE, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1954. Vice President (since November 1998), Assistant Secretary
(since February 2000) and Secretary (November 1998 to February 2000)
of the Berger Funds. Assistant Secretary of the Berger Funds from
October 1996 to November 1998. Vice President (since October 1997),
Secretary (since November 1998) and Assistant Secretary (October 1996
through November 1998) with Berger LLC. Vice President and Secretary
with Berger Distributors LLC, since August 1998. Formerly,
self-employed as a business consultant from June 1995 through
September 1996, Secretary of the Janus Funds from January 1990 to May
1995 and Assistant Secretary of Janus Capital Corporation from
October 1989 to May 1995.
* DAVID J. SCHULTZ, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1950. Vice President and Treasurer (since November 1998) and
Assistant Treasurer (September 1996 to November 1998) of the Berger
Funds. Vice President (since February 1997) and Controller (since
August 1994) with Berger LLC. Chief Financial Officer and Treasurer
(since May 1996), Assistant Secretary (since August 1998) and
Secretary (May 1996 to August 1998) with Berger Distributors LLC
Formerly, Partner with Smith, Brock & Gwinn (accounting firm) from
January 1984 to August 1994.
* ANTHONY R. BOSCH, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1965. Vice President of the Berger Funds since February 2000.
Vice President (since June 1999) with Berger LLC. Formerly, Assistant
Vice President of Federated Investors, Inc. from December 1996
through May 1999,
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<PAGE> 53
and Attorney with the U.S. Securities and Exchange Commission from
June 1990 through December 1996.
* BRIAN S. FERRIE, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1958. Vice President of the Berger Funds since November 1998.
Vice President (since February 1997) and Chief Compliance Officer
(since August 1994) with Berger LLC. Chief Compliance Officer with
Berger Distributors LLC, since May 1996. Formerly, Compliance Officer
with United Services Advisor, Inc., from January 1988 to July 1994,
and Director of Internal Audit of United Services Funds from January
1987 to July 1994.
* JOHN PAGANELLI, 210 University Boulevard, Suite 900, Denver, CO 80206, DOB:
1967. Assistant Treasurer of the Berger Funds since November 1998.
Vice President (since November 1998) and Manager of Accounting
(January 1997 through November 1998) with Berger LLC. Formerly,
Manager of Accounting (December 1994 through October 1996) and Senior
Accountant (November 1991 through December 1994) with Palmeri Fund
Administrators, Inc.
* SUE VREELAND, 210 University Boulevard, Suite 900, Denver, CO 80206, DOB:
1948. Secretary of the Berger Funds since February 2000. Assistant
Secretary of Berger LLC and Berger Distributors LLC since June 1999.
Formerly, Assistant Secretary of the Janus Funds from March 1994 to
May 1999, Assistant Secretary of Janus Distributors, Inc. from June
1995 to May 1997 and Manager of Fund Administration for Janus Capital
Corporation from February 1992 to May, 1999.
----------------
* Interested person (as defined in the Investment Company Act of 1940) of one or
more of the Funds and/or of the Funds' advisors or sub-advisors.
The directors or trustees of the Funds have adopted a
director/trustee retirement age of 75 years.
TRUSTEE COMPENSATION
The officers of the Funds receive no compensation from the
Funds. However, trustees of the Funds who are not interested persons of the
Funds or their advisors or subadvisors are compensated for their services
according to a fee schedule, allocated among the Funds. Neither the officers of
the Funds nor the trustees receive any form of pension or retirement benefit
compensation from the Funds.
The following table sets forth information regarding
compensation paid or accrued during the fiscal year ended December 31, 1999, for
each director or trustee of the Funds and the other Berger Funds:
<TABLE>
<CAPTION>
==================================================================================================================================
NAME AND POSITION WITH AGGREGATE COMPENSATION FROM
BERGER FUNDS
==================================================================================================================================
Berger Berger Berger
IPT - IPT - IPT -
New Small Berger Berger/BIAM Growth
Generation Company IPT - IPT - and All
Fund(1) Growth Growth International Income Berger
Fund Fund Fund Fund Funds(1)
--------------- --------------- ----------- ----------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Dennis E. Baldwin(2) $ 50 $116 $ 45 $ 55 $128 $ 47,600
--------------- --------------- ----------- ----------------- -------------- --------------
Louis R. Bindner(2) $ 50 $116 $ 45 $ 55 $128 $ 47,600
--------------- --------------- ----------- ----------------- -------------- --------------
Katherine A. Cattanach(2) $ 50 $116 $ 45 $ 55 $128 $ 47,600
--------------- --------------- ----------- ----------------- -------------- --------------
Paul R. Knapp(2) $ 50 $ 96 $ 35 $ 43 $102 $ 47,000
--------------- --------------- ----------- ----------------- -------------- --------------
Jack R. Thompson(2),(3),(4) $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
--------------- --------------- ----------- ----------------- -------------- --------------
Harry T. Lewis(2) $ 50 $116 $ 45 $ 55 $128 $ 47,600
--------------- --------------- ----------- ----------------- -------------- --------------
Michael Owen(2) $ 50 $137 $ 52 $ 64 $150 $ 57,600
--------------- --------------- ----------- ----------------- -------------- --------------
William Sinclaire(2) $ 50 $116 $ 45 $ 55 $128 $ 47,600
=============== =============== =========== ================= ============== ==============
</TABLE>
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<PAGE> 54
(1) For the period covered by this table, the Berger Funds included the Berger
Growth Fund, the Berger Growth and Income Fund, the Berger Investment Portfolio
Trust (seven series), the Berger Institutional Products Trust (four series), the
Berger/BIAM Worldwide Portfolios Trust (one series), the Berger/BIAM Worldwide
`Funds Trust (three series) and the Berger Omni Investment Trust (one series).
Amounts shown for the Berger IPT - New Generation Fund are estimates for its
first year of operations. Aggregate amounts did not include the estimated
amounts shown for the Berger IPT - New Generation Fund, which was added as a
series in May 2000. Of the aggregate amounts shown for each director/trustee,
the following amounts were deferred under applicable deferred compensation
plans: Dennis E. Baldwin $21,655; Louis R. Bindner $18,397; Katherine A.
Cattanach $47,138; Michael Owen $ 5,705; William Sinclaire $47,138.
(2) Director of Berger Growth Fund and Berger Growth and Income Fund. Trustee of
Berger Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust, Berger/BIAM Worldwide Portfolios Trust and
Berger Omni Investment Trust.
(3) President of Berger Growth Fund, Berger Growth and Income Fund, Berger
Investment Portfolio Trust, Berger Institutional Products Trust, Berger/BIAM
Worldwide Funds Trust, Berger/BIAM Worldwide Portfolios Trust and Berger Omni
Investment Trust.
(4) Interested person of Berger LLC.
Trustees may elect to defer receipt of all or a portion of their fees
pursuant to a fee deferral plan adopted by the Berger Institutional Products
Trust. Under the plan, deferred fees are credited to an account and adjusted
thereafter to reflect the investment experience of whichever of the Berger Funds
(or approved money market funds) is designated by the trustees for this purpose.
Pursuant to an SEC exemptive order, the Trust is permitted to purchase shares of
the designated funds in order to offset its obligation to the trustees
participating in the plan. Purchases made pursuant to the plan are excepted from
any otherwise applicable investment restriction limiting the purchase of
securities of any other investment company. The Trust's obligation to make
payments of deferred fees under the plan is a general obligation of the Trust.
As of the date of this Statement of Additional Information, the
officers and trustees of the Trust as a group did not own of record or
beneficially any shares of any of the Funds of the Berger Institutional Products
Trust.
4. INVESTMENT ADVISORS AND SUB-ADVISOR
BERGER LLC - INVESTMENT ADVISOR
Berger LLC ("Berger LLC"), 210 University Boulevard, Suite 900, Denver,
CO 80206, is the investment advisor to all the Funds except the Berger/BIAM
IPT - International Fund. Berger LLC is responsible for managing the investment
operations of these Funds and the composition of their investment portfolios.
Berger LLC also acts as each Funds' administrator and is responsible for such
functions as monitoring compliance with all applicable federal and state laws.
Berger LLC has been in the investment advisory business for 25 years.
It serves as investment advisor or sub-advisor to mutual funds and institutional
investors and had assets under management of approximately $6.1 billion as of
December 31, 1999. Berger LLC is a subsidiary of Stilwell Management Inc.
("Stilwell"), which owns more than 80% of Berger LLC, and is an indirect
subsidiary of Stilwell Financial, Inc. ("Stilwell Financial"), which in turn is
a wholly owned subsidiary of Kansas City Southern Industries, Inc. ("KCSI").
KCSI is a publicly traded holding company with principal operations in rail
transportation, through its subsidiary The Kansas City Southern Railway Company,
and financial asset management businesses. Stilwell also owns approximately 32%
of the outstanding shares of DST Systems, Inc. ("DST"), a publicly traded
information and transaction processing company which acts as the Funds'
sub-transfer agent. DST, in turn, owns 100% of DST Securities, a registered
broker-dealer, which executes portfolio trades for the Funds.
KCSI announced its intention to separate the transportation and
financial services segments through a proposed dividend of the stock of Stilwell
Financial. On July 12, 1999, KCSI announced that the Internal Revenue Service
issued a favorable tax ruling permitting KCSI to separate its financial services
segment from its transportation segment. Completion of this separation is
expected to occur in the year 2000.
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<PAGE> 55
BBOI WORLDWIDE LLC - INVESTMENT ADVISOR
BBOI Worldwide LLC ("BBOI Worldwide"), 210 University Boulevard,
Denver, CO 80206, is the investment advisor to the Berger/BIAM IPT -
International Fund (the "Fund"). BBOI Worldwide oversees, evaluates and monitors
the investment advisory services provided to the Fund by the Fund's sub-advisor
and is responsible for furnishing general business management and administrative
services to the Fund.
BBOI Worldwide is a Delaware limited liability company formed in 1996.
BBOI Worldwide is a joint venture between Berger LLC and Bank of Ireland Asset
Management (U.S.) Limited ("BIAM"), the sub-advisor to the Fund, which have both
been in the investment advisory business for many years.
Berger LLC and BIAM each own a 50% membership interest in BBOI
Worldwide and each have an equal number of representatives on BBOI Worldwide's
Board of Managers. Berger LLC's role in the joint venture is to provide
administrative services, and BIAM's role is to provide international and global
investment management expertise. Agreement of representatives of both Berger LLC
and BIAM is required for all significant management decisions.
On January 19, 2000, Berger LLC and BIAM entered into an agreement to
dissolve BBOI Worldwide. The dissolution of BBOI will have no effect on the
investment advisory services provided to the Berger/BIAM IPT - International
Fund and the fees borne by the Fund for advisory services are proposed to be
decreased. Contingent upon shareholder approval, when BBOI Worldwide is
dissolved, Berger LLC will become the Fund's advisor and BIAM will continue to
be responsible for day-to-day management of the Fund's portfolio as sub-advisor.
A Special Meeting of Shareholders of the Fund has been scheduled for May 5,
2000. Shareholders of the Fund of record at the close of business on March 6,
2000 (the record date) are entitled to attend and vote at the meeting and any
and all adjournments of the meeting. If approved by shareholders, these advisory
changes are expected to take place within ten business days following
shareholder approval.
BANK OF IRELAND ASSET MANAGEMENT (U.S.) LIMITED - SUB-ADVISOR
As permitted in its Investment Advisory Agreement with the Berger/BIAM
IPT - International Fund, BBOI Worldwide has delegated day-to-day investment
management responsibility for that Fund to BIAM. As sub-advisor, BIAM manages
the investments in the Fund and determines what securities and other investments
will be purchased, retained, sold or loaned, consistent with the investment
objective and policies established by the trustees. BIAM's main offices are at
26 Fitzwilliam Place, Dublin 2, Ireland. BIAM maintains a representative office
at 75 Holly Hill Lane, Greenwich, CT 06830. BIAM is an indirect wholly-owned
subsidiary of Bank of Ireland, a publicly traded, diversified financial services
group with business operations worldwide. Bank of Ireland provides investment
management services through a network of related companies, including BIAM which
serves primarily institutional clients in the United States and Canada. Bank of
Ireland and its affiliates managed assets for clients worldwide in excess of
$42.9 billion as of December 31, 1999.
Bank of Ireland or its affiliates may have deposit, loan or other
commercial or investment banking relationships with the issuers of securities
which may be purchased by the Fund, including outstanding loans to such issuers
which could be repaid in whole or in part with the proceeds of securities
purchased by the Fund. Federal law prohibits BIAM, in making investment
decisions, from using material non-public information in its possession or in
the possession of any of its affiliates. In addition, in making investment
decisions for the Fund, BIAM will not take into consideration whether an issuer
of securities proposed for purchase or sale by the Fund is a customer of Bank of
Ireland or its affiliates.
INVESTMENT ADVISORY AGREEMENTS AND SUB-ADVISORY AGREEMENT
Under the Investment Advisory Agreements between each Fund and its
advisor, the advisor is generally responsible for furnishing continuous advice
and making investment decisions as to the acquisition, holding or disposition of
securities or other assets which each Fund may own or contemplate acquiring from
time to time. Each Investment Advisory Agreement provides that the investment
advisor shall not be liable for any error of judgment or mistake of law or for
any loss arising out of any investment or for any act or omission taken with
respect to the Fund, except for willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of reckless disregard
of its obligations and duties thereunder and except to the extent otherwise
provided by law.
-23-
<PAGE> 56
Under the Agreements, the advisor is compensated for its services by
the payment of a fee at an annual rate, calculated as a percentage of the
average daily net assets of the Fund:
The following schedule reflects the advisory fees charged to the Funds
then in existence for the fiscal year ended December 31, 1999:
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
INVESTMENT
FUND ADVISOR ADVISORY FEE
- --------------------------------------------------------- -------------------------------- -----------------------------
<S> <C> <C>
Berger IPT - Small Company Growth Fund Berger LLC 0.88%(1)
- --------------------------------------------------------- -------------------------------- -----------------------------
Berger IPT - Growth Fund Berger LLC 0.75% (1)
- --------------------------------------------------------- -------------------------------- -----------------------------
Berger/BIAM IPT - International Fund (2) BBOI Worldwide (2) 0.90% (1)
- --------------------------------------------------------- -------------------------------- -----------------------------
Berger IPT - Growth and Income Fund Berger LLC 0.75% (1)
- --------------------------------------------------------- -------------------------------- -----------------------------
</TABLE>
(1) UNDER A WRITTEN CONTRACT, THE FUND'S INVESTMENT ADVISOR WAIVES ITS FEE AND
REIMBURSES THE FUND TO THE EXTENT THAT, AT ANY TIME DURING THE LIFE OF THE FUND,
THE FUND'S ANNUAL OPERATING EXPENSES EXCEED 1.00% IN THE CASE OF THE BERGER IPT
- - GROWTH FUND AND THE BERGER IPT - GROWTH AND INCOME FUND, 1.15% IN THE CASE OF
THE BERGER IPT - SMALL COMPANY GROWTH FUND AND 1.20% IN THE CASE OF THE
BERGER/BIAM IPT - INTERNATIONAL FUND. THE CONTRACT MAY NOT BE TERMINATED OR
AMENDED EXCEPT BY A VOTE OF THE FUND'S BOARD OF TRUSTEES.
(2) THE FUND IS SUB-ADVISED BY BIAM. SEE TEXT PRECEDING AND FOLLOWING TABLE.
Effective October 1, 1999, the investment advisory fee charged to the certain
Funds then in existence was reduced according to the following schedule. In
addition, the Berger IPT - New Generation Fund was added as a Fund effective May
1, 2000, at the rate shown:
<TABLE>
<CAPTION>
Fund Average Daily Net Assets Annual Rate
<S> <C> <C>
Berger IPT - Growth Fund First $500 million .75%
Berger IPT - Growth and Income Fund Next $500 million .70%
Over $1 billion .65%
---------------------------------------------- -------------------------- -----------
Berger IPT - New Generation Fund (1) First $500 million .85%
Berger IPT - Small Company Growth Fund Next $500 million .80%
Over $1 billion .75%
</TABLE>
1. Under a written contract, the Fund's investment advisor waives its fee and
reimburses the Fund to the extent that, at any time during the life of the Fund,
the Fund's annual operating expenses exceed 1.15%. The contract may not be
terminated or amended except by the vote of the Fund's Board of Trustees.
Each Fund's current Investment Advisory Agreement will continue in
effect until the last day of April 2002, and thereafter from year to year if
such continuation is specifically approved at least annually by the trustees or
by vote of a majority of the outstanding shares of the Fund and in either case
by vote of a majority of the trustees who are not "interested persons" (as that
term is defined in the 1940 Act) of the Fund or the advisor. Each Agreement is
subject to termination by the Fund or the advisor on 60 days' written notice,
and terminates automatically in the event of its assignment.
-24-
<PAGE> 57
Under the Sub-Advisory Agreement between the advisor and the
sub-advisor for the Berger/BIAM IPT - International Fund, the sub-advisor is
responsible for day-to-day investment management. The sub-advisor manages the
investments and determines what securities and other investments will be
acquired, held or disposed of, consistent with the investment objective and
policies established by the trustees. The Sub-Advisory Agreement provides that
the sub-advisor shall not be liable for any error of judgment or mistake of law
or for any loss arising out of any investment or for any act or omission taken
with respect to the Fund, except for willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of reckless disregard
of its obligations and duties thereunder and except to the extent otherwise
provided by law.
No fees are paid directly to the sub-advisor by the Berger/BIAM IPT -
International Fund. As sub-advisor, BIAM receives from BBOI Worldwide, as
advisor, a fee at the annual rate of 0.40% of the average daily net assets of
the Fund. During certain periods, BIAM may voluntarily waive all or a portion of
its fee under the Sub-Advisory Agreement, which will not affect the fee paid by
the Fund to BBOI Worldwide.
The Sub-Advisory Agreement between BBOI Worldwide and BIAM with respect
to the Berger/BIAM IPT - International Fund will continue in effect until April
2000, and thereafter from year to year if such continuation is specifically
approved at least annually by the trustees or by vote of a majority of the
outstanding shares of the Fund and in either case by vote of a majority of the
trustees of the Trust who are not "interested persons" (as that term is defined
in the Investment Company Act of 1940) of the Fund or BBOI Worldwide or BIAM.
The Sub-Advisory Agreement is subject to termination by the Fund, BBOI Worldwide
or BIAM on 60 days' written notice, and terminates automatically in the event of
its assignment and in the event of termination of the Investment Advisory
Agreement between the Trust and BBOI Worldwide with respect to the Berger/BIAM
IPT - International Fund.
TRADE ALLOCATIONS
While investment decisions for the Fund are made independently by the
advisor or sub-advisor, the same investment decision may be made for the Fund
and one or more accounts advised by the advisor or sub-advisor. In this
circumstance, should purchase and sell orders of the same class of security be
in effect on the same day, the orders for such transactions may be combined by
the advisor or sub-advisor in order to seek the best combination of net price
and execution for each. Client orders partially filled will, as a general
matter, be allocated pro rata in proportion to each client's original order,
although exceptions may be made to avoid, among other things, odd lots and de
minimus allocations. Execution prices for a combined order will be averaged so
that each participating client receives the average price paid or received.
While in some cases, this policy might adversely affect the price paid or
received by a Fund or other participating accounts, or the size of the position
obtained or liquidated, the advisor or sub-advisor will aggregate orders if it
believes that coordination of orders and the ability to participate in volume
transactions will result in the best overall combination of net price and
execution.
RESTRICTIONS ON PERSONAL TRADING
Berger LLC, the Berger Funds and Berger Distributors LLC each permits
its directors, officers and employees to purchase and sell securities for their
own accounts, including securities that may be purchased or held by the Funds,
in accordance with a policy regarding personal investing contained in each of
the Codes of Ethics for Berger LLC, the Berger Funds and Berger Distributors
LLC. The policy requires all covered persons to conduct their personal
securities transactions in a manner which does not operate adversely to the
interests of the Funds or Berger LLC's other advisory clients. Directors and
officers of Berger LLC, the Berger Funds and Berger Distributors LLC, investment
personnel and other designated persons deemed to have access to current trading
information ("access persons") are required to pre-clear all transactions in
securities not otherwise exempt under the policy. Requests for authority to
trade will be denied pre-clearance when, among other reasons, the proposed
personal transaction would be contrary to the provisions of the policy or would
be deemed to adversely affect any transaction then known to be under
consideration for or currently being effected on behalf of any client account,
including any of the Funds.
In addition to the pre-clearance requirements described above, the
policy subjects directors and officers of Berger LLC, the Berger Funds and
Berger Distributors LLC, investment personnel and other access persons to
various trading restrictions and reporting obligations. All reportable
transactions are reviewed for compliance with the policy. Each policy is
administered by Berger LLC and the provisions of each policy are subject
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<PAGE> 58
to interpretation by and exceptions authorized by the board of directors or
trustees of the company that adopted the policy.
BBOI Worldwide has adopted a Code of Ethics covering all board members,
officers, employees and other access persons of BBOI Worldwide who are not also
covered by an approved Code of Ethics of an affiliated person who is an
investment advisor. At present, there are no persons who would be covered by
BBOI Worldwide's Code of Ethics who are not also covered by the Code of Ethics
of Berger LLC or BIAM, which are both investment advisors affiliated with BBOI
Worldwide. BBOI Worldwide's Code is substantially similar to the Code of Ethics
adopted by Berger LLC (described above).
BIAM has also adopted a Code of Ethics which permits its directors,
officers and employees to purchase and sell securities for their own accounts,
including securities that may be held or acquired by the Berger/BIAM IPT -
International Fund. BIAM's Code of Ethics restricts its officers, employees and
other staff from personal trading in specified circumstances, including among
others prohibiting participation in initial public offerings, prohibiting
dealing in a security for the seven days before and after any trade in that
security on behalf of clients, prohibiting trading in a security while an order
is pending for any client on that same security, and requiring profits from
short-term trading in securities (purchase and sale within a 60-day period) to
be forfeited. In addition, staff of BIAM must report all of their personal
holdings in securities annually and must disclose their holdings in any private
company if an investment in that same company is being considered for clients.
Staff of BIAM are required to pre-clear all transactions in securities not
otherwise exempt under the Code of Ethics and must instruct their broker to
provide BIAM with duplicate confirmations of all such personal trades.
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<PAGE> 59
5. EXPENSES OF THE FUNDS
In addition to paying an investment advisory fee to its advisor, each
Fund pays all of its expenses not assumed by its advisor, including but not
limited to, custodian and transfer agent fees, legal and accounting expenses,
administrative and recordkeeping expenses, interest charges, federal and state
taxes, costs of share certificates, expenses of shareholders' meetings,
compensation of trustees who are not interested persons of the advisor or
sub-advisor, expenses of printing and distributing reports to shareholders and
federal and state administrative agencies, and all expenses incurred in
connection with the execution of its portfolio transactions, including brokerage
commissions on purchases and sales of portfolio securities, which are considered
a cost of securities of each Fund. Each Fund also pays all expenses incurred in
complying with all federal and state laws and the laws of any foreign country
applicable to the issue, offer or sale of shares of the Fund, including, but not
limited to, all costs involved in preparing and printing prospectuses for
shareholders of the Funds.
Under a separate Administrative Services Agreement with each Fund
except the Berger/BIAM IPT - International Fund, Berger LLC performs certain
administrative and recordkeeping services not otherwise performed by State
Street, including the preparation of financial statements and reports to be
filed with regulatory authorities. Until September 30, 1999, each Fund then in
existence paid Berger LLC a fee, before any waivers, at the annual rate of 0.01%
of its average daily net assets for such services. Under an Administrative
Services Agreement with the Berger/BIAM IPT - International Fund, BBOI Worldwide
performs similar administrative and recordkeeping services and until September
30, 1999 the Fund paid BBOI Worldwide a fee at the annual rate of 0.01% of its
average daily net assets. These administrative services fees are in addition to
the investment advisory fees paid by each Fund under its Investment Advisory
Agreement. Effective October 1, 1999, Berger LLC and BBOI Worldwide eliminated
the 0.01% administrative fee charged to the Funds. The administrative services
fees may be changed by the trustees without shareholder approval. In addition,
effective October 1, 1999, the investment advisory fee charged to certain Funds
was reduced. The advisory fee reductions are reflected earlier under Investment
Advisory Agreements.
Under a Sub-Administration Agreement between the BBOI Worldwide and
Berger LLC, Berger LLC has been delegated all of BBOI Worldwide's duties under
the Administrative Services Agreement and BBOI Worldwide's administrative duties
under the Investment Advisory Agreement for the Berger/BIAM IPT - International
Fund. For its services under the Sub-Administration Agreement, BBOI Worldwide
pays Berger LLC a fee of 0.20% of the average daily net assets of the
Berger/BIAM IPT - International Fund. During certain periods, Berger LLC may
voluntarily waive all or a portion of its fee from BBOI Worldwide, which will
not affect the fee paid by the Fund to BBOI Worldwide under the Administrative
Services Agreement or the advisory fee paid to BBOI Worldwide under the
Investment Advisory Agreement.
The following tables show the cost to each Fund of the advisory fee and
the fees for the administrative services for the period shown and the amounts of
expenses waived and reimbursed to each Fund.
Berger IPT - New Generation Fund
<TABLE>
<CAPTION>
Advisory Fee
Waiver and
Fiscal Year Ended Investment Administrative Expense
December 31, Advisory Fee Service Fee Reimbursements TOTAL
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
<S> <C> <C> <C> <C>
1999(1) N/A N/A N/A N/A
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
</TABLE>
(1) The Berger IPT - New Generation Fund did not commence operations until May
2000.
-27-
<PAGE> 60
Berger IPT - Small Company Growth Fund
<TABLE>
<CAPTION>
Advisory Fee
Waiver and
Fiscal Year Ended Investment Administrative Expense
December 31, Advisory Fee Service Fee Reimbursements TOTAL
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
<S> <C> <C> <C> <C>
1999 $132,056 $ 862 $(57,324) $75,594
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
1998 $ 51,369 $ 571 $(59,275) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
1997 $ 11,890 $ 131 $(61,554) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
</TABLE>
Berger IPT - Growth Fund
<TABLE>
<CAPTION>
Advisory Fee
Waiver and
Fiscal Year Ended Investment Administrative Expense
December 31, Advisory Fee Service Fee Reimbursements TOTAL
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
<S> <C> <C> <C> <C>
1999 $35,613 $338 $(56,591) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
1998 $18,445 $246 $(46,234) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
1997 $ 5,119 $ 68 $(55,910) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
</TABLE>
Berger/BIAM IPT - International Fund
<TABLE>
<CAPTION>
Advisory Fee
Waiver and
Fiscal Year Ended Investment Administrative Expense
December 31, Advisory Fee Service Fee Reimbursements TOTAL
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
<S> <C> <C> <C> <C>
1999 $49,260 $409 $(68,918) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
1998 $34,853 $387 $(64,078) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
1997* $13,368 $148 $(39,083) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
</TABLE>
* COVERS PERIOD MAY 1, 1997 (DATE OPERATIONS COMMENCED) TO DECEMBER 31, 1997.
Berger IPT - Growth and Income Fund
<TABLE>
<CAPTION>
Advisory Fee
Waiver and
Fiscal Year Ended Investment Administrative Expense
December 31, Advisory Fee Service Fee Reimbursements TOTAL
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
<S> <C> <C> <C> <C>
1999 $ 109,196 $ 967 $(27,572) $ 82,591
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
1998 $ 39,707 $ 529 $(52,203) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
1997 $ 4,872 $ 58 $(56,020) $ 0
- ------------------------- ----------------------- ----------------------- ---------------------- -----------------------
</TABLE>
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<PAGE> 61
Each of the Funds has appointed State Street Bank and Trust Company
("State Street"), 801 Pennsylvania, Kansas City, MO 64105, as its recordkeeping
and pricing agent. In addition, State Street also serves as the Funds'
custodian, while Investors Fiduciary Trust Company ("IFTC"), 801 Pennsylvania,
Kansas City, MO 64105, serves as transfer agent and dividend disbursing agent.
IFTC has engaged DST Systems, Inc. ("DST"), P.O. Box 219958, Kansas City, MO
64121, as sub-agent to provide transfer agency and dividend disbursing services
for the Funds. Approximately 32% of the outstanding shares of DST are owned by
Stilwell.
As recordkeeping and pricing agent, State Street calculates the daily
net asset value of each Fund and performs certain accounting and recordkeeping
functions required by the Funds. The Funds pay State Street a monthly base fee
plus an asset-based fee. State Street is also reimbursed for certain
out-of-pocket expenses.
State Street, as custodian, and its subcustodians have custody and
provide for the safekeeping of the Funds' securities and cash, and receive and
remit the income thereon as directed by the management of the Funds. The
custodian and subcustodians do not perform any managerial or policy-making
functions for the Funds. For its services as custodian, State Street receives an
asset-based fee plus certain transaction fees and out-of-pocket expenses.
As transfer agent and dividend disbursing agent, IFTC (through DST, as
sub-agent) maintains all shareholder accounts of record; assists in mailing all
reports, proxies and other information to the Funds' shareholders; calculates
the amount of, and delivers to the Funds' shareholders, proceeds representing
all dividends and distributions; and performs other related services. For these
services, IFTC receives a fee from the Funds at an annual rate of $14.00 per
open Fund shareholder account, subject to preset volume discounts, plus certain
transaction fees and fees for closed accounts, and is reimbursed for
out-of-pocket expenses, which fees in turn are passed through to DST as
sub-agent.
All of State Street's and IFTC's fees are subject to reduction pursuant
to an agreed formula for certain earnings credits on the cash balances of the
Funds. Earnings credits received by each Fund can be found on the Fund's
Statement of Operations in the Annual Report incorporated by reference into this
Statement of Additional Information.
From time to time, Berger LLC or BBOI Worldwide may compensate
Participating Insurance Companies or their affiliates whose customers hold
shares of the Funds for providing a variety of administrative services (such as
recordkeeping and accounting) and investor support services (such as responding
to inquiries and preparing mailings to shareholders). This compensation, which
may be paid as a per account fee or as a percentage of the average daily net
assets invested in the Funds by the compensated Participating Insurance Company,
depending on the nature, extent and quality of the services provided, will be
paid from Berger LLC's or BBOI Worldwide's own resources and not from the assets
of the Funds.
A Fund's advisor may also enter into arrangements with organizations
that solicit clients for the advisor, which may include clients who purchase
shares of the Funds. While the specific terms of each arrangement may differ,
generally, the fee paid by the advisor under such arrangements is based on the
value of the referred client's assets managed by the advisor. None of the fees
paid to such organizations will be borne by the Funds.
The trustees of each of the Funds have authorized portfolio
transactions to be placed on an agency basis through DST Securities, Inc.
("DSTS"), a wholly-owned broker-dealer subsidiary of DST. When transactions for
a Fund are effected through DSTS, the commission received by DSTS is credited
against, and thereby reduces, certain operating expenses that the Fund would
otherwise be obligated to pay. No portion of the commission is retained by DSTS.
See Section 6 Brokerage Policy for further information concerning the expenses
reduced as a result of these arrangements.
Under a written contract, each Fund's investment advisor waives its fee
and reimburses the Fund to the extent that, at any time during the life of the
Fund, the Fund's annual operating expenses exceed 1.00% in the case of the
Berger IPT - Growth Fund and the Berger IPT - Growth and Income Fund, 1.15% in
the case of the Berger IPT - Small Company Growth Fund and the Berger IPT - New
Generation Fund, and 1.20% in the case of the Berger/BIAM IPT - International
Fund. The contract may not be terminated or amended except by a vote of the
Fund's Board of Trustees.
-29-
<PAGE> 62
DISTRIBUTOR
The distributor (principal underwriter) of each Fund's shares is Berger
Distributors LLC (the "Distributor"), 210 University Boulevard, Suite 900,
Denver, CO 80206. The Distributor may be reimbursed by Berger LLC for its costs
in distributing the Funds' shares.
6. BROKERAGE POLICY
Although each Fund retains full control over its own investment
policies, the Funds' advisor (or sub-advisor, in the case of the Berger/BIAM IPT
- - International Fund) is authorized to place the portfolio transactions of each
Fund. A report on the placement of brokerage business is given to the trustees
of the Fund every quarter, indicating the brokers with whom Fund portfolio
business was placed and the basis for such placement. The brokerage commissions
paid by the Funds during the past three fiscal years were as follows:
BROKERAGE COMMISSIONS
<TABLE>
<CAPTION>
Fiscal Year Fiscal Year Fiscal Year
Ended Ended Ended
December 31, 1999 December 31, 1998 December 31, 1997
--------------------- --------------------- ---------------------
<S> <C> <C> <C>
Berger IPT - New Generation Fund(1) N/A N/A N/A
- ----------------------------------------------------- --------------------- --------------------- ---------------------
Berger IPT - Small Company Growth Fund $23,061 $ 12,722 $ 3,118
- ----------------------------------------------------- --------------------- --------------------- ---------------------
Berger IPT - Growth Fund $17,989 $ 13,732 $ 3,191
- ----------------------------------------------------- --------------------- --------------------- ---------------------
Berger/BIAM IPT - International Fund $5,334 $ 5,618 $ 6,134(2)
- ----------------------------------------------------- --------------------- --------------------- ---------------------
Berger IPT - Growth and Income Fund $31,609 $ 36,751 $ 2,817
- ----------------------------------------------------- --------------------- --------------------- ---------------------
</TABLE>
(1) The Berger IPT - New Generation Fund did not commence operations until May
2000.
(2) Covers period from May 1, 1997 (date operations commenced) to the end of the
Fund's first fiscal year on December 31, 1997.
The Investment Advisory Agreement that each Fund has with its advisor
(and the Sub-Advisory Agreement with the sub-advisor, in the case of the
Berger/BIAM IPT - International Fund) authorizes and directs the advisor (or
sub-advisor) to place portfolio transactions for the Fund only with brokers and
dealers who render satisfactory service in the execution of orders at the most
favorable prices and at reasonable commission rates. However, each Agreement
specifically authorizes the advisor (or sub-advisor) to place such transactions
with a broker with whom it has negotiated a commission that is in excess of the
commission another broker or dealer would have charged for effecting that
transaction if the advisor (or sub-advisor) determines in good faith that such
amount of commission was reasonable in relation to the value of the brokerage
and research services provided by such broker viewed in terms of either that
particular transaction or the overall responsibilities of the advisor (or
sub-advisor). Accordingly, the advisor (or sub-advisor) does not have an
obligation to seek the lowest available commission.
In accordance with this provision of the Agreements, portfolio
brokerage business of each fund may be placed with brokers who provide useful
brokerage and research services to the advisor or, where applicable, the
sub-advisor. Berger LLC considers and BIAM may consider the value of research
provided as a factor in the choice of brokers. "Research" includes computerized
on-line stock quotation systems and related data feeds from stock exchanges,
computerized trade order entry, execution and confirmation systems, fundamental
and technical analysis data and software, computerized stock market and business
news services, economic research, account performance data and computer hardware
used for the receipt of electronic research services and broker and other
third-party equity research, such as publications or writings which furnish
advice as to the value of securities and advisability of investing, and analyses
and reports concerning issuers, industries, securities, market trends, and
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<PAGE> 63
portfolio strategies. Research may be provided orally, in print, or
electronically. These include a service used by the independent trustees of the
Funds in reviewing the Investment Advisory Agreements.
In some cases, a product or services termed "research" may serve other
functions unrelated to the making of investment decisions. When a product has
such a mixed use, the advisor or sub-advisor will make a good faith allocation
of the cost of the product according to the use made of it. The portion of the
product that assists the advisor or sub-advisor in the investment
decision-making process may be paid for with a Fund's commission dollars. The
advisor or sub-advisor pays for the portion of the product that is not
"research" with its own funds. Accordingly, the decision whether and how to
allocate the costs of such a product presents a conflict of interest for the
advisor or sub-advisor.
Berger LLC does not and BIAM will not enter into formal agreements with
any brokers regarding the placement of securities transactions because of any
such brokerage or research services that they provide. Berger LLC or BIAM may,
however, make arrangements with and maintain internal procedures for allocating
transactions to brokers who provide such services to encourage them to provide
services expected to be useful to Berger LLC's or BIAM's clients, including the
Funds. Brokers may suggest a level of business they would like to receive in
return for the brokerage and research they provide. Berger LLC or BIAM may then
determine whether to continue receiving the research and brokerage provided and
the approximate amount of commissions it is willing to pay to continue the
brokerage and research arrangement with each broker. The actual amount of
commissions a broker may receive may be more or less than a broker's suggested
allocations, depending on Berger LLC's or BIAM's level of business, market
conditions and other relevant factors. Even under these arrangements, however,
the placement of all Fund transactions must be consistent with the Funds'
brokerage placement and execution policies, and must be directed to a broker who
renders satisfactory service in the execution of orders at the most favorable
prices and at reasonable commission rates.
During the fiscal year ended December 31, 1999, of the brokerage
commissions paid by the Funds, the following amounts were paid to brokers who
provided to the Funds selected brokerage or research services prepared by the
broker or subscribed or paid for by the broker on behalf of the Funds:
<TABLE>
<CAPTION>
Amount of
Fund Amount of Transactions Commissions
------------------------------------------------------ ------------------------------- -----------------------
<S> <C> <C>
Berger IPT - New Generation Fund (1) N/A N/A
------------------------------------------------------ ------------------------------- -----------------------
Berger IPT - Small Company Growth Fund $ 758,972 $1,797
------------------------------------------------------ ------------------------------- -----------------------
Berger IPT - Growth Fund $2,264,739 $2,604
------------------------------------------------------ ------------------------------- -----------------------
Berger/BIAM IPT - International Fund $ 0 $ 0
------------------------------------------------------ ------------------------------- -----------------------
Berger IPT - Growth and Income Fund $4,662,078 $5,224
------------------------------------------------------ ------------------------------- -----------------------
</TABLE>
(1) The Berger IPT - New Generation Fund did not commence operations until May
2000.
The brokerage and research services received from brokers are often
helpful to Berger LLC and could be helpful to BIAM in performing its investment
advisory responsibilities to the Funds, and the availability of such services
from brokers does not reduce the responsibility of Berger LLC's or BIAM's
advisory personnel to analyze and evaluate the securities in which the Funds
invest. The brokerage and research services obtained as a result of the Funds'
brokerage business also will be useful to Berger LLC or may be useful to BIAM in
making investment decisions for its other advisory accounts, and, conversely,
information obtained by reason of placement of brokerage business of such other
accounts may be used by Berger LLC or BIAM in rendering investment advice to the
Funds. Although such brokerage and research services may be deemed to be of
value to Berger LLC or
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<PAGE> 64
BIAM, they are not expected to decrease the expenses that Berger LLC or BIAM
would otherwise incur in performing its investment advisory services for the
Funds nor will the advisory fees that are received by Berger LLC or BIAM for
their services be reduced as a result of the availability of such brokerage and
research services from brokers.
The trustees of each of the Funds have authorized portfolio
transactions to be placed on an agency basis through DST Securities, Inc.
("DSTS"), a wholly-owned broker-dealer subsidiary of DST. When transactions for
a Fund are effected through DSTS, the commission received by DSTS is credited
against, and thereby reduces, certain operating expenses that the Fund would
otherwise be obligated to pay. No portion of the commission is retained by DSTS.
DSTS may be considered an affiliate of Berger LLC due to the ownership interest
of Stilwell in both DST and Berger LLC.
Included in the brokerage commissions paid by the Funds during the last
three fiscal years, as stated in the preceding Brokerage Commissions table, are
the following amounts paid to DSTS, which served to reduce each Fund's
out-of-pocket expenses as follows:
DSTS COMMISSIONS AND RELATED EXPENSE REDUCTIONS
<TABLE>
<CAPTION>
REDUCTION
DSTS IN DSTS REDUCTION
COMMISSIONS EXPENSES DSTS REDUCTION IN COMMISSIONS IN EXPENSES
PAID FYE COMMISSIONS PAID EXPENSES FYE PAID FYE
FYE 12/31/99 12/31/99(1) FYE 12/31/98 12/31/98(1) FYE 12/31/97 12/31/97(1)
- ------------------------- --------------- ------------ ----------------- --------------- ---------------- --------------
<S> <C> <C> <C> <C> <C> <C>
BERGER IPT - NEW N/A N/A N/A N/A N/A N/A
GENERATION FUND(2)
- ------------------------- --------------- ------------ ----------------- --------------- ---------------- --------------
BERGER IPT - SMALL $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
COMPANY GROWTH FUND
- ------------------------- --------------- ------------ ----------------- --------------- ---------------- --------------
BERGER IPT - GROWTH FUND $ 856(3) $642 $ 436 $ 327 $ 58 $ 44
- ------------------------- --------------- ------------ ----------------- --------------- ---------------- --------------
BERGER/BIAM IPT - $ 0 $ 0 $ 0 $ 0 $ 0(4) $ 0(4)
INTERNATIONAL FUND
- ------------------------- --------------- ------------ ----------------- --------------- ---------------- --------------
BERGER IPT - GROWTH AND $ 787(5) $590 $ 454 $ 341 $ 13 $ 10
INCOME FUND
- ------------------------- --------------- ------------ ----------------- --------------- ---------------- --------------
</TABLE>
(1) NO PORTION OF THE COMMISSION IS RETAINED BY DSTS. DIFFERENCE BETWEEN
COMMISSIONS PAID THROUGH DSTS AND REDUCTION IN EXPENSES CONSTITUTE
COMMISSIONS PAID TO AN UNAFFILIATED CLEARING BROKER.
(2) THE BERGER IPT - NEW GENERATION FUND DID NOT COMMENCE OPERATIONS UNTIL MAY
2000.
(3) CONSTITUTES 5% OF THE AGGREGATE BROKERAGE COMMISSIONS PAID BY THE BERGER
IPT - GROWTH FUND AND LESS THAN 1% OF THE AGGREGATE DOLLAR AMOUNT OF
TRANSACTIONS PLACED BY THAT FUND.
(4) COVERS THE PERIOD MAY 1, 1997 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31,
1997.
(5) CONSTITUTES 2% OF THE AGGREGATE BROKERAGE COMMISSIONS PAID BY THE BERGER
IPT - GROWTH AND INCOME FUND AND LESS THAN 1% OF THE AGGREGATE DOLLAR
AMOUNT OF TRANSACTIONS PLACED BY THAT FUND.
Each Fund's advisor or sub-advisor places securities orders with a
limited number of major institutional brokerage firms chosen for the reliability
and quality of execution; commission rates; quality of research coverage of
major U.S. companies, the U.S. economy and the securities markets; promptness;
back office capabilities; capital strength and financial stability; prior
performance in serving the advisor and its clients; and knowledge of
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<PAGE> 65
other buyers and sellers. The advisor or sub-advisor selects the broker for each
order based on the factors above, as well as the size, difficulty and other
characteristics of the order. The trustees of each Fund have authorized sales by
a broker-dealer of variable insurance contracts that permit allocation of
contract values to one or more of the Funds to be considered as a factor in the
selection of broker-dealers to execute portfolio transactions for the Funds. In
addition, the advisor or sub-advisor may also consider payments made by brokers
to a Fund or to other persons on behalf of a Fund for services provided to the
Fund for which it would otherwise be obligated to pay, such as transfer agency
fees. In placing portfolio business with any such broker or dealer, the advisors
and sub-advisor of the Funds will seek the best execution of each transaction.
During the fiscal year ended December 31, 1999, the Berger IPT-Growth
and Income Fund and Berger/BIAM IPT-International Fund acquired securities of
their regular broker-dealers. As of December 31, 1999, these Funds owned the
following common stock of their regular broker-dealers with the following
values:
<TABLE>
<CAPTION>
FUND BROKER/DEALER VALUE
--------------------------------------------- ------------------------------------------ --------------------
<S> <C> <C>
Berger IPT - Growth and Income Fund Morgan Stanley Dean Witter & Co. $ 286,927
Goldman Sachs Group, Inc. 165,770
--------------------------------------------- ------------------------------------------ --------------------
Berger/BIAM IPT-International Fund ABN AMRO Holdings NV 62,340
HSBC Holdings PLC 33,652
--------------------------------------------- ------------------------------------------ --------------------
</TABLE>
7. HOW TO PURCHASE AND REDEEM SHARES IN THE FUNDS
Shares of the Funds are sold by the Funds on a continuous basis to
separate accounts of Participating Insurance Companies or to qualified plans.
Investors may not purchase or redeem shares of the Funds directly, but only
through variable insurance contracts offered through the separate accounts of
Participating Insurance Companies or through qualified retirement plans. You
should refer to the applicable Separate Account Prospectus or your plan
documents for information on how to purchase or surrender a contract, make
partial withdrawals of contract values, allocate contract values to one or more
of the Funds, change existing allocations among investment alternatives,
including the Funds, or select specific Funds as investment options for a
qualified plan. No sales charge is imposed upon the purchase or redemption of
shares of the Funds. Sales charges for the variable insurance contracts or
qualified plans are described in the relevant Separate Account Prospectuses or
plan documents.
Fund shares are purchased or redeemed at the net asset value per share
next computed after receipt of a purchase or redemption order by a Fund, its
authorized agent or its designee. Payment for redeemed shares generally will be
made within three business days following the date of the request for
redemption. However, payment may be postponed under unusual circumstances, such
as when normal trading is not taking place on the New York Stock Exchange, an
emergency as defined by the Securities and Exchange Commission exists, or as
permitted by the Securities and Exchange Commission.
8. SUSPENSION OF REDEMPTION RIGHTS
The right of redemption may be suspended for any period during which
the New York Stock Exchange is closed or the Securities and Exchange Commission
determines that trading on the Exchange is restricted, or when there is an
emergency as determined by the Securities and Exchange Commission as a result of
which it is not reasonably practicable for a Fund to dispose of securities owned
by it or to determine the value of its net assets, or for such other period as
the Securities and Exchange Commission may by order permit for the protection of
shareholders of a Fund.
Each Fund intends to redeem its shares only for cash, although it
retains the right to redeem its shares in-kind under unusual circumstances, in
order to protect the interests of the remaining shareholders, by the delivery of
securities selected from its assets at its discretion. If shares are redeemed
in-kind, the redeeming shareholder generally will incur brokerage costs in
converting the assets to cash. The redeeming shareholder may have difficulty
selling the securities and recovering the amount of the redemption if the
securities are illiquid. The method of valuing securities used to make
redemption in-kind will be the same as the method of valuing portfolio
securities described below.
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<PAGE> 66
9. HOW THE NET ASSET VALUE IS DETERMINED
The net asset value of each Fund is determined once daily, at the close
of the regular trading session of the New York Stock Exchange (the "Exchange")
(normally 4:00 p.m., New York time, Monday through Friday) each day that the
Exchange is open. The Exchange is closed and the net asset value of the Funds is
not determined on weekends and on New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day each year. The per share net asset value of
each Fund is determined by dividing the total value of its securities and other
assets, less liabilities, by the total number of shares outstanding.
In determining net asset value, securities listed or traded primarily
on national exchanges, The Nasdaq Stock Market and foreign exchanges are valued
at the last sale price on such markets, or, if such a price is lacking for the
trading period immediately preceding the time of determination, such securities
are valued at the mean of their current bid and asked prices. Securities that
are traded in the over-the-counter market are valued at the mean between their
current bid and asked prices. The market value of individual securities held by
each Fund will be determined by using prices provided by pricing services which
provide market prices to other mutual funds or, as needed, by obtaining market
quotations from independent broker/dealers. Short-term money market securities
maturing within 60 days are valued on the amortized cost basis, which
approximates market value. All assets and liabilities initially expressed in
terms of non-U.S. dollar currencies are translated into U.S. dollars at the
prevailing market rates as quoted by one or more banks or dealers shortly before
the close of the Exchange. Securities and assets for which quotations are not
readily available or are not representative of market value may be valued at
their fair value determined in good faith pursuant to consistently applied
procedures established by the trustees. Examples would be when events occur that
materially affect the value of a security at a time when the security is not
trading or when the securities are illiquid.
Generally, trading in foreign securities markets is substantially
completed each day at various times prior to the close of the Exchange. The
values of foreign securities used in computing the net asset value of the shares
of a Fund are determined as of the earlier of such market close or the closing
time of the Exchange. Occasionally, events affecting the value of such
securities may occur between the times at which they are determined and the
close of the Exchange, or when the foreign market on which such securities trade
is closed but the Exchange is open, which will not be reflected in the
computation of net asset value. If during such periods, events occur which
materially affect the value of such securities, the securities may be valued at
their fair value as determined in good faith pursuant to consistently applied
procedures established by the trustees.
A Fund's securities may be listed primarily on foreign exchanges or
over-the-counter dealer markets which may trade on days when the Exchange is
closed (such as a customary U.S. holiday) and on which the Fund's net asset
value is not calculated. As a result, the net asset value of a Fund may be
significantly affected by such trading on days when shareholders cannot purchase
or redeem shares of the Fund.
10. INCOME DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAX TREATMENT
Each of the Funds intends to qualify to be treated as a separate
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code"). If they so qualify and meet certain minimum
distribution requirements, the Funds generally will not be liable for Federal
income tax on the amount of their earnings that are timely distributed. If a
Fund distributes annually less than 98% of its income and gain, under certain
circumstances, it may be subject to a nondeductible excise tax equal to 4% of
the shortfall.
Each Fund intends to restrict sales of its shares to Participating
Insurance Companies and qualified plans so as to qualify for "look-through"
treatment under the investment diversification requirements of Code Section
817(h) which apply to certain insurance company separate accounts. Each Fund
also intends to manage its investments in accordance with the diversification
requirements of Code Section 817(h) so that any separate account, or segregated
asset account thereof, that holds shares in any of the Funds as its sole asset
will comply with those requirements. For further information concerning Federal
income tax consequences for the owners of variable insurance contracts and
qualified plan participants, consult the appropriate Separate Account Prospectus
or plan documents.
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All dividends or capital gains distributions paid by a Fund will be
automatically reinvested in shares of that Fund at the net asset value on the
ex-dividend date, unless an election is made on behalf of a separate account or
qualified plan to receive distributions in cash. The tax treatment of
distributions made to any shareholder will depend on the shareholder's tax
status.
The amount, timing and character of a Fund's income may be affected by
certain special U.S. tax rules that may apply to foreign or other investments of
a Fund. Any income received by a Fund from foreign investments may also be
subject to foreign income, withholding or other taxes.
11. PERFORMANCE INFORMATION
From time to time in advertisements, the Funds may discuss their
performance ratings as published by recognized mutual fund statistical services,
such as Lipper Analytical Services, Inc., CDA Investment Technologies, Inc.,
Morningstar, Inc., or Value Line Investment Survey or by publications of general
interest such as The Wall Street Journal, Investor's Business Daily, Money,
Barron's, Financial World or Kiplinger's Personal Finance Magazine. In addition,
the Funds may compare their performance to that of recognized broad-based
securities market indices, including the Standard & Poor's 500 Stock Index, the
Dow Jones Industrial Average, the Russell 2000 Stock Index, the Standard &
Poor's 400 Mid-Cap Index, the Standard & Poor's 600 Small Cap Index, Morgan
Stanley Capital International EAFE (Europe, Australasia, Far East) Index, the
Dow Jones World Index, the Standard & Poor's/BARRA Value Index, the Nasdaq
Composite Index or the Lehman Brothers Intermediate Term Government/Corporate
Bond Index, or more narrowly-based or blended indices which reflect the market
sectors in which that Fund invests.
The total return of each Fund is calculated for any specified period of
time by assuming the purchase of shares of the Fund at the net asset value at
the beginning of the period. Each dividend or other distribution paid by the
Fund is assumed to have been reinvested at the net asset value on the
reinvestment date. The total number of shares then owned as a result of this
process is valued at the net asset value at the end of the period. The
percentage increase is determined by subtracting the initial value of the
investment from the ending value and dividing the remainder by the initial
value.
Each Fund's total return reflects the Fund's performance over a stated
period of time. An average annual total return reflects the hypothetical
annually compounded return that would have produced the same total return if the
Fund's performance had been constant over the entire period. Total return
figures are based on the overall change in value of a hypothetical investment in
each Fund. Because average annual total returns for more than one year tend to
smooth out variations in a Fund's return, investors should recognize that such
figures are not the same as actual year-by-year results.
All performance figures for the Funds are based upon historical results
and do not assure future performance. The investment return and principal value
of an investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
Quotations of average annual total return for the Funds will be
expressed in terms of the average annual compounded rate of return of a
hypothetical investment in the Fund over periods of 1, 3, 5 and 10 years (or the
life of the Fund, if shorter). These are the rates of return that would equate
the initial amount invested to the ending redeemable value. These rates of
return are calculated pursuant to the following formula: P(1 + T)n = ERV (where
P = a hypothetical initial payment of $1,000, T = the average annual total
return, n = the number of years and ERV = the ending redeemable value of a
hypothetical $1,000 payment made at the beginning of the period). All total
return figures reflect the deduction of a proportional share of Fund expenses on
an annual basis, and assume that all dividends and distributions are reinvested
when paid.
A Fund's total return includes the effect of deducting that Fund's
expenses, but does not include any charges and expenses attributable to a
particular variable insurance contract or qualified plan. Because shares of the
Funds can be purchased only through a variable insurance contract or qualified
plan, the Funds' total return data should be reviewed along with the description
of charges and expenses contained in the applicable Separate Account Prospectus
or plan documents. Total return for a Fund must always be accompanied by, and
reviewed with, comparable total return data for an associated separate account,
or data that would permit evaluation of the magnitude of charges and expenses
attributable to the contract or plan that are not reflected in the Fund's total
return.
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Each Fund has the same investment objective and follows similar
investment strategies as a Berger retail fund. The Berger retail funds have the
same investment advisor (and, as to the Berger/BIAM IPT - International Fund,
the same sub-advisor) as the corresponding Funds offered under this Prospectus.
The same persons who serve as portfolio managers of the Funds also serve as
portfolio managers of the corresponding Berger retail funds.
Set forth in the Prospectus is average annual total return data for
each of the Funds. Also set forth is total return information for each of the
corresponding Berger retail funds, calculated as described above. Investors
should not consider the performance data for the corresponding Berger retail
funds as a substitute for the performance of the Funds offered under the
Prospectus, nor as an indication of the past or future performance of the Funds.
The performance figures in the Prospectus reflect the deduction of the
historical fees and expenses paid by the Berger retail funds, and not those paid
or to be paid by these Funds. Performance data for the Funds and the retail
Berger/BIAM International Fund also reflect fee waivers and/or expense
reimbursements by the Funds' advisor, without which performance would be lower.
In addition, the figures do not reflect the deduction of charges or expenses
attributable to variable insurance contracts or qualified plans invested in the
Funds. As discussed above, investors should refer to the applicable Separate
Account Prospectus or qualified plan documents accompanying this Prospectus for
information pertaining to such contract charges and expenses and, in the case of
a Separate Account Prospectus for a variable annuity contract, to the
hypothetical performance data in that prospectus that illustrate the impact of
contract charges and loads on the returns shown below. Each Fund and its
corresponding Berger retail fund will be managed separately and the investments
and investment results are expected to differ. In particular, differences in
asset size and in cash flow resulting from purchases and redemption of Fund
shares may result in different security selections, differences in the relative
weightings of securities or differences in the prices paid for particular
portfolio holdings.
In conjunction with performance reports, comparative data between a
Fund's performance for a given period and other types of investment vehicles may
be provided. A Fund's performance is based upon amounts available for investment
under variable insurance contracts of Participating Insurance Companies or
available for allocation to a qualified plan account, rather than upon premiums
paid or contributions by contract owners or plan participants. Consequently the
Fund's total return data does not reflect the impact of sales loads (whether
front-load or deferred) or other contract or plan charges deducted from premiums
or from the assets of the separate accounts or qualified plans that invest in
the Fund. Such sales loads and charges may be substantial and may vary widely
among Participating Insurance Companies and qualified plans. Accordingly, the
total return data for the Funds is most useful for comparison with comparable
data for other investment options under the same variable insurance contract or
qualified plan.
Comparisons of the Funds' total returns to those of other investment
vehicles are useful in evaluating the historical portfolio management
performance of the Funds' investment advisor. However, such comparisons should
not be mistaken for comparisons of the returns from the purchase of a variable
insurance contract of a Participating Insurance Company, or investment in a
qualified plan, to the purchase of another investment vehicle. The Funds' total
return data should be reviewed along with comparable total return data for an
associated separate account or in conjunction with data (such as the data
contained in personalized, hypothetical illustrations of variable life insurance
contracts) that would permit evaluation of the magnitude of charges and expenses
attributable to the contract or plan that are not reflected in the Fund's total
return data.
AVERAGE ANNUAL TOTAL RETURNS
The average annual total return for each of the Funds for various
periods ending December 31, 1999, are shown on the following table:
<TABLE>
<CAPTION>
FUND 1-Year 3-Year Life of Fund
-------------------------------------------------- ------------- ------------- ----------------------------
<S> <C> <C> <C>
Berger IPT - New Generation Fund(1) N/A N/A N/A
-------------------------------------------------- ------------- ------------- ----------------------------
Berger IPT - Small Company Growth Fund 91.45% 33.21% 26.24% (since 5/1/96)
-------------------------------------------------- ------------- ------------- ----------------------------
Berger IPT - Growth Fund 49.13% 25.42% 21.60% (since 5/1/96)
-------------------------------------------------- ------------- ------------- ----------------------------
Berger/BIAM IPT - International Fund 31.24% N/A 16.17% (since 5/1/97)
-------------------------------------------------- ------------- ------------- ----------------------------
Berger IPT - Growth and Income Fund 59.05% 35.46% 31.98% (since 5/1/96)
-------------------------------------------------- ------------- ------------- ----------------------------
</TABLE>
(1) The Berger IPT - New Generation Fund did not commence operations until May
2000.
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12. ADDITIONAL INFORMATION
The Funds are separate series or portfolios established under the
Berger Institutional Products Trust, a Delaware business trust organized under
the Delaware Business Trust Act on October 17, 1995. The Berger IPT - Growth
Fund, the Berger IPT - Growth and Income Fund and the Berger IPT - Small Company
Growth Fund were established under the Trust on October 17, 1995. The
Berger/BIAM IPT - International Fund was established under the Trust in April
1997. The Berger IPT - Growth Fund was known as the Berger IPT - 100 Fund from
its inception to January 31, 2000 when it changed its name. The Berger IPT - New
Generation Fund was established under the Trust on February 15, 2000. Berger IPT
- - Small Company Growth Fund(R) was registered as a trademark in August 1998. The
name Berger IPT - Growth and Income Fund(R) was registered as a trademark in
October 1998.
The Trust is authorized to issue an unlimited number of shares of
beneficial interest in series or portfolios. Currently, the Funds named above
are the only series established under the Trust, although others may be added in
the future. The Trust is also authorized to establish multiple classes of shares
representing differing interests in an existing or new series. Shares of the
Funds are fully paid and nonassessable when issued. Each share has a par value
of $.01. All shares issued by each Fund participate equally in dividends and
other distributions by the Fund, and in the residual assets of the Fund in the
event of its liquidation.
Under Delaware law, shareholders of the Trust will enjoy the same
limitations on personal liability as extended to stockholders of a Delaware
corporation. Further, the Trust Instrument of the Trust provides that no
shareholder shall be personally liable for the debts, liabilities, obligations
and expenses incurred by, contracted for or otherwise existing with respect to,
the Trust or any particular series (fund) of the Trust. However, the principles
of law governing the limitations of liability of beneficiaries of a business
trust have not been authoritatively established as to business trusts organized
under the laws of one jurisdiction but operating or owning property in other
jurisdictions. In states that have adopted legislation containing provisions
comparable to the Delaware Business Trust Act, it is believed that the
limitation of liability of beneficial owners provided by Delaware law should be
respected. In those jurisdictions that have not adopted similar legislative
provisions, it is possible that a court might hold that the shareholders of the
Trust are not entitled to the limitations of liability set forth in Delaware law
or the Trust Instrument and, accordingly, that they may be personally liable for
the obligations of the Trust.
In order to protect shareholders from such potential liability, the
Trust Instrument requires that every written obligation of the Trust or any
series thereof contain a statement to the effect that such obligation may only
be enforced against the assets of the Trust or such series. The Trust Instrument
also provides for indemnification from the assets of the relevant series for all
losses and expenses incurred by any shareholder by reason of being or having
been a shareholder, and that the Trust shall, upon request, assume the defense
of any such claim made against such shareholder for any act or obligation of the
relevant series and satisfy any judgment thereon from the assets of that series.
As a result, the risk of a shareholder of any Fund incurring financial
loss on account of shareholder liability is limited to circumstances in which
the Fund itself would be unable to meet its obligations. The Trust believes that
the risk of personal liability to shareholders of any of the Funds is remote.
The trustees intend to conduct the operations of the Trust and the Funds so as
to avoid, to the extent possible, liability of shareholders for liabilities of
the Trust or the Funds.
None of the Funds or the Trust is required to hold annual shareholder
meetings unless required by the Investment Company Act of 1940 or other
applicable law or unless called by the trustees. If shareholders owning at least
10% of the outstanding shares of the Trust so request, a special shareholders'
meeting of the Trust will be held for the purpose of considering the removal of
a trustee. Special meetings will be held for other purposes if the holders of at
least 25% of the outstanding shares of the Trust so request. Subject to certain
limitations,
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the Trust will facilitate appropriate communications by shareholders desiring to
call a special meeting for the purpose of considering the removal of a trustee.
Shareholders of the Funds and, where applicable, the other
series/classes of the Trust, generally vote separately on matters relating to
those respective series/classes, although they vote together and with the
holders of any other series/classes of the Trust in the election of trustees of
the Trust and on all matters relating to the Trust as a whole. Each full share
of each Fund has one vote.
Shares of the Funds have non-cumulative voting rights, which means that
the holders of more than 50% of the shares voting for the election of trustees
can elect 100% of the trustees if they choose to do so and, in such event, the
holders of the remaining less than 50% of the shares voting for the election of
trustees will not be able to elect any person or persons as trustees.
Shares of the Funds have no preemptive rights. There are no sinking
funds or arrearage provisions which may affect the rights of the Fund shares.
Fund shares have no subscription rights or conversion rights. Shares of the
Funds may be transferred by endorsement, or other customary methods, but none of
the Funds is bound to recognize any transfer until it is recorded on its books.
Under governing separate law, each Fund may enter into a variety of
corporate transactions, such as reorganizations, conversions, mergers and asset
transfers, or may be liquidated. Any such transaction would be subject to a
determination of the Trustees that the transaction was in the best interests of
the Fund and its shareholders, and may require obtaining shareholder approval.
The separate accounts of the Participating Insurance Companies and the
trustees of the qualified plans invested in the Funds, rather than individual
contract owners or plan participants, are the shareholders of the Funds.
However, each Participating Insurance Company or qualified plan will vote such
shares as required by law and interpretations thereof, as amended or changed
from time to time. Under current law, a Participating Insurance Company is
required to request voting instructions from its contract owners and must vote
Fund shares held by each of its separate accounts in proportion to the voting
instructions received. Additional information about voting procedures is
contained in the applicable Separate Account Prospectuses.
Each Fund sells its shares only to certain qualified retirement plans
and to variable annuity and variable life insurance separate accounts of
insurance companies that are unaffiliated with Berger LLC and BBOI Worldwide and
that may be unaffiliated with one another. The Funds currently do not foresee
any disadvantages to policy owners arising out of the fact that each Fund offers
its shares to such entities. Nevertheless, the trustees intend to monitor events
in order to identify any material irreconcilable conflicts that may arise and to
determine what action, if any, should be taken in response to such conflicts. If
a conflict occurs, the trustees may require one or more insurance company
separate accounts or plans to withdraw its investments in one or more of the
Funds and to substitute shares of another Fund. As a result, a Fund may be
forced to sell securities at disadvantageous prices. In addition, the trustees
may refuse to sell shares of any Fund to any separate account or qualified plan
or may suspend or terminate the offering of shares of any Fund if such action is
required by law or regulatory authority or is deemed by the Fund to be in the
best interests of the shareholders of the Fund.
Owners of variable insurance contracts and qualified plan
administrators will receive annual and semiannual reports including the
financial statements of the Funds in which contract values or qualified plan
assets are invested. Each report will show the investments owned by each Fund
and the market values thereof, as well as other information about the Funds and
their operations.
PRINCIPAL SHAREHOLDERS
Insofar as the management of the Funds is aware, as of April 3, 2000,
no person owned, beneficially or of record, more than 5% of the outstanding
shares of any of the Funds, except for the following:
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<PAGE> 71
<TABLE>
<CAPTION>
Berger/BIAM
Berger IPT - Small IPT -
Company Growth Berger IPT International Berger IPT - Growth
Name and Address Fund - Growth Fund Fund and Income Fund
- ----------------------------------- ------------------- ------------------ ---------------- ---------------------
<S> <C> <C> <C> <C> <C>
Conseco Variable Insurance Company 19.37% 87.86% 50.03%(1) 99.86%
11825 N. Pennsylvania St.
Carmel, IN 46032
- ----------------------------------- -------------------------------------------------------------------------------
Great-West Life & Annuity 68.77% -- -- --
Insurance Company
8515 East Orchard Road
Englewood, CO 80111
- ----------------------------------- -------------------------------------------------------------------------------
Ameritas Life Insurance Corp. -- 12.07% -- --
Separate Account LLVA and
Separate Account LLVL
5900 O Street
Lincoln, NE 68510
- ----------------------------------- -------------------------------------------------------------------------------
Canada Life Insurance Company of -- -- 34.15% --
America
330 University Avenue SP12
Toronto, Ontario, Canada M5G1R8
- ----------------------------------- -------------------------------------------------------------------------------
BMA Variable Annuity -- -- 8.71% --
BMA Tower
P.O. Box 419458
Kansas City, MO 64141-6458
- ----------------------------------- -------------------------------------------------------------------------------
</TABLE>
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(1) THE SHARES OWNED OF RECORD BY CONSECO VARIABLE INSURANCE COMPANY INCLUDE
SHARES ATTRIBUTABLE TO A VARIABLE ANNUITY CONTRACT OWNED BY BERGER LLC, WHICH
CONSTITUTE 42.6% OF THE OUTSTANDING SHARES OF THE FUND. BERGER LLC IS A NEVADA
LIMITED LIABILITY COMPANY WHICH PROVIDED INITIAL CAPITAL TO ESTABLISH THE TRUST.
AS A RESULT OF ITS CURRENT SHARE OWNERSHIP, BERGER LLC MAY BE DEEMED TO CONTROL
THE BERGER/BIAM IPT - INTERNATIONAL FUND.
DISTRIBUTION
The Distributor is the principal underwriter of the shares of the
Funds. The Distributor is a registered broker-dealer under the Securities
Exchange Act of 1934 and is a member of the National Association of Securities
Dealers, Inc. The Distributor acts as the agent of the Funds in connection with
the sale of their shares in all states in which the shares are eligible for sale
and in which the Distributor is qualified as a broker-dealer. David J. Schultz,
Vice President, Treasurer and Chief Financial Officer of the Distributor, is
also Vice President and Treasurer of the Trust. Janice M. Teague, Vice President
and Secretary of the Distributor, is also Vice President and Assistant Secretary
of the Trust. Brian Ferrie, Vice President and Chief Compliance Officer of the
Distributor, is also Vice President of the Trust.
The Trust, on behalf of each Fund, and the Distributor are parties to a
Distribution Agreement that continues through April 2001, and thereafter from
year to year if such continuation is specifically approved at least annually by
the trustees or by vote of a majority of the outstanding shares of the Fund and
in either case by vote of a majority of the trustees of the Trust who are not
"interested persons" (as that term is defined in the Investment Company Act of
1940) of the Trust or the Distributor. The Distribution Agreement is subject to
termination by a Fund or the Distributor on 60 days' prior written notice, and
terminates automatically in the event of its assignment. Under the Distribution
Agreement, the Distributor continuously offers the shares of the Funds and
solicits orders to purchase Fund shares at net asset value. The Distributor is
not compensated for its services under the Distribution Agreement, but may be
reimbursed by Berger LLC for its costs in distributing Fund shares.
OTHER INFORMATION
The Trust has filed with the Securities and Exchange Commission,
Washington, D.C., a Registration Statement under the Securities Act of 1933, as
amended, with respect to the securities of the Funds, of which this Statement of
Additional Information is a part. If further information is desired with respect
to any of the Funds or such securities, reference is made to the Registration
Statement and the exhibits filed as a part thereof.
Davis, Graham & Stubbs LLP, 370 Seventeenth Street, Denver, Colorado,
acts as counsel to the Trust and the Funds.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 950 Seventeenth Street, Denver,
Colorado, acted as independent accountants for the Funds for the fiscal year
ended December 31, 1999. In that capacity, PricewaterhouseCoopers LLP audited
the financial statements of the Funds referenced below under "Financial
Information" and assisted the Funds in connection with the preparation of their
1998 income tax returns.
PricewaterhouseCoopers LLP has been appointed to act as
independent accountants for the Funds for the fiscal year ended December 31,
2000. In that capacity, PricewaterhouseCoopers LLP will audit the financial
statements of the Funds and assist the Funds in connection with the preparation
of their 1999 income tax returns.
FINANCIAL STATEMENTS
The following financial statements for each of the Funds are
incorporated herein by reference from the Annual Report to Shareholders of the
Funds dated December 31, 1999, in each case along with the Report of Independent
Accountants thereon dated February 4, 2000:
Schedule of Investments as of December 31, 1999
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Statement of Assets and Liabilities as of December 31, 1999
Statement of Operations for the Fiscal Year Ended December 31, 1999
Statement of Changes in Net Assets for each of the periods indicated
Notes to Financial Statements, December 31, 1999
Financial Highlights for each of the periods indicated
The above-referenced Annual Report is enclosed with a copy of this SAI.
Additional copies of that Annual Report may be obtained upon request without
charge by calling 1-800-259-2820, or by contacting a Participating Insurance
Company.
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APPENDIX A
HIGH-YIELD/HIGH RISK SECURITIES
Each of the Funds may invest in convertible securities of any quality,
including unrated securities or securities rated below investment grade (Ba or
lower by Moody's, BB or lower by S&P). However, a Fund will not purchase any
security in default at the time of purchase. None of the Funds will invest more
than 20% of the market value of its assets at the time of purchase in
convertible securities rated below investment grade.
Securities rated below investment grade are subject to greater risk
that adverse changes in the financial condition of their issuers or in general
economic conditions, or an unanticipated rise in interest rates, may impair the
ability of their issuers to make payments of interest and principal or
dividends. The market prices of lower grade securities are generally less
sensitive to interest rate changes than higher-rated investments, but more
sensitive to economic changes or individual corporate developments. Periods of
economic uncertainty and change can be expected to result in volatility of
prices of these securities. Lower rated securities also may have less liquid
markets than higher rated securities, and their liquidity as well as their value
may be adversely affected by poor economic conditions. Adverse publicity and
investor perceptions as well as new or proposed laws may also have a negative
impact on the market for high-yield/high-risk bonds. In the event of an
unanticipated default, a Fund will experience a reduction in its income and
could expect a decline in the market value of the securities affected. The
prices of these securities may be more volatile and the markets for them may be
less liquid than those for higher-rated securities.
Unrated securities, while not necessarily of lower quality than rated
securities, may not have as broad a market. Unrated securities will be included
in a Fund's percentage limits for investments rated below investment grade,
unless the Fund's advisor deems such securities to be the equivalent of
investment grade. If securities purchased by a Fund are downgraded following
purchase, or if other circumstances cause the Fund to exceed its percentage
limits on assets invested in securities rated below investment grade, the
director or trustees of the Fund, in consultation with the Fund's advisor, will
determine what action, if any, is appropriate in light of all relevant
circumstances.
Relying in part on ratings assigned by credit agencies in making
investments will not protect a Fund from the risk that the securities will
decline in value, since credit ratings represent evaluations of the safety of
principal, dividend and/or interest payments, and not the market values of such
securities. Moreover, such ratings may not be changed on a timely basis to
reflect subsequent events.
Although the market for high-yield debt securities has been in
existence for many years and from time to time has experienced economic
downturns, this market has involved a significant increase in the use of
high-yield debt securities to fund highly leverage corporate acquisitions and
restructurings. Past experience may not, therefore, provide an accurate
indication of future performance of the high-yield debt securities market,
particularly during periods of economic recession.
Expenses incurred in recovering an investment in a defaulted security
may adversely affect a Fund's net asset value. Moreover, the reduced liquidity
of the secondary market for such securities may adversely affect the market
price of, and the ability of a Fund to value, particular securities at certain
times, thereby making it difficult to make specific valuation determinations.
CORPORATE BOND RATINGS
The ratings of fixed-income securities by Moody's and Standard & Poor's
are a generally accepted measurement of credit risk. However, they are subject
to certain limitations. Ratings are generally based upon historical events and
do not necessarily reflect the future. In addition, there is a period of time
between the issuance of a rating and the update of the rating, during which time
a published rating may be inaccurate.
KEY TO MOODY'S CORPORATE RATINGS
Aaa-Bonds which are rated Aaa are judged to be of the best quality.
They carry the smallest degree of investment risk and are generally referred to
as "gilt edge." Interest payments are protected by a large or by an
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exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized are
most unlikely to impair the fundamentally strong position of such issues.
Aa-Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally known as
high grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities or fluctuation of protective
elements may be of greater amplitude or there may be other elements present
which make the long-term risks appear somewhat larger than in Aaa securities.
A-Bonds which are rated A possess many favorable investment attributes
and are to be considered as upper medium grade obligations. Factors giving
security to principal and interest are considered adequate but elements may be
present which suggest a susceptibility to impairment sometime in the future.
Baa-Bonds which are rated Baa are considered as medium grade
obligations, i.e., they are neither highly protected nor poorly secured.
Interest payments and principal security appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.
Ba-Bonds which are rated Ba are judged to have speculative elements;
their future cannot be considered as well assured. Often the protection of
interest and principal payments may be very moderate and thereby not well
safeguarded during good and bad times over the future. Uncertainty of position
characterizes bonds of this class.
B-Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may be
small.
Caa-Bonds which are rated Caa are of poor standing. Such issues may be
in default or there may be present elements of danger with respect to principal
or interest.
Ca-Bonds which are rated Ca represent obligations which are speculative
in a high degree. Such issues are often in default or have other marked
shortcomings.
C-Bonds which are rated C are the lowest rated class of bonds and
issues so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.
Note: Moody's applies numerical modifiers, 1, 2 and 3 in each generic
rating classification from Aa through B in its corporate bond rating system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates that the issue ranks in the lower end of its generic category.
KEY TO STANDARD & POOR'S CORPORATE RATINGS
AAA-Debt rated AAA has the highest rating assigned by Standard &
Poor's. Capacity to pay interest and repay principal is extremely strong.
AA-Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the higher rated issues only in small degree.
A-Debt rated A has a strong capacity to pay interest and repay
principal although it is somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than debt in higher rated
categories.
BBB-Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions, or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.
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<PAGE> 76
BB, B, CCC, CC AND C-Debt rated BB, B, CCC, CC and C is regarded, on
balance, as predominantly speculative with respect to capacity to pay interest
and repay principal in accordance with the terms of the obligation. BB indicates
the lowest degree of speculation and C the highest degree of speculation. While
such debt will likely have some quality and protective characteristics, these
are out-weighed by the large uncertainties or major risk exposures to adverse
conditions.
C1-The rating C1 is reserved for income bonds on which no interest is
being paid.
D-Debt rated D is in default, and payment of interest and/or repayment
of principal is in arrears.
PLUS (+) OR MINUS (-)-The ratings from "AA" to "CCC" may be modified by
the addition of a plus or minus sign to show relative standing within the major
rating categories.
-44-
<PAGE> 77
BERGER INSTITUTIONAL PRODUCTS TRUST
PART C. OTHER INFORMATION
Item 23. Exhibits
The Exhibit Index following the signature pages below is incorporated
herein by reference.
Item 24. Persons Controlled by or Under Common Control With Registrant
On the date that this amendment to the Registration Statement becomes
effective, Berger LLC, a Nevada limited liability company, may be deemed a
control person of the Berger/BIAM IPT - International Fund (the "Fund"). Berger
LLC may be deemed a control person of the Fund, since shares of the Fund owned
of record by Conseco Variable Insurance Company include shares attributable to a
variable annuity contract owned by Berger LLC which constitute more than 25% of
the shares outstanding of the Fund. Berger LLC will continue to be a control
person of the Fund as long as it indirectly holds more than 25% of the shares
outstanding of the Fund, as the term "control" is defined in the Investment
Company Act of 1940. As long as the Fund is controlled by Berger LLC, it will be
under common control with the other companies controlled by Berger LLC's
ultimate corporate parent, Kansas City Southern Industries, Inc. ("KCSI"). See
"Investment Advisor" in the Statement of Additional Information for more
information on KCSI and its affiliates.
Item 25. Indemnification
Article IX, Section 2 of the Trust Instrument for Berger Institutional
Products Trust (the "Trust"), provides for indemnification of certain persons
acting on behalf of the Trust to the fullest extent permitted by the law. In
general, trustees, officers, employees, managers and agents will be indemnified
against liability and against all expenses incurred by them in connection with
any claim, action, suit or proceeding (or settlement thereof) in which they
become involved by virtue of their Trust office, unless their conduct is
determined to constitute willful misfeasance, bad faith, gross negligence or
reckless disregard of their duties, or unless it has been determined that they
have not acted in good faith in the reasonable belief that their actions were in
or not opposed to the best interests of the Trust. The Trust also may advance
money for these expenses, provided that the trustees, officers, employees,
managers or agents undertake to repay the Trust if their conduct is later
determined to preclude indemnification. The Trust has the power to purchase
insurance on behalf of its trustees, officers, employees, managers and agents,
whether or not it would be permitted or required to indemnify them for any such
liability under the Trust Instrument or applicable law, and the Trust has
purchased and maintains an insurance policy covering such persons against
certain liabilities incurred in their official capacities.
Section 16 of the Investment Advisory Agreement between BBOI Worldwide
and the Trust with respect to the Berger/BIAM IPT - International Fund also
provides as follows:
C-1
<PAGE> 78
"The Trust hereby indemnifies and holds harmless BBOI Worldwide and its
officers, managers, members, employees and agents, and any controlling
person thereof, and any person to whom BBOI Worldwide has delegated any
of its duties and responsibilities pursuant to Section 13 hereof,
including Bank of Ireland Asset Management (U.S.) Limited, to which
BBOI Worldwide has delegated its duties and responsibilities specified
in Section 2 of this Agreement (the "Sub-Advisor") and Berger LLC, to
which BBOI Worldwide has delegated its duties and responsibilities
specified in Section 3 of this Agreement (the "Sub-Administrator"),
from all losses, charges, claims and liabilities, and all costs and
expenses, including without limitation reasonable attorneys' fees and
disbursements, arising from any action which BBOI Worldwide or the
Sub-Advisor or the Sub-Administrator takes or omits to take pursuant to
written instructions from the Trustees of the Trust based on
resolutions duly adopted by the Trustees, provided that no person shall
be indemnified hereunder against any liability to the Trust or its
shareholders (or any expenses incident to such liability) arising out
of their own willful misfeasance, bad faith or gross negligence in the
performance of their duties or by reason of their reckless disregard of
their duties or obligations under this Agreement.
"BBOI Worldwide hereby indemnifies and holds harmless the Trust and its
Trustees, officers, shareholders, employees and agents, and any
controlling person thereof, from all losses, charges, claims and
liabilities, and all costs and expenses, including without limitation
reasonable attorneys' fees and disbursements, arising out of BBOI
Worldwide's or the Sub-Advisor's or the Sub-Administrator's willful
misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its duties or
obligations under this Agreement, provided that no person shall be
indemnified hereunder against any liability to the Trust or its
shareholders (or any expenses incident to such liability) arising out
of their own willful misfeasance, bad faith or gross negligence in the
performance of their duties or by reason of their reckless disregard of
their duties or obligations under this Agreement."
Section 11 of the Sub-Advisory Agreement between BBOI Worldwide and
BIAM with respect to the Berger/BIAM IPT - International Fund also provides as
follows:
"BBOI Worldwide hereby indemnifies and holds harmless BIAM and its
officers, directors, shareholders, employees and agents, and any
controlling person thereof, from all losses, charges, claims and
liabilities, and all costs and expenses, including without limitation
reasonable attorneys' fees and disbursements, arising from any action
which BIAM takes or omits to take pursuant to written instructions from
BBOI Worldwide, the Sub-Administrator, or from officers or Trustees of
the Trust, provided that no person shall be indemnified hereunder
against any liability to the Trust or its shareholders (or any expenses
incident to such liability) arising out of such person's own willful
misfeasance, bad faith or gross negligence in the performance of their
duties or by reason of their reckless disregard of their duties or
obligations under this Agreement.
C-2
<PAGE> 79
"BBOI Worldwide acknowledges and agrees that BIAM, as the party to whom
BBOI Worldwide has delegated pursuant to Section 13 of the Advisory
Agreement all of BBOI Worldwide's duties and responsibilities required
to be performed by BBOI Worldwide for the Fund pursuant to Section 2 of
the Advisory Agreement, is a person entitled to indemnification by the
Trust pursuant to Section 16 of the Advisory Agreement.
"BIAM hereby indemnifies and holds harmless BBOI Worldwide and the
Trust, and each of their Trustees, officers, managers, shareholders,
members, employees and agents, and any controlling person thereof, from
all losses, charges, claims and liabilities, and all costs and
expenses, including without limitation reasonable attorneys' fees and
disbursements, arising out of BIAM's willful misfeasance, bad faith or
gross negligence in the performance of its duties or by reason of its
reckless disregard of its duties or obligations under this Agreement,
provided that no person shall be indemnified hereunder against any
liability to the Trust or its shareholders (or any expenses incident to
such liability) arising out of such person's own willful misfeasance,
bad faith or gross negligence in the performance of their duties or by
reason of their reckless disregard of their duties or obligations under
this Agreement."
Item 26. Business and Other Connections of Investment Advisor
The business of Berger LLC, the investment advisor of the Berger IPT -
Growth Fund, the Berger IPT - Growth and Income Fund, the Berger IPT - Small
Company Growth Fund and the Berger IPT - New Generation Fund, is described in
the Prospectus and in Section 4 in the Statement of Additional Information.
Information relating to the business and other connections of the officers and
directors of Berger LLC (current and for the past two years) is listed in
Schedules A and D of Berger LLC's Form ADV as filed with the Securities and
Exchange Commission (File No. 801-9451, dated February 28, 2000), which
information from such schedules is incorporated herein by reference.
The business of BBOI Worldwide LLC ("BBOI Worldwide"), the investment
advisor of the Berger/BIAM IPT - International Fund, is described in the
Prospectus and in Section 4 of the Statement of Additional Information.
Information relating to the business and other connections of the officers and
managers of BBOI Worldwide (current and for the past two years) is listed in
Schedules A and D of BBOI Worldwide's Form ADV as filed with the Securities and
Exchange Commission (File No. 801-52264, dated February 23, 2000), which
information from such schedules is incorporated herein by reference.
The business of Bank of Ireland Asset Management (U.S.) Limited
("BIAM"), the sub-advisor to the Berger/BIAM IPT - International Fund, is
described in the Prospectus and in Section 4 in the Statement of Additional
Information. Information relating to the business and other connections of the
officers and directors of BIAM (current and for the past two years) is listed in
Schedules A and D of BIAM's Form ADV as filed with the Securities and Exchange
Commission
C-3
<PAGE> 80
(File No. 801-29606, dated March 16, 2000), which information from such
schedules is incorporated herein by reference.
Item 27. Principal Underwriters
(a) Investment companies for which the Fund's principal underwriter
also acts as principal underwriter, depositor or investment adviser:
Berger Growth Fund, Inc.
Berger Growth and Income Fund, Inc.
Berger Investment Portfolio Trust
- --Berger Small Company Growth Fund
- --Berger New Generation Fund
- --Berger Balanced Fund
- --Berger Select Fund
- --Berger Mid Cap Growth Fund
- --Berger Mid Cap Value Fund
- --Berger Information Technology Fund
Berger Omni Investment Trust
- --Berger Small Cap Value Fund
Berger Institutional Products Trust
- --Berger IPT - Growth Fund
- --Berger IPT - Growth and Income Fund
- --Berger IPT - Small Company Growth Fund
- --Berger/BIAM IPT - International Fund
- --Berger IPT - New Generation Fund
Berger/BIAM Worldwide Funds Trust
- --Berger/BIAM International Fund
- --International Equity Fund
- --Berger/BIAM International CORE Fund
(b) For Berger Distributors LLC:
<TABLE>
<CAPTION>
=========================================================================================================
Name Positions and Positions and
Offices with Offices with
Underwriter Registrant
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C>
David G. Mertens President and CEO None
- ---------------------------------------------------------------------------------------------------------
David J. Schultz Vice President, Treasurer and Chief Vice President and Treasurer
Financial Officer
- ---------------------------------------------------------------------------------------------------------
Brian Ferrie Vice President and Chief Compliance Vice President
Officer
- ---------------------------------------------------------------------------------------------------------
Janice M. Teague Vice President and Secretary Vice President and Assistant
Secretary
- ---------------------------------------------------------------------------------------------------------
Sue Vreeland Assistant Secretary Secretary
=========================================================================================================
</TABLE>
C-4
<PAGE> 81
The principal business address of each of the persons in the table
above is 210 University Blvd., Suite 900, Denver, CO 80206.
(c) Not applicable.
Item 28. Location of Accounts and Records
The accounts, books and other documents required to be maintained by
Section 31(a) of the 1940 Act and the rules promulgated thereunder are
maintained as follows:
(a) Shareholder records are maintained by the Registrant's
transfer agent, DST Systems, Inc., P.O. Box 219958, Kansas
City, MO 64121;
(b) Accounting records relating to cash and other money balances;
asset, liability, reserve, capital, income and expense
accounts; portfolio securities; purchases and sales; and
brokerage commissions are maintained by the Registrant's
Recordkeeping and Pricing Agent, State Street Bank and Trust
Company ("State Street"), 801 Pennsylvania, Kansas City,
Missouri 64105. Other records of the Registrant relating to
purchases and sales; the Trust Instrument, minute books and
other trust records; brokerage orders; performance information
and other records are maintained at the offices of the
Registrant at 210 University Boulevard, Suite 900, Denver,
Colorado 80206.
(c) Certain records relating to day-to-day portfolio management of
the Berger/BIAM IPT - International Fund are kept at Bank of
Ireland Asset Management (U.S.) Limited, 26 Fitzwilliam
Street, Dublin 2, Ireland; or at Bank of Ireland Asset
Management (U.S.) Limited, 75 Holly Hill Lane, Greenwich,
Connecticut 06830.
Item 29. Management Services
The Registrant has no management-related service contract which is not
discussed in Parts A and B of this form.
Item 30. Undertakings
Not applicable.
C-5
<PAGE> 82
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant certifies that it meets all the requirements
for effectiveness of this Registration Statement pursuant to Rule 485(b) of the
Securities Act of 1933 and duly caused this amendment to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City and County of Denver, and State of Colorado, on the 28th
day of April, 2000.
BERGER INSTITUTIONAL PRODUCTS TRUST
(Registrant)
By /s/ Jack R. Thompson
------------------------------------------
Name: Jack R. Thompson
------------------------------------
Title: President
-----------------------------------
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Jack R. Thompson President (Principal April 28, 2000
- ------------------------------------------ Executive Officer)
Jack R. Thompson and Trustee
/s/ David J. Schultz Vice President and April 28, 2000
- ------------------------------------------ Treasurer (Principal
David J. Schultz Financial Officer)
</TABLE>
C-6
<PAGE> 83
<TABLE>
<S> <C> <C>
/s/ John Paganelli Assistant Treasurer April 28, 2000
- ----------------------------------------- (Principal Accounting
John Paganelli Officer)
Dennis E. Baldwin Trustee April 28, 2000
- -----------------------------------------
Dennis E. Baldwin*
Louis R. Bindner Trustee April 28, 2000
- -----------------------------------------
Louis R. Bindner*
Katherine A. Cattanach Trustee April 28, 2000
- -----------------------------------------
Katherine A. Cattanach*
Paul R. Knapp Trustee April 28, 2000
- -----------------------------------------
Paul R. Knapp*
Harry T. Lewis, Jr. Trustee April 28, 2000
- -----------------------------------------
Harry T. Lewis, Jr.*
Michael Owen Trustee April 28, 2000
- -----------------------------------------
Michael Owen*
William Sinclaire Trustee April 28, 2000
- -----------------------------------------
William Sinclaire*
</TABLE>
*By: /s/ Jack R. Thompson
----------------------
Jack R. Thompson
Attorney-in-fact
C-7
<PAGE> 84
BERGER INSTITUTIONAL PRODUCTS TRUST
EXHIBIT INDEX
<TABLE>
<CAPTION>
N-1A EDGAR
Exhibit Exhibit
No. No. Name of Exhibit
- ------- ------- ---------------
<S> <C> <C>
(1) Exhibit 23(a) Trust Instrument
(2) Exhibit 23(b) Bylaws
Exhibit 23(c) Not Applicable
(3) Exhibit 23(d)-1 Form of Investment Advisory Agreement for
Berger IPT - Growth Fund
* Exhibit 23(d)-1a EX-99B.23(d)-1a Form of Amendment to Investment Advisory
Agreement for Berger IPT - Growth Fund
(4) Exhibit 23(d)-2 Form of Investment Advisory Agreement for
Berger IPT - Growth and Income Fund
* Exhibit 23(d)-2a EX-99B.23(d)-2a Form of Amendment to Investment Advisory
Agreement for Berger IPT --Growth and
Income Fund
(5) Exhibit 23(d)-3 Form of Investment Advisory Agreement for
Berger IPT - Small Company Growth Fund
* Exhibit 23(d)-3a EX-99B.23(d)-3a Form of Amendment to Investment Advisory
Agreement for Berger IPT - Small Company
Growth Fund
(6) Exhibit 23(d)-4 Form of Investment Advisory Agreement for
Berger/BIAM IPT - International Fund
(7) Exhibit 23(d)-5 Form of Sub-Advisory Agreement for
Berger/BIAM IPT - International Fund
* Exhibit 23(d)-6 EX-99B.23(d)-6 Form of Investment Advisory Agreement for
Berger IPT - New Generation Fund
(35) Exhibit 23(d)-7 Form of Assignment and Assumption Agreement
For the Assignment and Assumption of Investment
Advisory Agreements and Administrative Services
Agreements
(8) Exhibit 23(e) Distribution Agreement between Berger
Institutional Products Trust and Berger
Distributors, Inc.
</TABLE>
<PAGE> 85
<TABLE>
<S> <C> <C>
Exhibit 23(f) Not Applicable
(9) Exhibit 23(g) Form of Custody Agreement
(36) Exhibit 23(g)a Assignment of Custody Agreement
(10) Exhibit 23(h)-1 Form of Administrative Services Agreement
for Berger IPT - Growth Fund
* Exhibit 23(h)-1a EX-99B.23(h)-1a Form of Amendment to Administrative
Services Agreement for Berger IPT -
Growth Fund
(11) Exhibit 23(h)-2 Form of Administrative Services Agreement
for Berger IPT - Growth and Income Fund
* Exhibit 23(h)-2a EX-99.23(h)-2a Form of Amendment to Administrative
Services Agreement for Berger IPT -
Growth and Income Fund
(12) Exhibit 23(h)-3 Form of Administrative Services Agreement
for Berger IPT - Small Company Growth
Fund
* Exhibit 23(h)-3a EX-99.23(h)-3a Form of Amendment to Administrative
Services Agreement for Berger IPT - Small
Company Growth Fund
(13) Exhibit 23(h)-4 Form of Administrative Services Agreement
for Berger/BIAM IPT - International Fund
* Exhibit 23(h)-4a EX-99.23(h)-4a Form of Amendment to Administrative
Services Agreement for Berger/BIAM IPT -
International Fund
(14) Exhibit 23(h)-5 Form of Sub-Administration Agreement for
Berger/BIAM IPT - International Fund
* Exhibit 23(h)-5a EX-99B.23(h)-5a Form of Administrative Services Agreement
for Berger IPT - New Generation Fund
(15) Exhibit 23(h)-6 Form of Recordkeeping and Pricing Agent
Agreement
* Exhibit 23(h)-6a EX-99B.23(h)-6a Assignment of Recordkeeping and Pricing
Agent Agreement
(16) Exhibit 23(h)-7 Form of Agency Agreement
(17) Exhibit 23(h)-8 Form of Participation Agreement between
Berger Institutional Products Trust,
Berger Associates, Inc. and Great
American Reserve Insurance Company
</TABLE>
<PAGE> 86
<TABLE>
<S> <C> <C>
* Exhibit 23(h)-8a EX-99B.23(h)-8a Assignment of Participation Agreement
between Berger Institutional Products
Trust, Berger Associates, Inc. and Great
American Reserve Insurance Company
(18) Exhibit 23(h)-9 Form of Participation Agreement between
Berger Institutional Products Trust,
Berger Associates, Inc. and Ameritas Life
Insurance Company
* Exhibit 23(h)-9a EX-99B.23(h)-9a Form of Assignment of Participation Agreement
between Berger Institutional Products Trust,
Berger Associates, Inc. and Ameritas Life
Insurance Company
(19) Exhibit 23(h)-10 Form of Participation Agreement between
Berger Institutional Products Trust, BBOI
Worldwide LLC and Great American Reserve
Insurance Company
(20) Exhibit 23(h)-11 Form of Participation Agreement between
Berger Institutional Products Trust,
Berger Associates, Inc., Berger
Distributors, Inc., Charles Schwab & Co.
Inc. and Great-West Life & Annuity
Insurance Company
* Exhibit 23(h)-11a EX-99B.23(h)-11a Assignment of Participation Agreement
between Berger Institutional Products
Trust, Berger Associates, Inc., Berger
Distributors, Inc., Charles Schwab & Co.
Inc. and Great-West Life & Annuity
Insurance Company
(21) Exhibit 23(h)-12 Form of Participation Agreement between
Berger Institutional Products Trust,
Berger Associates, Inc., Berger
Distributors, Inc., Charles Schwab & Co.
Inc. and First Great-West Life & Annuity
Insurance Company
* Exhibit 23(h)-12a EX-99B.23(h)-12a Assignment of Participation Agreement
between Berger Institutional Products
Trust, Berger Associates, Inc., Berger
Distributors, Inc., Charles Schwab & Co.
Inc. and First Great-West Life & Annuity
Insurance Company
(22) Exhibit 23(h)-13 Form of Participation Agreement between
Berger Institutional Products Trust, BBOI
Worldwide LLC and Canada Life Insurance
Company of America
(23) Exhibit 23(h)-14 Form of Participation Agreement between
Berger Institutional Products Trust, BBOI
Worldwide LLC and Canada Life Insurance
Company of New York
</TABLE>
<PAGE> 87
<TABLE>
<S> <C> <C>
(24) Exhibit 23(h)-15 Form of Participation Agreement between
Berger Institutional Products Trust,
Berger Associates, Inc. and Prudential
Insurance Company of America
* Exhibit 23(h)-15a EX-99B.23(h)-15a Assignment of Participation Agreement
between Berger Institutional Products
Trust, Berger Associates, Inc. and
Prudential Insurance Company of America
(25) Exhibit 23(h)-16 Form of Participation Agreement between
Berger Institutional Products Trust, BBOI
Worldwide LLC and Prudential Insurance
Company of America
(26) Exhibit 23(h)-17 Form of Participation Agreement between
Berger Institutional Products Trust,
Berger Associates, Inc. and Canada Life
Insurance Company of America
* Exhibit 23(h)-17a EX-99B.23(h)-17a Assignment of Participation Agreement
between Berger Institutional Products
Trust, Berger Associates, Inc. and Canada
Life Insurance Company of America
(27) Exhibit 23(h)-18 Form of Participation Agreement between
Berger Institutional Products Trust,
Berger Associates, Inc. and Canada Life
Insurance Company of New York
* Exhibit 23(h)-18a EX-99B.23(h)-18a Assignment of Participation Agreement
between Berger Institutional Products
Trust, Berger Associates, Inc. and Canada
Life Insurance Company of New York
(28) Exhibit 23(h)-19 Form of Participation Agreement between
Berger Institutional Products Trust,
BBOI Worldwide LLC. and Business Men's
Assurance Company of America
(31) Exhibit 23(h)-20 Form of Participation Agreement between
Berger Institutional Products Trust,
Berger Associates, Inc. and Conseco Life
Insurance Company of New York
</TABLE>
<PAGE> 88
<TABLE>
<S> <C> <C>
(32) Exhibit 23(h)-21 Form of Participation Agreement between
Berger Institutional Products Trust, BBOI
Worldwide LLC and Conseco Life Insurance
Company of New York
* Exhibit 23(h)-22 EX-99B.23(h)-22 Form of Participation Agreement among
Berger Institutional Products Trust, BBOI
Worldwide LLC and Fidelity Security Life
Insurance Company
(34) Exhibit 23(i)-1 Opinion and consent of Davis, Graham &
Stubbs LLP relating to the shares issued
under the initial registration statement
of the Trust
* Exhibit 23(i)-2 EX-99B.23(i)-2 Opinion and consent of Davis, Graham &
Stubbs LLP relating to the Berger IPT -
New Generation Fund
* Exhibit 23(j) EX-99B.23(j) Consent of PricewaterhouseCoopers LLP
Exhibit 23(k) Not Applicable
(30) Exhibit 23(l) Investment Letter from Initial
Stockholder
Exhibit 23(m) Not Applicable
Exhibit 23(n) Not Applicable
* Exhibit 23(p)-1 EX-99B.23(p)-1 Code of Ethics of the Berger Funds
* Exhibit 23(p)-2 EX-99B.23(p)-2 Code of Ethics of Berger LLC
* Exhibit 23(p)-3 EX-99B.23(p)-3 Code of Ethics of Berger Distributors LLC
* Exhibit 23(p)-4 EX-99B.23(p)-4 Code of Ethics of BBOI Worldwide LLC
* Exhibit 23(p)-5 EX-99B.23(p)-5 Code of Ethics of Bank of Ireland Asset
Management (U.S.) Limited
</TABLE>
- -----------------------
* Filed herewith
Filed previously as indicated below and incorporated herein by reference:
(1) Filed as Exhibit 1 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(2) Filed as Exhibit 2 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(3) Filed as Exhibit 5.1 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
<PAGE> 89
(4) Filed as Exhibit 5.2 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(5) Filed as Exhibit 5.3 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(6) Filed as Exhibit 5.4 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(7) Filed as Exhibit 5.5 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(8) Filed as Exhibit 6 with Post-Effective Amendment No. 2 to Registrant's
Registration Statement on Form N-1A, filed February 14, 1997.
(9) Filed as Exhibit 8 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(10) Filed as Exhibit 9.1.1 with Pre-Effective Amendment No. 1 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1996.
(11) Filed as Exhibit 9.1.2 with Pre-Effective Amendment No. 1 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1996.
(12) Filed as Exhibit 9.1.3 with Pre-Effective Amendment No. 1 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1996.
(13) Filed as Exhibit 9.1.4 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(14) Filed as Exhibit 9.1.5 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(15) Filed as Exhibit 9.2 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(16) Filed as Exhibit 9.3 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(17) Filed as Exhibit 9.4 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(18) Filed as Exhibit 9.5 with Post-Effective Amendment No. 2 to
Registrant's Registration Statement on Form N-1A, filed February 14,
1997.
(19) Filed as Exhibit 9.6 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(20) Filed as Exhibit 9.7 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(21) Filed as Exhibit 9.8 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(22) Filed as Exhibit 9.9 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(23) Filed as Exhibit 9.10 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(24) Filed as Exhibit 9.11 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
(25) Filed as Exhibit 9.12 with Post-Effective Amendment No. 3 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1997.
<PAGE> 90
(26) This agreement is identical to Exhibit 23(h)-13 to this Registration
Statement, except that Berger Associates, Inc. is substituted for BBOI
Worldwide LLC as a party.
(27) This agreement is identical to Exhibit 23(h)-14 to this Registration
Statement, except that Berger Associates, Inc. is substituted for BBOI
Worldwide LLC as a party.
(28) Filed as Exhibit 9.15 with Pre-Effective Amendment No. 1 to
Registrant's Registration Statement on Form N-1A, filed April 18, 1996.
(29) Filed as Exhibit 10 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(30) Filed as Exhibit 13 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(31) This agreement is identical to Exhibit 23(h)-8 to this Registration
Statement, except that Conseco Life Insurance Company of New York is
substituted for Great American Reserve Insurance Company as a party.
(32) This agreement is identical to Exhibit 23(h)-10 to this Registration
Statement, except that Conseco Life Insurance Company of New York is
substituted for Great American Reserve Insurance Company as a party.
(33) Filed as Exhibit number listed with Post-Effective Amendment No. 6 to
Registrant's Registration Statement on Form N-1A, filed February 12,
1999.
(34) Filed as Exhibit 10 with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement on Form N-1A, filed April 18, 1996.
(35) Filed as Exhibit number 23(d)-10 with Post-Effective Amendment No. 24
to the Berger Investment Portfolio Trust, 1933 Act File No. 33-69460
and 1940 Act File No. 811-8046, Filed January 28, 2000.
(36) This assignment is contained in Exhibit 23(h)-6a to this Post-Effective
Amendment No. 8.
<PAGE> 1
Exhibit 23(d)-1a
AMENDMENT NO. 1
TO
INVESTMENT ADVISORY AGREEMENT
BERGER IPT - 100 FUND
(a Series of Berger Institutional Products Trust)
This AMENDMENT NO. 1 TO INVESTMENT ADVISORY AGREEMENT (the "Amendment")
is made effective as of the 1st day of October, 1999, between BERGER LLC, a
Nevada limited liability company, and BERGER INSTITUTIONAL PRODUCTS TRUST, a
Delaware business trust (the "Trust"), with respect to the BERGER IPT - 100
FUND (the "Fund"), a series of the Trust.
RECITALS
A. Berger Associates, Inc., and the Trust entered into that certain
Investment Advisory Agreement dated April 16, 1996 (the "Agreement"), setting
forth the terms and conditions under which the Trust has appointed Berger
Associates, Inc., as investment advisor for the Fund.
B. Effective September 30, 1999, Berger Associates, Inc., assigned and
transferred all its rights, interests, duties and obligations, including its
rights, interests, duties and obligations under the Agreement, to its
subsidiary, Berger LLC, in an assignment and transfer approved by the Trustees
of the Trust. Accordingly, all compensation paid hereafter by the Trust for
investment advisory services rendered to the Fund under the Agreement is to be
paid to Berger LLC rather than to Berger Associates, Inc.
C. Berger LLC and the Trust desire to set forth herein their mutual
agreement to change the compensation paid to Berger LLC under the Agreement.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. Reduction in Compensation. Section 4 of the Agreement is hereby
amended in its entirety to read as follows:
"4. Compensation. The Trust shall pay to Berger LLC for its
services under this Agreement a fee, payable in United States dollars, at
an annual rate of 0.75% of the first $500 million of average daily net
assets of the Fund, 0.70% of the next $500 million of average daily net
assets of the Fund and 0.65% on any part of the average daily net assets of
the Fund in excess of $1 billion. This fee shall be computed and accrued
daily and payable monthly as of the last day of each month during which or
part of which this Agreement is in effect. For the month during which this
Agreement becomes effective and the month during which it terminates,
however, there shall be an appropriate proration of the fee payable for
such month based on the number of calendar days of such month during which
this Agreement is effective."
-1-
<PAGE> 2
2. No Other Changes. No changes to the Agreement are intended by
the parties other than the change reflected in Section 1 of this Amendment, and
all other provisions of the Agreement are hereby confirmed.
3. Limitation on Personal Liability. NOTICE IS HEREBY GIVEN that
the Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Amendment acknowledge and agree
that the Trust is a series trust and all debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series shall be enforceable against the assets held with respect to
such series only, and not against the assets of the Trust generally or against
the assets held with respect to any other series and further that no Trustee,
officer or holder of shares of beneficial interest of the Trust shall be
personally liable for any of the foregoing.
4. Governing Law. This Amendment shall be construed in accordance
with the laws of the State of Colorado (without giving effect to the conflicts
of laws principles thereof) and the Investment Company Act of 1940, as amended.
To the extent that the applicable laws of the State of Colorado conflict with
the applicable provisions of the Investment Company Act of 1940, as amended, the
latter shall control.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Amendment as of the date and year first above written.
BERGER LLC
By:
----------------------------
Jack R. Thompson
President
BERGER INSTITUTIONAL PRODUCTS TRUST, with
respect to the series known as the
BERGER IPT - 100 FUND
By:
----------------------------
Jack R. Thompson
President
-2-
<PAGE> 1
EXHIBIT 23(d)-2a
AMENDMENT NO. 1
TO
INVESTMENT ADVISORY AGREEMENT
BERGER IPT - GROWTH AND INCOME FUND
(A SERIES OF BERGER INSTITUTIONAL PRODUCTS TRUST)
This AMENDMENT NO. 1 TO INVESTMENT ADVISORY AGREEMENT (the "Amendment")
is made effective as of the 1st day of October, 1999, between BERGER LLC, a
Nevada limited liability company, and BERGER INSTITUTIONAL PRODUCTS TRUST, a
Delaware business trust (the "Trust"), with respect to the BERGER IPT - GROWTH
AND INCOME FUND (the "Fund"), a series of the Trust.
RECITALS
A. Berger Associates, Inc., and the Trust entered into that certain
Investment Advisory Agreement dated April 16, 1996 (the "Agreement"), setting
forth the terms and conditions under which the Trust has appointed Berger
Associates, Inc., as investment advisor for the Fund.
B. Effective September 30, 1999, Berger Associates, Inc., assigned and
transferred all its rights, interests, duties and obligations, including its
rights, interests, duties and obligations under the Agreement, to its
subsidiary, Berger LLC, in an assignment and transfer approved by the Trustees
of the Trust. Accordingly, all compensation paid hereafter by the Trust for
investment advisory services rendered to the Fund under the Agreement is to be
paid to Berger LLC rather than to Berger Associates, Inc.
C. Berger LLC and the Trust desire to set forth herein their mutual
agreement to change the compensation paid to Berger LLC under the Agreement.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. Reduction in Compensation. Section 4 of the Agreement is hereby
amended in its entirety to read as follows:
"4. Compensation. The Trust shall pay to Berger LLC for its
services under this Agreement a fee, payable in United States dollars,
at an annual rate of 0.75% of the first $500 million of average daily
net assets of the Fund, 0.70% of the next $500 million of average daily
net assets of the Fund and 0.65% on any part of the average daily net
assets of the Fund in excess of $1 billion. This fee shall be computed
and accrued daily and payable monthly as of the last day of each month
during which or part of which this Agreement is in effect. For the
month during which this Agreement becomes effective and the month
during which it terminates, however, there shall be an appropriate
proration of
-1-
<PAGE> 2
the fee payable for such month based on the number of calendar days of
such month during which this Agreement is effective."
2. No Other Changes. No changes to the Agreement are intended by the
parties other than the change reflected in Section 1 of this Amendment, and all
other provisions of the Agreement are hereby confirmed.
3. Limitation on Personal Liability. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Amendment acknowledge and agree
that the Trust is a series trust and all debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series shall be enforceable against the assets held with respect to
such series only, and not against the assets of the Trust generally or against
the assets held with respect to any other series and further that no Trustee,
officer or holder of shares of beneficial interest of the Trust shall be
personally liable for any of the foregoing.
4. Governing Law. This Amendment shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the Investment Company Act of 1940, as amended. To
the extent that the applicable laws of the State of Colorado conflict with the
applicable provisions of the Investment Company Act of 1940, as amended, the
latter shall control.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Amendment as of the date and year first above written.
BERGER LLC
By:
----------------------------
Jack R. Thompson
President
BERGER INSTITUTIONAL PRODUCTS TRUST, with
respect to the series known as the BERGER
IPT - GROWTH AND INCOME FUND
By:
----------------------------
Jack R. Thompson
President
-2-
<PAGE> 1
EXHIBIT 23(d)-3a
AMENDMENT NO. 1
TO
INVESTMENT ADVISORY AGREEMENT
BERGER IPT - SMALL COMPANY GROWTH FUND
(A SERIES OF BERGER INSTITUTIONAL PRODUCTS TRUST)
This AMENDMENT NO. 1 TO INVESTMENT ADVISORY AGREEMENT (the "Amendment")
is made effective as of the 1st day of October, 1999, between BERGER LLC, a
Nevada limited liability company, and BERGER INSTITUTIONAL PRODUCTS TRUST, a
Delaware business trust (the "Trust"), with respect to the BERGER IPT - SMALL
COMPANY GROWTH FUND (the "Fund"), a series of the Trust.
RECITALS
A. Berger Associates, Inc., and the Trust entered into that certain
Investment Advisory Agreement dated April 16, 1996 (the "Agreement"), setting
forth the terms and conditions under which the Trust has appointed Berger
Associates, Inc., as investment advisor for the Fund.
B. Effective September 30, 1999, Berger Associates, Inc., assigned and
transferred all its rights, interests, duties and obligations, including its
rights, interests, duties and obligations under the Agreement, to its
subsidiary, Berger LLC, in an assignment and transfer approved by the Trustees
of the Trust. Accordingly, all compensation paid hereafter by the Trust for
investment advisory services rendered to the Fund under the Agreement is to be
paid to Berger LLC rather than to Berger Associates, Inc.
C. Berger LLC and the Trust desire to set forth herein their mutual
agreement to change the compensation paid to Berger LLC under the Agreement.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. Reduction in Compensation. Section 4 of the Agreement is hereby
amended in its entirety to read as follows:
"4. Compensation. The Trust shall pay to Berger LLC for its
services under this Agreement a fee, payable in United States dollars,
at an annual rate of 0.85% of the first $500 million of average daily
net assets of the Fund, 0.80% of the next $500 million of average daily
net assets of the Fund and 0.75% on any part of the average daily net
assets of the Fund in excess of $1 billion. This fee shall be computed
and accrued daily and payable monthly as of the last day of each month
during which or part of which this Agreement is in effect. For the
month during which this Agreement becomes effective and the month
during which it terminates, however, there shall be an appropriate
proration of
-1-
<PAGE> 2
the fee payable for such month based on the number of calendar days of
such month during which this Agreement is effective."
2. No Other Changes. No changes to the Agreement are intended by the
parties other than the change reflected in Section 1 of this Amendment, and all
other provisions of the Agreement are hereby confirmed.
3. Limitation on Personal Liability. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Amendment acknowledge and agree
that the Trust is a series trust and all debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series shall be enforceable against the assets held with respect to
such series only, and not against the assets of the Trust generally or against
the assets held with respect to any other series and further that no Trustee,
officer or holder of shares of beneficial interest of the Trust shall be
personally liable for any of the foregoing.
4. Governing Law. This Amendment shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the Investment Company Act of 1940, as amended. To
the extent that the applicable laws of the State of Colorado conflict with the
applicable provisions of the Investment Company Act of 1940, as amended, the
latter shall control.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Amendment as of the date and year first above written.
BERGER LLC
By:
----------------------------
Jack R. Thompson
President
BERGER INSTITUTIONAL PRODUCTS TRUST, with
respect to the series known as the BERGER
IPT - SMALL COMPANY GROWTH FUND
By:
----------------------------
Jack R. Thompson
President
-2-
<PAGE> 1
EXHIBIT 23(d)-6
INVESTMENT ADVISORY AGREEMENT
(BERGER LLC/BERGER INSTITUTIONAL PRODUCTS TRUST)
WITH RESPECT TO THE
BERGER IPT - NEW GENERATION FUND
This INVESTMENT ADVISORY AGREEMENT (the "Agreement") is made this 1st
day of May, 2000, between BERGER LLC, a Nevada limited liability company
("Berger"), and BERGER INSTITUTIONAL PRODUCTS TRUST, a Delaware business trust
(the "Trust"), with respect to BERGER IPT - NEW GENERATION FUND (the "Fund"), a
series of the Trust.
RECITALS
A. The Trust is registered as an open-end management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"), and has
registered its shares for public offering under the Securities Act of 1933, as
amended (the "1933 Act").
B. The Trust is authorized to create separate series of shares in the
Trust, each with its own separate investment portfolio, and has created the Fund
as one such series.
C. Berger is engaged in the business of rendering investment advisory
services and is registered as an investment adviser under the Investment
Advisers Act of 1940, as amended (the "Advisers Act").
D. The Trust and Berger deem it mutually advantageous that Berger
should be appointed to assume responsibility for the day-to-day management of
the Fund and of the securities in the Fund in accordance with the terms and
conditions of this Agreement.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. Appointment. The Trust hereby appoints Berger as investment adviser
and manager with respect to the Fund for the period and on the terms set forth
in this Agreement. Berger hereby accepts such appointment and agrees to render
the services herein set forth, for the compensation herein provided.
2. Investment Advisory Functions. In its capacity as investment adviser
to the Fund, Berger shall have the following duties and responsibilities:
-1-
<PAGE> 2
(a) To manage the investment operations of the Fund and the
composition of its investment portfolio, and to determine
without prior consultation with the Trust, what securities and
other assets of the Fund will be acquired, held, disposed of
or loaned, in conformity with the investment objective,
policies and restrictions and the other statements concerning
the Fund in the Trust's trust instrument, as amended from time
to time (the "Trust Instrument"), bylaws and registration
statements under the 1940 Act and the 1933 Act, the 1940 Act
and the Advisers Act, the rules and regulations thereunder,
and all other applicable federal and state laws and
regulations, and the provisions of the Internal Revenue Code
of 1986, as amended from time to time, applicable to the Fund
as a regulated investment company or as required to maintain
compliance with any diversification provisions applicable to
insurance company separate accounts or qualified plans
investing in the Fund;
(b) To cause its officers to attend meetings and furnish oral or
written reports, as the Trust may reasonably require, in order
to keep the Trustees and appropriate officers of the Trust
fully informed as to the condition of the investment portfolio
of the Fund, the investment decisions of Berger, and the
investment considerations which have given rise to those
decisions;
(c) To place orders for the purchase and sale of securities for
investments of the Fund and for other related transactions; to
give instructions to the custodian (including any
subcustodian) of the Fund as to deliveries of securities to
and from such custodian and receipt and payments of cash for
the account of the Fund, and advise the Trust on the same day
such instructions are given; and to submit such reports
relating to the valuation of the Fund's assets and to
otherwise assist in the calculation of the net asset value of
shares of the Fund as may reasonably be requested; on behalf
of the Fund, to exercise such voting rights, subscription
rights, rights to consent to corporate action and any other
rights pertaining to the Fund's assets that may be exercised,
in accordance with any policy pertaining to the same that may
be adopted or agreed to by the Trustees of the Trust, or, in
the event that the Trust retains the right to exercise such
voting and other rights, to furnish the Trust with advice as
to the manner in which such rights should be exercised;
(d) To maintain all books and records required to be maintained by
Berger pursuant to the 1940 Act and the rules and regulations
promulgated thereunder, as the same may be amended from time
to time, with respect to transactions on behalf of the Fund,
and to furnish the Trustees with such periodic and special
reports as the Trustees reasonably may request. Berger agrees
that all records which it maintains for the Fund or the Trust
are the property of the Trust, agrees to permit the reasonable
inspection thereof by the Trust or its designees and agrees to
preserve for the periods prescribed under the 1940 Act any
records which it maintains for the Trust and which
-2-
<PAGE> 3
are required to be maintained under the 1940 Act, and further
agrees to surrender promptly to the Trust or its designees any
records which it maintains for the Trust upon request by the
Trust; and
(e) At such times as shall be reasonably requested by the
Trustees, to provide the Trustees with economic, operational
and investment data and reports, including without limitation
all information and materials reasonably requested by or
requested to be delivered to the Trustees of the Trust
pursuant to Section 15(c) of the 1940 Act, and make available
to the Trustees any economic, statistical and investment
services normally available to similar investment company
clients of Berger.
3. Further Obligations. In all matters relating to the performance of
this Agreement, Berger shall act in conformity with the Trust's Trust
Instrument, bylaws and currently effective registration statements under the
1940 Act and the 1933 Act and any amendments or supplements thereto (the
"Registration Statements") and with the written policies, procedures and
guidelines of the Fund, and written instructions and directions of the Trustees
of the Trust, and shall comply with the requirements of the 1940 Act, the
Advisers Act, the rules thereunder, and all other applicable federal and state
laws and regulations. The Trust agrees to provide Berger with copies of the
Trust's Trust Instrument, bylaws, Registration Statements, written policies,
procedures and guidelines, and written instructions and directions of the
Trustees, and any amendments or supplements to any of them at, or, if
practicable, before the time such materials become effective. Berger shall
maintain errors and omissions insurance in an amount at least equal to that
disclosed to the Trustees in connection with their approval of this Agreement.
4. Obligations of Trust. The Trust shall have the following obligations
under this Agreement:
(a) To keep Berger continuously and fully informed as to the
composition of the investment portfolio of the Fund and the
nature of all of the Fund's assets and liabilities from time
to time;
(b) To furnish Berger with a certified copy of any financial
statement or report prepared for the Fund by certified or
independent public accountants and with copies of any
financial statements or reports made to the Fund's
shareholders or to any governmental body or securities
exchange;
(c) To furnish Berger with any further materials or information
which Berger may reasonably request to enable it to perform
its function under this Agreement; and
(d) To compensate Berger for its services in accordance with the
provisions of Section 5 hereof.
-3-
<PAGE> 4
5. Compensation. The Trust shall pay to Berger for its services under
this Agreement a fee, payable in United States dollars, at an annual rate of
0.85% of the first $500 million of average daily net assets of the Fund, 0.80%
of the next $500 million of average daily net assets of the Fund and 0.75% of
any part of the average daily net assets of the Fund in excess of $1 billion.
This fee shall be computed and accrued daily and payable monthly as of the last
day of each month during which or part of which this Agreement is in effect. For
the month during which this Agreement becomes effective and the month during
which it terminates, however, there shall be an appropriate proration of the fee
payable for such month based on the number of calendar days of such month during
which this Agreement is effective.
6. Expenses.
(a) Expenses Paid by the Trust. The Trust assumes and shall pay all
expenses incidental to its operations and business not specifically assumed or
agreed to be paid by Berger hereunder or otherwise, including, but not limited
to, any compensation, fees or reimbursements which the Trust pays to its
Trustees who are not interested persons of Berger; compensation of the Fund's
custodian, transfer agent, registrar and dividend disbursing agent and other
service providers; legal, accounting, audit and printing expenses;
administrative, clerical, recordkeeping and bookkeeping expenses; brokerage
commissions and all other expenses in connection with execution of portfolio
transactions (including any appropriate commissions paid to Berger or its
affiliates for effecting exchange listed, over-the-counter or other securities
transactions); interest; all federal, state and local taxes (including stamp,
excise, income and franchise taxes); costs of stock certificates and expenses of
delivering such certificates to the purchasers thereof; expenses of local
representation in Delaware; expenses of shareholders' meetings and of preparing,
printing and distributing proxy statements, notices, and reports to
shareholders; expenses of preparing and filing reports and tax returns with
federal and state regulatory authorities; all expenses incurred in complying
with all federal and state laws and the laws of any foreign country applicable
to the issue, offer or sale of shares of the Fund, including, but not limited
to, all costs involved in preparing, printing and mailing prospectuses and
statements of additional information to shareholders of the Fund; and all fees,
dues and other expenses incurred by the Trust in connection with the membership
of the Trust in any trade association or other investment company organization.
To the extent that Berger shall perform any of the above described
administrative and clerical functions, including transfer agency, registry,
dividend disbursing, recordkeeping, bookkeeping, accounting and blue sky
monitoring and registration functions, and the preparation of reports and
returns, the Trust shall pay to Berger compensation for, or reimburse Berger for
its expenses incurred in connection with, such services as Berger and the Trust
shall agree from time to time, any other provision of this Agreement
notwithstanding.
(b) Expenses Paid by Berger. Berger shall pay all its own costs and
expenses incurred in fulfilling its obligations under this Agreement. In
addition to such costs and expenses, Berger shall incur and pay the following
expenses relating to the Fund's operations:
-4-
<PAGE> 5
(i) Reasonable compensation, fees and related expenses of the
Trust's officers and Trustees, except for such Trustees who are not interested
persons of Berger; and
(ii) Rental of offices of the Trust.
7. Brokerage Commissions. For purposes of this Agreement, brokerage
commissions paid by the Fund upon the purchase or sale of its portfolio
securities shall be considered a cost of securities of the Fund and shall be
paid by the Fund. Absent instructions from the Trust to the contrary, Berger is
authorized and directed to place portfolio transactions for the Fund only with
brokers and dealers who render satisfactory service in the execution of orders
at the most favorable prices and at reasonable commission rates, provided,
however, that Berger may pay a broker an amount of commission for effecting a
securities transaction in excess of the amount of commission another broker
would have charged for effecting that transaction if Berger determines in good
faith that such amount of commission was reasonable in relation to the value of
the brokerage and research services provided by such broker viewed in terms of
either that particular transaction or the overall responsibilities of Berger.
Berger is also authorized to consider sales of variable insurance contracts that
permit allocation of contract values to the Fund as a factor in selecting
broker-dealers to execute portfolio transactions for the Fund. In placing
portfolio business with such broker-dealers, Berger shall seek the best
execution of each transaction. Subject to the terms of this Agreement and the
applicable requirements and provisions of the law, including the 1940 Act and
the Securities Exchange Act of 1934, as amended, and in the event that Berger or
an affiliate is registered as a broker-dealer, Berger may select a broker with
which it or any of its affiliates or the Fund is affiliated. Berger or such
affiliated broker may effect or execute Fund securities transactions, whether on
a securities exchange or in the over-the-counter market, and receive separate
compensation from the Fund therefor. Notwithstanding the foregoing, the Trust
shall retain the right to direct the placement of all portfolio transactions,
and the Trustees of the Trust may establish policies or guidelines to be
followed by Berger in placing portfolio transactions for the Trust pursuant to
the foregoing provisions. Berger shall report on the placement of portfolio
transactions in the prior fiscal quarter at each quarterly meeting of such
Trustees. To the extent consistent with applicable law, purchase or sell orders
for the Fund may be aggregated with simultaneous purchase or sell orders for
other clients of Berger. Whenever Berger simultaneously places orders to
purchase or sell the same security on behalf of the Fund and one or more other
clients of Berger, such orders will be allocated as to price and amount among
all such clients in a manner reasonably believed by Berger to be fair and
equitable to each client. The Trust recognizes that in some cases, this
procedure may adversely affect the results obtained for the Fund.
8. Termination. This Agreement may be terminated at any time, without
penalty, by the Trustees of the Trust, or by the shareholders of the Fund acting
by vote of at least a majority of its outstanding voting securities, provided in
either case that sixty (60) days' advance written notice of termination be given
to Berger at its principal place of business. This Agreement may be terminated
by Berger at any time, without penalty, by giving sixty (60) days' advance
written notice of
-5-
<PAGE> 6
termination to the Trust, addressed to its principal place of business. The
Trust agrees that, consistent with the terms of the Trust's Trust Instrument,
the Trust shall cease to use the name "Berger" in connection with the Fund as
soon as reasonably practicable following any termination of this Agreement if
Berger does not continue to provide investment advice to the Fund after such
termination.
9. Assignment. This Agreement shall terminate automatically in the
event of any assignment of this Agreement.
10. Term. This Agreement shall continue in effect until April 30, 2002,
unless sooner terminated in accordance with its terms, and shall continue in
effect from year to year thereafter only so long as such continuance is
specifically approved at least annually by the vote of a majority of the
Trustees of the Trust who are not parties hereto or interested persons of any
such party, cast in person at a meeting called for the purpose of voting on the
approval of the terms of such renewal, and by either the Trustees of the Trust
or the affirmative vote of a majority of the outstanding voting securities of
the Fund.
11. Amendments. This Agreement may be amended by the parties only if
such amendment is specifically approved (i) by a majority of the Trustees,
including a majority of the Trustees who are not interested persons of the Fund
or Berger and, (ii) if required by applicable law, by the affirmative vote of a
majority of the outstanding voting securities of the Fund.
12. Allocation of Expenses. The Trustees shall determine the basis for
making an appropriate allocation of the Trust's expenses (other than those
directly attributable to the Fund) between the Fund and any other series of the
Trust and between the Fund and other investment companies managed by Berger or
its affiliates.
13. Limitation on Personal Liability. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Agreement acknowledge and agree
that the Trust is a series trust and all debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series shall be enforceable against the assets held with respect to
such series only, and not against the assets of the Trust generally or against
the assets held with respect to any other series and further that no Trustee,
officer or holder of shares of beneficial interest of the Trust shall be
personally liable for any of the foregoing.
14. Limitation of Liability of Berger. Berger shall not be liable for
any error of judgment or mistake of law or for any loss arising out of any
investment or for any act or omission taken with respect to the Fund, except for
willful misfeasance, bad faith or gross negligence in the performance of its
duties, or by reason of reckless disregard of its obligations and duties
hereunder and except to
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<PAGE> 7
the extent otherwise provided by law. As used in this section, "Berger" shall
include any affiliate of Berger performing services for the Trust contemplated
hereunder and directors, managers, officers and employees of Berger and such
affiliates.
15. Activities of Berger. The services of Berger to the Trust hereunder
are not to be deemed to be exclusive, and Berger and its affiliates are free to
render services to other parties, so long as its services under this Agreement
are not materially adversely affected or otherwise impaired thereby. Nothing in
this Agreement shall limit or restrict the right of any manager, officer or
employee of Berger to engage in any other business or to devote his or her time
and attention in part to the management or other aspects of any other business,
whether of a similar nature or a dissimilar nature. It is understood that
Trustees, officers and shareholders of the Trust are or may become interested in
Berger as managers, officers and shareholders of Berger, that managers,
officers, employees and shareholders of Berger are or may become similarly
interested in the Trust, and that Berger may become interested in the Trust as a
shareholder or otherwise.
16. Certain Definitions. The terms "vote of a majority of the
outstanding voting securities," "assignment," "approved at least annually" and
"interested persons" when used herein, shall have the respective meanings
specified in the 1940 Act, as now in effect or hereafter amended, and the rules
and regulations thereunder, subject to such orders, exemptions and
interpretations as may be issued by the Securities and Exchange Commission under
said Act and as may be then in effect. Where the effect of a requirement of the
federal securities laws reflected in any provision of this Agreement is made
less restrictive by a rule, regulation, order, interpretation or other authority
of the Securities and Exchange Commission, whether of special or general
application, such provision shall be deemed to incorporate the effect of such
rule, regulation, order, interpretation or other authority.
17. Governing Law. This Agreement shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the 1940 Act. To the extent that the applicable
laws of the State of Colorado conflict with the applicable provisions of the
1940 Act, the latter shall control.
18. Miscellaneous. The headings in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions thereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
-7-
<PAGE> 8
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Investment Advisory Agreement as of the date and year
first above written.
BERGER LLC
By:
--------------------------------------
Jack R. Thompson
President
BERGER INSTITUTIONAL PRODUCTS TRUST, with
respect to the series known as the Berger
IPT - New Generation Fund
By:
--------------------------------------
Jack R. Thompson
President
-8-
<PAGE> 1
EXHIBIT 23(h)-1a
AMENDMENT NO. 1
TO
ADMINISTRATIVE SERVICES AGREEMENT
BERGER IPT - 100 FUND
(A SERIES OF BERGER INSTITUTIONAL PRODUCTS TRUST)
This AMENDMENT NO. 1 TO ADMINISTRATIVE SERVICES AGREEMENT (the
"Amendment") is made effective as of the 1st day of October, 1999, between
BERGER LLC, a Nevada limited liability company, and BERGER INSTITUTIONAL
PRODUCTS TRUST, a Delaware business trust (the "Trust"), with respect to the
BERGER IPT - 100 FUND (the "Fund"), a series of the Trust.
RECITALS
A. Berger Associates, Inc., and the Trust entered into that certain
Administrative Services Agreement dated April 16, 1996 (the "Agreement"),
setting forth the terms and conditions under which the Trust has appointed
Berger Associates, Inc., to provide certain administrative services to the Fund.
B. Effective September 30, 1999, Berger Associates, Inc., assigned and
transferred all its rights, interests, duties and obligations, including its
rights, interests, duties and obligations under the Agreement, to its
subsidiary, Berger LLC, in an assignment and transfer approved by the Trustees
of the Trust.
C. Berger LLC and the Trust desire to set forth in this Amendment their
mutual agreement that Berger LLC will continue to provide the services required
by the Agreement, but without compensation or payment therefor.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. Elimination of Compensation. Section 2 of the Agreement is hereby
amended in its entirety to read as follows:
"2. For its services under this Agreement, Berger LLC shall
not be compensated or paid a fee."
2. No Other Changes. No changes to the Agreement are intended by the
parties other than the changes reflected in Section 1 of this Amendment, and all
other provisions of the Agreement are hereby confirmed.
3. Limitation on Personal Liability. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Amendment acknowledge and agree
that the Trust is a series trust and all debts, liabilities, obligations and
expenses incurred,
-1-
<PAGE> 2
contracted for or otherwise existing with respect to a particular series shall
be enforceable against the assets held with respect to such series only, and not
against the assets of the Trust generally or against the assets held with
respect to any other series and further that no Trustee, officer or holder of
shares of beneficial interest of the Trust shall be personally liable for any of
the foregoing.
4. Governing Law. This Amendment shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the Investment Company Act of 1940, as amended. To
the extent that the applicable laws of the State of Colorado conflict with the
applicable provisions of the Investment Company Act of 1940, as amended, the
latter shall control.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Amendment as of the date and year first above written.
BERGER LLC
By:
----------------------------
Jack R. Thompson
President
BERGER INSTITUTIONAL PRODUCTS TRUST, with
respect to the series known as the BERGER
IPT - 100 FUND
By:
----------------------------
Jack R. Thompson
President
-2-
<PAGE> 1
EXHIBIT 23(h)-2a
AMENDMENT NO. 1
TO
ADMINISTRATIVE SERVICES AGREEMENT
BERGER IPT - GROWTH AND INCOME FUND
(A SERIES OF BERGER INSTITUTIONAL PRODUCTS TRUST)
This AMENDMENT NO. 1 TO ADMINISTRATIVE SERVICES AGREEMENT (the
"Amendment") is made effective as of the 1st day of October, 1999, between
BERGER LLC, a Nevada limited liability company, and BERGER INSTITUTIONAL
PRODUCTS TRUST, a Delaware business trust (the "Trust"), with respect to the
BERGER IPT - GROWTH AND INCOME FUND (the "Fund"), a series of the Trust.
RECITALS
A. Berger Associates, Inc., and the Trust entered into that certain
Administrative Services Agreement dated April 16, 1996 (the "Agreement"),
setting forth the terms and conditions under which the Trust has appointed
Berger Associates, Inc., to provide certain administrative services to the Fund.
B. Effective September 30, 1999, Berger Associates, Inc., assigned and
transferred all its rights, interests, duties and obligations, including its
rights, interests, duties and obligations under the Agreement, to its
subsidiary, Berger LLC, in an assignment and transfer approved by the Trustees
of the Trust.
C. Berger LLC and the Trust desire to set forth in this Amendment their
mutual agreement that Berger LLC will continue to provide the services required
by the Agreement, but without compensation or payment therefor.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. Elimination of Compensation. Section 2 of the Agreement is hereby
amended in its entirety to read as follows:
"2. For its services under this Agreement, Berger LLC shall
not be compensated or paid a fee."
2. No Other Changes. No changes to the Agreement are intended by the
parties other than the changes reflected in Section 1 of this Amendment, and all
other provisions of the Agreement are hereby confirmed.
3. Limitation on Personal Liability. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Amendment acknowledge
-1-
<PAGE> 2
and agree that the Trust is a series trust and all debts, liabilities,
obligations and expenses incurred, contracted for or otherwise existing with
respect to a particular series shall be enforceable against the assets held with
respect to such series only, and not against the assets of the Trust generally
or against the assets held with respect to any other series and further that no
Trustee, officer or holder of shares of beneficial interest of the Trust shall
be personally liable for any of the foregoing.
4. Governing Law. This Amendment shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the Investment Company Act of 1940, as amended. To
the extent that the applicable laws of the State of Colorado conflict with the
applicable provisions of the Investment Company Act of 1940, as amended, the
latter shall control.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Amendment as of the date and year first above written.
BERGER LLC
By:
----------------------------
Jack R. Thompson
President
BERGER INSTITUTIONAL PRODUCTS TRUST, with
respect to the series known as the BERGER
IPT - GROWTH AND INCOME FUND
By:
----------------------------
Jack R. Thompson
President
-2-
<PAGE> 1
EXHIBIT 23(h)-3a
AMENDMENT NO. 1
TO
ADMINISTRATIVE SERVICES AGREEMENT
BERGER IPT - SMALL COMPANY GROWTH FUND
(A SERIES OF BERGER INSTITUTIONAL PRODUCTS TRUST)
This AMENDMENT NO. 1 TO ADMINISTRATIVE SERVICES AGREEMENT (the
"Amendment") is made effective as of the 1st day of October, 1999, between
BERGER LLC, a Nevada limited liability company, and BERGER INSTITUTIONAL
PRODUCTS TRUST, a Delaware business trust (the "Trust"), with respect to the
BERGER IPT - SMALL COMPANY GROWTH FUND (the "Fund"), a series of the Trust.
RECITALS
A. Berger Associates, Inc., and the Trust entered into that certain
Administrative Services Agreement dated April 16, 1996 (the "Agreement"),
setting forth the terms and conditions under which the Trust has appointed
Berger Associates, Inc., to provide certain administrative services to the Fund.
B. Effective September 30, 1999, Berger Associates, Inc., assigned and
transferred all its rights, interests, duties and obligations, including its
rights, interests, duties and obligations under the Agreement, to its
subsidiary, Berger LLC, in an assignment and transfer approved by the Trustees
of the Trust.
C. Berger LLC and the Trust desire to set forth in this Amendment their
mutual agreement that Berger LLC will continue to provide the services required
by the Agreement, but without compensation or payment therefor.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. Elimination of Compensation. Section 2 of the Agreement is hereby
amended in its entirety to read as follows:
"2. For its services under this Agreement, Berger LLC shall
not be compensated or paid a fee."
2. No Other Changes. No changes to the Agreement are intended by the
parties other than the changes reflected in Section 1 of this Amendment, and all
other provisions of the Agreement are hereby confirmed.
3. Limitation on Personal Liability. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Amendment acknowledge
-1-
<PAGE> 2
and agree that the Trust is a series trust and all debts, liabilities,
obligations and expenses incurred, contracted for or otherwise existing with
respect to a particular series shall be enforceable against the assets held with
respect to such series only, and not against the assets of the Trust generally
or against the assets held with respect to any other series and further that no
Trustee, officer or holder of shares of beneficial interest of the Trust shall
be personally liable for any of the foregoing.
4. Governing Law. This Amendment shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the Investment Company Act of 1940, as amended. To
the extent that the applicable laws of the State of Colorado conflict with the
applicable provisions of the Investment Company Act of 1940, as amended, the
latter shall control.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Amendment as of the date and year first above written.
BERGER LLC
By:
----------------------------
Jack R. Thompson
President
BERGER INSTITUTIONAL PRODUCTS TRUST, with
respect to the series known as the BERGER
IPT - SMALL COMPANY GROWTH FUND
By:
----------------------------
Jack R. Thompson
President
-2-
<PAGE> 1
EXHIBIT 23(h)-4a
AMENDMENT NO. 1
TO
ADMINISTRATIVE SERVICES AGREEMENT
BERGER/BIAM IPT - INTERNATIONAL FUND
(A SERIES OF BERGER INSTITUTIONAL PRODUCTS TRUST)
This AMENDMENT NO. 1 TO ADMINISTRATIVE SERVICES AGREEMENT (the
"Amendment") is made effective as of the 1st day of October, 1999, between BBOI
WORLDWIDE LLC, a Delaware limited liability company ("BBOI Worldwide"), and
BERGER INSTITUTIONAL PRODUCTS TRUST, a Delaware business trust (the "Trust"),
with respect to the BERGER/BIAM IPT - INTERNATIONAL FUND (the "Fund"), a series
of the Trust.
RECITALS
A. BBOI Worldwide and the Trust entered into that certain
Administrative Services Agreement dated May 1, 1997 (the "Agreement"), setting
forth the terms and conditions under which the Trust has appointed BBOI
Worldwide to provide certain administrative services to the Fund.
B. BBOI Worldwide and the Trust desire to set forth in this Amendment
their mutual agreement that BBOI Worldwide will continue to provide the services
required by the Agreement, but without compensation or payment therefor.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. Elimination of Compensation.
(A) Section 1 of the Agreement is hereby amended to delete the phrase
"for the compensation herein provided."
(B) Section 4 of the Agreement is hereby amended in its entirety to
read as follows:
"4. Compensation. For its services under this Agreement, BBOI
Worldwide shall not be compensated or paid a fee."
2. No Other Changes. No changes to the Agreement are intended by the
parties other than the changes reflected in Section 1 of this Amendment, and all
other provisions of the Agreement are hereby confirmed.
3. Limitation on Personal Liability. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Amendment acknowledge
-1-
<PAGE> 2
and agree that the Trust is a series trust and all debts, liabilities,
obligations and expenses incurred, contracted for or otherwise existing with
respect to a particular series shall be enforceable against the assets held with
respect to such series only, and not against the assets of the Trust generally
or against the assets held with respect to any other series and further that no
Trustee, officer or holder of shares of beneficial interest of the Trust shall
be personally liable for any of the foregoing.
4. Governing Law. This Amendment shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the Investment Company Act of 1940, as amended. To
the extent that the applicable laws of the State of Colorado conflict with the
applicable provisions of the Investment Company Act of 1940, as amended, the
latter shall control.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Amendment as of the date and year first above written.
BBOI WORLDWIDE LLC
By:
----------------------------
Jack R. Thompson
Co-Chief Executive Officer
BERGER INSTITUTIONAL PRODUCTS TRUST, with
respect to the series known as the
BERGER/BIAM IPT - INTERNATIONAL FUND
By:
----------------------------
Jack R. Thompson
President
-2-
<PAGE> 1
Exhibit 23(h)-5a
ADMINISTRATIVE SERVICES AGREEMENT
(BERGER LLC/BERGER INSTITUTIONAL PRODUCTS TRUST)
WITH RESPECT TO THE
BERGER IPT - NEW GENERATION FUND
This ADMINISTRATIVE SERVICES AGREEMENT (the "Agreement") is
entered into effective as of the 1st day of May, 2000, by and between BERGER
LLC, a Nevada limited liability company ("Berger"), and BERGER INSTITUTIONAL
PRODUCTS TRUST, a Delaware business trust (the "Trust"), with respect to the
BERGER IPT - NEW GENERATION FUND, a series of the Trust (the "Fund").
RECITALS
A. The Trust is a Delaware business trust and an open-end,
management investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act").
B. The Fund is a series of the Trust for which Berger acts as
investment advisor.
C. The parties desire that in addition to its duties as
investment advisor, Berger provide certain administrative services to the Trust
with respect to the Fund, on the terms and conditions set forth herein.
AGREEMENT
For good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Appointment. The Trust hereby appoints Berger as the
administrator of the Fund, to provide to the Fund, at Berger's expense except as
specifically set forth below, all services specified herein, for the period and
on the terms set forth in this Agreement. Berger hereby accepts such appointment
and agrees to render the services and assume the responsibilities herein set
forth. In performing its services under this Agreement, Berger shall comply with
all relevant provisions of the 1940 Act and all other applicable federal and
state laws and regulations.
2. Services to be Provided. Berger shall provide the following
services to the Fund at Berger's own expense:
(a) coordinating all matters relating to the operations of the
Fund, including any necessary coordination among the investment advisor,
transfer agent,
1
<PAGE> 2
dividend disbursing agent, fund accounting agent, accountants, attorneys and
other parties performing services or operational functions for the Fund;
(b) providing personnel and assistance necessary to maintain
the qualification and/or registration to sell shares under the federal
securities laws and in each state where Berger has determined such qualification
and/or registration to be advisable;
(c) monitoring the Fund's compliance with (i) the Trust's
trust instrument, as amended from time to time (the "Trust Instrument"), bylaws
and currently effective registration statement under the Securities Act of 1933,
as amended (the "1933 Act") and the 1940 Act and any amendments or supplements
thereto ("Registration Statement"); (ii) the written policies, procedures and
guidelines of the Fund, and the written instructions from the Trustees of the
Trust; (iii) the requirements of the 1933 Act, the 1940 Act, the rules
thereunder, and all other applicable federal and state laws and regulations; and
(iv) the provisions of the Internal Revenue Code applicable to the Fund as a
regulated investment company under Subchapter M or as required to maintain
compliance with any diversification provisions applicable to insurance company
separate accounts or qualified plans investing in the Fund;
(d) supervising the preparation of any or all registration
statements (including prospectuses and statements of additional information),
tax returns, proxy materials, financial statements, notices and reports for
filings with regulatory authorities and distribution to shareholders of the
Fund;
(e) issuing certain correspondence to shareholders;
(f) maintaining or supervising the maintenance of certain
books and records;
(g) providing the Trust with adequate personnel, office space,
communications facilities and other facilities necessary for operation of the
Fund as contemplated by this Agreement; and
(h) preparing and rendering to the Trustees of the Trust such
periodic and special reports as the Trustees may reasonably request.
3. Expenses and Excluded Expenses. Berger shall pay all its
own costs and expenses incurred in rendering the services required under this
Agreement. Notwithstanding any other provision hereof, it is expressly agreed
that Berger shall not be responsible to pay, except as the parties may otherwise
agree, directly or on behalf of the Fund, any of the Fund's expenses which shall
remain the Trust's own obligation and responsibility to pay.
2
<PAGE> 3
4. Compensation. For its services under this Agreement, Berger
shall not be compensated or paid a fee.
5. Books and Records. Berger hereby agrees that all records
which it maintains for the Fund or the Trust hereunder are the property of the
Trust, agrees to permit the reasonable inspection thereof by the Trust or its
designees and agrees to preserve for the periods prescribed under the 1940 Act
any records which it maintains for the Fund or the Trust and which are required
to be maintained under the 1940 Act. Berger further agrees to surrender promptly
to the Trust or its designees any records which it maintains for the Fund or the
Trust upon request by the Trust.
6. Term and Termination. This Agreement shall become effective
as of the date first set forth above and shall continue until terminated by
either party on 60 days' written notice to the other party. This Agreement may
also be terminated by the Trustees of the Trust at any time if Berger becomes
unable to discharge its duties and obligations under this Agreement.
7. Assignment and Amendments. This Agreement shall not be
assigned by either party without the prior written consent of the other party to
the Agreement. This Agreement may be amended in writing by the parties, provided
that all such amendments shall be subject to the approval of the Trustees of the
Trust.
8. Limitation of Liability of Berger. Berger shall not be
liable for any error of judgment or mistake of law or for any act or omission
taken with respect to the Fund, except for willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason of reckless
disregard of its obligations and duties hereunder and except to the extent
otherwise provided by law. As used in this section, "Berger" shall include
managers, officers and employees of Berger.
9. Activities of Berger. The services of Berger hereunder are
not to be deemed to be exclusive, and Berger is free to render services to other
parties, so long as its services under this Agreement are not materially
adversely affected or otherwise impaired thereby. Nothing in this Agreement
shall limit or restrict the right of any manager, officer or employee of Berger
to engage in any other business or to devote his or her time and attention in
part to the management or other aspects of any other business, whether of a
similar nature or a dissimilar nature.
10. Limitation on Personal Liability. NOTICE IS HEREBY GIVEN
that the Trust is a business trust organized under the Delaware Business Trust
Act pursuant to a Certificate of Trust filed in the office of the Secretary of
State of the State of Delaware. All parties to this Agreement acknowledge and
agree that the Trust is a series trust and all debts, liabilities, obligations
and expenses incurred, contracted for or otherwise existing with respect to a
particular series shall be enforceable against the assets held with respect to
such series only, and not against the assets of the Trust generally or against
the assets held with respect to any other series and further that no
3
<PAGE> 4
Trustee, officer or holder of shares of beneficial interest of the Trust shall
be personally liable for any of the foregoing.
11. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of Colorado (without giving effect to the
conflicts of laws principles thereof) and the 1940 Act. To the extent that the
applicable laws of the State of Colorado conflict with the applicable provisions
of the 1940 Act, the latter shall control.
12. Miscellaneous. The headings in this Agreement are included
for convenience of reference only and in no way define or limit any of the
provisions thereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement effective as of the date first above written.
BERGER LLC
By:
--------------------------------
Jack R. Thompson
President
BERGER INSTITUTIONAL PRODUCTS TRUST,
with respect to the series known as the Berger IPT -
New Generation Fund
By:
--------------------------------
Jack R. Thompson
President
4
<PAGE> 1
Exhibit 23(h)-6a
ASSIGNMENT, AMENDMENT AND CONSENT
THIS ASSIGNMENT, AMENDMENT AND CONSENT AGREEMENT (the "Amendment") is
made and entered into effective as of March 1, 2000 by and among BERGER
INVESTMENT PORTFOLIO TRUST, BERGER GROWTH FUND, INC., BERGER GROWTH AND INCOME
FUND, INC., BERGER/BIAM WORLDWIDE FUNDS TRUST, BERGER/BIAM WORLDWIDE PORTFOLIOS
TRUST, BERGER OMNI INVESTMENT TRUST, AND BERGER INSTITUTIONAL PRODUCTS TRUST
(collectively "Berger"), INVESTORS FIDUCIARY TRUST COMPANY ("IFTC"), and STATE
STREET BANK AND TRUST COMPANY ("State Street").
WHEREAS, IFTC has agreed to provide certain services to the entity
referenced below pursuant to the referenced agreements (collectively, the
"Agreements"):
BERGER INVESTMENT PORTFOLIO TRUST: Recordkeeping and Pricing Agent
Agreement dated December 14, 1993 as amended December 1, 1998, Custody
Agreement dated December 20, 1995, and various related Special Custody
Account (Short Sales) and Procedural and Safekeeping Agreements
BERGER GROWTH FUND, INC. F/K/A/ THE ONE HUNDRED FUND, INC.:
Recordkeeping and Pricing Agent Agreement dated October 1, 1992 as
amended December 1, 1998 and January 31, 2000, Custody Agreement dated
December 20, 1995 as amended January 31, 2000, and various related
Special Custody Account Agreement (Short Sales) and Procedural and
Safekeeping Agreements
BERGER GROWTH AND INCOME FUND, INC. F/K/A BERGER ONE HUNDRED AND ONE
FUND, INC.: Recordkeeping and Pricing Agent Agreement dated October 1,
1992 as amended December 1, 1998 and January 31, 2000, Custody
Agreement dated December 20, 1995 as amended January 31, 2000, and
various related Special Custody Account (Short Sales) and Procedural
and Safekeeping Agreements
BERGER/BIAM WORLDWIDE FUNDS TRUST: Recordkeeping and Pricing Agent
Agreement dated October 3, 1996 as amended December 1, 1998 and Custody
Agreement dated October 3, 1996
BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST: Recordkeeping, Pricing Agent
and Transfer Agency Agreement dated October 3, 1996 as amended December
1, 1998 and Custody Agreement dated October 3, 1996
BERGER OMNI INVESTMENT TRUST: Recordkeeping and Pricing Agent Agreement
dated January 1, 1997 as amended December 1, 1998 and Custody Agreement
dated January 1, 1997; and
BERGER INSTITUTIONAL PRODUCTS TRUST: Recordkeeping and Pricing Agent
Agreement dated December 20, 1995 as amended December 1, 1998, Custody
Agreement dated December 20, 1995 and various related Special Custody
Account (Short Sales) and Procedural and Safekeeping Agreements
WHEREAS, State Street and IFTC, its wholly owned subsidiary, have
commenced a reorganization that will ultimately result in the liquidation of
IFTC, and, therefore, IFTC desires to assign, and State Street desires to
assume, each of the Agreements; and
WHEREAS, Berger and State Street desire to amend and supplement the
Agreements upon the following terms and conditions.
NOW THEREFORE, for and in consideration of the mutual promises
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Berger, IFTC and State Street
hereby agree that the Agreements are assigned, amended and supplemented as
follows:
<PAGE> 2
Exhibit 23(h)-6a
1. IFTC hereby assigns all of its rights, duties and obligations under the
Agreements to State Street and State Street hereby assumes all of such
rights, duties and obligations. Berger hereby consents to such
assignment and assumption.
2. The first paragraph of each Agreement is hereby amended by deleting
"127 West 10th Street" and replacing it with "801 Pennsylvania Avenue".
3. The "Notice" provisions of the Agreements are hereby amended by
replacing the address of State Street as follows:
State Street Bank and Trust Company
801 Pennsylvania Avenue
Kansas City, Missouri 64105-1716
Attention: Chief Financial Officer
4. General Provisions. This Amendment may be executed in any number of
counterparts, each constituting an original and all considered one and
the same agreement. This Amendment is intended to modify and amend the
Agreements and the terms of this Amendment and the Agreements are to be
construed to be cumulative and not exclusive of each other. Except as
provided herein, the Agreements are hereby ratified and confirmed and
remain in full force and effect.
IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed by their duly authorized officers to be effective as of the date first
above written.
INVESTORS FIDUCIARY TRUST COMPANY BERGER/BIAM WORLDWIDE FUNDS TRUST
By: By:
------------------------------- -------------------------------
Name, Title Name, Title
STATE STREET BANK AND TRUST COMPANY BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST
By: By:
------------------------------- -------------------------------
Name, Title Name, Title
BERGER INVESTMENT PORTFOLIO TRUST BERGER OMNI INVESTMENT TRUST
By: By:
------------------------------- -------------------------------
Name, Title Name, Title
BERGER GROWTH FUND, INC BERGER INSTITUTIONAL PRODUCTS TRUST
By: By:
------------------------------- -------------------------------
Name, Title Name, Title
BERGER GROWTH AND INCOME FUND, INC
By:
-------------------------------
Name, Title
<PAGE> 1
EXHIBIT 23(h)-8a
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
August 4, 1999
Great American Reserve Insurance Company
11814 N. Pennsylvania Street
Carmel, IN 46032
Attn: L. Gregory Gloeckner
Dear Mr. Gloeckner:
Pursuant to Section 12.7 of the Participation Agreement, dated April 15, 1996
(the "Agreement"), among Great American Reserve Insurance Company, on its own
behalf and on behalf of each segregated asset account set forth on Schedule A of
the Agreement, Berger Institutional Products Trust and Berger Associates, Inc.
("Berger") seek your consent to an assignment. Berger desires to assign its
interests, rights, duties and obligations under the Agreement to a newly formed
subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability company
and will be registered as an investment adviser under the Investment Advisers
Act of 1940 to which Berger will transfer all of its operating assets and
business. Berger LLC will accept and assume all such assigned interests, rights,
duties and obligations under the Agreement. Such assignment is intended to
become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
-------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
GREAT AMERICAN RESERVE INSURANCE COMPANY
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
<PAGE> 1
Exhibit 23(h)-9a
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
August 4, 1999
Ameritas Life Insurance Corp.
One Ameritas Way
Lincoln, Nebraska 68510
Attn: Norman M. Krivosha, Executive Vice President,
Secretary and Corporate General Counsel
Dear Mr. Krivosha:
Pursuant to Section 12.7 of the Participation Agreement, dated December 10, 1996
(the "Agreement"), among Ameritas Life Insurance Corp., on its own behalf and on
behalf of each segregated asset account set forth on Schedule A of the
Agreement, Berger Institutional Products Trust and Berger Associates, Inc.
("Berger"), Berger seeks your consent to an assignment. Berger desires to assign
its interests, rights, duties and obligations under the Agreement to a newly
formed subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability
company and will be registered as an investment adviser under the Investment
Advisers Act of 1940 to which Berger will transfer all of its operating assets
and business. Berger LLC will accept and assume all such assigned interests,
rights, duties and obligations under the Agreement. Such assignment is intended
to become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
AMERITAS LIFE INSURANCE CORP.
By:
-------------------------
Name:
-------------------------
Title:
-------------------------
<PAGE> 2
August 4, 1999
Berger Institutional Products Trust
210 University Boulevard, Suite 900
Denver, Colorado 80206
Attn: Jack Thompson
Dear Mr. Thompson:
Pursuant to Section 12.7 of the Participation Agreement, dated December 10, 1996
(the "Agreement"), among Ameritas Life Insurance Corp., on its own behalf and on
behalf of each segregated asset account set forth on Schedule A of the
Agreement, Berger Institutional Products Trust and Berger Associates, Inc.
("Berger"), Berger seeks your consent to an assignment. Berger desires to assign
its interests, rights, duties and obligations under the Agreement to a newly
formed subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability
company and will be registered as an investment adviser under the Investment
Advisers Act of 1940 to which Berger will transfer all of its operating assets
and business. Berger LLC will accept and assume all such assigned interests,
rights, duties and obligations under the Agreement. Such assignment is intended
to become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
BERGER INSTITUTIONAL PRODUCTS TRUST
By:
-------------------------
Name:
-------------------------
Title:
-------------------------
<PAGE> 1
EXHIBIT 23(h)-11a
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
August 20, 1999
Great-West Life & Annuity Insurance Company
8515 East Orchard Road
Englewood, Colorado 80111
Attn: Assistant Vice President, Savings Products
Dear Sir or Madam:
Pursuant to Section 12.8 of the Participation Agreement, dated May 1, 1997, as
amended May 1, 1999 (the "Agreement"), among Great-West Life & Annuity Insurance
Company, on its own behalf and on behalf of its Separate Account Variable
Annuity-1 Series Account, Berger Institutional Products Trust, Berger
Associates, Inc. ("Berger"), Berger Distributors, Inc. and Charles Schwab & Co.,
Inc., Berger seeks your consent to an assignment. Berger desires to assign its
interests, rights, duties and obligations under the Agreement to a newly formed
subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability company
and will be registered as an investment adviser under the Investment Advisers
Act of 1940 to which Berger will transfer all of its operating assets and
business. Berger LLC will accept and assume all such assigned interests, rights,
duties and obligations under the Agreement. Such assignment is intended to
become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
-------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
<PAGE> 2
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
August 20, 1999
Charles Schwab & Co., Inc.
SF 120 KNY-14-107
101 Montgomery Street
San Francisco, CA 94104
Attn: Ms. Tina Parrino
Dear Ms. Parrino:
Pursuant to Section 12.8 of the Participation Agreement, dated May 1, 1997, as
amended May 1, 1999 (the "Agreement"), among Great-West Life & Annuity Insurance
Company, on its own behalf and on behalf of its Separate Account Variable
Annuity-1 Series Account, Berger Institutional Products Trust, Berger
Associates, Inc. ("Berger"), Berger Distributors, Inc. and Charles Schwab & Co.,
Inc., Berger seeks your consent to an assignment. Berger desires to assign its
interests, rights, duties and obligations under the Agreement to a newly formed
subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability company
and will be registered as an investment adviser under the Investment Advisers
Act of 1940 to which Berger will transfer all of its operating assets and
business. Berger LLC will accept and assume all such assigned interests, rights,
duties and obligations under the Agreement. Such assignment is intended to
become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
-------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
CHARLES SCHWAB & CO., INC.
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
<PAGE> 3
August 20, 1999
Berger Institutional Products Trust
210 University Boulevard, Suite 900
Denver, Colorado 80206
Attn: Jack Thompson
Dear Mr. Thompson:
Pursuant to Section 12.8 of the Participation Agreement, dated May 1, 1997, as
amended May 1, 1999 (the "Agreement"), among Great-West Life & Annuity Insurance
Company, on its own behalf and on behalf of its Separate Account Variable
Annuity-1 Series Account, Berger Institutional Products Trust, Berger
Associates, Inc. ("Berger"), Berger Distributors, Inc. and Charles Schwab & Co.,
Inc., Berger seeks your consent to an assignment. Berger desires to assign its
interests, rights, duties and obligations under the Agreement to a newly formed
subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability company
and will be registered as an investment adviser under the Investment Advisers
Act of 1940 to which Berger will transfer all of its operating assets and
business. Berger LLC will accept and assume all such assigned interests, rights,
duties and obligations under the Agreement. Such assignment is intended to
become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
-------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
BERGER INSTITUTIONAL PRODUCTS TRUST
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
<PAGE> 4
August 20, 1999
Berger Distributors, Inc.
210 University Boulevard, Suite 900
Denver, Colorado 80206
Attn: David G. Mertens
Dear Mr. Mertens:
Pursuant to Section 12.8 of the Participation Agreement, dated May 1, 1997, as
amended May 1, 1999 (the "Agreement"), among Great-West Life & Annuity Insurance
Company, on its own behalf and on behalf of its Separate Account Variable
Annuity-1 Series Account, Berger Institutional Products Trust, Berger
Associates, Inc. ("Berger"), Berger Distributors, Inc. and Charles Schwab & Co.,
Inc., Berger seeks your consent to an assignment. Berger desires to assign its
interests, rights, duties and obligations under the Agreement to a newly formed
subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability company
and will be registered as an investment adviser under the Investment Advisers
Act of 1940 to which Berger will transfer all of its operating assets and
business. Berger LLC will accept and assume all such assigned interests, rights,
duties and obligations under the Agreement. Such assignment is intended to
become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
-------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
BERGER DISTRIBUTORS, INC.
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
<PAGE> 1
EXHIBIT 23(h)-12a
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
August 20, 1999
First Great-West Life & Annuity Insurance Company
8515 East Orchard Road
Englewood, Colorado 80111
Attn: Assistant Vice President, Savings Products
Dear Sir or Madam:
Pursuant to Section 12.8 the Participation Agreement, dated July 8, 1997, as
amended May 1, 1999 (the "Agreement"), among First Great-West Life & Annuity
Insurance Company, on its own behalf and on behalf of its Separate Account
Variable Annuity-1 Series Account, Berger Institutional Products Trust, Berger
Associates, Inc. ("Berger"), Berger Distributors, Inc. and Charles Schwab & Co.,
Inc., Berger seeks your consent to an assignment. Berger desires to assign its
interests, rights, duties and obligations under the Agreement to a newly formed
subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability company
and will be registered as an investment adviser under the Investment Advisers
Act of 1940 to which Berger will transfer all of its operating assets and
business. Berger LLC will accept and assume all such assigned interests, rights,
duties and obligations under the Agreement. Such assignment is intended to
become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
---------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
FIRST GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
By:
-----------------------------
Name:
-----------------------------
Title:
-----------------------------
<PAGE> 2
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
August 20, 1999
Charles Schwab & Co., Inc.
SF 120 KNY-14-107
101 Montgomery Street
San Francisco, CA 94104
Attn: Ms. Tina Parrino
Dear Ms. Parrino:
Pursuant to Section 12.8 of the Participation Agreement, dated July 8, 1997, as
amended May 1, 1999 (the "Agreement"), among First Great-West Life & Annuity
Insurance Company, on its own behalf and on behalf of its Separate Account
Variable Annuity-1 Series Account, Berger Institutional Products Trust, Berger
Associates, Inc. ("Berger"), Berger Distributors, Inc. and Charles Schwab & Co.,
Inc., Berger seeks your consent to an assignment. Berger desires to assign its
interests, rights, duties and obligations under the Agreement to a newly formed
subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability company
and will be registered as an investment adviser under the Investment Advisers
Act of 1940 to which Berger will transfer all of its operating assets and
business. Berger LLC will accept and assume all such assigned interests, rights,
duties and obligations under the Agreement. Such assignment is intended to
become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
-----------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
CHARLES SCHWAB & CO., INC.
By:
-----------------------------
Name:
-----------------------------
Title:
-----------------------------
<PAGE> 3
August 20, 1999
Berger Distributors, Inc.
210 University Boulevard, Suite 900
Denver, Colorado 80206
Attn: David G. Mertens
Dear Mr. Mertens:
Pursuant to Section 12.8 of the Participation Agreement, dated July 8, 1997, as
amended May 1, 1999 (the "Agreement"), among First Great-West Life & Annuity
Insurance Company, on its own behalf and on behalf of its Separate Account
Variable Annuity-1 Series Account, Berger Institutional Products Trust, Berger
Associates, Inc. ("Berger"), Berger Distributors, Inc. and Charles Schwab & Co.,
Inc., Berger seeks your consent to an assignment. Berger desires to assign its
interests, rights, duties and obligations under the Agreement to a newly formed
subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability company
and will be registered as an investment adviser under the Investment Advisers
Act of 1940 to which Berger will transfer all of its operating assets and
business. Berger LLC will accept and assume all such assigned interests, rights,
duties and obligations under the Agreement. Such assignment is intended to
become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
--------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
BERGER DISTRIBUTORS, INC.
By:
-----------------------------
Name:
-----------------------------
Title:
-----------------------------
<PAGE> 4
August 20, 1999
Berger Institutional Products Trust
210 University Boulevard, Suite 900
Denver, Colorado 80206
Attn: Jack Thompson
Dear Mr. Thompson:
Pursuant to Section 12.8 of the Participation Agreement, dated July 8, 1997, as
amended May 1, 1999 (the "Agreement"), among First Great-West Life & Annuity
Insurance Company, on its own behalf and on behalf of its Separate Account
Variable Annuity-1 Series Account, Berger Institutional Products Trust, Berger
Associates, Inc. ("Berger"), Berger Distributors, Inc. and Charles Schwab & Co.,
Inc., Berger seeks your consent to an assignment. Berger desires to assign its
interests, rights, duties and obligations under the Agreement to a newly formed
subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability company
and will be registered as an investment adviser under the Investment Advisers
Act of 1940 to which Berger will transfer all of its operating assets and
business. Berger LLC will accept and assume all such assigned interests, rights,
duties and obligations under the Agreement. Such assignment is intended to
become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
--------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
BERGER INSTITUTIONAL PRODUCTS TRUST
By:
-----------------------------
Name:
-----------------------------
Title:
-----------------------------
<PAGE> 1
Exhibit 23(h)-15a
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
August 5, 1999
Prudential Insurance Company of America
751 Broad Street
Newark, NJ 07102
Attn: Mary Cavanaugh, Esq.
Dear Ms. Cavanaugh:
Pursuant to Section 12.7 of the Participation Agreement, dated March 4, 1997
(the "Agreement"), among Prudential Insurance Company of America, on its own
behalf and on behalf of each segregated asset account set forth on Schedule A of
the Agreement, Berger Institutional Products Trust and Berger Associates, Inc.
("Berger"), Berger seeks your consent to an assignment. Berger desires to assign
its interests, rights, duties and obligations under the Agreement to a newly
formed subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability
company and will be registered as an investment adviser under the Investment
Advisers Act of 1940 to which Berger will transfer all of its operating assets
and business. Berger LLC will accept and assume all such assigned interests,
rights, duties and obligations under the Agreement. Such assignment is intended
to become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
--------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
PRUDENTIAL INSURANCE COMPANY OF AMERICA
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
<PAGE> 2
August 5, 1999
Berger Institutional Products Trust
210 University Boulevard, Suite 900
Denver, Colorado 80206
Attn: Jack Thompson
Dear Mr. Thompson:
Pursuant to Section 12.7 of the Participation Agreement, dated March 4, 1997
(the "Agreement"), among Prudential Insurance Company of America, on its own
behalf and on behalf of each segregated asset account set forth on Schedule A of
the Agreement, Berger Institutional Products Trust and Berger Associates, Inc.
("Berger"), Berger seeks your consent to an assignment. Berger desires to assign
its interests, rights, duties and obligations under the Agreement to a newly
formed subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability
company and will be registered as an investment adviser under the Investment
Advisers Act of 1940 to which Berger will transfer all of its operating assets
and business. Berger LLC will accept and assume all such assigned interests,
rights, duties and obligations under the Agreement. Such assignment is intended
to become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
--------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
BERGER INSTITUTIONAL PRODUCTS TRUST
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
<PAGE> 1
Exhibit 23(h)-17a
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
August 4, 1999
Canada Life Insurance Company of America
6201 Powers Ferry Road
Atlanta, Georgia 30339
Attn: David Hopkins, Chief Counsel
Dear Mr. Hopkins:
Pursuant to Section 12.7 of the Participation Agreement, dated May 1, 1998 (the
"Agreement"), among Canada Life Insurance Company of America, on its own behalf
and on behalf of each segregated asset account set forth on Schedule A of the
Agreement, Berger Institutional Products Trust and Berger Associates, Inc.
("Berger"), Berger seeks your consent to an assignment. Berger desires to assign
its interests, rights, duties and obligations under the Agreement to a newly
formed subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability
company and will be registered as an investment adviser under the Investment
Advisers Act of 1940 to which Berger will transfer all of its operating assets
and business. Berger LLC will accept and assume all such assigned interests,
rights, duties and obligations under the Agreement. Such assignment is intended
to become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
--------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
CANADA LIFE INSURANCE COMPANY OF AMERICA
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
<PAGE> 2
August 5, 1999
Berger Institutional Products Trust
210 University Boulevard, Suite 900
Denver, Colorado 80206
Attn: Jack Thompson
Dear Mr. Thompson:
Pursuant to Section 12.7 of the Participation Agreement, dated May 1, 1998 (the
"Agreement"), among Canada Life Insurance Company of America, on its own behalf
and on behalf of each segregated asset account set forth on Schedule A of the
Agreement, Berger Institutional Products Trust and Berger Associates, Inc.
("Berger"), Berger seeks your consent to an assignment. Berger desires to assign
its interests, rights, duties and obligations under the Agreement to a newly
formed subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability
company and will be registered as an investment adviser under the Investment
Advisers Act of 1940 to which Berger will transfer all of its operating assets
and business. Berger LLC will accept and assume all such assigned interests,
rights, duties and obligations under the Agreement. Such assignment is intended
to become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
--------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
BERGER INSTITUTIONAL PRODUCTS TRUST
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
<PAGE> 1
Exhibit 23(h)-18a
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
August 5, 1999
Canada Life Insurance Company of New York
6201 Powers Ferry Road
Atlanta, Georgia 30339
Attn: David Hopkins, Chief Counsel
Dear Mr. Hopkins:
Pursuant to Section 12.7 of the Participation Agreement, dated May 1, 1998 (the
"Agreement"), among Canada Life Insurance Company of New York, on its own behalf
and on behalf of each segregated asset account set forth on Schedule A of the
Agreement, Berger Institutional Products Trust and Berger Associates, Inc.
("Berger"), Berger seeks your consent to an assignment. Berger desires to assign
its interests, rights, duties and obligations under the Agreement to a newly
formed subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability
company and will be registered as an investment adviser under the Investment
Advisers Act of 1940 to which Berger will transfer all of its operating assets
and business. Berger LLC will accept and assume all such assigned interests,
rights, duties and obligations under the Agreement. Such assignment is intended
to become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
--------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
CANADA LIFE INSURANCE COMPANY OF NEW YORK
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
<PAGE> 2
August 5, 1999
Berger Institutional Products Trust
210 University Boulevard, Suite 900
Denver, Colorado 80206
Attn: Jack Thompson
Dear Mr. Thompson:
Pursuant to Section 12.7 of the Participation Agreement, dated May 1, 1998 (the
"Agreement"), among Canada Life Insurance Company of New York, on its own behalf
and on behalf of each segregated asset account set forth on Schedule A of the
Agreement, Berger Institutional Products Trust and Berger Associates, Inc.
("Berger"), Berger seeks your consent to an assignment. Berger desires to assign
its interests, rights, duties and obligations under the Agreement to a newly
formed subsidiary, Berger LLC. Berger LLC will be a Nevada limited liability
company and will be registered as an investment adviser under the Investment
Advisers Act of 1940 to which Berger will transfer all of its operating assets
and business. Berger LLC will accept and assume all such assigned interests,
rights, duties and obligations under the Agreement. Such assignment is intended
to become effective September 30, 1999.
Please indicate your consent to such assignment by signing in the space
indicated below, and returning the originally executed consent in the enclosed
self-addressed, postage prepaid envelope.
Sincerely,
Berger Associates, Inc.
By:
--------------------------------
Brian S. Ferrie
Vice President - Compliance
ACCEPTED AND AGREED TO
THIS _____ DAY OF __________, 1999
BERGER INSTITUTIONAL PRODUCTS TRUST
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
<PAGE> 1
EXHIBIT 23(h)-22
PARTICIPATION AGREEMENT
Among
BERGER INSTITUTIONAL PRODUCTS TRUST
BBOI WORLDWIDE LLC
and
FIDELITY SECURITY LIFE INSURANCE COMPANY
THIS AGREEMENT, made and entered into this 13th day of April, 1999 by
and among FIDELITY SECURITY LIFE INSURANCE COMPANY, (hereinafter the "Insurance
Company"), a Missouri corporation, on its own behalf and on behalf of each
segregated asset account of the Insurance Company set forth on Schedule A hereto
as may be amended from time to time (each such account hereinafter referred to
as the "Account"), BERGER INSTITUTIONAL PRODUCTS TRUST, a Delaware business
trust (the "Trust") and BBOI WORLDWIDE LLC, a Delaware limited liability company
("BBOI Worldwide").
WHEREAS, the Trust engages in business as an open-end management
investment company and is available to act as the investment vehicle for
variable annuity and life insurance contracts to be offered by separate accounts
of insurance companies which have entered into participation agreements
substantially identical to this Agreement ("Participating Insurance Companies")
and for qualified retirement and pension plans ("Qualified Plans"); and
WHEREAS, the beneficial interest in the Trust is divided into several
series of shares, each designated a "Fund" and representing the interest in a
particular managed portfolio of securities and other assets; and
WHEREAS, the Trust has obtained an order from the Securities and
Exchange Commission (the "Commission"), dated April 24, 1996 (File No.
812-9852), granting Participating Insurance Companies
1
<PAGE> 2
and their separate accounts exemptions from the provisions of Sections 9(a),
13(a), 15(a), and 15(b) of the Investment Company Act of 1940, as amended, (the
"1940 Act") and Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, to the extent
necessary to permit shares of the Trust to be sold to and held by Qualified
Plans and by variable annuity and variable life insurance separate accounts of
life insurance companies that may or may not be affiliated with one another (the
"Mixed and Shared Funding Exemptive Order"); and
WHEREAS, the Trust is registered as an open-end management investment
company under the 1940 Act and the offering of its shares is registered under
the Securities Act of 1933, as amended (hereinafter the "1933 Act"); and
WHEREAS, BBOI Worldwide is duly registered as an investment adviser
under the Investment Advisers Act of 1940 and any applicable state securities
law; and
WHEREAS, the Insurance Company has registered under the 1933 Act, or
will register under the 1933 Act, certain variable annuity or variable life
insurance contracts identified by the form number(s) listed on Schedule B to
this Agreement, as amended from time to time hereafter by mutual written
agreement of all the parties hereto (the "Contracts"); and
WHEREAS, each Account is a duly organized, validly existing segregated
asset account, established by resolution of the board of directors of the
Insurance Company on the date shown for that Account on Schedule A hereto, to
set aside and invest assets attributable to the Contracts; and
WHEREAS, the Insurance Company has registered or will register each
Account as a unit investment trust under the 1940 Act; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Insurance Company intends to purchase shares in the Funds at
net asset value on behalf of each Account to fund the Contracts;
NOW, THEREFORE, in consideration of their mutual promises, the
Insurance Company, the Trust and BBOI Worldwide agree as follows:
2
<PAGE> 3
ARTICLE I. SALE OF TRUST SHARES
1.1. The Trust agrees to sell to the Insurance Company those shares of
the Trust which each Account orders, executing such orders on a daily basis at
the net asset value next computed after receipt by the Trust or its designee of
the order for the shares of the Trust. For purposes of this Section 1.1, the
Insurance Company shall be the designee of the Trust for receipt of such orders
from the Accounts and receipt by such designee shall constitute receipt by the
Trust; provided that the Trust receives notice of such order by 8:00 a.m.,
Central Time, on the next following Business Day. In this Agreement, "Business
Day" shall mean any day on which the New York Stock Exchange is open for trading
and on which the Trust calculates its net asset value pursuant to the rules of
the Commission.
1.2. The Trust agrees to make its shares available for purchase at the
applicable net asset value per share by the Insurance Company and its Accounts
on those days on which the Trust calculates its Funds' net asset values pursuant
to rules of the Commission and the Trust shall use reasonable efforts to
calculate its Funds' net asset values on each day on which the New York Stock
Exchange is open for trading. Notwithstanding the foregoing, the trustees of the
Trust may refuse to sell shares of any Fund to any person, or suspend or
terminate the offering of shares of any Fund if such action is required by law
or by regulatory authorities having jurisdiction or is, in the sole discretion
of the trustees of the Trust acting in good faith and in light of their
fiduciary duties under federal and any applicable state laws, necessary in the
best interests of the shareholders of that Fund.
1.3. The Trust agrees that shares of the Trust will be sold only to
Accounts of Participating Insurance Companies and to Qualified Plans, all in
accordance with the requirements of Section 817(h) of the Internal Revenue Code
of 1986, as amended (the "Code") and Treasury Regulation 1.817-5. No shares of
any Fund will be sold to the general public.
1.4. The Trust will not sell its shares to any insurance company or
separate account unless an agreement containing provisions substantially the
same as Sections 2.4, 3.4, 3.5, and Sections 7.1 - 7.7 of this Agreement is in
effect to govern such sales.
3
<PAGE> 4
1.5. The Trust agrees to redeem, on the Insurance Company's request,
any full or fractional shares of the Trust held by the Account, executing such
requests on a daily basis at the net asset value next computed after receipt by
the Trust or its designee of the request for redemption. However, if one or more
Funds has determined to settle redemption transactions for all of its
shareholders on a delayed basis (more than one business day, but in no event
more than three Business Days, after the date on which the redemption order is
received, unless otherwise permitted by an order of the Commission under Section
22(e) of the 1940 Act), the Trust shall be permitted to delay sending redemption
proceeds to the Insurance Company by the same number of days that the Trust is
delaying sending redemption proceeds to the other shareholders of the Fund. For
purposes of this Section 1.5, the Insurance Company shall be the designee of the
Trust for receipt of requests for redemption from each Account and receipt by
that designee shall constitute receipt by the Trust; provided that the Trust
receives notice of the request for redemption by 8:00 a.m., Central Time, on the
next following Business Day.
1.6. The Insurance Company agrees to purchase and redeem the shares of
each Fund offered by the then-current prospectus of the Trust in accordance with
the provisions of that prospectus.
1.7. The Insurance Company shall pay for Trust shares by 2:00 p.m.,
Central Time, on the next Business Day after an order to purchase Trust shares
is made in accordance with the provisions of Section 1.1 hereof. Payment shall
be in federal funds transmitted by wire. For the purpose of Sections 2.9 and
2.10, upon receipt by the Trust of the federal funds so wired, such funds shall
cease to be the responsibility of the Insurance Company and shall become the
responsibility of the Trust. Payment of net redemption proceeds (aggregate
redemptions of a Fund's shares by an Account minus aggregate purchases of that
Fund's shares by that Account) of less than $1 million for a given Business Day
will be made by wiring federal funds to the Insurance Company on the next
Business Day after receipt of the redemption request. Payment of net redemption
proceeds of $1 million or more will be by wiring federal funds within three
Business Days after receipt of the redemption request. However, payment may be
postponed under unusual circumstances, such as when normal trading is not taking
place on the New York Stock Exchange, an emergency
4
<PAGE> 5
as defined by the Securities and Exchange Commission exists, or as permitted by
the Securities and Exchange Commission.
1.8. Issuance and transfer of the Trust's shares will be by book entry
only. Stock certificates will not be issued to the Insurance Company or any
Account. Shares ordered from the Trust will be recorded in an appropriate title
for each Account or the appropriate subaccount of each Account.
1.9. The Trust shall furnish same day notice (by wire or telephone,
followed by written confirmation) to the Insurance Company of any income,
dividends or capital gain distributions payable on the Funds' shares. The
Insurance Company hereby elects to receive all income dividends and capital gain
distributions payable on a Fund's shares in additional shares of that Fund. The
Insurance Company reserves the right to revoke this election and to receive all
such income dividends and capital gain distributions in cash. The Trust shall
notify the Insurance Company of the number of shares issued as payment of
dividends and distributions.
1.10. The Trust shall make the net asset value per share for each Fund
available to the Insurance Company on a daily basis as soon as reasonably
practical after the net asset value per share is calculated and shall use its
best efforts to make those per-share net asset values available by 6:00 p.m.,
Central Time. If the Trust provides the Insurance Company with materially
incorrect share net asset value information through no fault of the Insurance
Company, the Insurance Company on behalf of the Account, shall be entitled to an
adjustment to the number of shares purchased or redeemed to reflect the correct
share net asset value. Any material error in the calculation of net asset value
per share, dividend or capital gain information shall be reported promptly upon
discovery to the Insurance Company. Furthermore, BBOI Worldwide shall be liable
for the reasonable administrative costs incurred by the Insurance Company in
relation to the correction of any material error. Administrative costs shall
include allocation of staff time, costs of outside service providers, printing
and postage.
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ARTICLE II. REPRESENTATIONS, WARRANTIES AND AGREEMENTS
2.1. The Insurance Company represents, warrants and agrees that the
offerings of the Contracts are, or will be, registered under the 1933 Act; that
the Contracts will be issued and sold in compliance in all material respects
with all applicable federal and state laws and that the sale of the Contracts
shall comply in all material respects with applicable state insurance
suitability requirements. The Insurance Company further represents that it is an
insurance company duly organized and in good standing under applicable law and
that it has legally and validly established the Account prior to any issuance or
sale thereof as a segregated asset account under the laws of the State of
Missouri and has registered, or warrants and agrees that prior to any issuance
or sale of the Contracts it will register, the Account as a unit investment
trust in accordance with the provisions of the 1940 Act to serve as a segregated
investment account for the Contracts.
2.2. The Trust warrants and agrees that Trust shares sold pursuant to
this Agreement shall be registered under the 1933 Act, duly authorized for
issuance and sale in compliance with the laws of the State of Delaware and all
applicable federal securities laws and that the Trust is and shall remain
registered under the 1940 Act. The Trust warrants and agrees that it shall amend
the registration statement for its shares under the 1933 Act and the 1940 Act
from time to time as required in order to effect the continuous offering of its
shares. The Trust shall register and qualify the shares for sale in accordance
with the laws of the various states only if and to the extent deemed advisable
by the Trust or BBOI Worldwide.
2.3. The Trust represents that it is currently qualified as a Regulated
Investment Company under Subchapter M of the Internal Revenue Code of 1986, as
amended, (the "Code") and warrants and agrees that it will maintain its
qualification (under Subchapter M or any successor or similar provision) and
that it will notify the Insurance Company immediately upon having a reasonable
basis for believing that it has ceased to so qualify or that it might not so
qualify in the future.
2.4. The Insurance Company represents that the Contracts are currently
treated as annuity or life insurance contracts under applicable provisions of
the Code and warrants and agrees that it will make every effort to maintain such
treatment and that it will notify the Trust and BBOI Worldwide immediately upon
having a
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reasonable basis for believing that the Contracts have ceased to be so treated
or that they might not be so treated in the future.
2.5. The Trust may elect to make payments to finance distribution
expenses pursuant to Rule 12b-1 under the 1940 Act. To the extent that it
decides to finance distribution expenses pursuant to Rule 12b-1, the Trust
undertakes to have a board of trustees, a majority of whom are not interested
persons of the Trust, formulate and approve any plan under Rule 12b-1 to finance
distribution expenses.
2.6. The Trust makes no representation warranties as to whether any
aspect of its operations (including, but not limited to, fees and expenses and
investment policies) complies or will comply with the insurance laws or
regulations of the various states.
2.7. The Trust represents that it is lawfully organized and validly
existing under the laws of the State of Delaware and represents, warrants and
agrees that it does and will comply in all material respects with the 1940 Act.
2.8. BBOI Worldwide represents that it is and warrants that it shall
remain duly registered as an investment adviser under all applicable federal and
state securities laws and agrees that it shall perform its obligations for the
Trust in compliance in all material respects with the laws of the State of
Colorado and any applicable state and federal securities laws.
2.9. The Trust and BBOI Worldwide represent and warrant that all of
their officers, employees, investment advisers, investment sub-advisers, and
other individuals or entities described in Rule 17g-1 under the 1940 Act dealing
with the money and/or securities of the Trust are, and shall continue to be at
all times, covered by a blanket fidelity bond or similar coverage for the
benefit of the Trust in an amount not less than the minimum coverage required
currently by Rule 17g-1 under the 1940 Act or related provisions as may be
promulgated from time to time. That fidelity bond shall include coverage for
larceny and embezzlement and shall be issued by a reputable bonding company.
2.10. The Insurance Company represents and warrants that all of its
officers, employees, investment advisers, and other individuals or entities
described in Rule 17g-1 under the 1940 Act
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shall to the extent required by Rule 17g-1 be at all times covered by a blanket
fidelity bond or similar coverage for the benefit of the Trust.
ARTICLE III. DISCLOSURE DOCUMENTS AND VOTING
3.1. At least annually, the Trust or its designee shall provide the
Insurance Company, free of charge, with as many copies of the current prospectus
for shares of the Funds as the Insurance Company may reasonably request for
distribution to existing Contract owners whose Contracts are funded by such
shares. The Trust or its designee shall provide the Insurance Company, at the
Insurance Company's expense, with as many more copies of the current prospectus
for the shares as the Insurance Company may reasonably request for distribution
to prospective purchasers of Contracts. If requested by the Insurance Company in
lieu thereof, the Trust or its designee shall provide such documentation
(including a camera ready copy of the prospectus as set in type or, at the
request of the Insurance Company, as a diskette in the form sent to the
financial printer) and other assistance as is reasonably necessary in order for
the parties hereto once a year (or more frequently if the prospectus for the
shares is supplemented or amended) to have the prospectus for the Contracts and
the prospectus for the Trust shares and any other fund shares offered under the
Contracts printed together in one document. The expenses of such printing will
be apportioned between (a) the Insurance Company, (b) other funds, and (c) the
Trust in proportion to the number of pages of the Contract, other fund shares'
prospectuses and the Trust shares prospectus, taking account of other relevant
factors affecting the expense of printing, such as covers, columns, graphs and
charts; the Trust to bear the cost of printing the shares' prospectus portion of
such document for distribution only to owners of existing Contracts funded by
the Trust shares and the Insurance Company to bear the expense of printing the
portion of such documents relating to the Account; provided, however, the
Insurance Company shall bear all printing expenses of such combined documents
where used for distribution to prospective purchasers or to owners of existing
Contracts not funded by the shares.
3.2. The Trust's prospectus shall state that the Statement of
Additional Information for the Trust (the "SAI") is available from the Trust,
and BBOI Worldwide (or the Trust), at its expense,
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shall print and provide the SAI free of charge to the Insurance Company and to
any owner of a Contract or prospective owner who requests the SAI.
3.3. The Trust, at its expense, shall provide the Insurance Company
with copies of its proxy material, reports to shareholders and other
communications to shareholders in such quantity as the Insurance Company shall
reasonably require for distributing to Contract owners.
3.4. If and to the extent required by law, the Insurance Company shall:
(i) solicit voting instructions from Contract owners;
(ii) vote the Trust shares in accordance with instructions
received from Contract owners; and
(iii) vote Trust shares for which no instructions have been
received in the same proportion as Trust shares of
that Fund for which instructions have been received;
so long as and to the extent that the Commission continues to interpret the 1940
Act to require pass-through voting privileges for variable contract owners. The
Insurance Company reserves the right to vote Trust shares held in any segregated
asset account in its own right, to the extent permitted by law. Participating
Insurance Companies shall be responsible for assuring that each of their
separate accounts participating in the Trust calculates voting privileges in a
manner consistent with the standards set forth on Schedule C attached hereto and
incorporated herein by this reference, which standards will also be provided to
the other Participating Insurance Companies. The Insurance Company shall fulfill
its obligation under, and abide by the terms and conditions of, the Mixed and
Shared Funding Exemptive Order.
3.5. The Trust will comply with all provisions of the 1940 Act
requiring voting by shareholders, and in particular the Trust will either
provide for annual meetings (except insofar as the Commission may interpret
Section 16 of the 1940 Act not to require such meetings) or, as the Trust
currently intends, comply with Section 16(c) of the 1940 Act (although the Trust
is not one of the trusts described in Section 16(c) of that Act) as well as with
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Sections 16(a) and, if and when applicable, 16(b). Further, the Trust will act
in accordance with the Commission's interpretation of the requirements of
Section 16(a) with respect to periodic elections of trustees and with whatever
rules the Commission may promulgate with respect thereto.
ARTICLE IV. SALES MATERIAL AND INFORMATION
4.1. The Insurance Company shall furnish, or shall cause to be
furnished, to the Trust or its designee, each piece of sales literature or other
promotional material in which the Trust, a sub-adviser of one of the Funds, or
BBOI Worldwide is named, at least fifteen calendar days prior to its use. No
such material shall be used if the Trust or its designee objects to such use
within ten calendar days after receipt of such material.
4.2. The Insurance Company shall not give any information or make any
representations or statements on behalf of the Trust or concerning the Trust in
connection with the sale of the Contracts other than the information or
representations contained in the Trust's registration statement, prospectus or
SAI, as that registration statement, prospectus or SAI may be amended or
supplemented from time to time, or in reports or proxy statements for the Trust,
or in sales literature or other promotional material approved by the Trust or
its designee or by BBOI Worldwide or its designee, except with the permission of
the Trust or BBOI Worldwide or their designees.
4.3. The Trust, BBOI Worldwide, or its designee shall furnish, or shall
cause to be furnished, to the Insurance Company or its designee, each piece of
sales literature or other promotional material in which the Insurance Company or
the Account is named at least fifteen calendar days prior to its use. No such
material shall be used if the Insurance Company or its designee objects to such
use within ten calendar days after receipt of that material.
4.4. The Trust and BBOI Worldwide, or their designees, shall not give
any information or make any representations on behalf of the Insurance Company
or concerning the Insurance Company, any Account, or the Contracts other than
the information or representations contained in a registration statement,
prospectus or statement of additional information for the Contracts, as that
registration statement, prospectus or statement of additional
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information may be amended or supplemented from time to time, or in published
reports for any Account which are in the public domain or approved by the
Insurance Company for distribution to Contract owners, or in sales literature or
other promotional material approved by the Insurance Company or its designee,
except with the permission of the Insurance Company.
4.5. The Trust will provide to the Insurance Company at least one
complete copy of each registration statement, prospectus, statement of
additional information, report, proxy statement, piece of sales literature or
other promotional material, application for exemption, request for no-action
letter, and any amendment to any of the above, that relate to the Trust or its
shares, contemporaneously with the filing of the document with the Commission,
the National Association of Securities Dealers, Inc. ("NASD"), or other
regulatory authorities.
4.6. The Insurance Company will provide to the Trust at least one
complete copy of each registration statement, prospectus, statement of
additional information, report, solicitation for voting instructions, piece of
sales literature and other promotional material, application for exemption,
request for no-action letter, and any amendment to any of the above, that
relates to the Contracts or the Account, contemporaneously with the filing of
the document with the Commission, the NASD, or other regulatory authorities.
4.7. For purposes of this Article IV, the phrase "sales literature or
other promotional material" includes, but is not limited to, advertisements,
newspaper, magazine, or other periodical, radio, television, telephone or tape
recording, videotape display, signs or billboards, motion pictures, or other
public media, sales literature (i.e., any written communication distributed or
made generally available to customers or the public, including brochures,
circulars, research reports, market letters, form letters, shareholder
newsletters, seminar texts, reprints or excerpts of any other advertisement,
sales literature, or published article), educational or training materials or
other communications distributed or made generally available to some or all
agents or employees, and registration statements, prospectuses, statements of
additional information, shareholder reports, and proxy materials.
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4.8. At the request of any party to this Agreement, each other party
will make available to the other party's independent auditors and/or
representative of the appropriate regulatory agencies, all records, data and
access to operating procedures that may be reasonably requested.
ARTICLE V. FEES AND EXPENSES
5.1. The Trust and BBOI Worldwide shall pay no fee or other
compensation to the Insurance Company under this agreement, except as set forth
in Section 5.4 and except that if the Trust or any Fund adopts and implements a
plan pursuant to Rule 12b-1 to finance distribution expenses, BBOI Worldwide or
the Trust may make payments to the Insurance Company in amounts consistent with
that 12b-1 plan, subject to review by the trustees of the Trust.
5.2. All expenses incident to performance by the Trust under this
Agreement shall be paid by the Trust. The Trust shall see to it that any
offering of its shares is registered and that all of its shares are authorized
for issuance in accordance with applicable federal law and, if and to the extent
deemed advisable by the Trust or BBOI Worldwide, in accordance with applicable
state laws prior to their sale. The Trust shall bear the cost of registration
and qualification of the Trust's shares, preparation and filing of the Trust's
prospectus and registration statement, proxy materials and reports, setting the
prospectus in type, setting in type and printing the proxy materials and reports
to shareholders, the preparation of all statements and notices required by any
federal or state law, and all taxes on the issuance or transfer of the Trust's
shares.
5.3. The Insurance Company shall bear the expenses of printing and
distributing to Contract owners the Contract prospectuses and of distributing to
Contract owners the Trust's prospectus, proxy materials and reports.
5.4. The Insurance Company bears the responsibility and correlative
expense for administrative and support services for Contract owners. BBOI
Worldwide recognizes the Insurance Company as the sole shareholder of shares of
the Trust issued under this Agreement. From time to time, BBOI Worldwide may pay
amounts from its past profits to the Insurance Company for providing other
services that relate to the Trust. In consideration of the savings resulting
from such arrangement, and to compensate the
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Insurance Company for its costs, BBOI Worldwide agrees to pay to the Insurance
Company if on any day during the six-month period from June 1, 1999 through
November 30, 1999 the aggregate amount invested by the Account in the Trust
under this Agreement exceeds $1,000,000. This amount shall be payable at the end
of such six-month period and shall be equal to 20 basis points (0.20%) per annum
on the average aggregate assets invested during such period. Subsequent to such
time, BBOI Worldwide agrees to pay to the Insurance Company quarterly an amount
equal to 20 basis points (0.20%) per annum of the prior quarter's average
aggregate amount invested by the Account in the Trust under this Agreement, but
such payments will be made only when the average aggregate amount invested
during the prior quarter exceeds $1,000,000, and shall be made for as long as
the Account invests in the Trust. The parties agree that such payments are for
administrative services and investor support services, and do not constitute
payment for investment advisory, distribution or other services. Payment of such
amounts by BBOI Worldwide shall not increase the fees paid by the Trust or its
shareholders. The obligation to pay the amounts provided for in this Section 5.4
may be assigned by BBOI Worldwide in its discretion to Berger Associates, Inc.,
or other entity acceptable to the Insurance Company.
ARTICLE VI. DIVERSIFICATION
6.1. The Trust will comply with Section 817(h) of the Code and Treasury
Regulation 1.817-5 relating to the diversification requirements for variable
annuity, endowment, modified endowment or life insurance contracts and any
amendments or other modifications to that Section or Regulation at all times
necessary to satisfy those requirements. The Trust will notify the Insurance
Company immediately upon having a reasonable basis for believing any Fund has
ceased to comply or might not so comply and will immediately take all reasonable
steps to adequately diversify the Fund to achieve compliance.
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ARTICLE VII. POTENTIAL CONFLICTS
7.1. The trustees of the Trust will monitor the Trust for the existence
of any material irreconcilable conflict between the interests of the variable
Contract owners of all separate accounts investing in the Trust and the
participants of all Qualified Plans investing in the Trust. An irreconcilable
material conflict may arise for a variety of reasons, including: (a) an action
by any state insurance regulatory authority; (b) a change in applicable federal
or state insurance, tax, or securities laws or regulations, or a public ruling,
private letter ruling, no-action or interpretive letter, or any similar action
by insurance, tax, or securities regulatory authorities; (c) an administrative
or judicial decision in any relevant proceeding; (d) the manner in which the
investments of any Fund are being managed; (e) a difference in voting
instructions given by variable annuity contract and variable life insurance
contract owners; or (f) a decision by a Participating Insurance Company to
disregard the voting instructions of variable contract owners. The trustees of
the Trust shall promptly inform the Insurance Company if they determine that an
irreconcilable material conflict exists and the implications thereof. The
trustees of the Trust shall have sole authority to determine whether an
irreconcilable material conflict exists and their determination shall be binding
upon the Insurance Company.
7.2. The Insurance Company and BBOI Worldwide each will report promptly
any potential or existing conflicts of which it is aware to the trustees of the
Trust. The Insurance Company and BBOI Worldwide each will assist the trustees of
the Trust in carrying out their responsibilities under the Mixed and Shared
Funding Exemptive Order, by providing the trustees of the Trust with all
information reasonably necessary for them to consider any issues raised. This
includes, but is not limited to, an obligation by the Insurance Company to
inform the trustees of the Trust whenever Contract owner voting instructions are
to be disregarded. These responsibilities shall be carried out by the Insurance
Company with a view only to the interests of the Contract owners and by BBOI
Worldwide with a view only to the interests of Contract holders and Qualified
Plan participants.
7.3. If it is determined by a majority of the trustees of the Trust, or
a majority of the trustees who are not interested persons of the Trust, any of
its Funds, or BBOI Worldwide (the
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"Independent Trustees"), that a material irreconcilable conflict exists, the
Insurance Company and/or other Participating Insurance Companies or Qualified
Plans that have executed participation agreements shall, at their expense and to
the extent reasonably practicable (as determined by a majority of the
Independent Trustees), take whatever steps are necessary to remedy or eliminate
the irreconcilable material conflict, up to and including: (1) withdrawing the
assets allocable to some or all of the separate accounts from the Trust or any
Fund and reinvesting those assets in a different investment medium, including
(but not limited to) another Fund of the Trust, or submitting the question
whether such segregation should be implemented to a vote of all affected
variable contract owners and, as appropriate, segregating the assets of any
appropriate group (e.g., annuity contract owners, life insurance contract
owners, or variable contract owners of one or more Participating Insurance
Companies) that votes in favor of such segregation, or offering to the affected
variable contract owners the option of making such a change; and (2)
establishing a new registered management investment company or managed separate
account and obtaining any necessary approvals or orders of the Commission in
connection therewith.
7.4. If a material irreconcilable conflict arises because of a decision
by the Insurance Company to disregard Contract owner voting instructions and
that decision represents a minority position or would preclude a majority vote,
the Insurance Company may be required, at the Trust's election, to withdraw the
affected Account's investment in the Trust and terminate this Agreement with
respect to that Account; provided, however, that such withdrawal and termination
shall be limited to the extent required by the foregoing material irreconcilable
conflict as determined by a majority of the Independent Trustees. Any such
withdrawal and termination must take place within six (6) months after the Trust
gives written notice that this provision is being implemented, and, until the
end of that six month period, the Trust shall continue to accept and implement
orders by the Insurance Company for the purchase (and redemption) of shares of
the Trust.
7.5. If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Insurance Company
conflicts with the majority of other state regulators, then the Insurance
Company will withdraw the affected Account's investment in the Trust and
terminate this Agreement with respect to that Account within six months after
the trustees
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of the Trust inform the Insurance Company in writing that they have determined
that the state insurance regulator's decision has created an irreconcilable
material conflict; provided, however, that such withdrawal and termination shall
be limited to the extent required by the foregoing material irreconcilable
conflict as determined by a majority of the Independent Trustees. Until the end
of the foregoing six month period, the Trust shall continue to accept and
implement orders by the Insurance Company for the purchase (and redemption) of
shares of the Trust.
7.6. For purposes of Sections 7.3 through 7.6 of this Agreement, a
majority of the Independent Trustees shall determine whether any proposed action
adequately remedies any irreconcilable material conflict, but in no event will
the Trust be required to establish a new funding medium for the Contracts. The
Insurance Company shall not be required by Section 7.3 to establish a new
funding medium for the Contracts if an offer to do so has been declined by vote
of a majority of Contract owners materially adversely affected by the
irreconcilable material conflict. In the event that the trustees of the Trust
determine that any proposed action does not adequately remedy any irreconcilable
material conflict, then the Insurance Company will withdraw the Account's
investment in the Trust and terminate this Agreement within six (6) months after
the trustees of the Trust inform the Insurance Company in writing of the
foregoing determination, provided, however, that the withdrawal and termination
shall be limited to the extent required by the material irreconcilable conflict,
as determined by a majority of the Independent Trustees.
7.7. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended,
or Rule 6e-3 is adopted, to provide exemptive relief from any provision of the
Act or the rules promulgated thereunder with respect to mixed or shared funding
(as defined in the Mixed and Shared Funding Exemptive Order) on terms and
conditions materially different from those contained in the Mixed and Shared
Funding Exemptive Order, then (a) the Trust and/or the Participating Insurance
Companies, as appropriate, shall take such steps as may be necessary to comply
with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3, as adopted, to the
extent those rules are applicable; and (b) Sections 3.4, 3.5, 7.1, 7.2, 7.3,
7.4, and 7.5 of this Agreement shall continue in effect only to the extent that
terms and conditions substantially identical to those Sections are contained in
the Rule(s) as so amended or adopted.
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ARTICLE VIII. INDEMNIFICATION
8.1. INDEMNIFICATION BY THE INSURANCE COMPANY
8.1(a). The Insurance Company agrees to indemnify and hold harmless the
Trust and each trustee, officer, employee or agent of the Trust, and each
person, if any, who controls the Trust within the meaning of Section 15 of the
1933 Act (collectively, the "Indemnified Parties" for purposes of this Section
8.1) against any and all losses, claims, damages, liabilities (including amounts
paid in settlement with the written consent of the Insurance Company) or
litigation (including legal and other expenses), to which the Indemnified
Parties may become subject under any statute, regulation, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements are related to the sale, acquisition,
or redemption of the Trust's shares or the Contracts and:
(i) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in
the registration statement or prospectus for the Contracts or
contained in the Contracts or sales literature for the
Contracts (or any amendment or supplement to any of the
foregoing), or arise out of or are based upon the omission or
the alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements
therein not misleading, provided that this agreement to
indemnify shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or omission
was made in reliance upon and in conformity with information
furnished in writing to the Insurance Company by or on behalf
of the Trust for use in the registration statement or
prospectus for the Contracts or in the Contracts or sales
literature (or any amendment or supplement) or otherwise for
use in connection with the sale of the Contracts or shares of
the Trust;
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(ii) arise out of or as a result of statements or
representations (other than statements or representations
contained in the registration statement, prospectus or sales
literature of the Trust not supplied by the Insurance Company,
or persons under its control) or wrongful conduct of the
Insurance Company or persons under its control, with respect
to the sale or distribution of the Contracts or Trust Shares;
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, or sales literature of the Trust or any
amendment thereof or supplement thereto or the omission or
alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein
not misleading if such a statement or omission was made in
reliance upon information furnished in writing to the Trust by
or on behalf of the Insurance Company;
(iv) arise as a result of any failure by the Insurance Company
to provide the services and furnish the materials under the
terms of this Agreement; or
(v) arise out of or result from any material breach of any
representation, warranty or agreement made by the Insurance
Company in this Agreement or arise out of or result from any
other material breach of this Agreement by the Insurance
Company,
as limited by and in accordance with the provisions of Sections 8.1(b) and
8.1(c) hereof.
8.1(b). The Insurance Company shall not be liable under this
indemnification provision with respect to any losses, claims, damages,
liabilities or litigation incurred or assessed against an Indemnified Party that
may arise from that Indemnified Party's willful misfeasance, bad faith, or gross
negligence in the
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performance of that Indemnified Party's duties or by reason of that Indemnified
Party's reckless disregard of obligations or duties under this Agreement or to
the Trust, whichever is applicable.
8.1(c). The Insurance Company shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless that Indemnified Party shall have notified the Insurance Company in
writing within a reasonable time after the summons or other first legal process
giving information of the nature of the claim shall have been served upon that
Indemnified Party (or after the Indemnified Party shall have received notice of
such service on any designated agent). Notwithstanding the foregoing, the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Insurance Company of its obligations hereunder except to the extent
that the Insurance Company has been prejudiced by such failure to give notice.
In addition, any failure by the Indemnified Party to notify the Insurance
Company of any such claim shall not relieve the Insurance Company from any
liability which it may have to the Indemnified Party against whom the action is
brought otherwise than on account of this indemnification provision. In case any
such action is brought against the Indemnified Parties, the Insurance Company
shall be entitled to participate, at its own expense, in the defense of the
action. The Insurance Company also shall be entitled to assume the defense
thereof, with counsel satisfactory to the party named in the action; provided,
however, that if the Indemnified Party shall have reasonably concluded that
there may be defenses available to it which are different from or additional to
those available to the Insurance Company, the Insurance Company shall not have
the right to assume said defense, but shall pay the costs and expenses thereof
(except that in no event shall the Insurance Company be liable for the fees and
expenses of more than one counsel for Indemnified Parties in connection with any
one action or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances). After notice from
the Insurance Company to the Indemnified Party of the Insurance Company's
election to assume the defense thereof, and in the absence of such a reasonable
conclusion that there may be different or additional defenses available to the
Indemnified Party, the Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and the Insurance Company will not be liable
to that party under this Agreement for any
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legal or other expenses subsequently incurred by the party independently in
connection with the defense thereof other than reasonable costs of
investigation.
8.1(d). The Indemnified Parties will promptly notify the Insurance
Company of the commencement of any litigation or proceedings against them in
connection with the issuance or sale of the Trust's shares or the Contracts or
the operation of the Trust.
8.2. INDEMNIFICATION BY BBOI WORLDWIDE
8.2(a). BBOI Worldwide agrees to indemnify and hold harmless the
Insurance Company and each of its directors, officers, employees or agents, and
each person, if any, who controls the Insurance Company within the meaning of
Section 15 of the 1933 Act (collectively, the "Indemnified Parties" for purposes
of this Section 8.2) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of BBOI
Worldwide) or litigation (including legal and other expenses) to which the
Indemnified Parties may become subject under any statute, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements are related to the sale, acquisition
or redemption of the Trust's shares or the Contracts and:
(i) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the
registration statement or prospectus or sales literature of
the Trust (or any amendment or supplement to any of the
foregoing), or arise out of or are based upon the omission or
the alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements
therein not misleading, provided that this agreement to
indemnify shall not apply as to any Indemnified Party if the
statement or omission or alleged statement or omission was
made in reliance upon and in conformity with information
furnished in writing to BBOI Worldwide or the Trust by or on
behalf of the
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Insurance Company for use in the registration statement or
prospectus for the Trust or in sales literature (or any
amendment or supplement) or otherwise for use in connection
with the sale of the Contracts or Trust shares;
(ii) arise out of or as a result of statements or
representations (other than statements or representations
contained in the registration statement, prospectus or sales
literature for the Contracts not supplied by BBOI Worldwide or
persons under its control) or wrongful conduct of the Trust,
BBOI Worldwide or persons under their control, with respect to
the sale or distribution of the Contracts or shares of the
Trust;
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, or sales literature covering the
Contracts, or any amendment thereof or supplement thereto, or
the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statement or statements therein not misleading, if such
statement or omission was made in reliance upon information
furnished in writing to the Insurance Company by or on behalf
of the Trust;
(iv) arise as a result of any failure by the Trust to provide
the services and furnish the materials under the terms of this
Agreement (including a failure, whether unintentional or in
good faith or otherwise, to comply with the diversification
requirements specified in Article VI of this Agreement); or
(v) arise out of or result from any material breach of any
representation, warranty or agreement made by BBOI Worldwide
in this
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Agreement or arise out of or result from any other material
breach of this Agreement by BBOI Worldwide;
as limited by and in accordance with the provisions of Sections 8.2(b) and
8.2(c) hereof.
8.2(b) BBOI Worldwide shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or litigation
incurred or assessed against an Indemnified Party that may arise from the
Indemnified Party's willful misfeasance, bad faith, or gross negligence in the
performance of the Indemnified Party's duties or by reason of the Indemnified
Party's reckless disregard of obligations and duties under this Agreement.
8.2(c) BBOI Worldwide shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless the
Indemnified Party shall have notified BBOI Worldwide in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the
Indemnified Party (or after the Indemnified Party shall have received notice of
such service on any designated agent). Notwithstanding the foregoing, the
failure of any Indemnified Party to give notice as provided herein shall not
relieve BBOI Worldwide of its obligations hereunder except to the extent that
BBOI Worldwide has been prejudiced by such failure to give notice. In addition,
any failure by the Indemnified Party to notify BBOI Worldwide of any such claim
shall not relieve BBOI Worldwide from any liability which it may have to the
Indemnified Party against whom such action is brought otherwise than on account
of this indemnification provision. In case any such action is brought against
the Indemnified Parties, BBOI Worldwide will be entitled to participate, at its
own expense, in the defense thereof. BBOI Worldwide also shall be entitled to
assume the defense thereof, with counsel satisfactory to the party named in the
action; provided, however, that if the Indemnified Party shall have reasonably
concluded that there may be defenses available to it which are different from or
additional to those available to BBOI Worldwide, BBOI Worldwide shall not have
the right to assume said defense, but shall pay the costs and expenses thereof
(except that in no event shall BBOI Worldwide be liable for the fees and
expenses of more than one counsel for Indemnified Parties in
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<PAGE> 23
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances).
After notice from BBOI Worldwide to the Indemnified Party of BBOI Worldwide's
election to assume the defense thereof, and in the absence of such a reasonable
conclusion that there may be different or additional defenses available to the
Indemnified Party, the Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and BBOI Worldwide will not be liable to that
party under this Agreement for any legal or other expenses subsequently incurred
by that party independently in connection with the defense thereof other than
reasonable costs of investigation.
8.2(d) The Insurance Company agrees to notify BBOI Worldwide promptly
of the commencement of any litigation or proceedings against it or any of its
officers or directors in connection with the issuance or sale of the Contracts
or the operation of the Account.
8.3 INDEMNIFICATION BY THE TRUST
8.3(a). The Trust agrees to indemnify and hold harmless the Insurance
Company, and each of its directors, officers, employees and agents, and each
person, if any, who controls the Insurance Company within the meaning of Section
15 of the 1933 Act (collectively, the "Indemnified Parties" for purposes of this
Section 8.3) against any and all losses, claims, damages, liabilities (including
legal and other expenses) to which the Indemnified Parties may become subject
under any statute, at common law or otherwise, insofar as those losses, claims,
damages, liabilities or expenses (or actions in respect thereof) or settlements
are related to the operations of the Trust and:
(i) arise as a result of any failure by the Trust to provide
the services and furnish the materials under the terms of this
Agreement (including a failure to comply with the
diversification requirements specified in Article VI of this
Agreement); or
(ii) arise out of or result from any material breach of any
representation, warranty or agreement made by the Trust in
this Agreement or arise out of or result from any other
material breach of this Agreement by the Trust;
as limited by, and in accordance with the provisions of, Sections 8.3(b) and
8.3(c) hereof.
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<PAGE> 24
8.3(b). The Trust shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or litigation
incurred or assessed against an Indemnified Party that may arise from the
Indemnified Party's willful misfeasance, bad faith, or gross negligence in the
performance of the Indemnified Party's duties or by reason of the Indemnified
Party's reckless disregard of obligations and duties under this Agreement.
8.3(c). The Trust shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless the
Indemnified Party shall have notified the Trust in writing within a reasonable
time after the summons or other first legal process giving information of the
nature of the claim shall have been served upon the Indemnified Party (or after
the Indemnified Party shall have received notice of such service on any
designated agent). Notwithstanding the foregoing, the failure of any Indemnified
Party to give notice as provided herein shall not relieve the Trust of its
obligations hereunder except to the extent that the Trust has been prejudiced by
such failure to give notice. In addition, any failure by the Indemnified Party
to notify the Trust of any such claim shall not relieve the Trust from any
liability which it may have to the Indemnified Party against whom such action is
brought otherwise than on account of this indemnification provision. In case any
such action is brought against the Indemnified Parties, the Trust will be
entitled to participate, at its own expense, in the defense thereof. The Trust
also shall be entitled to assume the defense thereof, with counsel satisfactory
to the party named in the action; provided, however, that if the Indemnified
Party shall have reasonably concluded that there may be defenses available to it
which are different from or additional to those available to the Trust, the
Trust shall not have the right to assume said defense, but shall pay the costs
and expenses thereof (except that in no event shall the Trust be liable for the
fees and expenses of more than one counsel for Indemnified Parties in connection
with any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or
24
<PAGE> 25
circumstances). After notice from the Trust to the Indemnified Party of the
Trust's election to assume the defense thereof, and in the absence of such a
reasonable conclusion that there may be different or additional defenses
available to the Indemnified Party, the Indemnified Party shall bear the fees
and expenses of any additional counsel retained by it, and the Trust will not be
liable to that party under this Agreement for any legal or other expenses
subsequently incurred by that party independently in connection with the defense
thereof other than reasonable costs of investigation.
8.3(d). The Insurance Company and BBOI Worldwide agree promptly to
notify the Trust of the commencement of any litigation or proceedings against it
or any of its respective officers or directors in connection with this
Agreement, the issuance or sale of the Contracts, the operation of the Account,
or the sale or acquisition of shares of the Trust.
ARTICLE IX. APPLICABLE LAW
9.1. This Agreement shall be construed and provisions hereof
interpreted under and in accordance with the laws of the State of Delaware.
9.2. This Agreement shall be subject to the provisions of the 1933,
1934, and 1940 Acts, and the rules and regulations and rulings thereunder,
including any exemptions from those statutes, rules and regulations the
Commission may grant (including, but not limited to, the Mixed and Shared
Funding Exemptive Order) and the terms hereof shall be interpreted and construed
in accordance therewith.
ARTICLE X. TERMINATION
10.1. This Agreement shall terminate:
(a) at the option of any party upon six months advance written
notice to the other parties; provided, however, such notice
shall not be given earlier than one year following the date of
this Agreement; or
(b) at the option of the Insurance Company to the extent that
shares of Funds are not reasonably available to meet the
requirements of the Contracts as
25
<PAGE> 26
determined by the Insurance Company, provided, however, that
such a termination shall apply only to the Fund(s) not
reasonably available. Prompt written notice of the election to
terminate for such cause shall be furnished by the Insurance
Company to the Trust and BBOI Worldwide; or
(c) at the option of the Trust or BBOI Worldwide, in the event
that formal administrative proceedings are instituted against
the Insurance Company by the NASD, the Commission, an
insurance commissioner or any other regulatory body regarding
the Insurance Company's duties under this Agreement or related
to the sale of the Contracts, the operation of any Account, or
the purchase of the Trust's shares, provided, however, that
the Trust determines in its sole judgment exercised in good
faith, that any such administrative proceedings will have a
material adverse effect upon the ability of the Insurance
Company to perform its obligations under this Agreement; or
(d) at the option of the Insurance Company in the event that
formal administrative proceedings are instituted against the
Trust or BBOI Worldwide by the NASD, the Commission, or any
state securities or insurance department or any other
regulatory body, provided, however, that the Insurance Company
determines in its sole judgement exercised in good faith, that
any such administrative proceedings will have a material
adverse effect upon the ability of the Trust or BBOI Worldwide
to perform its obligations under this Agreement; or
(e) with respect to any Account, upon requisite vote of the
Contract owners having an interest in that Account (or any
subaccount) to substitute the shares of another investment
company for the corresponding Fund shares in accordance with
the terms of the Contracts for which those Fund shares had
been selected to serve as the underlying investment media. The
Insurance Company will give at least 30 days' prior written
notice to the Trust of the date of any proposed vote to
replace the Trust's shares; or
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<PAGE> 27
(f) at the option of the Insurance Company, in the event any
of the Trust's shares are not registered, issued or sold in
accordance with applicable state and/or federal law or
exemptions therefrom, or such law precludes the use of those
shares as the underlying investment media of the Contracts
issued or to be issued by the Insurance Company; or
(g) at the option of the Insurance Company, if the Trust
ceases to qualify as a regulated investment company under
Subchapter M of the Code or under any successor or similar
provision, or if the Insurance Company reasonably believes
that the Trust may fail to so qualify; or
(h) at the option of the Insurance Company, if the Trust fails
to meet the diversification requirements specified in Article
VI hereof; or
(i) at the option of either the Trust or BBOI Worldwide, if
(1) the Trust or BBOI Worldwide, respectively, shall
determine, in their sole judgment reasonably exercised in good
faith, that the Insurance Company has suffered a material
adverse change in its business or financial condition or is
the subject of material adverse publicity and that material
adverse change or material adverse publicity will have a
material adverse impact upon the business and operations of
either the Trust or BBOI Worldwide, (2) the Trust or BBOI
Worldwide shall notify the Insurance Company in writing of
that determination and its intent to terminate this Agreement,
and (3) after considering the actions taken by the Insurance
Company and any other changes in circumstances since the
giving of such a notice, the determination of the Trust or
BBOI Worldwide shall continue to apply on the sixtieth (60th)
day following the giving of that notice, which sixtieth day
shall be the effective date of termination; or
(j) at the option of the Insurance Company, if (1) the
Insurance Company shall determine, in its sole judgment
reasonably exercised in good faith, that either the Trust or
BBOI Worldwide has suffered a material adverse
27
<PAGE> 28
change in its business or financial condition or is the
subject of material adverse publicity and that material
adverse change or material adverse publicity will have a
material adverse impact upon the business and operations of
the Insurance Company, (2) the Insurance Company shall notify
the Trust and BBOI Worldwide in writing of the determination
and its intent to terminate the Agreement, and (3) after
considering the actions taken by the Trust and/or BBOI
Worldwide and any other changes in circumstances since the
giving of such a notice, the determination shall continue to
apply on the sixtieth (60th) day following the giving of the
notice, which sixtieth day shall be the effective date of
termination; or
(k) at the option of the Insurance Company, upon the Trust's
breach of any material provision of this Agreement, which
breach has not been cured to the satisfaction of the Insurance
Company within ten days after written notice of such breach is
delivered to the Trust; or
(l) at the option of the Trust, upon the Insurance Company's
breach of any material provision of this Agreement, which
breach has not been cured to the satisfaction of the Trust
within ten days after written notice of such breach is
delivered to the Insurance company.
10.2. It is understood and agreed that the right of any party hereto to
terminate this Agreement pursuant to Section 10.1(a) may be exercised for any
reason or for no reason.
10.3. No termination of this Agreement shall be effective unless and
until the party terminating this Agreement gives prior written notice to all
other parties to this Agreement of its intent to terminate, which notice shall
set forth the basis for the termination. Furthermore,
(a) In the event that any termination is based upon the
provisions of Article VII, or the provision of Section 10.1(a), 10.1(i),
10.1(j), 10.1(k) or 10.1(l) of this Agreement,
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<PAGE> 29
the prior written notice shall be given in advance of the effective date of
termination.
(b) In the event that any termination is based upon the
provisions of Section 10.1(c) or 10.1(d) of this Agreement, the prior written
notice shall be given at least sixty (60) days before the effective date of
termination.
10.4. Notwithstanding any termination of this Agreement, subject to
Section 1.2 of this Agreement and for so long as the Trust continues to exist,
the Trust and BBOI Worldwide shall at the option of the Insurance Company,
continue to make available additional shares of the Trust pursuant to the terms
and conditions of this Agreement, for all Contracts in effect on the effective
date of termination of this Agreement ("Existing Contracts"). Specifically,
without limitation, the owners of the Existing Contracts shall be permitted to
reallocate investments in the Trust, redeem investments in the Trust and/or
invest in the Trust upon the making of additional purchase payments under the
Existing Contracts. The parties agree that this Section 10.4 shall not apply to
any terminations under Article VII and the effect of Article VII terminations
shall be governed by Article VII of this Agreement.
10.5. The Insurance Company shall not redeem Trust shares attributable
to the Contracts (as opposed to Trust shares attributable to the Insurance
Company's assets held in the Account) except (i) as necessary to implement
Contract-owner-initiated transactions, (ii) as required by state and/or federal
laws or regulations or judicial or other legal precedent of general application
(a "Legally Required Redemption"), or (iii) as permitted under an order of
substitution by the Commission. Upon request, the Insurance Company will
promptly furnish to the Trust and BBOI Worldwide the opinion of counsel for the
Insurance Company (which counsel shall be reasonably satisfactory to the Trust
and BBOI Worldwide) to the effect that any redemption pursuant to clause (ii)
above is a Legally Required Redemption. Furthermore, the Insurance Company shall
not prevent new Contract owners from allocating payments to a Fund that formerly
was available under the Contracts without first giving the Trust or BBOI
Worldwide 45 days notice of its intention to do so.
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<PAGE> 30
ARTICLE XI. NOTICES
Any notice shall be sufficiently given when sent by registered or
certified mail to the other party at the address of that other party set forth
below or at such other address as the other party may from time to time specify
in writing.
If to the Trust:
210 University Boulevard, Suite 900
Denver, Colorado 80206
Attention: Brian S. Ferrie, Vice President
If to the Insurance Company:
3130 Broadway
Kansas City, Missouri 64111-2406
Attention: Leland Schmitt
If to BBOI Worldwide:
210 University Boulevard, Suite 700
Denver, Colorado 80206
Attention: Brian S. Ferrie
ARTICLE XII. MISCELLANEOUS
12.1. Subject to the requirements of legal process and regulatory
authority, each party hereto shall treat as confidential the names and addresses
of the owners of the Contracts and all information reasonably identified as
confidential in writing by any other party hereto and, except as permitted by
this Agreement, shall not disclose, disseminate or utilize such names and
addresses and other confidential information without the express written consent
of the affected party unless and until that information may come into the public
domain.
12.2. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.
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<PAGE> 31
12.3. This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
12.4. If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
12.5. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the
Commission, the NASD and state insurance regulators) and shall permit those
authorities reasonable access to its books and records in connection with any
lawful investigation or inquiry relating to this Agreement or the transactions
contemplated hereby.
12.6. The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled to under
state and federal laws.
12.7. This Agreement shall be binding upon and inure to the benefit of
the parties and their respective successors and assigns; provided, that no party
may assign this Agreement without the prior written consent of the others.
12.8. If this Agreement terminates, the parties agree that Article
VIII, and to the extent that all or a portion of assets of the Account continue
to be invested in the Trust, Articles I, II, III, V, VI, VII, IX and XI, will
remain in effect after termination.
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<PAGE> 32
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed in its name and on its behalf by its duly authorized
representative as of the date specified below.
Insurance Company:
FIDELITY SECURITY LIFE INSURANCE COMPANY
By its authorized officer,
By:
--------------------------------------
Title:
-----------------------------------
Date:
------------------------------------
Trust:
BERGER INSTITUTIONAL PRODUCTS TRUST
By its authorized officer,
By:
--------------------------------------
Title:
-----------------------------------
Date:
------------------------------------
BBOI Worldwide:
BBOI WORLDWIDE LLC
By its authorized officer,
By:
--------------------------------------
Title:
-----------------------------------
Date:
------------------------------------
32
<PAGE> 33
SCHEDULE A
ACCOUNTS
NAME OF ACCOUNT DATE OF RESOLUTION OF INSURANCE COMPANY'S
BOARD WHICH ESTABLISHED THE ACCOUNT
Separate Account M August 25, 1998
33
<PAGE> 34
SCHEDULE B
CONTRACTS
1. Contract Form - M2011
34
<PAGE> 35
SCHEDULE C
PROXY VOTING PROCEDURE
The following is a list of procedures and corresponding responsibilities for the
handling of proxies relating to the Trust by BBOI Worldwide, the Trust and the
Insurance Company. The defined terms herein shall have the meanings assigned in
the Participation Agreement except that the term "Insurance Company" shall also
include the department or third party assigned by the Insurance Company to
perform the steps delineated below.
1. The number of proxy proposals is given to the Insurance Company by BBOI
Worldwide as early as possible before the date set by the Trust for the
shareholder meeting to facilitate the establishment of tabulation
procedures. At this time BBOI Worldwide will inform the Insurance
Company of the Record, Mailing and Meeting dates. This will be done
verbally approximately two months before meeting.
2. Promptly after the Record Date, the Insurance Company will perform a
"tape run", or other activity, which will generate the names, addresses
and number of units which are attributed to each
contractowner/policyholder (the "Customer") as of the Record Date.
Allowance should be made for account adjustments made after this date
that could affect the status of the Customers' accounts of the Record
Date.
Note: The number of proxy statements is determined by the activities
described in Step #2. The Insurance Company will use its best efforts to call in
the number of Customers to BBOI Worldwide, as soon as possible, but no later
than one week after the Record Date.
3. The text and format for the Voting Instruction Cards ("Cards" or
"Card") is provided to the Insurance Company by the Trust. The
Insurance Company, at its expense, shall produce and personalize the
Voting Instruction cards. BBOI Worldwide must approve the Card before
it is printed. Allow approximately 2-4 business days for printing
information on the Cards. Information commonly found on the Cards
includes:
a. name (legal name as found on account registration)
b. address
c. Fund or account number
d. coding to state number of units
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<PAGE> 36
e. individual Card number for use in tracking and
verification of votes (already on Cards as printed by the
Trust).
(This and related steps may occur later in the chronological process
due to possible uncertainties relating to the proposals.)
4. During this time, BBOI Worldwide will develop, produce, and the Trust
will pay for the Notice of Proxy and the Proxy Statement (one
document). Printed and folded notices and statements will be sent to
Insurance Company for insertion into envelopes (envelopes and return
envelopes are provided and paid for by the Insurance Company). Contents
of envelope sent to customers by Insurance Company will include:
a. Voting Instruction Card(s)
b. One proxy notice and statement (one document)
c. Return envelope (postage pre-paid by Insurance Company)
addressed to the Insurance Company or its tabulation agent
d. "Urge buckslip" - optional, but recommended.
(This is a small, single sheet of paper that requests Customers to vote as
quickly as possible and that their vote is important. One copy will be supplied
by the Trust.)
e. Cover letter - optional, supplied by Insurance Company and
reviewed and approved in advance by BBOI Worldwide.
5. The above contents should be received by the Insurance Company
approximately 3-5 business days before mail date. Individual in charge
at Insurance Company reviews and approves the contents of the mailing
package to ensure correctness and completeness. Copy of this approval
sent to BBOI Worldwide.
6. Package mailed by the Insurance Company.
* The Trust must allow at least a 15-day solicitation time to
the Insurance Company as the shareowner. (A 5-week period is
recommended.) Solicitation time is calculated as calendar days
from (but not including) the meeting, counting backwards.
7. Collection and tabulation of Cards begins. Tabulation usually takes
place in another department or another vendor depending on process
used. An often used procedure is to sort
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<PAGE> 37
cards on arrival by proposal into vote categories of all yes, no, or
mixed replies, and to begin data entry.
Note: Postmarks are not generally needed. A need for postmark
information would be due to an insurance company's internal procedure.
8. If Cards are mutilated, or for any reason are illegible or are not
signed properly, they are sent back to the Customer with an explanatory
letter, a new Card and return envelope. The mutilated or illegible Card
is disregarded and considered to be not received for purposes of vote
tabulation. Such mutilated or illegible Cards are "hand verified,"
i.e., examined as to why they did not complete the system. Any
questions on those Cards are usually remedied individually.
9. There are various control procedures used to ensure proper tabulation
of votes and accuracy of that tabulation. The most prevalent is to sort
the Cards as they first arrive into categories depending upon their
vote; an estimate of how the vote is progressing may then be
calculated. If the initial estimates and the actual vote do not
coincide, then an internal audit of that vote should occur. This may
entail a recount.
10. The actual tabulation of votes is done in units which is then converted
to shares. (It is very important that the Trust receives the
tabulations stated in terms of a percentage and the number of shares.)
BBOI Worldwide must review and approve tabulation format.
11. Final tabulation in shares is verbally given by the Insurance Company
to BBOI Worldwide on the morning of the meeting not later than 10:00
a.m. Denver time. BBOI Worldwide may request an earlier deadline if
required to calculate the vote in time for the meeting.
12. A Certificate of Mailing and Authorization to Vote Shares will be
required from the Insurance Company as well as an original copy of the
final vote. BBOI Worldwide will provide a standard form for each
Certification.
13. The Insurance Company will be required to box and archive the Cards
received from the Customers. In the event that any vote is challenged
or if otherwise necessary for legal,
37
<PAGE> 38
regulatory, or accounting purposes, BBOI Worldwide will be permitted
reasonable access to such Cards.
14. All approvals and "signing-off" may be done orally, but must always be
followed up in writing.
38
<PAGE> 1
EXHIBIT 23(i)-2
DAVIS, GRAHAM & STUBBS LLP
A Limited Liability Partnership
Attorneys at Law
370 17th Street
Suite 4700
Denver, CO 80202
303-892-9400 (telephone)
303-893-1379 (facsimile)
April 28, 2000
Berger Institutional Products Trust
210 University Blvd., Suite 900
Denver, Colorado 80206
Re: Berger IPT - New Generation Fund
Ladies and Gentlemen:
We have acted as counsel to Berger Institutional Products Trust, a
Delaware business trust (the "Trust"), and are providing this opinion in
connection with the registration by the Trust of shares of beneficial interest,
$.01 par value (the "Shares"), of the Berger IPT - New Generation Fund (the
"Fund"), a series of the Trust, described in Post-Effective Amendment No. 8 to
the Registration Statement on Form N1-A of the Trust (1933 Act File No.
033-63493; 1940 Act File No. 811-07367), as filed with the Securities and
Exchange Commission on April 28, 2000 (the "Registration Statement").
In such connection, we have examined the Trust's Trust Instrument and
Bylaws, the proceedings of its Trustees relating to the authorization, issuance
and proposed sale of the Shares, and the Registration Statement, and we have
considered such other records and documents and such factual and legal matters
as we deemed appropriate for purposes of this opinion.
Based on the foregoing, it is our opinion that the Shares have been
duly authorized and, when sold as contemplated in the Registration Statement,
including receipt by the Fund of full payment for the Shares and compliance
with the Securities Act of 1933, the Investment Company Act of 1940 and
applicable state law regulating the offer and sale of securities, will be
validly issued, fully paid and non-assessable Shares of the Trust.
We hereby consent to all references to this firm in the Registration
Statement and to the filing of this opinion as an exhibit to the Registration
Statement. This consent does not constitute a consent under Section 7 of the
Securities Act of 1933, and in consenting to the references to our firm in the
Registration Statement, we have not certified any part of the Registration
Statement and do not otherwise come within the categories of persons whose
consent is required under Section 7 or the rules and regulations of the
Securities and Exchange Commission thereunder.
Very truly yours,
DAVIS, GRAHAM & STUBBS LLP
<PAGE> 1
EXHIBIT 23(j)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the use in this Registration Statement on Form N-1A of our
report dated February 4, 2000, relating to the financial statements and
financial highlights of Berger Institutional Products Trust, which appear in
such Registration Statement. We also consent to the references to us under the
headings "Financial Highlights" and "Other Information" in such Registration
Statement.
PricewaterhouseCoopers LLP
Denver, Colorado
April 26, 2000
<PAGE> 1
EXHIBIT 23(p)-1
CODE OF ETHICS
ADOPTED BY
THE BERGER FUNDS
LAST REVISED APRIL 18, 2000
<PAGE> 2
I. STATEMENT OF GENERAL PRINCIPLES
The Berger Growth Fund, the Berger Growth and Income Fund, the Berger Investment
Portfolio Trust and each of its series, the Berger Omni Investment Trust and
each of its series, the Berger Institutional Products Trust and each of its
series, the Berger/BIAM Worldwide Portfolios Trust and each of its series and
the Berger/BIAM Worldwide Funds Trust and each of its series (collectively, the
"Funds", and individually, a "Fund") have adopted this Code of Ethics ( the
"Code"), pursuant to Rule 17j-1 under the Investment Company Act of 1940.
A relationship of trust and confidence exists between the directors, trustees
and officers of the Funds and the Funds' shareholders. As a result, the
interests of the Funds must always come first. This means that all actions by
directors, trustees and officers of the Funds which are detrimental, or
potentially detrimental, to the Funds must be avoided. While this principle
extends to a broad range of actions and practices, it is of particular relevance
to any decision relating to the personal investment activities of all directors,
trustees and officers of the Funds since such activities may involve potential
conflicts of interest. In order to fulfill their fiduciary duties, all
directors, trustees and officers of the Funds must conduct their personal
securities transactions in a manner which does not operate adversely to the
interests of the Funds and must otherwise avoid serving their own personal
interests ahead of those of the Funds' shareholders.
In order to ensure that directors, trustees and officers of the Funds comply
with their fiduciary duties and other standards imposed by federal securities
law upon their personal investment activities, the Funds have adopted this Code
of Ethics (the "Code"). The Code includes specific provisions with which all
covered persons must comply. However, compliance with these technical provisions
alone will not be sufficient to insulate from scrutiny trades which show a
pattern of abuse of the individual's fiduciary relationships. All directors,
trustees and officers of the Funds are expected to abide by the spirit of the
Code and the principles articulated herein, and with respect to such matters
must at all times act in accordance with the highest ethical standards. Upon
assuming their position with the Funds, each Independent Director/Trustee of the
Funds is required to certify in writing that they have read and understand the
Code and that they recognize they are subject to the Code and will comply with
its requirements.
II. DEFINITIONS
(a) "Funds" shall mean the Berger Growth Fund, the Berger Growth and Income
Fund, the Berger Investment Portfolio Trust and each of its series, the
Berger Omni Investment Trust and each of its series, the Berger
Institutional Products Trust and each of its series, the Berger/BIAM
Worldwide Portfolios Trust and each of its series and the Berger/BIAM
Worldwide Funds Trust and each of its series.
(b) "Adviser" shall mean each Fund's investment adviser.
(c) "Adviser's Code of Ethics" shall mean the code of ethics adopted by the
Board of Directors or Board of Managers of each Fund's investment adviser.
(d) "Interested Person" shall have the meaning as that set forth in Section
2(a)(19) of the Investment Company Act of 1940.
(e) "Independent Director/Trustee" shall mean any director or trustee of the
Funds who is not an Interested Person.
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<PAGE> 3
(f) "Beneficial Ownership" shall be interpreted in the same manner as it would
be under Rule 16a-1(a)(2) under the Securities Exchange Act of 1934 in
determining whether a person is subject to the provisions of Section 16
and the rules and regulations thereunder, except that the determination of
direct or indirect beneficial ownership shall apply to all Securities
which a director, trustee or officer of the Funds has or acquires.
Application of this definition is explained in more detail in Appendix A
attached hereto.
(g) "Security" shall have the same meaning as that set forth in Section
2(a)(36) of the Investment Company Act of 1940 (generally, all securities)
except that it shall not include shares of registered open-end investment
companies (i.e, mutual funds), direct obligations of the Government of the
United States (e.g., U.S. Treasury Securities), banker's acceptances, bank
certificates of deposit, commercial paper and high quality short-term debt
instruments, including repurchase agreements.
(h) "Purchase or sale of a Security", or phrases of similar import, shall
include, among other things, the purchase, writing or sale of an option to
purchase or sell that Security, the purchase or sale of any derivative
Security whose value is derived from that Security, such as a Security
convertible into or exchangeable for that Security, and the purchase or
sale of any other Security which has a substantial economic relationship
to that Security being purchased or sold by a Fund (e.g., a Security
issued by a partnership which has a substantial portion of its assets
invested in the Security being purchased or sold).
(i) A Security is "being considered for purchase or sale" when a portfolio
manager is seriously considering the purchase or sale of a Security for a
Fund, or, with respect to a security analyst who makes a recommendation to
purchase or sell a Security for a Fund, when such person seriously
considers making such a recommendation.
(j) "Control", which shall have the same meaning as that set forth in Section
2(a)(9) of the Investment Company Act of 1940, generally means the power
to exercise a controlling influence over the management or policies of a
company, unless such power is solely the result of an official position
with such company.
(k) "Compliance Officer" shall mean the employee of the Adviser or other
individual designated by vote of the Board of Directors or Board of
Managers of the Adviser to receive reports and take certain actions as
provided in the Adviser's Code of Ethics. The Compliance Officer may
appoint designees to carry out his/her functions pursuant to the Code.
Any Independent Director/Trustee of the Funds who has any questions regarding
these definitions should consult with Counsel to the Independent
Directors/Trustees. Any director, trustee or officer of the Funds who is an
Interested Person of the Funds or the Adviser who has any questions regarding
these definitions should consult with the Compliance Officer.
III. CODE PROVISIONS APPLICABLE ONLY TO INTERESTED PERSONS OF THE FUND
THE PROVISIONS OF THE ADVISER'S CODE OF ETHICS ARE HEREBY INCORPORATED BY
REFERENCE INTO THIS CODE OF ETHICS OF THE FUNDS AND ARE APPLICABLE ONLY TO
DIRECTORS, TRUSTEES AND OFFICERS OF THE FUNDS WHO ARE INTERESTED PERSONS OF THE
FUNDS OR THE ADVISER. A violation of the Adviser's Code of Ethics by any such
Interested Person shall also constitute a violation of this
2
<PAGE> 4
Code of Ethics. Such Interested Persons shall report their personal security
transactions pursuant to the provisions of the Adviser's Code of Ethics.
IV. CODE PROVISIONS APPLICABLE ONLY TO INDEPENDENT DIRECTORS/TRUSTEES OF THE
FUNDS
(a) Prohibited Purchases and Sales
No Independent Director/Trustee of the Funds shall purchase or sell,
directly or indirectly, any Security in which he or she has, or by reason
of such transaction acquires, any direct or indirect Beneficial Ownership
and which he or she knows or should have known at the time of such purchase
or sale:
(1) is being purchased or sold by a Fund;
(2) is being considered for purchase or sale by a Fund; or
(3) has been purchased or sold by a Fund within the previous 7 calendar
days.
It is contemplated that the Independent Directors/Trustees of each Fund
will not be provided information respecting purchases or sales of any
Security by the Fund or information respecting any Security being
considered for purchase or sale by the Fund, until at least 15 days
following such purchase or sale or consideration thereof and therefore they
will not ordinarily know or be deemed to have been in a position in which
they should have known, at the time of any purchase or sale by Independent
Directors/Trustees, information respecting purchases or sales or
consideration thereof by the Fund.
Although explained more fully in the definition of "purchase or sale of a
Security" in Section II. of the Code, it bears emphasis here that included
for purposes of this prohibition is any personal securities transaction
involving a derivative Security or other Security which has a substantial
economic relationship to the Security being considered for purchase or sale
or that is being, or that within the previous 7 calendar days has been,
purchased or sold by a Fund.
Subject to a final decision by the Board of Directors/Trustees for the
affected Fund after having reviewed all of the facts and circumstances
relevant to the particular transaction, an Independent Director/Trustee of
a Fund may be required to disgorge all or a portion of any profits gained
or losses avoided as a result of participating in any such prohibited
personal securities transaction. See Section IV.(e) of the Code below for a
more detailed discussion of this matter.
(b) Exempted Transactions
The prohibitions of Section IV.(a) of the Code shall not apply to:
(1) purchases or sales effected in any account over which the Independent
Director/Trustee has no direct or indirect influence or control;
(2) purchases or sales which are non-volitional on the part of the
Independent Director/Trustee, such as Securities acquired as a result
of a spin-off of an entity from a company whose Securities are owned by
the Independent Director/Trustee or the
3
<PAGE> 5
involuntary sale of Securities due to a merger or as the result of a
company exercising a call provision on its outstanding debt;
(3) purchases which are part of an automatic dividend reinvestment plan or
a company sponsored stock purchase plan;
(4) purchases effected upon the exercise of rights issued by an issuer pro
rata to all holders of a class of its Securities, to the extent such
rights were acquired from such issuer, and sales of such rights so
acquired; and
(5) any Securities transaction, or series of related transactions,
involving 500 shares or less in the aggregate, if the issuer has a
market capitalization (outstanding shares multiplied by the current
price per share) greater than $10 billion.
(c) Reporting
(1) On the 16th day following the end of each month or shortly thereafter,
the Adviser will furnish each Independent Director/Trustee with a list
of all of the securities transactions executed in each of the Funds
during the previous month, and their holdings as of the end of the
month. Each Independent Director/Trustee will then be responsible for
comparing all of his or her personal securities transactions for the
same month against the list of each Fund's securities transactions and
holdings in order to determine if the Independent Director/Trustee
engaged in a personal security transaction in any Security purchased,
sold or held by a Fund(s) during the period.
If as a result of such review an Independent Director/Trustee
determines that he or she did purchase or sell the same (or equivalent)
Securities that were purchased, sold or held by a Fund(s), whether or
not one of the exemptions listed in Section IV.(b) of the Code applies,
each Independent Director/Trustee shall file with the Compliance
Officer a written report containing the information described in
Section IV.(c)(2) of the Code below with respect to each transaction in
any such Security in which such Independent Director/Trustee by reason
of such transaction acquires or disposes of any direct or indirect
Beneficial Ownership in the Security; provided, however, that an
Independent Director/Trustee shall not be required to make a report
with respect to any transaction effected for any account over which he
or she does not have any direct or indirect influence or control. Each
such report may contain a statement that the report shall not be
construed as an admission by the Independent Director/Trustee that he
or she has any direct or indirect Beneficial Ownership in the Security
to which the report relates.
Upon the completion of such monthly reviews, each Independent
Director/Trustee shall complete a representation letter stating either
that, for the period covered, they did not engage in any personal
securities transactions in any Securities purchased, sold or held by
the Funds during the period, or that they did engage in such
transactions and that they have completed an enclosed report of all
such personal securities transactions which they participated in during
the period (see Appendix B).
(2) Such representation letter (and, if applicable, such personal
securities transactions report) shall be filed by each Independent
Director/Trustee with the Compliance Officer upon completing their
review, but not later than 30 days after their receipt of the Funds
security transactions and holdings for the previous month, and shall
contain the following information:
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<PAGE> 6
(a) the date of the transaction, the title, the interest rate and
maturity date (if applicable), the number of shares, and the
principal amount of each such Security involved;
(b) the nature of the transaction (i.e., purchase, sale or any other
type of acquisition or disposition);
(c) the price at which the Security transaction was effected; and
(d) the name of the broker, dealer or bank with or through whom the
transaction was effected.
(3) An Independent Director/Trustee will be deemed to have participated in,
and must report under this Code, any such Securities transactions
participated in by:
(a) The person's spouse;
(b) The person's minor children;
(c) Any other relatives sharing the person's household;
(d) A trust in which the person has a beneficial interest, unless such
person has no direct or indirect control over the trust;
(e) A revocable trust as to which the person is a settler; or
(f) A partnership of which the person is a partner (including most
investment clubs) unless the person has no direct or indirect
control over the partnership.
(4) The Compliance Officer shall identify all Independent
Directors/Trustees of the Funds who are required to make the reports
required by Section IV.(c) of the Code and shall inform them of their
reporting obligations hereunder.
(d) Review
The Compliance Officer shall, under the supervision of the President of
each Fund, review or supervise the review of the personal securities
transactions reported pursuant to Section IV.(c) of the Code. As part of
that review, each such reported Securities transaction shall be compared
against the trading activity of the Funds to determine whether a violation
of Section IV.(a) of the Code may have occurred. If the Compliance Officer
determines that a violation may have occurred, he or she shall promptly
submit the pertinent information regarding the transaction to the President
of the appropriate Fund and Counsel to the Funds, who on behalf of the
Board of Directors/Trustees of such Fund shall perform a preliminary
evaluation of the transaction to determine whether a violation of the Code
may have occurred, taking into account all the exemptions provided under
Section IV.(b) of the Code, and if so, whether such violation may be
material. If upon the conclusion of their review of the transaction they
also determine that a material violation of the Code may have occurred, the
matter shall be submitted to the full Board for its consideration. The
Board of Directors/Trustees for the Fund will consider all relevant facts
and circumstances surrounding the transaction prior to making its
determination whether a material violation of the Code has occurred. In
addition, before making any such determination, the Board shall give the
Independent Director/Trustee involved an opportunity to supply additional
information regarding the transaction in question.
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<PAGE> 7
(e) Sanctions
If a final determination is made that an intentional and material violation
of this Code has occurred as a result of a prohibited transaction, the
Board of Directors/Trustees of the affected Fund may require the
Independent Director/Trustee to disgorge to the Fund any portion of the
profits gained or losses avoided as a result of the prohibited transaction,
except that such disgorgement shall not include profits accruing before or
after the period in which the transaction was prohibited. The Board of
Directors/Trustees of the Fund will also take such further action and
impose such sanctions as said Board deems appropriate, which sanctions may
in the Board's discretion include, among other things, censure or
suspension. Counsel to the Funds shall prepare a written report on the
Board of Directors'/Trustees' final determination in regards to each such
matter.
V. ANNUAL REPORTING AND CERTIFICATION
(a) On an annual basis, the Compliance Officer shall prepare a written report
to the Board of Directors/Trustees for each of the Funds setting forth the
following:
(1) A summary of existing procedures to detect and prevent violations of
the Code,
(2) Full details of any investigation, either internal or by a regulatory
agency, of any violations of the Code, the resolution of such
investigations and the steps taken to prevent further violations, and
(3) An evaluation of the current compliance procedures and any
recommendations for improvement.
In addition, the directors/trustees of each Fund must receive a
certification from the Fund annually stating that it has adopted procedures
reasonably necessary to prevent Access Persons from violating the Code.
The directors/trustees shall approve the Code before the commencement of
operations of any Fund. In conjunction with such approval, the
directors/trustees must receive a certification from the Fund stating that
it has adopted procedures reasonably necessary to prevent Access Persons
from violating the Code.
Any material changes to the Code must be approved by each Fund's
directors/trustees within 6 months after adoption of the material change.
6
<PAGE> 8
(b) On an annual basis, all directors, trustees and officers of the Funds are
required to certify in writing that they have read and understand the Code
of Ethics and recognize that they are subject thereto. In addition, all
such persons are required to certify annually that they have complied with
the requirements of the Code and that they have reported all personal
securities transactions required to be reported pursuant to the Code (see
Appendix C). If an Independent Director/Trustee of the Funds has any
questions pertaining to their responsibilities under the Code, they should
discuss them with Counsel to the Independent Directors/Trustees. Any
director, trustee or officer of the Funds who is an Interested Person of
the Funds or the Adviser who has any questions pertaining to their
responsibilities under the Code should discuss them with the Compliance
Officer.
VI. MISCELLANEOUS PROVISIONS
(a) Any amendment or revision of an Adviser's Code of Ethics shall be deemed to
be an amendment or revision of Section III. of this Code and such amendment
or revision shall be promptly furnished to the Independent
Directors/Trustees of the Funds.
(b) The Funds shall maintain records in the manner and to the extent set forth
below, and make such records available for examination by representatives
of the U.S. Securities and Exchange Commission:
(1) A copy of this Code and any other code of ethics which is, or at any
time within the past five years has been, in effect shall be preserved
in an easily accessible place;
(2) A record of any violation of the Code and of any action taken as a
result of such violation shall be preserved in an easily accessible
place for a period of not less than five years following the end of the
fiscal year in which the violation occurs;
(3) A copy of each report made by a director, trustee or officer of the
Funds pursuant to the Code shall be preserved for a period of not less
than five years from the end of the fiscal year in which it is made,
the first two years in an easily accessible place; and
(4) A list of all persons who are, or within the past five years have been,
required to make reports pursuant to the Code, and who are, or within
the past five years have been, responsible for reviewing these reports,
shall be maintained in an easily accessible place.
(c) All reports of Securities transactions and any other information filed with
the Adviser or furnished to any person pursuant to the Code shall be
treated as confidential, but are subject to review as provided herein and
by representatives of the U.S. Securities and Exchange Commission or any
other regulatory or self-regulatory organization to the extent required by
law or regulation.
(d) The directors/trustees of the Funds may from time to time adopt such
interpretations of the Code and such exceptions to provisions of the Code
as they deem appropriate.
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<PAGE> 9
APPENDIX A
For purposes of the attached Code of Ethics, a "beneficial owner" shall mean any
director, trustee or officer who, directly or indirectly, through any contract,
arrangement, understanding, relationship or otherwise, has or shares a direct or
indirect opportunity to profit or share in any profit derived from a transaction
in the subject securities. The term "beneficial ownership" of securities would
include not only ownership of securities held by a director, trustee or officer
for his or her own benefit, whether in bearer form or registered in their name
or otherwise, but also ownership of securities held for his or her benefit by
others (regardless of whether or how they are registered) such as custodians,
brokers, executors, administrators, or trustees (including trusts in which he or
she has only a remainder interest), and securities held for his or her account
by pledgees, securities owned by a partnership in which he or she is a member if
they may exercise a controlling influence over the purchase, sale or voting of
such securities, and securities owned by any corporation that he or she should
regard as a personal holding corporation. Correspondingly, this term would
exclude securities held by a director, trustee or officer for the benefit of
someone else.
Ordinarily, this term would not include securities held by executors or
administrators in estates in which a director, trustee or officer is a legatee
or beneficiary unless there is a specific legacy to such person of such
securities or such person is the sole legatee or beneficiary and there are other
assets in the estate sufficient to pay debts ranking ahead of such legacy, or
the securities are held in the estate more than a year after the decedent's
death.
Securities held in the name of another should be considered as "beneficially"
owned by a director, trustee or officer where such person enjoys "benefits
substantially equivalent to ownership". The U.S. Securities and Exchange
Commission has said that although the final determination of beneficial
ownership is a question to be determined in the light of the facts of the
particular case, generally a person is regarded as the beneficial owner of
securities held in the name of his or her spouse and their minor children.
Absent special circumstances such relationship ordinarily results in such person
obtaining benefits substantially equivalent to ownership, e.g., application of
the income derived from such securities to maintain a common home, to meet
expenses that such person otherwise would meet from other sources, or the
ability to exercise a controlling influence over the purchase, sale or voting of
such securities.
A director, trustee or officer also may be regarded as the beneficial owner of
securities held in the name of another person, if by reason of any contract,
understanding, relationship, agreement, or other arrangement, he or she obtains
therefrom benefits substantially equivalent to those of ownership. Moreover, the
fact that the holder is a relative or relative of a spouse and sharing the same
home as a director, trustee or officer may in itself indicate that the director,
trustee or officer would obtain benefits substantially equivalent to those of
ownership from securities held in the name of such relative. Thus, absent
countervailing facts, it is expected that securities held by relatives of the
director, trustee or officer or his or her spouse who share the same home as the
director, trustee or officer will be treated as being beneficially owned by the
director, trustee or officer.
A director, trustee or officer also is regarded as the beneficial owner of
securities held in the name of a spouse, minor children or other person, even
though he or she does not obtain therefrom the aforementioned benefits of
ownership, if they can vest or revest title in themselves at once or at some
future time.
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<PAGE> 10
APPENDIX B
TO: Compliance Officer
Berger LLC
SUBJECT: Personal Securities Transactions Report for the Month of (1)
------------
- I have not effected any reportable personal securities
- ------------- transactions in any of the Securities listed on the
schedules that I received from the Adviser for the
purchases, sales and month-end holdings for any Berger
Fund or series thereof for this month.
- I have not effected any reportable personal securities
- ------------- transactions in any of the Securities listed on the
schedules that I received from the Adviser for the
purchases, sales and month-end holdings for any Berger
Fund or series thereof for this month EXCEPT FOR THOSE I
HAVE REPORTED ON THE ENCLOSED PERSONAL SECURITIES
TRANSACTIONS REPORT.
Except for the following companies, I do not beneficially own more than 1/2 of
1% of the securities of any public issuer (if you have no such levels of
ownership in any public issuer, please write "None") - (2)
- --------
1 Please check the appropriate line below and, if applicable, complete the
enclosed Personal Securities Transactions Report. Upon completion of this
representation, sign and date the form and return it to the Compliance
Officer of Berger LLC.
2 This information is needed to determine compliance with certain of the
Fund's fundamental investment restrictions.
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<PAGE> 11
<TABLE>
<CAPTION>
APPENDIX B (CONTINUED)
PERSONAL
SECURITIES TRANSACTIONS REPORT
BERGER FUNDS
NAME: FOR THE MONTH ENDED:
----------------------- ----------------------
(Please Print)
Security Description
Transaction (including interest rate and maturity date, Number Principal Nature of Name of Broker,
Date if applicable) Symbol of Shares Amount Transaction Price Dealer or Bank
- ----------- ------------------------------------------- ------ --------- --------- ----------- ----- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C>
DEFINITIONS: Principal Amount - Total amount received or paid for the security.
Nature of Transaction - Purchase, sale or other acquisition or disposition.
Price - Price per share at which transaction was effected.
Broker, Dealer or Bank - Name of broker, dealer or bank with or through whom the transaction was effected.
NOTE: Transactions in shares of registered open-end investment companies (i.e., mutual funds), direct obligations
of the Government of the United States (e.g., U.S. Treasury securities), banker's acceptances, bank
certificates of deposit, commercial paper and high-quality short-term debt instruments, including repurchase
agreements, are not required to be reported.
STATEMENT: THIS REPORT IS NOT TO BE CONSTRUED AS AN ADMISSION BY ME THAT I HAVE ANY DIRECT OR INDIRECT BENEFICIAL
OWNERSHIP IN THE SECURITIES TO WHICH THIS REPORT RELATES.
--------------------------------
(Signature)
</TABLE>
<PAGE> 12
APPENDIX C
ANNUAL CONFIRMATION FOR YOUR BERGER FUNDS
CODE OF ETHICS (THE "CODE")
I have carefully read and understand the Code. I recognize that I must
comply with the Code and that I am subject to the policies and procedures
contained therein. I understand that the policies and procedures stated in this
Code are subject to change and that, from time to time, I may receive
information about changes in the policies and procedures contained therein. In
addition (please check the appropriate line below):
___________I have complied with the requirements of the Code at all times since
my last Confirmation for the Code, and I have reported all of my personal
securities transactions since my last Confirmation which are required to be
reported pursuant to the Code.
___________I have complied with the requirements of the Code at all times since
my last Confirmation for the Code, except in certain instances during the
period, a description of which is attached hereto, which the President of the
appropriate Fund is aware of and which have been addressed by the Board of
Directors/Trustees of such Fund. I have reported all of my personal securities
transactions since my last Confirmation for the Code which are required to be
reported pursuant to the Code.
- ------------------------------------ ------------------------------------
Date of Confirmation Covered Person's Name (please print)
------------------------------------
Covered Person's Signature
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- ------------------------------------ ------------------------------------
Covered Person's Name (please print) Covered Person's Signature
- ------------------
Date
10
<PAGE> 1
Exhibit 23(p)-2
CODE OF ETHICS AND STATEMENT OF POLICIES
ADOPTED BY BERGER LLC
LAST REVISED APRIL 18, 2000
I. STATEMENT OF GENERAL PRINCIPLES
The success of Berger LLC (the "Adviser") as an investment adviser depends upon
its reputation for excellence and integrity in the investment marketplace. All
Directors, officers and employees of the Adviser must therefore act in
accordance with the highest ethical standards.
A relationship of trust and confidence exists between the Adviser and its
clients. As a result, the interests of the Adviser's clients must always come
first. This means that all actions by Directors, officers and employees of the
Adviser which are detrimental, or potentially detrimental, to the Adviser's
clients must be avoided. While this principle extends to a broad range of
actions and practices, it is of particular relevance to any decision relating to
the personal investment activities of all Directors, officers and employees of
the Adviser since such activities may involve potential conflicts of interest.
In order to fulfill their fiduciary duties, all Directors, officers and
employees of the Adviser must conduct their personal securities transactions in
a manner which does not operate adversely to the interests of the Adviser's
clients and must otherwise avoid serving their own personal interests ahead of
such clients.
In order to ensure that Directors, officers and employees of the Adviser comply
with their fiduciary duties and other standards imposed by federal securities
law upon their personal investment activities, the Adviser has adopted this Code
of Ethics and Statement of Policies (the "Code"). The Code includes specific
provisions with which all covered persons must comply. However, compliance with
these technical provisions alone will not be sufficient to insulate from
scrutiny trades which show a pattern of abuse of the individual's fiduciary
relationships. All Directors, officers and employees are expected to abide by
the spirit of the Code and the principles articulated herein. Upon assuming
their position with the Adviser, each Director, officer or employee of the
Adviser is required to certify in writing that they have read and understand the
Code and that they recognize they are subject to the Code and will comply with
its requirements.
In the course of fulfilling the responsibilities of their position, Directors,
officers, and employees of the Adviser may deal with issuers of securities,
broker/dealers and business associates of the Adviser and its clients. Such
relationships can result in the individual being offered or given investment
opportunities, perquisites, or gifts from persons doing or seeking business with
the Adviser or its clients. All such offers and gifts which are more than de
minimis in value (see Section III.(c) of the Code) should be declined or
returned in order to prevent a situation which might compromise or appear to
compromise a Director's, officer's or employee's exercise of independent and
objective judgment on behalf of the Adviser's clients.
This Code establishes policies and procedures which govern certain types of
personal securities transaction by individuals deemed "Access Persons" of the
Adviser. In addition, the Code establishes policies and procedures applicable to
all Directors, officers and employees of the Adviser which have been designed to
detect and prevent the misuse of material, nonpublic information in securities
transactions and to provide guidance in other legal and regulatory
<PAGE> 2
matters. Compliance with the Code is a condition of employment and willful or
repeated violation of its provisions may be cause for termination of employment.
II. DEFINITIONS
(a) "Access Person" means (i) any Director or officer of the
Adviser, (ii) any employee of the Adviser (or any employee of
any company in a Control relationship to the Adviser) who, in
connection with his or her regular functions or duties, makes,
participates in, or obtains information regarding the purchase
or sale of a Security by an Investment Company/Account, or
whose functions relate to the making of any recommendations
with respect to such purchases or sales and (iii) any natural
person in a Control relationship to the Adviser who obtains
information concerning recommendations made to an Investment
Company/Account, with regard to the purchase or sale of a
Security.
(b) "Beneficial Ownership" shall be interpreted in the same manner
as it would be under Rule 16a-1(a)(2) under the Securities
Exchange Act of 1934 in determining whether a person is
subject to the provisions of Section 16 and the rules and
regulations thereunder, except that the determination of
direct or indirect beneficial ownership shall apply to all
Securities which an Access Person has or acquires. Application
of this definition is explained in more detail in Appendix A
attached hereto.
(c) "Investment Personnel" shall mean (i) any employee of the
Adviser (or any employee of any company in a Control
relationship to the Adviser) who, in connection with his or
her regular functions or duties, makes or participates in
making recommendations regarding the purchase or sale of a
Security by an Investment Company/Account and (ii) any natural
person who controls the Adviser and who obtains information
concerning recommendations made to the Fund regarding the
purchase or sale of a Security by an Investment
Company/Account. Investment Personnel shall include all
persons employed by the Adviser as portfolio managers,
security analysts and security traders.
(d) "Security" shall have the same meaning as that set forth in
Section 2(a)(36) of the Investment Company Act of 1940
(generally, all securities) except that it shall not include
shares of registered open-end investment companies (i.e.,
mutual funds), direct obligations of the Government of the
United States (e.g., U.S. Treasury securities), banker's
acceptances, bank certificates of deposit, commercial paper
and high quality short-term debt instruments, including
repurchase agreements.
(e) "Purchase or sale of a Security", or phrases of similar
import, shall include, among other things, the purchase,
writing or sale of an option to purchase or sell that
Security, the purchase or sale of any derivative Security
whose value is derived from that Security, such as a Security
convertible into or exchangeable for that Security, and the
purchase or sale of any other Security which has a substantial
economic relationship to that Security being purchased or sold
by an Investment Company/Account (e.g., a Security issued by a
partnership which has a substantial portion of its assets
invested in the Security being purchased or sold).
(f) A Security is "being considered for purchase or sale" when a
portfolio manager is seriously considering the purchase or
sale of a Security for an Investment Company/Account, or, with
respect to a security analyst who makes a recommendation to
purchase or sell a Security for an Investment Company/Account,
when such person seriously considers making such a
recommendation.
(g) "Control", which shall have the same meaning as that set forth
in Section 2(a)(9) of the Investment Company Act of 1940,
generally means the power to exercise a controlling influence
over the management or policies of a company, unless such
power is solely the result of an official position with such
company.
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(h) "Compliance Officer" shall mean the employee of the Adviser
designated by the Adviser to receive reports and take certain
actions as provided in this Code of Ethics and Statement of
Policies. The Compliance Officer may appoint designees to
carry out his/her functions pursuant to the Code.
(i) "Investment Company/Account" means a company registered as
such under the Investment Company Act of 1940 and for which
the Adviser or an entity controlled by the Adviser is the
investment adviser or sub-adviser, or any pension or
profit-sharing plan or any institutional or private account
managed by the Adviser.
(j) "Director" of the Adviser shall mean a member of the Board of
Directors of the Adviser's member-manager, Stilwell
Management, Inc.
(k) "Initial Public Offering" means an offering of securities
registered under the Securities Act of 1933, the issuer of
which, immediately before the registration, was not subject to
the reporting requirements of sections 13 or 15(d) of the
Securities Exchange Act of 1934.
(l) "Limited Offering" means an offering that is exempt from
registration under the Securities Act of 1933 pursuant to
section 4(2) or section 4(6) or pursuant to rule 504, rule
505, or rule 506 thereunder.
Any Director, officer or employee of the Adviser who has any questions regarding
these definitions should consult with the Adviser's Compliance Officer.
III. PROHIBITIONS
NOTE: SUBJECT TO A FINAL DECISION BY ADVISER MANAGEMENT AFTER HAVING REVIEWED
ALL OF THE FACTS AND CIRCUMSTANCES RELEVANT TO THE PARTICULAR TRANSACTION,
INDIVIDUALS COVERED BY THE FOLLOWING PROHIBITIONS MAY BE REQUIRED TO DISGORGE
ALL OR A PORTION OF ANY PROFITS GAINED OR LOSSES AVOIDED AS A RESULT OF
PARTICIPATING IN ANY OF THE PROHIBITED PERSONAL SECURITIES TRANSACTIONS
DISCUSSED BELOW. SEE SECTION VII. SANCTIONS OF THE CODE FOR A MORE DETAILED
DISCUSSION OF THIS MATTER.
Prohibitions Applicable To All Access Persons
(a) No Access Person shall purchase or sell, directly or
indirectly, any Security in which he or she has, or by reason
of such transaction acquires, any direct or indirect
Beneficial Ownership and which he or she knows or should have
known at the time of such purchase or sale:
(1) is being purchased or sold by an Investment Company/
Account;
(2) is being considered for purchase or sale by an
Investment Company/Account; or
(3) has been purchased or sold by an Investment
Company/Account within the previous 7 calendar days.
Although explained more fully in the definition of "purchase
or sale of a Security" in Section II. of the Code, it bears
emphasis here that included for purposes of this prohibition
is any personal securities transaction involving a derivative
Security or other Security which has a substantial economic
relationship to the Security being
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considered for purchase or sale or that is being, or that
within the previous 7 calendar days has been, purchased or
sold by an Investment Company/Account.
(b) All Access Persons are prohibited from the purchase or sale of
Securities without prior approval from the Compliance Officer,
unless such purchase or sale is an exempted transaction as
defined in Section IV. of the Code. The preclearance process
shall include the Compliance Officer presenting each requested
personal securities transaction to the Adviser's portfolio
manager(s) (or, for Investment Companies/Accounts for which
the Adviser has contracted with another investment adviser, to
such sub-adviser) for the purpose of determining whether the
provisions of Sections III.(a)(1) and III.(a)(2) prevent its
current approval. If granted, such approval will normally be
given in writing (see Appendix B). In circumstances that
require approval of the transaction to be granted verbally,
the Compliance Officer shall document for the Adviser's
records all information pertinent to the approved purchase or
sale. Any approval for a personal securities transaction will
be effective for 3 business days following the date of
approval (unless otherwise specified in the written approval).
Any transaction not completed within the 3 day (or other
specified) time period will require reapproval by the
Compliance Officer prior to engaging in any further purchases
or sales.
When requesting approval for a personal securities
transaction, all Access Persons should be careful to identify
for the Compliance Officer any factors potentially relevant to
a conflict of interest. This is especially true when an Access
Person requests approval to purchase or sell a Security with a
complicated investment structure, since the Security may be
substantially economically related to a separate Security
which is being considered for purchase or sale or being
purchased or sold by an Investment Company/Account.
A portfolio manager may not preclear his/her own personal
securities transactions. Any personal securities transaction
requested by a portfolio manager shall, in addition to the
standard preclearance process, be presented to the President
of the Adviser for his/her approval. In addition, because the
Compliance Officer may not preclear his/her own personal
securities transactions, the Compliance Officer shall request
approval for his or her personal securities transactions from
his/her supervisor, the Vice President-Legal.
(c) All Access Persons are prohibited from receiving on an annual
basis any gifts or other things of value from any person or
entity that does business with or on behalf of the Adviser or
the Investment Companies/Accounts which in total could
reasonably be valued above $100. However, this policy does not
apply to customary business meals or entertainment, or
promotional items (e.g., pens, mugs, caps, T-shirts, etc.)
which are consistent with customary business practices in the
industry.
(d) All Access Persons must immediately notify the Compliance
Officer upon becoming a member of a board of directors of a
publicly traded company. As a condition of being given
approval to engage in any personal securities transaction
involving the securities of such company(s), the Access Person
will be required to obtain documented approval to trade from
the company's management, in light of their procedures
designed to prevent the misuse of material, nonpublic
information by company insiders (For a description of each
Director's, officer's and employee's responsibilities in the
event that they come into the possession of material,
nonpublic information, see Section VIII. of the Code).
Notwithstanding this provision, those Access Persons that are
also Investment Personnel are generally prohibited from
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serving on the board of directors of publicly traded companies
(See Section III.(i) of the Code).
Prohibitions Applicable Only To Investment Personnel
(e) Prior to recommending a Security for purchase or sale by an
Investment Company/Account, Investment Personnel are required
to provide disclosure, if applicable, of any
ownership/Security position they have in the issuer, or any
present or proposed business relationship between such issuer
and such person, to the Chief Investment Officer and the
Compliance Officer. In the event that such disclosure is
required of the Chief Investment Officer, it should be made to
the Compliance Officer. The Investment Personnel's
holdings/relationship will then be reviewed to determine
whether it presents a conflict of interest that should be
addressed prior to the Adviser acting on their purchase or
sale recommendation for the Investment Company/Account.
(f) All Investment Personnel are prohibited from profiting in the
purchase and sale, or sale and purchase, of the same (or
equivalent) Security within 60 calendar days. This prohibition
shall not apply to exchange-traded stock options that are
purchased for the purpose of establishing a bona fide position
hedge on Securities held in excess of 60 calendar days, or to
options on stock indices which are composed of 100 or more
Securities. However, any transaction which is exempt from this
prohibition shall be subject to all otherwise applicable
provisions of the Code, including but not limited to the
preclearance requirements of Section III(b).
(g) All Investment Personnel are prohibited from acquiring any
Security in an Initial Public Offering.
(h) All Investment Personnel are prohibited from acquiring any
Security in a Limited Offering without prior written approval.
Request for such approval should be made via a memorandum
directed to the Chief Investment Officer and the Compliance
Officer. Limited Offerings for which the Chief Investment
Officer is seeking approval will be reviewed by the President
and the Compliance Officer. The memo shall state the name of
the company, the number of shares/units being offered and the
offering price per share/unit, a description of the company's
history and operations, and a discussion of whether the
company's current business plan anticipates a future Initial
Public Offering of its Securities. No approval will be granted
for the acquisition of Securities in a Limited Offering if the
company currently has any publicly traded equity Securities
(or other publicly traded Securities convertible into equity
Securities) issued and outstanding. A copy of the Limited
Offering agreement or the purchase contract should be attached
to the memo.
Subsequent to Investment Personnel obtaining shares/units of a
company in a Limited Offering, the company may issue and have
outstanding publicly traded Securities. If in the course of
performing their job responsibilities any Investment Personnel
who acquired shares/units in a Limited Offering transaction
becomes involved in the consideration of an investment in the
issuer by an Investment Company/Account, they will disclose
the existence of their personal ownership in the company to
the Chief Investment Officer. The Adviser will then excuse
such employee from the investment decision making process for
the Security.
(i) All Investment Personnel are prohibited from serving on the
boards of directors of publicly traded companies, absent prior
authorization based upon a determination by Adviser management
that the board service would be consistent with the interests
of
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the Investment Companies/Accounts. In instances where Adviser
management determines that board service for a company is
merited, such Investment Personnel will be subject to the same
restrictions that are imposed on all other Access Persons with
respect to their personal securities transactions which
involve Securities of the company for which they are a
director, as described in Section III.(d) of the Code.
(j) All Investment Personnel must make disclosure with respect to
any family member(s) employed in the securities business who
might be in a position to benefit as a result of the trading
activity of the Investment Companies/Accounts. It is
prohibited for Investment Personnel to influence the
allocation of brokerage for direct or indirect personal or
familial benefit. However, such disclosure shall not be deemed
evidence that any benefit has been conferred, directly or
indirectly, by Investment Personnel on such family member(s).
Prohibition Applicable Only To Portfolio Managers
(k) All portfolio managers are prohibited from purchasing or
selling any Security (or equivalent Security) within at least
7 calendar days before or after an Investment Company/Account
that he or she manages purchases or sells that Security.
IV. EXEMPTED TRANSACTIONS
The prohibitions of Section III. of the Code shall not apply to:
(a) purchases or sales effected in any account over which the
Access Person has no direct or indirect influence or control;
(b) purchases or sales which are non-volitional on the part of the
Access Person, such as Securities acquired as a result of a
spin-off of an entity from a company whose Securities are
owned by an Access Person, or the involuntary sale of
Securities due to a merger or as the result of a company
exercising a call provision on its outstanding debt;
(c) purchases which are part of an automatic dividend reinvestment
plan or a company sponsored stock purchase plan;
(d) purchases effected upon the exercise of rights issued by an
issuer pro rata to all holders of a class of its Securities,
to the extent such rights were acquired from such issuer, and
sales of such rights so acquired; and
(e) any Securities transaction, or series of related transactions,
involving 500 shares or less in the aggregate, if the issuer
has a market capitalization (outstanding shares multiplied by
the current price per share) greater than $10 billion. This
exemption (e) is not available to Investment Personnel.
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V. REPORTING
(a) Within 10 days of their commencement of employment with the
Adviser (or if not an employee, of their otherwise becoming an
Access Person to the Adviser), all Access Persons shall
disclose in writing to the Compliance Officer all of their
Security holdings in which they have any direct or indirect
Beneficial Ownership at such time as the person became an
Access Person (see Appendix E).
Thereafter, when requested by the Compliance Officer all
Access Persons shall on an annual basis disclose in writing to
the Compliance Officer all of their Security holdings in which
they have any direct or indirect Beneficial Ownership. This
information must be current as of a date no more than 30 days
before the report is submitted.
Both the Initial and the Annual Holdings Report shall contain
the following information:
(1) the title, number of shares and the principal amount
of each Security;
(2) the name of any broker, dealer or bank with whom the
Access Person maintained an account in which any
Securities were held; and
(3) the date that the report is submitted by the Access
Person.
The above notwithstanding, an Access Person shall not be
required to make a report with respect to any Security held in
any account over which he or she does not have any direct or
indirect influence or control. Each such report may contain a
statement that the report shall not be construed as an
admission by the Access Person that he or she has any direct
or indirect Beneficial Ownership in the Security to which the
report relates.
(b) All Access Persons shall direct their brokers to supply the
Compliance Officer, on a timely basis, duplicate copies of
confirmations of all personal securities transactions and
copies of all statements for all Securities accounts. Please
note that even if the Access Person does not currently intend
to purchase or sell Securities (as defined at Section II.(d)
above) in the account, the Access Person must direct their
brokers to send the Compliance Officer duplicate confirmations
and statements on the account if the account allows any
trading in such Securities.
(c) Whether or not one of the exemptions listed in Section IV. of
the Code applies, each Access Person shall file with the
Compliance Officer a written report (see Appendix C)
containing the information described in Section V.(d) of the
Code with respect to each transaction in any Security in which
such Access Person by reason of such transaction acquires or
disposes of any direct or indirect Beneficial Ownership in the
Security; provided, however, that an Access Person shall not
be required to make a report with respect to any transaction
effected for any account over which he or she does not have
any direct or indirect influence or control. Each such report
may contain a statement that the report shall not be construed
as an admission by the Access Person that he or she has any
direct or indirect Beneficial Ownership in the Security to
which the report relates.
(d) Such report shall be made not later than 10 days after the end
of the calendar quarter in which the transaction to which the
report relates was effected, and shall contain the following
information:
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(1) the date of the transaction, the title, the interest
rate and maturity date (if applicable), the number of
shares and the principal amount of each Security
involved;
(2) the nature of the transaction (i.e., purchase, sale
or any other type of acquisition or disposition);
(3) the price at which the Security transaction was
effected;
(4) the name of the broker, dealer or bank with or
through whom the transaction was effected; and
(5) the date that the report is submitted by the Access
Person.
For any report concerning a purchase or sale in which the
Access Person relied upon one of the exemptions provided in
Section IV. of the Code, the Access Person will provide a
brief statement of the exemption relied upon and the
circumstances of the transaction if requested by the
Compliance Officer.
In addition to such report, within 10 days after the end of
the calendar quarter in which an Access Person opens any
brokerage account, the Access Person provide the Compliance
Officer with the following information:
(1) the name of the broker, dealer or bank with whom the
Access Person established the account;
(2) the date the account was established; and
(3) the date that the report is submitted by the Access
Person.
(e) The Securities transaction reporting requirements of Sections
V.(c) and V.(d) of the Code may be satisfied by the
Compliance Officer receiving all confirmations of Security
transactions and/or periodic statements for each Access
Person's Securities accounts. Confirmations of Security
transactions and/or Security account statements received by
the Compliance Officer will be distributed quarterly to Access
Persons for their review to ensure that such
confirmations/statements include all Security transactions
required to be reported under this Code.
(f) An Access Person will be deemed to have participated in, and
must report under this Code, any Securities transactions
participated in by:
(1) The person's spouse;
(2) The person's minor children;
(3) Any other relatives sharing the person's household;
(4) A trust in which the person has a beneficial
interest, unless such person has no direct or
indirect control over the trust;
(5) A trust as to which the person is a trustee;
(6) A revocable trust as to which the person is a
settler; or
(7) A partnership of which the person is a partner
(including most investment clubs) unless the person
has no direct or indirect control over the
partnership.
(g) The Compliance Officer shall identify all Access Persons who
are required to make the reports required by Section V. of the
Code and shall inform them of their reporting obligations
hereunder.
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VI. REVIEW
The Compliance Officer shall review or supervise the review of the personal
securities transactions and the holdings reported pursuant to Section V. of the
Code. Personal securities transactions and holdings reported by the Compliance
Officer shall be reviewed by the Vice President-Legal. As part of this review,
each such reported personal securities transaction shall be compared against the
trading activity of the Investment Companies/Accounts to determine whether a
violation of Section III. of the Code may have occurred. If the Compliance
Officer or Vice President-Legal determines that a violation may have occurred,
he or she shall promptly submit the pertinent information regarding the
transaction to Adviser management, who shall evaluate whether a violation of the
Code has occurred, taking into account all the exemptions provided under Section
IV. of the Code, and if so, whether such violation is material. The Adviser will
consider all relevant facts and circumstances surrounding the transaction prior
to making its determination. In addition, before making any determination that a
material violation has occurred, Adviser management shall give the person
involved an opportunity to supply additional information regarding the
transaction in question.
VII. SANCTIONS
If a final determination is made that a material violation of this Code has
occurred, the Adviser's management may require the Access Person to disgorge to
the affected Investment Company/Account or, if not related to a particular
Investment Company/Account, a charitable organization, all or a portion of the
profits gained or losses avoided as a result of the prohibited transaction. The
Compliance Officer or Vice President-Legal shall provide a written report of
management's determination to the Board of Directors of the member-manager for
such further action and sanctions as said Board deems appropriate, which
sanctions may in the Board's discretion include, among other things, imposition
of a monetary penalty and/or censure, suspension or termination of the Access
Person. A copy of the report shall also be provided to the Board of
directors/trustees of each investment company for which the Adviser is the
investment adviser or sub-adviser.
VIII. PROCEDURES FOR PREVENTING THE TRADING ON MATERIAL, NONPUBLIC
INFORMATION
(a) In addition to the prohibitions set forth in Section III. of
the Code which are applicable only to Access Persons of the
Adviser, the Adviser forbids any Director, officer or employee
(including spouses, minor children and adults living in the
same household as the Director, officer or employee), either
personally or on behalf of others (such as Investment
Companies/Accounts managed by the Adviser) from trading on
material, nonpublic information or communicating material,
nonpublic information to others in violation of the securities
laws. This conduct is frequently referred to as "insider
trading." The Adviser's policy against insider trading applies
to every Director, officer and employee and extends to
activities within and outside their duties at the Adviser. Any
questions regarding the Adviser's policies and procedures
should be referred to the Compliance Officer.
The term "insider trading" is not defined in the federal
securities laws, but generally is used to refer to the use of
material, nonpublic information to trade in securities
(whether or not one is an "insider") or to the communication
of material, nonpublic information to others.
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While the law concerning insider trading is not static, it is
generally understood that the law prohibits:
o trading by an insider, while in possession of
material, nonpublic information, or
o trading by a non-insider, while in possession of
material, nonpublic information, where the
information either was disclosed to the non-insider
in violation of an insider's duty to keep it
confidential or was misappropriated, or
o communicating material, nonpublic information to
others.
The elements of insider trading and the penalties for such
unlawful conduct are discussed below. If, after reviewing this
policy statement, you have any questions, you should consult
the Compliance Officer.
1. Who is an insider?
The concept of "insider" is broad. It includes
directors, officers and employees of a company. In
addition, a person can be a "temporary insider" if he
or she enters into a special confidential
relationship with a company and as a result is given
access to information solely for such company's
purposes. A temporary insider can include, among
others, a company's attorneys, accountants,
consultants and bank lending officers, and the
employees and associates of such persons. In
addition, the Adviser may become a temporary insider
of a company it advises or for which it performs
other services. According to the Supreme Court, the
company must expect the outsider to keep the
nonpublic information confidential, and the
relationship must at least imply such a duty before
the outsider will be considered a temporary insider.
In addition, one who receives material, nonpublic
information (a "tippee") or one who gives material,
nonpublic information to another person (a "tipper")
may become an insider and therefore incur liability
for insider trading. Finally, and perhaps most
relevant for the Code, a Director, officer or
employee of the Adviser may become an insider if
material, nonpublic information is received from an
insider of a company whose securities are held or
being considered for purchase by an Investment
Company/Account.
2. What is Material Information?
Trading on inside information is not a basis for
liability unless the information is material.
"Material information" generally is defined as
information for which there is a substantial
likelihood that a reasonable investor would consider
it important in a decision to buy, hold or sell
stock, or information that is reasonably certain to
have a substantial effect on the price of a company's
securities. Information that Directors, officers or
employees should consider material includes, but is
not limited to: dividend changes, earnings estimates,
changes in previously released earnings estimates,
significant merger or acquisition proposals or
agreements, major litigation, liquidation problems,
and extraordinary management developments.
Material information does not have to relate to a
company's business. For example, in Carpenter v.
U.S., 108 U.S. 316 (1987), the U.S. Supreme Court
considered material certain information about the
contents of a forthcoming newspaper column that was
expected to affect the market price of a security. In
that case, a Wall Street Journal reporter was found
criminally liable for
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disclosing to others the dates that reports on
various companies would appear in the Journal and
whether those reports would be favorable.
3. What is Nonpublic Information?
Information is nonpublic until it has been
effectively communicated to the marketplace. One must
be able to point to some fact to show that the
information is generally public. For example,
information found in a report filed with the U.S.
Securities and Exchange Commission or appearing in
Dow Jones, Reuters Economic Services, The Wall Street
Journal or other publications would be considered
public.
4. Penalties for Insider Trading
Penalties for trading on or communicating material,
nonpublic information are severe, both for the
individuals involved in such unlawful conduct and
their employers. A person can be subjected to some or
all of the penalties below even if he or she does not
personally benefit from the violation. Penalties
include:
o Civil injunctions,
o treble damages,
o jail sentences of up to ten years,
o civil penalties for the person who committed
the violation of up to three times the
profit gained or loss avoided, whether or
not the person actually benefited,
o criminal fines (no matter how small the
profit) of up to $1 million, civil penalties
for the employer or other controlling person
of up to the greater of $1 million or three
times the profit gained or loss avoided.
Because of the serious potential penalties against
employers as well as violators, any violation of this
Code of Ethics and Statement of Policies which
involves insider trading can be expected to result in
serious sanctions by the Adviser, including dismissal
of the persons involved for cause.
(b) The following procedures have been established to aid the
Directors, officers and employees of the Adviser in avoiding
insider trading, and to aid the Adviser in preventing,
detecting and imposing sanctions against insider trading.
Every Director, officer and employee of the Adviser must
follow these procedures or risk serious sanctions by the
Adviser, including dismissal for cause, substantial personal
liability and criminal penalties. If you have any questions
about these procedures, you should consult the Compliance
Officer.
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Identifying Inside Information in the Context of Personal Securities
Trading
Before trading for yourself or others, including Investment
Companies/Accounts managed by the Adviser, in the securities of a
company about which you may have potential inside information, whether
obtained through the Advisers activities or not, ask yourself the
following questions:
(a) Is the information material? Is there a substantial
likelihood that a reasonable investor would consider
this information important in making his or her
decision to buy, hold or sell stock? Is it reasonably
certain that this information would substantially
affect the market price of the securities if it were
generally disclosed?
(b) Is the information nonpublic? To whom has this
information been provided? Has the information been
effectively communicated to the marketplace by being
filed with the U.S. Securities and Exchange
Commission or published in Reuters, The Wall Street
Journal or other such publications?
(c) If your securities transactions became the subject of
scrutiny, how would they be viewed after-the-fact
with the benefit of hindsight? As a result, before
engaging in any transaction, you should carefully
consider how regulators and others might view your
transaction in hindsight.
If, after consideration of the above, you believe that the information
is material and nonpublic, or if you have any doubt as to whether the
information is material and nonpublic, you must take the following
steps:
(1) Report the matter immediately to the Compliance
Officer,
(2) Refrain from purchasing or selling the securities on
behalf of yourself or others, including Investment
Companies/Accounts managed by the Adviser,
(3) Refrain from communicating the information inside or
outside of the Adviser, other than to the Compliance
Officer, and
(4) After the Compliance Officer has reviewed the issue,
you will be instructed to continue the prohibitions
against trading and communication, or you will be
allowed to trade and communicate the information.
Restricting Access to Material, Nonpublic Information
(a) General Procedures
Material, nonpublic information in the possession of a
Director, officer or employee of the Adviser may not be
communicated to anyone, including persons within the Adviser
except to the Compliance Officer as provided in Section VIII.
(b) of the Code or as is necessary for individuals to perform
their duties at the Adviser. In addition, care should be taken
so that such information is secure. For example, files
containing material, nonpublic information should be
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maintained in a secure manner; access to computer files
containing material, nonpublic information should be
restricted.
(b) Contacts With Public Companies
For the Adviser, contacts with public companies represent an
important part of its research efforts. The Adviser may make
investment decisions on the basis of the firm's conclusions
formed through such contacts and analysis of
publicly-available information. Difficult legal issues arise,
however, when, in the course of these contacts, a Director,
officer or employee of the Adviser becomes aware of material,
nonpublic information. This could happen, for example, if a
company's Chief Financial Officer prematurely discloses
quarterly results to an analyst or an investor relations
representative makes a selective disclosure of adverse news to
a handful of investors. In such situations, the Adviser must
make a judgment as to its further conduct. To protect the
Adviser and its Investment Companies/Accounts, all Directors,
officers and employees of the Adviser should contact the
Compliance Officer immediately if they believe that they may
have received material, nonpublic information.
(c) Tender Offers
Tender offers represent a particular concern in the law of
insider trading for two reasons. First, tender offer activity
often produces extraordinary gyrations in the price of the
target company's securities. Trading during this time period
is more likely to attract regulatory attention (and produces a
disproportionate percentage of insider trading cases). Second,
the U.S. Securities and Exchange Commission has adopted a rule
which expressly forbids trading and "tipping" while in
possession of material, nonpublic information regarding a
tender offer received from the tender offeror, the target
company or anyone acting on behalf of either. Directors,
officers and employees of the Adviser should exercise
particular caution any time they become aware of nonpublic
information relating to a tender offer.
Procedures Designed to Prevent and Detect Insider Trading
The following procedures are designed to prevent and detect insider
trading within the Adviser or by the Adviser's Directors, officers and
employees. To prevent and detect insider trading the Compliance Officer
should:
(a) Provide, on an annual basis, an educational program designed
to familiarize Directors, officers and employees of the
Adviser with the Adviser's policies and procedures on insider
trading, misuse of material, nonpublic information, reporting
requirements for personal securities transactions and related
matters.
(b) Answer questions from Directors, officers and employees of the
Adviser relating to the Adviser's policies and procedures.
(c) Resolve issues of whether information received by Directors,
officers and employees of the Adviser is material and
nonpublic.
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(d) Review on an annual basis and update as necessary the
Adviser's policies and procedures to reflect changes in rules,
regulations and case law.
(e) When it has been determined that a Director, officer or
employee of the Adviser has material, nonpublic information on
a company, the Compliance Officer will take reasonable steps
to (i) ensure that such information is not disseminated, and
(ii) restrict Directors, officers and employees from trading
in securities to which the information relates, either for
their own accounts or for Investment Companies/Accounts
managed by the Adviser. These objectives will be served by
placing the company on a "Restricted List" that will be
maintained by the Compliance Officer.
While each such company is on the Restricted List, no
portfolio manager shall initiate or recommend any transaction
in the company's securities in any Investment
Companies/Accounts managed by the Adviser. The Compliance
Officer will be responsible for removing a particular company
from the Restricted List after having received permission for
such action from Adviser management, and will be responsible
for making available the Restricted List and any updates to it
to all Investment Personnel. The Restricted List is highly
confidential and shall, under no circumstances, be discussed
with or disseminated to anyone outside of the Adviser.
Special Restricted List Procedures
(1) Purchase and Sale of Securities Issued by the
Adviser's Parent Company
More than 80% of the Adviser's stock is indirectly
owned by a publicly traded company. As a result, the
Company is considered to be in a position of Control
with respect to the Adviser. Federal securities law
prohibits any Investment Company for which the
Adviser acts as investment adviser or sub-adviser
from investing in the securities of such a company.
The Company has been placed on the Adviser's
Restricted List indefinitely, and therefore no
Investment Company/Account may invest in any of its
securities. Personal security transactions by
Directors, officers and employees of the Adviser in
the securities of this Company will be allowed
pursuant to policies and procedures as in effect from
time to time that will be provided to you by the
Compliance Officer.
(2) Publicly Traded Companies for Which a Director,
Officer or Employee of the Adviser Serves as a
Director or Officer
Subject to the requirement that they disclose their
position to the Compliance Officer (and, in the case
of Investment Personnel, that they obtain prior
approval from Adviser management), Directors,
officers and employees of the Adviser may serve on
the boards of directors of publicly traded companies.
In addition, Directors, officers and employees of the
Adviser may be officers of publicly traded companies.
To preclude the possibility of trades of such
companies' securities occurring in Investment
Companies/Accounts while the Adviser may be in
possession of material, nonpublic information, any
publicly traded company for which a Director, officer
or employee of the Adviser is a director or officer
shall be placed on the Restricted List and shall
remain on the list until their directorship or
14
<PAGE> 15
officership is terminated and the Director, officer
or employee of the Adviser ceases to be an insider to
the company.
While a company is on the Restricted List, each of
the Adviser's Directors, officers and employees who
are a member of the board of directors of a publicly
traded company or an officer of a publicly traded
company may engage in personal securities
transactions involving the securities of such
company, subject to preclearance that will be
conditioned upon obtaining documented approval to
trade from such company's management, in light of
their procedures designed to prevent the misuse of
material, nonpublic information by company insiders.
(f) Promptly, upon learning of a potential violation of the
Adviser's policies and procedures on insider trading, prepare
a written report to Adviser management with full details about
the potential violation and recommendations for further
action.
IX. ANNUAL REPORTING AND CERTIFICATION
(a) On an annual basis, the Compliance Officer shall prepare a
written report to the President of the Adviser and the Board
of Directors of the member-manager setting forth the
following:
(1) A summary of existing procedures to detect and
prevent violations of the Code,
(2) Full details of any investigation, either internal or
by a regulatory agency, of any violations of the
Code, the resolution of such investigations and the
steps taken to prevent further violations,
(3) An evaluation of the current compliance procedures
and any recommendations for improvement, and
(4) A description of the Adviser's continuing efforts to
educate all Directors, officers and employees of the
Adviser regarding the Code, including the dates of
any such educational programs presented since the
last report.
A report setting forth the above shall also be made annually
to the board of directors/trustees of each Investment Company
for which the Adviser acts as investment adviser or
sub-adviser, except that any information about violations of
the Code may be limited to only material violations. In
addition, the Adviser shall certify to each such Investment
Company annually that it has adopted procedures reasonably
necessary to prevent Access Persons from violating the Code.
After September 1, 2000, before being approved as an
investment adviser or sub-adviser for any Investment Company,
the Adviser is required to provide the Code to the Investment
Company's directors/trustees for approval along with a
certification that the Adviser has adopted procedures
reasonably necessary to prevent Access Persons from violating
the Code.
Any material changes to the Code must be approved by each
Investment Company's directors/trustees within 6 months after
adoption of the material change.
15
<PAGE> 16
(b) On an annual basis, all Directors, officers and employees of
the Adviser are required to certify in writing that they have
read and understand the Code of Ethics and Statement of
Policies and recognize that they are subject thereto. In
addition, all such persons are required to certify annually
that they have complied with the requirements of the Code and,
as for Access Persons, that they have reported all personal
securities transactions and holdings required to be reported
pursuant to the Code (see Appendix D).
In conjunction with such certification, the Compliance Officer
will provide all Access Persons with an educational program
designed to familiarize them with their responsibilities under
the Code. If a Director, officer or employee of the Adviser
has any questions pertaining to these responsibilities or
about the policies or procedures contained in the Code, they
should discuss them with the Compliance Officer prior to
completing their annual certification statement.
X. OTHER LEGAL AND REGULATORY MATTERS
(a) Confidentiality. All account information concerning the
Adviser's clients (e. g., name, account size, specific
securities held, securities trades, etc.) is absolutely
confidential. Therefore, access to Investment Company/Account
information is limited to those individuals who must have such
access to perform their duties, and such information shall not
be communicated to any other person either within or outside
the Adviser. The confidentiality of all Investment
Company/Account information is critical to the Adviser's
reputation for excellence and integrity and maintenance of the
Adviser's competitive position, and any disclosure of
confidential information can be expected to result in serious
sanctions by the Adviser, including possible dismissal for
cause.
(b) Bankruptcy/Criminal Offenses. The Adviser is required to
notify regulatory organizations when certain events occur
regarding its Directors, officers and/or employees.
Accordingly the Vice President-Legal must be notified if any
of the following occur with respect to a Director, officer or
employee:
o Personal bankruptcy.
o The bankruptcy of a corporation in which any
Director, officer or employee owns 10% or more of the
securities.
o Arrest, arraignment, indictment or conviction for, or
the entry of a guilty or no contest plea for, any
criminal offense (other than minor traffic
violations).
(c) Receipt of Legal Documents. On occasion, employees are served
with legal documents (e.g., a subpoena) for the Adviser. Upon
receipt of legal documents, the Adviser's Vice President-Legal
is to be notified immediately.
(d) Retention of Outside Counsel. Directors, officers and
employees may not retain the services of outside counsel under
circumstances such that the Adviser would be obligated to pay
legal fees unless the Adviser's Vice President-Legal has
granted approval for retention of such counsel in advance.
(e) Contact with Industry Regulators. In the event of an inquiry
from an industry regulator--whether via the telephone, mail or
personal visit--Directors, officers and employees must contact
the Adviser's Vice President-Legal as soon as possible for
instructions.
16
<PAGE> 17
(f) Political Contributions. The use of funds or assets of the
Adviser for any unlawful or improper purpose is prohibited.
This prohibition includes any contribution to any public
official, political candidate or political entity, except as
may be expressly permitted by law. This shall also preclude
unlawful contributions through consultants, customers or other
third parties, including payments where Directors, officers or
employees of the Adviser know or have reason to believe that
payments made to such other third parties will be used as
unlawful contributions.
The above prohibitions relate only to the use of corporate
funds and in no way are intended to discourage Directors,
officers or employees from making personal contributions to
political candidates or parties of their choice. No such
individual contribution will be reimbursed by the Adviser in
any manner, directly or indirectly.
(g) Business Conduct. It is the policy of the Adviser to conduct
business in accordance with the applicable laws and
regulations of the United States and all other individual
states and countries in which the Adviser operates or has any
significant contacts. Unethical business practices will
subject Directors, officers and employees to appropriate
disciplinary action, including dismissal for cause if
warranted, and may result in prosecution for violating
federal, state or foreign laws.
No payment (cash or otherwise) can be made (directly or
indirectly) to any employee, official or representative of any
domestic or foreign governmental agency, instrumentality,
party, or candidate thereof, for the purpose of influencing
any act, omission or decision.
The Adviser's books, records and accounts must be maintained
in sufficient detail as to accurately reflect the transactions
and dispositions of its assets. No undisclosed or unrecorded
fund or asset of the Adviser may be established for any
purpose.
Any Director, officer or employee with questions about or
knowledge of violations of these policies must contact the
Adviser's Vice President-Legal.
XI. MISCELLANEOUS PROVISIONS
(a) The Adviser shall maintain records in the manner and to the
extent set forth below, and make such records available for
examination by representatives of the U.S. Securities and
Exchange Commission:
(1) A copy of this Code and any other code of ethics
which is, or at any time within the past five years
has been, in effect shall be preserved in an easily
accessible place;
(2) A record of any violation of the Code and of any
action taken as a result of such violation shall be
preserved in an easily accessible place for a period
of not less than five years following the end of the
fiscal year in which the violation occurs;
(3) A copy of each report made by an Access Person
pursuant to the Code shall be preserved for a period
of not less than five years from the end of the
fiscal year in which it is made, the first two years
in an easily accessible place;
(4) A list of all persons who are, or within the past
five years have been, required to make reports
pursuant to the Code, and who are, or within the past
five years have been, responsible for reviewing these
reports, shall be maintained in an easily accessible
place; and
17
<PAGE> 18
(5) A record of any decision, and the reasons supporting
the decision, to approve the acquisition by any
Investment Personnel of a Security pursuant to a
Limited Offering shall be preserved for a period of
not less than five years from the end of the fiscal
year in which the approval was granted.
(b) All reports of Securities transactions and any other
information filed with the Adviser or furnished to any person
pursuant to the Code shall be treated as confidential, but are
subject to review as provided herein and by representatives of
the U.S. Securities and Exchange Commission or any other
regulatory or self-regulatory organization to the extent
required by law or regulation.
(c) The Board of Directors of the member-manager may from time to
time adopt such interpretations of the Code and such
exceptions to provisions of the Code as they deem appropriate.
18
<PAGE> 19
APPENDIX A
For purposes of the attached Code of Ethics and Statement of Policies, a
"beneficial owner" shall mean any Director, officer or employee who, directly or
indirectly, through any contract, arrangement, understanding, relationship or
otherwise, has or shares a direct or indirect opportunity to profit or share in
any profit derived from a transaction in the subject securities. The term
"Beneficial Ownership" of securities would include not only ownership of
securities held by a Director, officer or employee for his or her own benefit,
whether in bearer form or registered in their name or otherwise, but also
ownership of securities held for his or her benefit by others (regardless of
whether or how they are registered) such as custodians, brokers, executors,
administrators, or trustees (including trusts in which he or she has only a
remainder interest), and securities held for his or her account by pledgees,
securities owned by a partnership in which he or she is a member if they may
exercise a controlling influence over the purchase, sale or voting of such
securities, and securities owned by any corporation that he or she should regard
as a personal holding corporation. Correspondingly, this term would exclude
securities held by a Director, officer or employee for the benefit of someone
else.
Ordinarily, this term would not include securities held by executors or
administrators in estates in which a Director, officer or employee is a legatee
or beneficiary unless there is a specific legacy to such person of such
securities or such person is the sole legatee or beneficiary and there are other
assets in the estate sufficient to pay debts ranking ahead of such legacy, or
the securities are held in the estate more than a year after the decedent's
death.
Securities held in the name of another should be considered as "beneficially"
owned by a Director, officer or employee where such person enjoys "benefits
substantially equivalent to ownership". The U.S. Securities and Exchange
Commission has said that although the final determination of Beneficial
Ownership is a question to be determined in the light of the facts of the
particular case, generally a person is regarded as the beneficial owner of
securities held in the name of his or her spouse and their minor children.
Absent special circumstances such relationship ordinarily results in such person
obtaining benefits substantially equivalent to ownership, e.g., application of
the income derived from such securities to maintain a common home, to meet
expenses that such person otherwise would meet from other sources, or the
ability to exercise a controlling influence over the purchase, sale or voting of
such securities.
A Director, officer, or employee also may be regarded as the beneficial owner of
securities held in the name of another person, if by reason of any contract,
understanding, relationship, agreement, or other arrangement, he or she obtains
therefrom benefits substantially equivalent to those of ownership. Moreover, the
fact that the holder is a relative or relative of a spouse and sharing the same
home as a Director, officer or employee may in itself indicate that the
Director, officer or employee would obtain benefits substantially equivalent to
those of ownership from securities held in the name of such relative. Thus,
absent countervailing facts, it is expected that securities held by relatives of
the Director, officer or employee or his or her spouse who share the same home
as the Director, officer or employee will be treated as being beneficially owned
by the Director, officer or employee.
A Director, officer or employee also is regarded as the beneficial owner of
securities held in the name of a spouse, minor children or other person, even
though he or she does not obtain therefrom the aforementioned benefits of
ownership, if they can vest or revest title in themselves at once or at some
future time.
19
<PAGE> 20
APPENDIX B
APPROVAL FORM
FOR THE PURCHASE/SALE OF SECURITIES
- --------------------------------------------------------------------------------
PROPOSED TRANSACTION
TO BE COMPLETED BY THE ACCESS PERSON 1,2
Security Description:
------------------------------------------------
Security Symbol: Security Exchange
-------------- -------------
Type of Transaction: Purchase Sale
------- -----
Maximum Number of Shares/Principal Amount of Debt:
-------------------
Except as follows, I am not aware of any factors that pertain to this proposed
personal security transaction that would be relevant to the determination of
whether such transaction could be in conflict with the interests of an
Investment Company/Account managed by Berger LLC (See Section III (b) of the
Code):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- ----------------------------- ---------------------------------- ---------------
Access Person (please print) Signature of Access Person Date
1. See Berger LLC's Code of Ethics and Statement of Policies (the "Code") for
the definition of "Access Person."
2. As described in Section IV. Exempted Transactions of the Code, certain
transactions involving the purchase or sale of Securities are not prohibited
and therefore do not require pre-clearance. IT IS THE RESPONSIBILITY OF THE
ACCESS PERSON TO CORRECTLY DETERMINE WHETHER THEIR PROPOSED PERSONAL
SECURITY TRANSACTION IS AN EXEMPTED TRANSACTION UNDER THE CODE. ANY ACCESS
PERSON WHO HAS QUESTIONS REGARDING THIS DETERMINATION SHOULD CONSULT WITH
THE COMPLIANCE OFFICER PRIOR TO ENGAGING IN THE PROPOSED PERSONAL SECURITY
TRANSACTION.
- --------------------------------------------------------------------------------
APPROVAL/DISAPPROVAL
TO BE COMPLETED BY THE COMPLIANCE OFFICER
<TABLE>
<S> <C>
The above proposed transaction has been: Approved for execution within 3 business days after the date
----- of this approval
Approved for execution between and
----- ----------- -----------
Disapproved
-----
Comments:
---------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------
- ---------------------------------- ---------------------------------
Signature of Compliance Officer Date
</TABLE>
<PAGE> 21
APPENDIX C
PERSONAL
SECURITIES TRANSACTIONS REPORT
BERGER LLC
<TABLE>
<S> <C>
NAME: FOR THE QUARTER ENDED:
-------------------------------------------------- ---------------------
(Please Print)
[ ] - Confirmations for all of my reportable personal securities [ ] - Confirmations for all of my reportable
transactions for the quarter are attached to this report. personal securities transactions for the
quarter are attached to this report
EXCEPT AS DESCRIBED BELOW:
</TABLE>
<TABLE>
<CAPTION>
Transaction Security Description Number Principal Nature of Name of Broker,
Date (including interest rate and maturity date, if applicable) Symbol of Shares Amount Transaction Price Dealer or Bank
<S> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
DEFINITIONS: Principal Amount - Total amount received or paid for the security.
Nature of Transaction - Purchase, sale or other acquisition or disposition.
Price - Price per share at which transaction was effected.
Broker, Dealer or Bank - Name of broker, dealer or bank with or through whom the transaction was effected.
NOTE: Transactions in shares of registered open-end investment companies (i.e., mutual funds), direct obligations of
the Government of the United States (e.g., U.S. Treasury securities), banker's acceptances, bank certificates of
deposit, commercial paper and high-quality short-term debt instruments, including repurchase agreements, are not
required to be reported.
STATEMENT: THIS REPORT IS NOT TO BE CONSTRUED AS AN ADMISSION BY ME THAT I HAVE ANY DIRECT OR INDIRECT BENEFICIAL OWNERSHIP IN
THE SECURITIES TO WHICH THIS REPORT RELATES.
---------------------------------------------------- ----------------------------
(Signature) (Date)
</TABLE>
<PAGE> 22
APPENDIX D
ANNUAL CONFIRMATION FOR YOUR BERGER LLC
CODE OF ETHICS AND STATEMENT OF POLICIES (THE "CODE")
I have carefully read and understand the Code. I recognize that I must
comply with the Code and that I am subject to the policies and procedures
contained therein. I understand that the policies and procedures stated in this
Code are subject to change and that, from time to time, I may receive
information about changes in the policies and procedures contained therein. I
recognize that I have / have not (Compliance Officer to circle one) been deemed
to be an Access Person under the Code until I receive further written notice
from the Compliance Officer. In addition (please check the appropriate line
below):
_____________- I have complied with the requirements of the Code at all times
since my last Confirmation for the Code, and I have reported all of my personal
securities transactions since my last Confirmation which are required to be
reported pursuant to the Code.
_____________- I have complied with the requirements of the Code at all times
since my last Confirmation for the Code, except in certain instances during the
period, a description of which is attached hereto, which the Compliance Officer
is aware of and which have been addressed by Adviser management. I have reported
all of my personal securities transactions since my last Confirmation for the
Code which are required to be reported pursuant to the Code.
As required to be reported annually by all Access Persons under the
Code, attached (if applicable) is a complete listing, as of the date of this
Confirmation, of all of my Security holdings in which I have any direct or
indirect Beneficial Ownership.
- ------------------------------- ------------------------------------
Date of Confirmation Covered Person's Name (please print)
------------------------------------
Covered Person's Signature
<PAGE> 23
APPENDIX E
PERSONAL SECURITIES
HOLDINGS REPORT (1), (2)
BERGER LLC
NAME: DATE:
------------------------- ------------------------
(Please Print)
<TABLE>
<CAPTION>
Number of Shares or
Security Description Symbol Principal Amount of Debt
<S> <C> <C>
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to the provisions of Section V.(a) of Berger LLC's Code of Ethics
and Statement of Policies (the "Code"), this report shall include a
complete listing of the Access Person's Security holdings (see (2) below)
in which they have any direct or indirect Beneficial Ownership.
(2) The term "Security" as defined in the Code excludes shares of registered
open-end investment companies (i.e., mutual funds), direct obligations of
the Government of the United States (e.g., U.S. Treasury securities)
banker's acceptances, bank certificates of deposit, commercial paper and
high-quality short-term debt instruments, including repurchase agreements.
Therefore, holdings by Access Persons in these types of investments are not
required to be included on this report.
-------------------------------------------
(Signature)
<PAGE> 1
Exhibit 23(p)-3
CODE OF ETHICS
BERGER DISTRIBUTORS LLC
Last Revised April 18, 2000
I. Incorporation of the Code of Ethics and Statement of Policies of Berger
LLC
Berger Distributors LLC (the "Distributor") is a wholly-owned
subsidiary of Berger LLC (the "Adviser"), a registered investment
adviser under the Investment Advisers Act of 1940. The Distributor is
the principal underwriter and distributor for the Berger Funds, a
family of no-load mutual funds, while the Adviser acts as the
investment advisor and administrator, or sub-administrator, for the
Berger Funds. As the principal underwriter and distributor for the
Berger Funds, the Distributor hereby incorporates into its Code of
Ethics (the "Distributor's Code") the attached Code of Ethics and
Statement of Policies of the Adviser (the "Adviser's Code") which
covers the Distributor pursuant to its provision of distribution
services to the Berger Funds.
All provisions of the Adviser's Code applicable to "Access
Persons" of the Adviser (as defined in that Code), including but not
limited to the quarterly reporting of securities transactions, apply to
the activities of any "Access Person" of the Distributor as defined
below. A violation of the Adviser's Code by any person covered by this
Code shall also constitute a violation of this Code and will cause such
person to be subject to the provisions of Section VII. SANCTIONS
included in the Adviser's Code. The determination of such sanctions for
a violation of the Distributors Code by an Access Person of the
Distributor will be determined by Distributor management and the Board
of Directors of the Distributor.
II. Definition of "Access Person"
"Access Person" of the Distributor means any director,
officer, employee or registered representative of the Distributor. All
such Access Persons under the Distributor's Code are hereby deemed to
be an Access Person under the Adviser's Code and, as mentioned above,
shall cause all Access Persons of the Distributor to be subject to the
applicable provisions of the Adviser's Code.
In the event that the same individual serves as the Compliance
Officer for both the Distributor and the Adviser, directors, officers,
employees and registered representatives of the Distributor who are
also a director, officer or employee of the Adviser will satisfy the
reporting provisions of this Code by their compliance with the
reporting provisions of the Adviser's Code.
III. Provisions Applicable Only to Access Persons of Berger Distributors LLC
In addition to being subject to certain provisions of the
Advisers Code as described above, Access Persons of the Distributor are
also subject to the following provisions of this Code:
<PAGE> 2
(a) In accordance with Conduct Rule 3040 of the NASD Rules, Access
Persons must, prior to participating in any private securities
transaction, give written notice of such transaction to the
Distributor, describing in detail the proposed transaction,
the person's proposed role therein and stating whether they
will receive selling compensation in connection with the
transaction. "Private securities transaction" shall mean any
securities transaction outside the regular course or scope of
a person's employment with the Distributor. "Selling
compensation" shall mean any compensation paid directly or
indirectly from whatever source in connection with or as a
result of the purchase or sale of a security.
A copy of such notice must be sent to the Compliance Officer.
The Distributor reserves the right to approve or disapprove
such person's participation in the proposed transaction. If an
Access Person engages in a private securities transaction
without receiving prior approval from the Distributor,
management may require the Access Person to disgorge to a
charitable organization all or a portion of the selling
compensation received from the prohibited transaction. The
Compliance Officer shall provide a written report of each such
prohibited transaction to the Board of Directors of the
Distributor for such further action and sanctions as said
Board deems appropriate, which sanctions may in the Board's
discretion include, among other things, imposition of a
monetary penalty and/or censure, suspension or termination of
the Access Person.
(b) All Access Persons are prohibited from giving on an annual
basis any gifts or other things of value to any person or
entity that does business with or on behalf of the Distributor
or any entity for which it acts as the principal underwriter
and distributor (i.e., the Berger Funds) which in total could
reasonably be valued above $100. However, this policy does not
apply to customary business meals or entertainment, or
promotional items (e.g., pens, mugs, caps, T-shirts, etc.)
which are consistent with customary business practices in the
industry.
If a potential violation of this policy is discovered, the
Compliance Officer shall provide a written report of each such
potential violation to Distributor management. If a final
determination is made that the incident does in fact represent
a violation of this policy, the Compliance Officer shall
provide a copy of such report to the Board of Directors of the
Distributor for such action and sanctions as said Board deems
appropriate, which sanctions may in the Board's discretion
include, among other things, imposition of a monetary penalty
and/or censure, suspension or termination of the Access
Person.
ATTACHMENT - Code of Ethics for Berger LLC: Please refer to Exhibit
23(p)-2 of this N-1A filing.
2
<PAGE> 1
EXHIBIT 23(p)-4
CODE OF ETHICS AND STATEMENT OF POLICIES
ADOPTED BY
BBOI WORLDWIDE LLC
LAST REVISED APRIL 18, 2000
<PAGE> 2
PROVISIONS OF THE BBOI WORLDWIDE LLC CODE OF ETHICS AND STATEMENT OF POLICIES
(the "CODE") APPLICABLE ONLY TO MANAGERS, OFFICERS, EMPLOYEES AND OTHER ACCESS
PERSONS OF BBOI WORLDWIDE LLC (the "ADVISER") THAT ARE ALSO COVERED BY AN
APPROVED CODE OF ETHICS OF AN AFFILIATED INVESTMENT ADVISER
If, in addition to being covered by this Code, a member of the Board of Managers
of the Adviser ("Manager") or an officer, employee or other Access Person of the
Adviser is covered by another code of ethics as a result of being a director,
officer or employee of another investment adviser registered under the
Investment Advisers Act of 1940 that is an "affiliated person" of the Adviser as
defined in Section 2(a)(3) of the Investment Company Act of 1940, then for these
persons the provisions of such affiliated adviser's code of ethics are hereby
incorporated by reference into this Code and shall apply to such persons as if
restated herein in full. The incorporation of an affiliated adviser's code of
ethics into this Code is subject to approval by the Adviser and its
determination that such code of ethics meets all applicable legal requirements.
All approved codes of ethics that have been incorporated pursuant to these
provisions are attached as Exhibit I. Persons covered by this Code and an
affiliated adviser's code of ethics which has been approved by the Adviser and
incorporated herein shall report their personal security transactions pursuant
to the provisions of such code of ethics of the affiliated adviser. A violation
of such approved codes of ethics by any person covered by this Code shall also
constitute a violation of this Code and will cause such person to be subject to
the provisions of Section VII. SANCTIONS included herein. Any violation of an
affiliated adviser's approved code of ethics shall be reported to the Compliance
Officer of the Adviser as soon as practicable. In addition, each affiliated
adviser whose code of ethics has been approved and incorporated herein is
required to prepare annually a written report to the Compliance Officer of the
Adviser containing the information required to be reported under Section IX.
ANNUAL REPORTING AND CERTIFICATION of this Code for inclusion by the Adviser in
its report. To the extent required by law, all such approved codes of ethics of
affiliated advisers shall also be submitted for the review and approval of the
Trustees/Directors of any registered investment company advised by the Adviser.
CODE PROVISIONS APPLICABLE ONLY TO MANAGERS, OFFICERS, EMPLOYEES AND OTHER
ACCESS PERSONS OF THE ADVISER THAT ARE NOT COVERED BY AN APPROVED CODE OF ETHICS
OF AN AFFILIATED INVESTMENT ADVISER
I. STATEMENT OF GENERAL PRINCIPLES
The success of BBOI Worldwide LLC as an investment adviser depends upon its
reputation for excellence and integrity in the investment marketplace. All
Managers, officers, employees and other Access Persons of the Adviser must
therefore act in accordance with the highest ethical standards.
A relationship of trust and confidence exists between the Adviser and its
clients. As a result, the interests of the Adviser's clients must always come
first. This means that all actions by
1
<PAGE> 3
Managers, officers, employees and other Access Persons of the Adviser which are
detrimental, or potentially detrimental, to the Adviser's clients must be
avoided. While this principle extends to a broad range of actions and practices,
it is of particular relevance to any decision relating to the personal
investment activities of all Managers, officers, employees and other Access
Persons of the Adviser since such activities may involve potential conflicts of
interest. In order to fulfill their fiduciary duties, all Managers, officers,
employees and other Access Persons of the Adviser must conduct their personal
securities transactions in a manner which does not operate adversely to the
interests of the Adviser's clients and must otherwise avoid serving their own
personal interests ahead of such clients.
In order to ensure that Managers, officers, employees and other Access Persons
of the Adviser comply with their fiduciary duties and other standards imposed by
federal securities law upon their personal investment activities, the Adviser
has adopted this Code of Ethics and Statement of Policies. The Code includes
specific provisions with which all covered persons must comply. However,
compliance with these technical provisions alone will not be sufficient to
insulate from scrutiny trades which show a pattern of abuse of the individual's
fiduciary relationships. All Managers, officers, employees and other Access
Persons are expected to abide by the spirit of the Code and the principles
articulated herein.
Upon assuming their position with the Advisor, each Director, officer or
employee of the Advisor is required to certify in writing that they have read
and understand the Code and that they recognize they are subject to the Code and
will comply with its requirements.
In the course of fulfilling the responsibilities of their position, Managers,
officers, employees and other Access Persons of the Adviser may deal with
issuers of securities, broker/dealers and business associates of the Adviser and
its clients. Such relationships can result in the individual being offered or
given investment opportunities, perquisites, or gifts from persons doing or
seeking business with the Adviser or its clients. All such offers and gifts
which are more than de minimis in value (see Section IV.(a)(3) of the Code)
should be declined or returned in order to prevent a situation which might
compromise or appear to compromise a Manager's, officer's, employee's or other
Access Person's exercise of independent and objective judgment on behalf of the
Adviser's clients.
This Code establishes policies and procedures which govern certain types of
personal securities transaction by individuals deemed "Access Persons" of the
Adviser. In addition, the Code establishes policies and procedures applicable to
all Managers, officers, and employees of the Adviser which have been designed to
detect and prevent the misuse of material, nonpublic information in securities
transactions and to provide guidance in other legal and regulatory matters.
Compliance with the Code is a condition of employment and willful or repeated
violation of its provisions may be cause for termination of employment.
II. DEFINITIONS
(a) "Access Person" means (i) any Manager or officer of the Adviser,
(ii) any employee of the Adviser (or of any company in a Control
relationship to the Adviser) who, in connection with his or her
regular functions or duties, makes, participates in, or obtains
information regarding the purchase or sale of a Security by an
Investment Company/Account, or whose functions relate to the
making of any recommendations with respect to such purchases or
sales and (iii) any natural person in a Control relationship to
the Adviser who obtains information concerning recommendations
made to an Investment Company/Account, with regard to the
purchase or sale of a Security.
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(b) "Beneficial Ownership" shall be interpreted in the same manner as
it would be in determining whether a person is subject to the
provisions of Section 16 and the rules and regulations
thereunder, except that the determination of direct or indirect
beneficial ownership shall apply to all Securities which an
Access Person has or acquires. Application of this definition is
explained in more detail in Appendix A attached hereto.
(c) "Investment Personnel" shall mean ( ) any employee of the Adviser
(or any employee of any company in a Control relationship to the
Adviser) who, in connection with his or her regular functions or
duties, makes or participates in making recommendations regarding
the purchase or sale of a Security by an Investment
Company/Account and (ii) any natural person who controls the
Adviser and who obtains information concerning recommendations
made to the Fund regarding the purchase or sale of a Security by
an Investment Company/Account. Investment Personnel shall include
all persons employed by the Adviser as portfolio managers,
security analysts and security traders.
(d) "Security" shall have the same meaning as that set forth in
Section 2(a)(36) of the Investment Company Act of 1940
(generally, all securities) except that it shall not include
shares of registered open-end investment companies (i.e., mutual
funds), direct obligations of the Government of the United States
(e.g., U.S. Treasury securities), banker's acceptances, bank
certificates of deposit, commercial paper and high quality
short-term debt instruments, including repurchase.
(e) "Purchase or sale of a Security", or phrases of similar import,
shall include, among other things, the purchase, writing or sale
of an option to purchase or sell that Security, the purchase or
sale of any derivative Security whose value is derived from that
Security, such as a Security convertible into or exchangeable for
that Security, and the purchase or sale of any other Security
which has a substantial economic relationship to that Security
being purchased or sold by an Investment Company/Account (e.g., a
Security issued by a partnership which has a substantial portion
of its assets invested in the Security being purchased or sold).
(f) A Security is "being considered for purchase or sale" when a
portfolio manager is seriously considering the purchase or sale
of a Security for an Investment Company/Account, or, with respect
to a security analyst a recommendation to purchase or sell a
Security for an Investment Company/Account, when such person
seriously considers making such a recommendation.
(g) "Control", which shall have the same meaning as that set forth in
Section 2(a)(9) of the Investment Company Act of 1940, generally
means the power to exercise a controlling influence over the
management or policies of a company, unless such power is solely
the result of an official position with such company.
(h) "Compliance Officer" shall mean the employee of the Adviser or
other individual designated by vote of the Board of Managers of
the Adviser to receive reports and take certain actions as
provided in this Code of Ethics and Statement of Policies, or in
the event no such employee has been designated, the employee of
any affiliated adviser acting in such capacity on behalf of the
Adviser. The Compliance Officer may appoint designee to carry out
his/her functions pursuant to the Code.
(i) "Investment Company/Account" means a company registered as such
under the Investment Company Act of 1940 and for which the
Adviser is the investment adviser or sub-adviser, or any pension
or profit-sharing plan, or any institutional or private account
managed by the Adviser.
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(j) "Director of the Advisor shall mean a member of the Board of
Directors of the Adviser's member-manager, Stilwell Management,
Inc.
(k) "Initial Public Offering" means an offering of securities
registered under the Securities Act of 1933, the issuer of which,
immediately before the registration, was not subject to the
reporting requirements of sections 13 or 15(d) of the Securities
Exchange Act of 1934.
(l) "Limited Offering" means an offering that is exempt from
registration under the Securities Act of 1933 pursuant to section
4(2) or section 4(6) or pursuant to rule 504, rule 505, or rule
506 thereunder.
Any Manager, officer, employee or other Access Person of the Adviser who has any
questions regarding these definitions should consult with the Adviser's
Compliance Officer.
III. PROHIBITIONS
NOTE: SUBJECT TO A FINAL DECISION BY ADVISER MANAGEMENT AFTER HAVING REVIEWED
ALL OF THE FACTS AND CIRCUMSTANCES RELEVANT TO THE PARTICULAR TRANSACTION,
INDIVIDUALS COVERED BY THE FOLLOWING PROHIBITIONS MAY BE REQUIRED TO DISGORGE
ALL OR A PORTION OF ANY PROFITS GAINED OR LOSSES AVOIDED AS A RESULT OF
PARTICIPATING IN ANY OF THE PROHIBITED PERSONAL SECURITIES TRANSACTIONS
DISCUSSED BELOW. SEE SECTION VII. SANCTIONS OF THE CODE FOR A MORE DETAILED
DISCUSSION OF THIS MATTER.
Prohibitions Applicable To All Access Persons
(a) No Access Person shall purchase or sell, directly or indirectly,
any Security in which he or she has, or by reason of such
transaction acquires, any direct or indirect Beneficial Ownership
and which he or she knows or should have known at the time of
such purchase or sale:
(1) is being purchased or sold by an Investment Company/Account;
or
(2) is being considered for purchase or sale by an Investment
Company/Account.
Although explained more fully in the definition of "purchase or
sale of a Security" in Section II. of the Code, it bears emphasis
here that included for purposes of this prohibition is any
personal securities transaction involving a derivative Security
or other Security which has a substantial economic relationship
to the Security being considered for purchase or sale or being
purchased or sold by an Investment Company/Account.
(b) All Access Persons are prohibited from the purchase or sale of
Securities without prior approval from the Compliance Officer,
unless such purchase or sale is an exempted transaction as
defined in Section IV. Of the Code. The preclearance process
shall include the Compliance Officer presenting each requested
personal securities transaction to the Adviser's portfolio
manager(s) (or, for Investment Companies/Accounts for which the
Adviser has contracted with another investment adviser, to such
sub-adviser) for the purpose of determining whether the
provisions of Sections III.(a)(1) and III.(a)(2) prevent its
current approval. If granted, such approval will normally be
given in writing (see Appendix B). In circumstances that require
approval of the transaction to be granted verbally, the
Compliance Officer
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shall document for the Adviser's records all information
pertinent to the approved purchase or sale. Any approval for a
personal securities transaction will be effective for 3 business
days following the date of approval (unless otherwise specified
in the written approval). Any transaction not completed within
the 3 day (or other specified) time period will require
reapproval by the Compliance Officer prior to engaging in any
further purchases or sales.
When requesting approval for a personal securities transaction,
all Access Persons should be careful to identify for the
Compliance Officer any factors potentially relevant to a conflict
of interest. This is especially true when an Access Person
requests approval to purchase or sell a Security with a
complicated investment structure, since the Security may be
substantially economically related to a separate Security which
is being considered for purchase or sale or being purchased or
sold by an Investment Company/Account. A portfolio manager may
not preclear his/her own personal securities transactions. Any
personal securities transaction requested by a portfolio manager
shall, in addition to the standard preclearance process, be
presented to the President of the Advisor for his/her approval.
In addition, because the Compliance Officer may not preclear
his/her own personal securities transactions, the Compliance
Officer shall request approval for his or her personal securities
transactions from his/her supervisor, the Vice President-Legal.
(c) All Access Persons are prohibited from receiving on an annual
basis any gifts or other things of value from any person or
entity that does business with or on behalf of the Adviser or the
Investment Companies/Accounts which in total could reasonably be
valued above $100. However, this policy does not apply to
customary business meals or entertainment, or promotional items
(e.g., pens, mugs, caps, T-shirts, etc.) which are consistent
with customary business practices in the industry.
(d) All Access Persons must immediately notify the Compliance Officer
upon becoming a member of a Board of Directors of a publicly
traded company. As a condition of being given approval to engage
in any personal securities transaction involving the securities
of such company(s), the Access Person will be required to obtain
documented approval to trade from the company's management, in
light of their procedures designed to prevent the misuse of
material, nonpublic information by company insiders (For a
description of each Manager's, officer's, employee's and other
Access Person's responsibilities in the event that they come into
the possession of material, nonpublic information, see Section
VIII. of the Code). Notwithstanding this provision, those Access
Persons that are also Investment Personnel are generally
prohibited from serving on the Board of Directors of publicly
traded companies (See Section III.(i) of the Code).
Prohibitions Applicable Only To Investment Personnel
(e) Prior to recommending a Security for purchase or sale by an
Investment Company/Account, Investment Personnel are required to
provide disclosure, if applicable, of any ownership/Security
position they have in the issuer, or any present or proposed
business relationship between such issuer and such person, to the
Chief Investment Officer and the Compliance Officer. In the event
that such disclosure is required of the Chief Investment Officer,
it should be made to the Compliance Officer. The Investment
Personnel's holdings/relationship will then be reviewed to
determine whether it presents a conflict of interest that should
be addressed prior to
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the Adviser acting on their purchase or sale recommendation for
the Investment Company/Account.
(f) All Investment Personnel are prohibited from profiting in the
purchase and sale, or sale and purchase, of the same (or
equivalent) Security within 60 calendar days, unless the Security
was not purchased, sold or held by an Investment Company/Account
during the 60-day period. This prohibition shall not apply to
exchange-traded stock options that are purchased for the purpose
of establishing a bona fide position hedge on Securities held in
excess of 60 calendar days, or to options on stock indices which
are composed of 100 or more Securities. However, any transaction
which is exempt from this prohibition shall be subject to all
otherwise applicable provisions of the Code, including but not
limited to the preclearance requirements of Section III(b).
(g) All Investment Personnel are prohibited from acquiring any
Security in an Initial Public Offering.
(h) All Investment Personnel are prohibited from acquiring any
Security in a Limited Offering without prior written approval.
Request for such approval should be made via a memorandum
directed to the Chief Investment Officer and the Compliance
Officer. Limited Offerings for which the Chief Investment Officer
is seeking approval will be reviewed by a member of the Board of
Managers of the Adviser and the Compliance Officer. The memo
shall state the name of the company, the number of shares/units
being offered and the offering price per share/unit, a
description of the company's history and operations, and a
discussion of whether the company's current business plan
anticipates a future Initial Public Offering of its Securities.
No approval will be granted for the acquisition of Securities in
a Limited Offering if the company currently has any publicly
traded equity Securities (or other publicly traded Securities
convertible into equity Securities) issued and outstanding. A
copy of the Limited Offering agreement or the purchase contract
should be attached to the memo.
Subsequent to Investment Personnel obtaining shares/units of a
company in a Limited Offering, the company may issue and have
outstanding publicly traded Securities. If in the course of
performing their job responsibilities any Investment Personnel
who acquired shares/units in a Limited Offering transaction
becomes involved in the consideration of an investment in the
issuer by an Investment Company/Account, they will disclose the
existence of their personal ownership in the company to the Chief
Investment Officer. The Adviser will then excuse such employee
from the investment decision making process for the Security.
(i) All Investment Personnel are prohibited from serving on the
Boards of Directors of publicly traded companies, absent prior
authorization based upon a determination by Adviser management
that the board service would be consistent with the interests of
the Investment Companies/Accounts. In instances where Adviser
management determines that board service for a company is
merited, such Investment Personnel will be subject to the same
restrictions that are imposed on all other Access Persons with
respect to their personal securities transactions which involve
Securities of the company for which they are a director, as
described in Section III.(d) of the Code.
(j) All Investment Personnel must make disclosure with respect to any
family member(s) employed in the securities business who might be
in a position to benefit as a result of the trading activity of
the Investment Companies/Accounts. It is prohibited for
Investment Personnel to influence the allocation of brokerage for
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direct or indirect personal or familial benefit. However, such
disclosure shall not be deemed evidence that any benefit has been
conferred, directly or indirectly, by Investment Personnel on
such family member(s).
Prohibition Applicable Only To Portfolio Managers
(k) All portfolio managers are prohibited from purchasing or selling
any Security (or equivalent Security) within at least 7 calendar
days before or after an Investment Company/Account that he or she
manages purchases or sells that Security.
IV. EXEMPTED TRANSACTIONS
The prohibitions of Section III. of the Code shall not apply to:
(a) purchases or sales effected in any account over which the Access
Person has no direct or indirect influence or control;
(b) purchases or sales which are non-volitional on the part of the
Access Person, such as Securities acquired as a result of a
spin-off of an entity from a company whose Securities are owned
by an Access Person, or the involuntary sale of Securities due to
a merger or as the result of a company exercising a call
provision on its outstanding debt;
(c) purchases which are part of an automatic dividend reinvestment
plan;
(d) purchases effected upon the exercise of rights issued by an
issuer pro rata to all holders of a class of its Securities, to
the extent such rights were acquired from such issuer, and sales
of such rights so acquired; and
(e) any Securities transaction, or series of related transactions,
involving 500 shares or less in the aggregate, if the issuer has
a market capitalization (outstanding shares multiplied by the
current price per share) greater than $5 billion.
V. REPORTING
Within 10 days of their commencement of employment with the
Adviser (or if not an employee, of their otherwise becoming an
Access Person to the Adviser), all Access Persons shall disclose
in writing to the Compliance Officer all of their Security
holdings in which they have any direct or indirect Beneficial
(a) Ownership at such time as the person became an Access Person (see
Appendix E). Thereafter, when requested by the Compliance Officer
all Access Persons shall on an annual basis disclose in writing
to the Compliance Officer all of their Security holdings in which
they have any direct or indirect Beneficial Ownership. This
information must be current as of a date no more than 30 days
before the report is submitted.
Both the Initial and the Annual Holdings Report shall contain the
following information:
(1) the title, number of shares and the principal amount of each
Security;
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(2) the name of any broker, dealer or bank with whom the Access
Person maintained an account in which any Securities were
held; and
(3) the date that the report is submitted by the Access Person.
The above notwithstanding, an Access Person shall not be required
to make a report with respect to any Security held in any account
over which he or she does not have any direct or indirect
influence or control. Each such report may contain a statement
that the report shall not be construed as an admission by the
Access Person that he or she has any direct or indirect
Beneficial Ownership in the Security to which the report relates.
(b) All Access Persons shall direct their brokers to supply the
Compliance Officer, on a timely basis, duplicate copies of
confirmations of all personal securities transactions and copies
of all statements for all Securities.
Accounts. Please note that even if the Access Person does not
currently intend to purchase or sell Securities (as defined at
Section II.(d) above) in the account, the Access Person must
direct their brokers to send the Compliance Officer duplicate
confirmations and statements on the account if the account allows
any trading in such Securities.
(c) Whether or not one of the exemptions listed in Section IV. of the
Code applies, each Access Person shall file with the Compliance
Officer a written report (see Appendix C) containing the
information described in Section V.(d) of the Code with respect
to each transaction in any Security in which such Access Person
by reason of such transaction acquires or disposes of any direct
or indirect Beneficial Ownership in the Security; provided,
however, that an Access Person shall not be required to make a
report with respect to any transaction effected for any account
over which he or she does not have any direct or indirect
influence or control. Each such report may contain a statement
that the report shall not be construed as an admission by the
Access Person that he or she has any direct or indirect
Beneficial Ownership in the Security to which the report relates.
(d) Such report shall be made not later than 10 days after the end of
the calendar quarter in which the transaction to which the report
relates was effected, and shall contain the following
information:
(1) the date of the transaction, the title, the interest rate and
maturity date (if applicable), the number of shares, and the
principal amount of each Security involved;
(2) the nature of the transaction (i.e., purchase, sale or any
other type of acquisition or disposition);
(3) the price at which the transaction was effected;
(4) the name of the broker, dealer or bank with or through whom
the transaction was effected; and
(5) the date that the report is submitted by the Access Person.
For any report concerning a purchase or sale in which the Access
Person relied upon one of the exemptions provided in Section IV.
of the Code, the Access Person will provide a brief statement of
the exemption relied upon and the circumstances of the
transaction if requested by the Compliance Officer.
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In addition to such report, within 10 days after the end of the
calendar quarter in which an Access Person opens any brokerage
account, the Access Person provide the Compliance Officer with
the following information:
(1) the name of the broker, dealer or bank with whom the Access
Person established the account;
(2) the date the account was established; and
(3) the date that the report is submitted by the Access Person.
(e) The Securities transaction reporting requirements of Sections
V.(c) and V.(d) of the Code may be satisfied by the Compliance
Officer receiving all confirmations of Security transactions
and/or periodic statements for each Access Person's Securities
accounts. Confirmations of Security transactions and/or Security
account statements received by the Compliance Officer will be
distributed quarterly to Access Persons for their review to
ensure that such confirmations/statements include all Security
transactions required to be reported under this Code.
(f) An Access Person will be deemed to have participated in, and must
report under this Code, any Securities transactions participated
in by:
(1) The person's spouse;
(2) The person's minor children;
(3) Any other relatives sharing the person's household;
(4) A trust in which the person has a beneficial interest, unless
such person has no direct or indirect control over the trust;
(5) A trust as to which the person is a trustee;
(6) A revocable trust as to which the person is a settler; or
(7) A partnership of which the person is a partner (including
most investment clubs) unless the person has no direct or
indirect control over the partnership.
(g) The Compliance Officer shall identify all Access Persons who are
required to make the reports required by Section V. of the Code
and shall inform them of their reporting obligations hereunder.
VI. REVIEW
The Compliance Officer shall review or supervise the review of the personal
securities transactions and the holdings reported pursuant to Section V. of the
Code. Personal securities transactions reported by the Compliance Officer shall
be reviewed by the Vice President-Legal. As part of this review, each such
reported personal securities transaction shall be compared against the trading
activity of the Investment Companies/Accounts to determine whether a violation
of Section III. of the Code may have occurred. If the Compliance Officer or Vice
President-Legal determines that a violation may have occurred, he or she shall
promptly submit the pertinent information regarding the transaction to Adviser
management, who shall evaluate whether a violation of the Code has occurred,
taking into account all the exemptions provided under Section IV. of the Code,
and if so, whether such violation is material. The Adviser will consider all
relevant facts and circumstances surrounding the transaction prior to making its
determination. In addition, before making any determination that a material
violation has occurred, Adviser management shall give the person involved an
opportunity to supply additional information regarding the transaction in
question.
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VII. SANCTIONS
If a final determination is made that a material violation of this Code has
occurred, the Adviser's management may require the Access Person to disgorge to
the affected Investment Company/Account or, if not related to a particular
Investment Company/Account, a charitable organization, all or a portion of the
profits gained or losses avoided as a result of the prohibited transaction. The
Compliance Officer or Vice President-Legal shall provide a written report of
management's determination to the Board of Managers of the Adviser for such
further action and sanctions as said Board deems appropriate, which sanctions
may in the Board's discretion include, among other things, imposition of a
monetary penalty and/or censure, suspension or termination of the Access Person.
A copy of the report shall also be provided to the Board of directors/trustees
of each investment company for which the Adviser is the investment adviser or
sub-adviser.
VIII. PROCEDURES FOR PREVENTING THE TRADING ON MATERIAL, NONPUBLIC INFORMATION
(a) In addition to the prohibitions set forth in Section III. of the
Code which are applicable only to Access Persons of the Adviser,
the Adviser forbids any Manager, officer, employee or other
Access Person (including spouses, minor children and adults
living in the same household as the Manager, officer, employee or
other Access Person), either personally or on behalf of others
(such as Investment Companies/Accounts managed by the Adviser)
from trading on material, nonpublic information or communicating
material, nonpublic information to others in violation of the
securities laws. This conduct is frequently referred to as
"insider trading." The Adviser's policy against insider trading
applies to every Manager, officer, employee and other Access
Person and extends to activities within and outside their duties
at the Adviser. Any questions regarding the Adviser's policies
and procedures should be referred to the Compliance Officer.
The term "insider trading" is not defined in the federal
securities laws, but generally is used to refer to the use of
material, nonpublic information to trade in securities (whether
or not one is an "insider") or to the communication of material,
nonpublic information to others.
While the law concerning insider trading is not static, it is
generally understood that the law prohibits:
o trading by an insider, while in possession of material,
nonpublic information, or
o trading by a non-insider, while in possession of material,
nonpublic information, where the information either was
disclosed to the non-insider in violation of an insider's
duty to keep it confidential or was misappropriated, or
o communicating material, nonpublic information to others.
The elements of insider trading and the penalties for such
unlawful conduct are discussed below. If, after reviewing this
policy statement, you have any questions, you should consult the
Compliance Officer.
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1. Who is an insider?
The concept of "insider" is broad. It includes
Directors/Managers, officers and employees of a company. In
addition, a person can be a "temporary insider" if he or she
enters into a special confidential relationship with a
company and as a result is given access to information solely
for such company's purposes. A temporary insider can include,
among others, a company's attorneys, accountants, consultants
and bank lending officers, and the employees and associates
of such persons. In addition, the Adviser may become a
temporary insider of a company it advises or for which it
performs other services. According to the Supreme Court, the
company must expect the outsider to keep the nonpublic
information confidential, and the relationship must at least
imply such a duty before the outsider will be considered a
temporary insider. In addition, one who receives material,
nonpublic information (a "tippee") or one who gives material,
nonpublic information to another person (a "tipper") may
become an insider and therefore incur liability for insider
trading. Finally, and perhaps most relevant for the Code, a
Manager, officer, employee or other Access Person of the
Adviser may become an insider if material, nonpublic
information is received from an insider of a company whose
securities are held or being considered for purchase by an
Investment Company/Account.
2. What is Material Information?
Trading on inside information is not a basis for liability
unless the information is material. "Material information"
generally is defined as information for which there is a
substantial likelihood that a reasonable investor would
consider it important in a decision to buy, hold or sell
stock, or information that is reasonably certain to have a
substantial effect on the price of a company's securities.
Information that Managers, officers, employees and other
Access Persons should consider material includes, but is not
limited to: dividend changes, earnings estimates, changes in
previously released earnings estimates, significant merger or
acquisition proposals or agreements, major litigation,
liquidation problems, and extraordinary management
developments.
Material information does not have to relate to a company's
business. For example, in Carpenter v. U.S., 108 U.S. 316
(1987), the U.S. Supreme Court considered material certain
information about the contents of a forthcoming newspaper
column that was expected to affect the market price of a
security. In that case, a Wall Street Journal reporter was
found criminally liable for disclosing to others the dates
that reports on various companies would appear in the Journal
and whether those reports would be favorable.
3. What is Nonpublic Information?
Information is nonpublic until it has been effectively
communicated to the marketplace. One must be able to point to
some fact to show that the information is generally public.
For example, information found in a report filed with the
U.S. Securities and Exchange Commission or appearing in Dow
Jones, Reuters Economic Services, The Wall Street Journal or
other publications would be considered public.
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4. Penalties for Insider Trading
Penalties for trading on or communicating material, nonpublic
information are severe, both for the individuals involved in
such unlawful conduct and their employers. A person can be
subjected to some or all of the penalties below even if he or
she does not personally benefit from the violation. Penalties
include:
o Civil injunctions,
o treble damages,
o jail sentences of up to ten years,
o civil penalties for the person who committed the
violation of up to three times the profit gained or loss
avoided, whether or not the person actually benefited,
o criminal fines (no matter how small the profit) of up to
$1 million, civil penalties for the employer or other
controlling person of up to the greater of $1 million or
three times the profit gained or loss avoided.
Because of the serious potential penalties against employers
as well as violators, any violation of this Code of Ethics
and Statement of Policies which involves insider trading can
be expected to result in serious sanctions by the Adviser,
including dismissal of the persons involved for cause.
(b) The following procedures have been established to aid the
Managers, officers, employees and other Access Persons of the
Adviser in avoiding insider trading, and to aid the Adviser in
preventing, detecting and imposing sanctions against insider
trading. Every Manager, officer, employee and other Access Person
of the Adviser must follow these procedures or risk serious
sanctions by the Adviser, including dismissal for cause,
substantial personal liability and criminal penalties. If you
have any questions about these procedures, you should consult the
Compliance Officer.
Identifying Inside Information in the Context of Personal
Securities Trading
Before trading for yourself or others, including Investment
Companies/Accounts managed by the Adviser, in the securities of a
company about which you may have potential inside information,
whether obtained through the Advisers activities or not, ask
yourself the following questions:
(a) Is the information material? Is there a substantial
likelihood that a reasonable investor would consider this
information important in making his or her decision to
buy, hold or sell stock? Is it reasonably certain that
this information would substantially affect the market
price of the securities if it were generally disclosed?
(b) Is the information nonpublic? To whom has this information
been provided? Has the information been effectively
communicated to the marketplace by being filed with the
U.S. Securities and Exchange Commission or published in
Reuters, The Wall Street Journal or other such
publications?
(c) If your securities transactions became the subject of
scrutiny, how would they be viewed after-the-fact with the
benefit of hindsight? As a result,
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<PAGE> 14
before engaging in any transaction, you should carefully
consider how regulators and others might view your
transaction in hindsight.
If, after consideration of the above, you believe that the
information is material and nonpublic, or if you have any doubt as
to whether the information is material and nonpublic, you must
take the following steps:
(1) Report the matter immediately to the Compliance Officer,
(2) Refrain from purchasing or selling the securities on
behalf of yourself or others, including Investment
Companies/Accounts managed by the Adviser,
(3) Refrain from communicating the information inside or
outside of the Adviser, other than to the Compliance
Officer, and
(4) After the Compliance Officer has reviewed the issue, you
will be instructed to continue the prohibitions against
trading and communication, or you will be allowed to trade
and communicate the information.
Restricting Access to Material, Nonpublic Information
(a) General Procedures
Material, nonpublic information in the possession of a
Manager, officer, employee or other Access Person of the
Adviser may not be communicated to anyone, including persons
within the Adviser except to the Compliance Officer as
provided in Section VIII.(b) of the Code or as is necessary
for individuals to perform their duties at the Adviser. In
addition, care should be taken so that such information is
secure. For example, files containing material, nonpublic
information should be maintained in a secure manner; access to
computer files containing material, nonpublic information
should be restricted.
(b) Contacts With Public Companies
For the Adviser, contacts with public companies represent an
important part of its research efforts. The Adviser may make
investment decisions on the basis of the firm's conclusions
formed through such contacts and analysis of publicly-
available information. Difficult legal issues arise, however,
when, in the course of these contacts, a Manager, officer,
employee or other Access Person of the Adviser becomes aware
of material, nonpublic information. This could happen, for
example, if a company's Chief Financial Officer prematurely
discloses quarterly results to an analyst or an investor
relations representative makes a selective disclosure of
adverse news to a handful of investors. In such situations,
the Adviser must make a judgment as to its further conduct. To
protect the Adviser and its Investment Companies/Accounts, all
Managers, officers, employees and other Access Persons of the
Adviser should contact the Compliance Officer immediately if
they believe that they may have received material, nonpublic
information.
13
<PAGE> 15
(c)Tender Offers
Tender offers represent a particular concern in the law of
insider trading for two reasons. First, tender offer activity
often produces extraordinary gyrations in the price of the
target company's securities. Trading during this time period
is more likely to attract regulatory attention (and produces a
disproportionate percentage of insider trading cases). Second,
the U.S. Securities and Exchange Commission has adopted a rule
which expressly forbids trading and "tipping" while in
possession of material, nonpublic information regarding a
tender offer received from the tender offeror, the target
company or anyone acting on behalf of either. Managers,
officers, employees and other Access Persons of the Adviser
should exercise particular caution any time they become aware
of nonpublic information relating to a tender offer.
Procedures Designed to Prevent and Detect Insider Trading
The following procedures are designed to prevent and detect
insider trading within the Adviser or by the Adviser's Managers,
officers, employees and other Access Persons. To prevent and
detect insider trading the Compliance Officer should:
(a) Provide, on an annual basis, an educational program to
familiarize Managers, officers, employees and other Access
Persons of the Adviser with the Adviser's policies and
procedures on insider trading, misuse of material, nonpublic
information, reporting requirements for personal securities
transactions and related matters.
(b) Answer questions from Managers, officers, employees and other
Access Persons of the Adviser relating to the Adviser's
policies and procedures.
(c) Resolve issues of whether information received by Managers,
officers, employees and other Access Persons of the Adviser is
material and nonpublic.
(d) Review on an annual basis and update as necessary the
Adviser's policies and procedures to reflect changes in rules,
regulations and case law.
(e) When it has been determined that a Manager, officer, employee
or other Access Person of the Adviser has material, nonpublic
information on a company, the Compliance Officer will take
reasonable steps to (i) ensure that such information is not
disseminated, and (ii) restrict Managers, officers, employees
and other Access Persons from trading in securities to which
the information relates, either for their own accounts or for
Investment Companies/Accounts managed by the Adviser. These
objectives will be served by placing the company on a
"Restricted List" that will be maintained by the Compliance
Officer.
While each such company is on the Restricted List, no
portfolio manager shall initiate or recommend any transaction
in the company's securities in any Investment
Companies/Accounts managed by the Adviser. The Compliance
Officer will be responsible for removing a particular company
from the
14
<PAGE> 16
Restricted List after having received permission for such
action from Adviser management, and will be responsible for
making available the Restricted List and any updates to it to
all Investment Personnel. The Restricted List is highly
confidential and shall, under no circumstances, be discussed
with or disseminated to anyone outside of the Adviser.
Special Restricted List Procedures
(1) Purchase and Sale of Securities Issued by Companies
Controlling the Adviser
The Adviser is currently 100% owned by its sole member,
the majority of whose voting common stock is owned by a
publicly traded company. It is contemplated that upon
receipt of certain regulatory approvals a 50% interest in
the Adviser will be acquired by another company which is a
wholly-owned indirect subsidiary of a publicly traded
company. As a result, such publicly-traded companies (the
"Companies") are considered to be in a position of control
with respect to the Adviser. Federal securities law
prohibits any Investment Company for which the Adviser
acts as investment adviser or subadviser from investing in
the securities of Companies have been placed on the
Adviser's Restricted List indefinitely, and therefore no
Investment Company/Account may invest in any of its
securities. Personal security transactions by Managers,
officers, employees and other Access Persons of the
Adviser in the securities of these Companies will be
allowed pursuant to policies and procedures as in effect
from time to time that will be provided to you by the
Compliance Officer.
(2) Publicly Traded Companies for Which a Manager, Officer,
Employee or Other Access Person of the Adviser Serves as a
Director
Subject to the requirement that they disclose their
position to the Compliance Officer (and, in the case of
Investment Personnel, that they obtain prior approval from
Adviser management), Managers, officers, employees and
other Access Persons of the Adviser may serve on the
Boards of Directors of publicly traded companies. To
preclude the possibility of trades of such companies'
securities occurring in Investment Companies/Accounts
while the Adviser may be in possession of material,
nonpublic information, any publicly traded company for
which a Manager, officer, employee or other Access Person
of the Adviser is a director shall be placed on the
Restricted List and shall remain on the list until their
directorship is terminated and the Manager, officer,
employee or other Access Person of the Adviser ceases to
be an insider to the company.
While a company is on the Restricted List, each of the
Adviser's Managers, officer, employees and other Access
Persons who are a member of the Board of Directors of a
publicly traded company may engage in personal securities
transactions involving the securities of such company,
subject to preclearance that will be conditioned upon
obtaining documented approval to trade from such company's
management, in light of their procedures designed to
prevent the misuse of material, nonpublic information by
company insiders.
15
<PAGE> 17
(f) Promptly, upon learning of a potential violation of the
Adviser's policies and procedures on insider trading, prepare
a written report to Adviser management with full details about
the potential violation and recommendations for further
action.
IX. ANNUAL REPORTING AND CERTIFICATION
(a) On an annual basis, the Compliance Officer shall prepare a written
report to the Board of Managers of the Adviser setting forth the
following:
(1) A summary of existing procedures to detect and prevent
violations of the Code,
(2) Full details of any investigation, either internal or by a
regulatory agency, of any violations of the Code, the
resolution of such investigations and the steps taken to
prevent further violations,
(3) An evaluation of the current compliance procedures and any
recommendations for improvement, and
(4) A description of the Adviser's continuing efforts to educate
all Managers, officers, employees and other Access Persons of
the Adviser regarding the Code, including the dates of any
such educational programs presented since the last report.
A report setting forth the above shall also be made annually to
the Board of Directors/Trustees of each Investment Company for
which the Adviser acts as investment adviser or sub-adviser,
except that any information about violations of the Code may be
limited to only material violations. In addition, the Adviser
shall certify to each such Investment Company annually that it has
adopted procedures reasonably necessary to prevent Access Persons
from violating the Code.
After September 1, 2000, before being approved as an investment
adviser or subadviser for any Investment Company, the Adviser is
required to provide the Code to the Investment Company's
Directors/Trustees for approval along with a certification that
the Adviser has adopted procedures reasonably necessary to prevent
Access Persons from violating the Code.
Any material changes to the Code must be approved by each
Investment Company's Directors/Trustees within 6 months after
adoption of the material change.
(b) On an annual basis, all Managers, officers, employees and other
Access Persons of the Adviser are required to certify in writing
that they have read and understand the Code of Ethics and
Statement of Policies and recognize that they are subject thereto.
In addition, all such persons are required to certify annually
that they have complied with the requirements of the Code and that
they have reported all personal securities transactions required
to be reported pursuant to the Code (see Appendix D). If a
Manager, officer, employee or other Access Person of the Adviser
has any questions pertaining to their responsibilities under the
Code, they should discuss them with the Compliance Officer prior
to completing their annual certification statement.
16
<PAGE> 18
X. OTHER LEGAL AND REGULATORY MATTERS
(a) Confidentiality. All account information concerning the Adviser's
clients (e.g., name, account size, specific securities held,
securities trades, etc.) is absolutely confidential. Therefore,
access to Investment Company/Account information is limited to
those individuals who must have such access to perform their
duties, and such information shall not be communicated to any
other person either within or outside the Adviser. The
confidentiality of all Investment Company/Account information is
critical to the Adviser's reputation for excellence and integrity
and maintenance of the Adviser's competitive position, and any
disclosure of confidential information can be expected to result
in serious sanctions by the Adviser, including possible dismissal
for cause.
(b) Bankruptcy/Criminal Offenses. The Adviser is required to notify
regulatory organizations when certain events occur regarding its
Managers, officers, employees and other Access Persons.
Accordingly the Board of Managers of the Adviser must be notified
if any of the following occur with respect to a Manager, officer,
employee or other Access Person:
o Personal bankruptcy.
o The bankruptcy of a corporation in which any Manager, officer,
employee or other Access Person owns 10% or more of the
securities.
o Arrest, arraignment, indictment or conviction for, or the
entry of a guilty or no contest plea for, any criminal offense
(other than minor traffic violations).
(c) Receipt of Legal Documents. On occasion, employees are served with
legal documents (e.g., a subpoena) for the Adviser. Upon receipt
of legal documents, the Vice President-Legal is to be notified
immediately.
(d) Retention of Outside Counsel. Managers, officers, employees and
other Access Persons may not retain the services of outside
counsel under circumstances such that the Adviser would be
obligated to pay legal fees unless the Adviser's Vice
President-Legal has granted approval for retention of such counsel
in advance.
(e) Contact with Industry Regulators. In the event of an inquiry from
an industry regulator--whether via the telephone, mail or personal
visit--Managers, officers, employees and other Access Persons must
contact the President-Legal as soon as possible for instructions.
(f) Political Contributions. The use of funds or assets of the Adviser
for any unlawful or improper purpose is prohibited. This
prohibition includes any contribution to any public official,
political candidate or political entity, except as may be
expressly permitted by law. This shall also preclude unlawful
contributions through consultants, customers or other third
parties, including payments where Managers, officers, employees or
other Access Persons of the Adviser know or have reason to believe
that payments made to such other third parties will be used as
unlawful contributions.
The above prohibitions relate only to the use of corporate funds
and in no way are intended to discourage Managers, officers,
employees or other Access Persons from making personal
contributions to political candidates or parties of their choice.
No such individual contribution will be reimbursed by the Adviser
in any manner, directly or indirectly.
17
<PAGE> 19
(g) Business Conduct. It is the policy of the Adviser to conduct
business in accordance with the applicable laws and regulations of
the United States and all other individual states and countries in
which the Adviser operates or has any significant contacts.
Unethical business practices will subject Managers, officers,
employees and other Access Persons to appropriate disciplinary
action, including dismissal for cause if warranted, and may result
in prosecution for violating federal, state or foreign laws.
No payment (cash or otherwise) can be made (directly or
indirectly) to any employee, official or representative of any
domestic or foreign governmental agency, instrumentality, party,
or candidate thereof, for the purpose of influencing any act,
omission or decision.
The Adviser's books, records and accounts must be maintained in
sufficient detail as to accurately reflect the transactions and
dispositions of its assets. No undisclosed or unrecorded fund or
asset of the Adviser may be established for any purpose.
Any Manager, officer, employee or other Access Person with
questions about or knowledge of violations of these policies must
contact the Adviser's Vice President-Legal.
XI. MISCELLANEOUS PROVISIONS
(a) The Adviser shall maintain records in the manner and to the extent
set forth below, and make such records available for examination
by representatives of the U.S. Securities and Exchange Commission:
(1) A copy of this Code and any other code of ethics which is, or
at any time within the past five years has been, in effect
shall be preserved in an easily accessible place;
(2) A record of any violation of the Code and of any action taken
as a result of such violation shall be preserved in an easily
accessible place for a period of not less than five years
following the end of the fiscal year in which the violation
occurs;
(3) A copy of each report made by an Access Person pursuant to the
Code shall be preserved for a period of not less than five
years from the end of the fiscal year in which it is made, the
first two years in an easily accessible place;
(4) A list of all persons who are, or within the past five years
have been, required to make reports pursuant to the Code, and
who are, or within the past five years have been, responsible
for reviewing these reports, shall be maintained in an easily
accessible place; and
(5) A record of any decision, and the reasons supporting the
decision, to approve the acquisition by any Investment
Personnel of a Security pursuant to a Limited Offering shall
be preserved for a period of not less than five years from the
end of the fiscal year in which the approval was granted.
(b) All reports of Securities transactions and any other information
filed with the Adviser or furnished to any person pursuant to the
Code shall be treated as confidential, but are subject to review
as provided herein and by representatives of the U.S. Securities
and Exchange Commission or any other regulatory or self-regulatory
organization to the extent required by law or regulation.
(c) The Board of Managers of the Adviser may from time to time adopt
such interpretations of the Code and such exceptions to provisions
of the Code as they deem appropriate.
18
<PAGE> 20
APPENDIX A
For purposes of the attached Code of Ethics and Statement of Policies, a
"beneficial owner" shall mean any Manager, officer, employee or other Access
Person who, directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has or shares a direct or indirect
opportunity to profit or share in any profit derived from a transaction in the
subject securities. The term "beneficial ownership" of securities would include
not only ownership of securities held by a Manager, officer, employee or other
Access Person for his or her own benefit, whether in bearer form or registered
in their name or otherwise, but also ownership of securities held for his or her
benefit by others (regardless of whether or how they are registered) such as
custodians, brokers, executors, administrators, or trustees (including trusts in
which he or she has only a remainder interest), and securities held for his or
her account by pledgees, securities owned by a partnership in which he or she is
a member if they may exercise a controlling influence over the purchase, sale or
voting of such securities, and securities owned by any corporation that he or
she should regard as a personal holding corporation. Correspondingly, this term
would exclude securities held by a Manager, officer, employee or other Access
Person for the benefit of someone else.
Ordinarily, this term would not include securities held by executors or
administrators in estates in which a Manager, officer, employee or other Access
Person is a legatee or beneficiary unless there is a specific legacy to such
person of such securities or such person is the sole legatee or beneficiary and
there are other assets in the estate sufficient to pay debts ranking ahead of
such legacy, or the securities are held in the estate more than a year after the
decedent's death.
Securities held in the name of another should be considered as "beneficially"
owned by a Manager, officer, employee or other Access Person where such person
enjoys "benefits substantially equivalent to ownership". The U.S. Securities and
Exchange Commission has said that although the final determination of beneficial
ownership is a question to be determined in the light of the facts of the
particular case, generally a person is regarded as the beneficial owner of
securities held in the name of his or her spouse and their minor children.
Absent special circumstances such relationship ordinarily results in such person
obtaining benefits substantially equivalent to ownership, e.g., application of
the income derived from such securities to maintain a common home, to meet
expenses that such person otherwise would meet from other sources, or the
ability to exercise a controlling influence over the purchase, sale or voting of
such securities.
A Manager, officer, employee or other Access Person also may be regarded as the
beneficial owner of securities held in the name of another person, if by reason
of any contract, understanding, relationship, agreement, or other arrangement,
he or she obtains therefrom benefits substantially equivalent to those of
ownership. Moreover, the fact that the holder is a relative or relative of a
spouse and sharing the same home as a Manager, officer, employee or other Access
Person may in itself indicate that the Manager, officer, employee or other
Access Person would obtain benefits substantially equivalent to those of
ownership from securities held in the name of such relative. Thus, absent
countervailing facts, it is expected that securities held by relatives of the
Manager, officer, employee or other Access Person or his or her spouse who share
the same home as the Manager, officer, employee or other Access Person will be
treated as being beneficially owned by the Manager, officer, employee or other
Access Person.
A Manager, officer, employee or other Access Person also is regarded as the
beneficial owner of securities held in the name of a spouse, minor children or
other person, even though he or she does not obtain therefrom the aforementioned
benefits of ownership, if they can vest or revest title in themselves at once or
at some future time.
19
<PAGE> 21
APPENDIX B
APPROVAL FORM
FOR THE PURCHASE/SALE OF SECURITIES
- --------------------------------------------------------------------------------
PROPOSED TRANSACTION
TO BE COMPLETED BY THE ACCESS PERSON 1,2
Security Description:
------------------------------------------------
Security Symbol: Security Exchange
-------------- -------------
Type of Transaction: Purchase Sale
------- -----
Maximum Number of Shares/Principal Amount of Debt:
-------------------
Except as follows, I am not aware of any factors that pertain to this proposed
personal security transaction that would be relevant to the determination of
whether such transaction could be in conflict with the interests of an
Investment Company/Account managed by BBOI Worldwide LLC (See Section III (b) of
the Code):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- ----------------------------- ---------------------------------- ---------------
Access Person (please print) Signature of Access Person Date
1. See BBOI Worldwide LLC Code of Ethics and Statement of Policies (the "Code")
for the definition of "Access Person."
2. As described in Section IV. Exempted Transactions of the Code, certain
transactions involving the purchase or sale of Securities are not prohibited
and therefore do not require pre-clearance. IT IS THE RESPONSIBILITY OF THE
ACCESS PERSON TO CORRECTLY DETERMINE WHETHER THEIR PROPOSED PERSONAL
SECURITY TRANSACTION IS AN EXEMPTED TRANSACTION UNDER THE CODE. ANY ACCESS
PERSON WHO HAS QUESTIONS REGARDING THIS DETERMINATION SHOULD CONSULT WITH
THE COMPLIANCE OFFICER PRIOR TO ENGAGING IN THE PROPOSED PERSONAL SECURITY
TRANSACTION.
- --------------------------------------------------------------------------------
APPROVAL/DISAPPROVAL
TO BE COMPLETED BY THE COMPLIANCE OFFICER
<TABLE>
<S> <C>
The above proposed transaction has been: Approved for execution within 3 business days after the date
----- of this approval
Approved for execution between and
----- ----------- -----------
Disapproved
-----
Comments:
---------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------
- ---------------------------------- ---------------------------------
Signature of Compliance Officer Date
</TABLE>
<PAGE> 22
APPENDIX C
PERSONAL
SECURITIES TRANSACTIONS REPORT
BBOI WORLDWIDE LLC
<TABLE>
<S> <C>
NAME: FOR THE QUARTER ENDED:
-------------------------------------------------- ---------------------
(Please Print)
[ ] - Confirmations for all of my reportable personal securities [ ] - Confirmations for all of my reportable
transactions for the quarter are attached to this report. personal securities transactions for the
quarter are attached to this report
EXCEPT AS DESCRIBED BELOW:
</TABLE>
<TABLE>
<CAPTION>
Transaction Security Description Number Principal Nature of Name of Broker,
Date (including interest rate and maturity date, if applicable) Symbol of Shares Amount Transaction Price Dealer or Bank
<S> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
DEFINITIONS: Principal Amount - Total amount received or paid for the security.
Nature of Transaction - Purchase, sale or other acquisition or disposition.
Price - Price per share at which transaction was effected.
Broker, Dealer or Bank - Name of broker, dealer or bank with or through whom the transaction was effected.
NOTE: Transactions in shares of registered open-end investment companies (i.e., mutual funds), direct obligations of
the Government of the United States (e.g., U.S. Treasury securities), banker's acceptances, bank certificates of
deposit, commercial paper and high-quality short-term debt instruments, including repurchase agreements, are not
required to be reported.
STATEMENT: THIS REPORT IS NOT TO BE CONSTRUED AS AN ADMISSION BY ME THAT I HAVE ANY DIRECT OR INDIRECT BENEFICIAL OWNERSHIP IN
THE SECURITIES TO WHICH THIS REPORT RELATES.
---------------------------------------------------- ----------------------------
(Signature) (Date)
</TABLE>
<PAGE> 23
APPENDIX D
ANNUAL CONFIRMATION FOR YOUR BBOI WORLDWIDE LLC
CODE OF ETHICS AND STATEMENT OF POLICIES (THE "CODE")
I have carefully read and understand the Code. I recognize that I must
comply with the Code and that I am subject to the policies and procedures
contained therein. I understand that the policies and procedures stated in this
Code are subject to change and that, from time to time, I may receive
information about changes in the policies and procedures contained therein. I
recognize that I have / have not (Compliance Officer to circle one) been deemed
to be an Access Person under the Code until I receive further written notice
from the Compliance Officer. In addition (please check the appropriate line
below):
_____________- I have complied with the requirements of the Code at all times
since my last Confirmation for the Code, and I have reported all of my personal
securities transactions since my last Confirmation which are required to be
reported pursuant to the Code.
_____________- I have complied with the requirements of the Code at all times
since my last Confirmation for the Code, except in certain instances during the
period, a description of which is attached hereto, which the Compliance Officer
is aware of and which have been addressed by Adviser management. I have reported
all of my personal securities transactions since my last Confirmation for the
Code which are required to be reported pursuant to the Code.
As required to be reported annually by all Access Persons under the
Code, attached (if applicable) is a complete listing, as of the date of this
Confirmation, of all of my Security holdings in which I have any direct or
indirect Beneficial Ownership.
- ------------------------------- ------------------------------------
Date of Confirmation Covered Person's Name (please print)
------------------------------------
Covered Person's Signature
<PAGE> 24
APPENDIX E
PERSONAL SECURITIES
HOLDINGS REPORT (1), (2)
BBOI WORLDWIDE LLC
NAME: DATE:
------------------------- ------------------------
(Please Print)
<TABLE>
<CAPTION>
Number of Shares or
Security Description Symbol Principal Amount of Debt
<S> <C> <C>
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to the provisions of Section V.(a) of BBOI Worldwide LLC's Code of
Ethics and Statement of Policies (the "Code"), this report shall include a
complete listing of the Access Person's Security holdings (see (2) below)
in which they have any direct or indirect Beneficial Ownership.
(2) The term "Security" as defined in the Code excludes shares of registered
open-end investment companies (i.e., mutual funds), direct obligations of
the Government of the United States (e.g., U.S. Treasury securities)
banker's acceptances, bank certificates of deposit, commercial paper and
high-quality short-term debt instruments, including repurchase agreements.
Therefore, holdings by Access Persons in these types of investments are not
required to be included on this report.
-------------------------------------------
(Signature)
<PAGE> 1
Exhibit 23(p)-5
BANK OF IRELAND ASSET MANAGEMENT (U.S.) LIMITED
CODE OF ETHICS
1. INTRODUCTION
Bank of Ireland Asset Management (U.S) Limited (BIAM (U.S.)) has adopted a Code
of Ethics, designed to reduce the risk of actual or potential conflicts of
interest with dealings on behalf of clients. The code applies to all employees,
officers and directors of BIAM (U.S.) (including `dual employees' as defined in
the ADV). More stringent rules are applied to persons who are deemed to be
`Access Persons'.
2. WHO ARE ACCESS PEOPLE
For the purpose of this code, an Access Person is;
o An officer or director of BIAM (U.S.); or
o Any BIAM (U.S.) employee who makes or participates in decisions
regarding the recommendation to purchase or sell securities on behalf
of clients, or who has access to such information;or
o Any BIAM (U.S.) employee who executes client trades.
All Access People will be notified by the Compliance Unit if they have been
classified as an Access Person.
3. WHAT TYPES OF SECURITIES TRANSACTIONS ARE COVERED BY THE CODE
The Code of Ethics applies to personal dealing in all securities. Certain
securities transactions are exempt from the pre-approval and/or the
reporting requirements.
4. EXAMPLES OF THE PERSONAL SECURITIES TRANSACTIONS THAT REQUIRE PRE-APPROVAL
The following are examples of the types of securities that require
pre-approval (covered securities). If any employee is in doubt whether or
not a particular type of trade requires approval, they should consult the
Compliance Unit.
o Equities, futures contracts, options, warrants,
<PAGE> 2
Exhibit 23(p)-5
o Participation in any IPO's (generally not granted)
o Any private placements, any investment in a private company (generally
not granted)
o Participation in investment clubs
o Spread betting on any of the above securities
5. WHAT TYPES OF SECURITIES DEALING DO NOT REQUIRE PRE-APPROVAL
Pre-approval is not required for personal dealing in the following
securities;
o Investment in mutual funds, unit trusts or similar collective
investment schemes
o Money market instruments or fixed interest securities
o Direct investment in property
However, for access persons, there are reporting requirements for trading
in some of these investment instruments (see section on requirements for
access persons below).
6. RULES FOR ALL EMPLOYEES (INCLUDING ACCESS PERSONS)
1. ALL personal securities transactions (except those listed in point 5
above) must be pre-approved by the Compliance Unit.
2. All transactions must be conducted through the BIAM dealing room,
unless permission is granted by the Compliance Unit to deal through a
particular broker. Such approval is normally only granted if dealing
through a local broker is more efficient, or if the deal requested is
of a small size (i.e.: less than $1,500 or equivalent)
3. Approval to deal through an outside broker will have an expiration
time which is generally 24 hours
4. A copy of all contract notes must be submitted to the Compliance Unit
directly from the executing broker.
5. Approval is generally not granted for investment in any IPO or Private
Placement.
6. All trades in Irish securities require approval by IBI Corporate
Finance.
7. A blackout period applies to personal securities transactions (subject
to a de-minimus size of $5,000 or equivalent). Permission will
generally be refused if we have executed, or intend to execute a trade
in the same security, on the same day for clients.
8. Employees and Access Persons may not benefit from short term trading
in securities. Short term trading is defined as buying and selling (or
vice versa) the same security within a 60 day period. Bed
<PAGE> 3
Exhibit 23(p)-5
& Breakfast (B&B) transactions to realize a profit are exempt from
this rule, but all B&B transactions must be pre-approved.
9. If an employee or Access Person receives free shares they must notify
the Compliance Unit of the details e.g.: gift from relative, or shares
received through a flotation of a public company.
10. Transfers of shares out of an employees/access persons name must be
pre-approved e.g.: transferring to partner or spouse, or giving shares
as a gift.
11. The above procedures also apply to dealing in Bank of Ireland
Stock/Bristol & West securities, except in a `close period.' A `close
period' is defined as the period from:
- 31 March until the preliminary announcement of the annual results
(mid-May)
- 30 September until the announcement of the interim results
(mid-November)
During these `close periods' trading in these stocks is prohibited.
All the above rules also apply to personal securities trading of any third
party (e.g.: spouse, children, relative, friend etc.) where a BIAM
employee:
o is involved in the decision to trade; or
o is funding the transaction.
7. ADDITIONAL RULES FOR ACCESS PERSONS:
In addition to the above rules, the following rules also apply to Access
Persons;
o Access Persons will be required to provide a statement of all
securities holdings within 10 days of commencement of employment,
including holdings in private companies, unit trusts (or any similar
collective investment scheme), fixed income securities and money
market instruments. Access Persons will also be required to submit an
annual holdings report in all securities, within 10 days of request
from the Compliance Unit. Access Persons must also ensure a copy
contract note is promptly forwarded to the Compliance Unit for dealing
in all securities, including those which do not require pre-approval
(e.g.: mutual funds & fixed income securities)
The only securities exempt from these reporting requirements are;
- U.S. registered open ended investment funds (funds must be
registered as investment companies under the U.S. Investment
Companies Act 1940)
<PAGE> 4
Exhibit 23(p)-5
- Direct obligations of the U.S. Government (e.g.: U.S. Treasury
Bills)
- U.S. bank certificates of deposit, U.S. commercial paper and U.S.
short term debt instruments (less than 365 days).
o The blackout period is extended from the same day as a client trade,
to 7 days before or after a client trade.
o No de-minimus applies to the black-out period.
o Access Persons will be required to ensure that the Compliance Unit
receives a copy contract note, direct from the executing broker, for
any securities transaction executed by their spouse, partner, or minor
children, living in the same household. This is required even if the
Access Person has no involvement in the investment decision, and prior
approval was not required.
ANY BREACHES OF THESE RULES WILL BE VIEWED AS VERY SERIOUS AND MAY RESULT
IN DISCIPLINARY ACTION UP TO AND INCLUDING DISMISSAL. ALL EMPLOYEES ARE
RESPONSIBLE FOR ENSURE THEY COMPLY WITH THESE RULES. IF IN DOUBT, OR HAVE
ANY QUESTIONS ON THE ABOVE, PLEASE CONTACT THE COMPLIANCE UNIT.
