AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER
18, 1996
FILE NO. 811-07507
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 1
BT INSURANCE FUNDS TRUST
(Exact Name of Registrant as Specified in Charter)
One Exchange Place
Boston, Massachusetts 02109
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: 617-573-1556
Name and Address of Agent for Service:
Julie A. Tedesco, Esq.
First Data Investor Services Group
One Exchange Place
Boston, Massachusetts 02109
CONFIDENTIAL PRIVATE OFFERING MEMORANDUM
BT INSURANCE FUNDS TRUST- MANAGED ASSETS FUND
The Managed Assets Fund (the "Fund") seeks a high level of current
income consistent with liquidity and the preservation of capital
through investment in high-quality money market instruments. The
Fund is a registered investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"), and is a
diversified series of BT Insurance Funds Trust, a Massachusetts
business trust (the "Trust"). Bankers Trust Company serves as the
Fund's investment adviser. The Fund is a management investment
company known as a money market mutual fund.
Please read this Confidential Private Offering Memorandum (the
"Memorandum") carefully before investing and retain it for future
reference. It contains important information about the Fund that
investors should know before investing.
A Confidential Statement of Additional Information with respect to
the Fund ("SAI") with the same date has been filed with the
Securities and Exchange Commission, and is incorporated herein by
reference. A copy of the SAI is available without charge by
calling (508) 871-3140 or writing to the Fund at 440 Financial
Distributors, Inc., 4400 Computer Drive, Westborough,
Massachusetts 01581-5107.
In order to purchase shares of the Fund, a prospective investor
must satisfactorily complete, execute and deliver a Subscription
Agreement to 440 Financial Distributors, Inc., 4400 Computer
Drive, Westborough, Massachusetts 01581-5107. Prospective
investors should contact 440 Financial Distributors Inc. by
calling (508) 871-3140 or writing to the above address to obtain a
Subcription Agreement.
Shares of the Fund are not deposits or obligations of, or
guaranteed or endorsed by, Bankers Trust Company or any other
banking or depository institution, and the shares are not
Federally guaranteed or insured by the Federal Deposit Insurance
Corporation, the U.S. Government, the Federal Reserve Board or any
other agency. The Fund intends to maintain a constant $1.00 per
share net asset value, although there can be no assurance that it
will be able to do so.
THE SECURITIES DESCRIBED HEREIN ARE OFFERED PURSUANT TO AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
OF 1933, AS AMENDED, AND HAVE NOT BEEN REGISTERED WITH OR APPROVED
OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY
OTHER REGULATORY AUTHORITY OF ANY JURISDICTION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
SHARES OF THE FUND ARE BEING OFFERED ONLY TO INVESTORS WHO QUALIFY
AS BOTH (1) ACCREDITED INVESTORS AS DEFINED UNDER REGULATION D
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND (2)
INSTITUTIONAL INVESTORS. SHARES OF THE FUND ARE NOT BEING OFFERED
TO INDIVIDUALS OR TO ENTITIES ORGANIZED FOR THE PURPOSE OF
INVESTING ON BEHALF OF INDIVIDUALS.
BANKERS TRUST COMPANY
Investment Adviser
FOR NEW HAMPSHIRE RESIDENTS
NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN
APPLICATION FOR A LICENSE HAS BEEN FILED WITH THE STATE OF NEW
HAMPSHIRE NOR THE FACT THAT A SECURITY IS EFFECTIVELY
REGISTERED OR A PERSON IS LICENSED IN THE STATE OF NEW
HAMPSHIRE CONSTITUTES A FINDING BY THE ATTORNEY GENERAL OR THE
SECRETARY OF STATE THAT ANY DOCUMENT FILED UNDER RSA 421-B IS
TRUE, COMPLETE AND NOT MISLEADING. NEITHER ANY SUCH FACT NOR
THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE FOR A
SECURITY OR TRANSACTION MEANS THAT THE ATTORNEY GENERAL HAS
PASSED IN ANY WAY UPON THE MERITS OR QUALIFICATIONS OF, OR
RECOMMENDED OR GIVEN APPROVAL TO, ANY PERSON, SECURITY, OR
TRANSACTION. IT IS UNLAWFUL TO MAKE OR CAUSE TO BE MADE, TO
ANY PROSPECTIVE PURCHASER, CUSTOMER OR CLIENT, ANY
REPRESENTATION INCONSISTENT WITH THE PROVISIONS OF THIS
PARAGRAPH.
FOR GEORGIA INVESTORS
THESE SECURITIES HAVE BEEN ISSUED OR SOLD IN RELIANCE ON
PARAGRAPH (13) OF CODE SECTION 10-5-9 OF THE GEORGIA SECURITIES
ACT OF 1973, AND MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN A
TRANSACTION WHICH IS EXEMPT UNDER SUCH ACT OR PURSUANT TO AN
EFFECTIVE REGISTRATION UNDER SUCH ACT.
FOR FLORIDA INVESTORS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE FLORIDA
SECURITIES AND INVESTOR PROTECTION ACT.
IF SALES ARE MADE TO FIVE (5) OR MORE INVESTORS IN FLORIDA, ANY
FLORIDA INVESTOR MAY, AT THE INVESTOR'S OPTION, VOID ANY
PURCHASE HEREUNDER WITHIN A PERIOD OF THREE (3) DAYS AFTER THE
INVESTOR (A) FIRST TENDERS OR PAYS TO THE ISSUER, AN AGENT OF
THE ISSUER OR AN ESCROW AGENT THE CONSIDERATION REQUIRED
HEREUNDER OR (B) DELIVERS ITS EXECUTED SUBSCRIPTION AGREEMENT,
WHICHEVER OCCURS LATER. TO ACCOMPLISH THIS, IT IS SUFFICIENT
FOR A FLORIDA INVESTOR TO SEND A LETTER OR TELEGRAM TO THE
ISSUER WITHIN SUCH THREE (3) DAY PERIOD, STATING THAT THE
INVESTOR IS VOIDING AND RESCINDING THE PURCHASE. IF AN
INVESTOR SENDS A LETTER, IT IS PRUDENT TO DO SO BY CERTIFIED
MAIL, RETURN RECEIPT REQUESTED, TO INSURE THAT THE LETTER IS
RECEIVED AND TO EVIDENCE THE TIME OF MAILING.
TABLE OF CONTENTS
Summary of Fund Expenses
Fund Financial Highlights
Investment Objective and Policies
Risk Factors
Net Asset Value
Purchase and Redemption of Shares
Taxation and Distributions
Performance Information and Reports
Management of the Fund and Trust
SUMMARY OF FUND EXPENSES
The following table provides (i) a summary of expenses relating
to purchases and sales of shares of Managed Assets Fund (the
"Fund") and the estimated aggregate annual operating expenses
of the Fund, as a percentage of average net assets of the Fund
and (ii) an example illustrating the dollar cost of such
expenses on a $1,000 investment in the Fund.
Annual Operating Expenses
(as a percentage of the average daily net assets of the Fund)
Investment advisory fee 0.10%
Distribution (Rule 12b-1) Fee None
Other expenses (after reimbursements or waivers) 0.02
Total operation expenses (after reimbursements or waivers)
0.12%
Example 1 year 3 years
You would pay the following expenses on a $1,000 investment,
$1 $4
assuming: (1) 5% annual return and (2) redemption at the end of
each time period
The expense table and the example above show the estimated
costs and expenses that an investor will bear directly or
indirectly as a shareholder of the Fund. The expense table and
the example reflect a voluntary undertaking by Bankers Trust
Company ("Bankers Trust") and First Data Investor Services
Group, Inc. ("First Data"), the Fund's administrator, to waive
or reimburse expenses such that the total operating expenses
will not exceed 0.12% of the Fund's average net assets
annually. The example should not be considered a
representation of past or future expenses and actual expenses,
prior to the application of Bankers Trust's or First Data's
waiver or reimbursement of such expenses, may be greater or
less than those shown. Moreover, while each example assumes a
5% annual return, actual performance will vary and may result
in a return greater or less than 5%.
Shares of the Fund are sold by 440 Financial Distributors, Inc.
("440 Distributors") as the Fund's placement agent (the
"Placement Agent") primarily to institutional customers of
Bankers Trust that participate in Bankers Trust's securities
lending program.
For more information with respect to the expenses of the Fund
see "Management of the Fund and Trust" herein.
FUND FINANCIAL HIGHLIGHTS
The Fund will have a fiscal year-end of June 30. As this is
the Fund's first fiscal year, financial information with
respect to the Fund is not available at this time.
INVESTMENT OBJECTIVE AND POLICIES
The Fund seeks a high level of current income consistent with
liquidity and the preservation of capital through investment in
high-quality money market instruments. The Fund offers
investors a convenient means of investing in a diversified
portfolio of short-term money market instruments.
There can be no assurance that the investment objective of the
Fund will be achieved. The Fund's investment objective is not
a fundamental policy and may be changed upon 30 days written
notice to, but without the approval of, the Fund's
shareholders. If there is a change in the Fund's investment
objective, the Fund's shareholders should consider whether the
Fund remains an appropriate investment in light of their then-
current needs.
The following is a discussion of the various investments and
investment policies of the Fund. Additional information about
the investment policies of the Fund appears in the Confidential
Statement of Additional Information ("SAI") of the Fund.
The Fund will attempt to achieve its investment objective by
investing in the following money market instruments:
Obligations of Banks and Other Financial Institutions. The
Fund may invest in U.S. dollar-denominated fixed rate or
variable rate obligations of U.S. or foreign financial
institutions, including banks, which are rated in the highest
short-term rating category by any two nationally recognized
statistical rating organizations ("NRSROs") (or one NRSRO if
that NRSRO is the only such NRSRO which rates such obligations)
or, if not so rated, are believed by Bankers Trust, acting
under the supervision of the Board of Trustees of the Fund, to
be of comparable quality. Financial institution obligations in
which the Fund may invest include, but are not limited to,
certificates of deposit, bankers' acceptances, bank time
deposits, commercial paper and other U.S. dollar-denominated
instruments issued or supported by the credit of U.S. or
foreign financial institutions, including banks. If Bankers
Trust, acting under the supervision of the Board of Trustees of
the Fund, deems the instruments to present minimal credit risk,
the Fund may invest in obligations of foreign banks or foreign
branches and subsidiaries of U.S. and foreign financial
institutions, including banks. Investments in these
obligations may entail risks that are different from those of
investments in obligations of U.S. financial institutions,
including banks, because of differences in political,
regulatory and economic systems and conditions. These risks
include future political and economic developments, currency
blockage, the possible imposition of withholding taxes on
interest payments, differing reserve requirements, reporting
and recordkeeping requirements and accounting standards,
possible seizure or nationalization of deposits, difficulty or
inability of pursuing legal remedies and obtaining judgments in
foreign courts, possible establishment of exchange controls or
the adoption of other foreign governmental restrictions that
might affect adversely the payment of principal and interest on
financial institution obligations. Under normal market
conditions, the Fund will invest more than 25% of its assets in
the bank and other financial institution obligations described
above. The Fund's concentration of its investments in
financial institution obligations will cause the Fund to be
subject to the risks peculiar to the financial institution
industry to a greater extent than if its investments were not
so concentrated.
Commercial Paper. The Fund may invest in fixed rate or
variable rate commercial paper, including variable rate master
demand notes, issued by U.S. or foreign corporations or
financial institutions. Commercial paper when purchased by the
Fund must be rated in the highest short-term rating category by
any two NRSROs (or one NRSRO if that NRSRO is the only such
NRSRO which rates such security) or, if not so rated, must be
believed by Bankers Trust, acting under the supervision of the
Board of Trustees of the Trust (referred to hereinafter as the
"Board of Trustees"), to be of comparable quality. Any
commercial paper issued by a foreign corporation and purchased
by the Fund must be U.S. dollar-denominated and must not be
subject to foreign withholding tax at the time of purchase.
Investing in foreign commercial paper generally involves risks
similar to those described above relating to obligations of
foreign banks or foreign branches and subsidiaries of U.S. and
foreign banks.
Variable rate master demand notes are unsecured instruments
that permit the indebtedness thereunder to vary and provide for
periodic adjustments in the interest rate. Because variable
rate master demand notes are direct lending arrangements
between the Fund and the issuer, they are not ordinarily
traded. Although no active secondary market may exist for
these notes, the Fund will purchase only those notes under
which it may demand and receive payment of principal and
accrued interest daily or may resell the note to a third party.
While the notes are not typically rated by credit rating
agencies, issuers of variable rate master demand notes must
satisfy Bankers Trust, acting under the supervision of the
Board of Trustees, that the same criteria as set forth above
for issuers of commercial paper are met. In the event an
issuer of a variable rate master demand note defaulted on its
payment obligation, the Fund might be unable to dispose of the
note because of the absence of a secondary market and could,
for this or other reasons, suffer a loss to the extent of the
default. The face maturities of variable rate notes may exceed
397 days. (See "Quality and Maturity of the Fund's Securities"
herein.)
U.S. Government Obligations. The Fund may invest in
obligations issued or guaranteed by the U.S. Treasury or by
agencies or instrumentalities of the U.S. Government ("U.S.
Government Obligations"). Obligations of certain agencies and
instrumentalities of the U.S. Government, such as short-term
obligations of the Government National Mortgage Association,
are supported by the "full faith and credit" of the U.S.
Government; others, such as those of the Export-Import Bank of
the U.S. are supported by the right of the issuer to borrow
from the U.S. Treasury; others, such as those of the Federal
National Mortgage Association, are supported by the
discretionary authority of the U.S. Government to purchase the
agency's obligations; and still others, such as those of the
Student Loan Marketing Association, are supported only by the
credit of the instrumentality. No assurance can be given that
the U.S. Government would provide financial support to U.S.
Government-sponsored instrumentalities if it is not obligated
to do so by law.
Other Debt Obligations. The Fund may invest in deposits,
bonds, notes and debentures of issuers that at the time of
purchase have outstanding short-term obligations meeting the
above short-term rating requirements, or if there are no such
short-term ratings, are determined by Bankers Trust, acting
under the supervision of the Board of Trustees, to be of
comparable quality and are rated in the top two highest long-
term rating categories by two NRSROs (or one NRSRO if that
NRSRO is the only such NRSRO which rates the security).
Asset-Backed Securities. The Fund may also invest in
securities generally referred to as asset-backed securities,
which directly or indirectly represent a participation interest
in, or are secured by and payable from, a stream of payments
generated by particular assets such as motor vehicle or credit
card receivables. Asset-backed securities provide periodic
payments that generally consist of both interest and principal
payments. Consequently, the life of an asset-backed security
varies with the pre-payment and loss experience of the
underlying assets.
Repurchase Agreements. The Fund may engage in repurchase
agreement transactions with banks and governmental securities
dealers approved by the Board of Trustees. Under the terms of
a typical repurchase agreement, the Fund would acquire U.S.
Government Obligations of any remaining maturity for a
relatively short period (usually not more than one week),
subject to an obligation of the seller to repurchase, and the
Fund to resell the obligation at an agreed price and time,
thereby determining the yield during the Fund's holding period.
This arrangement results in a fixed rate of return that is not
subject to market fluctuations during the Fund's holding
period. The value of the underlying securities will be at
least equal at all times to the total amount of the repurchase
obligations, including interest. The Fund bears a risk of loss
in the event that the other party to a repurchase agreement
defaults on its obligations and the Fund is delayed in or
prevented from exercising its rights to dispose of the
collateral securities, including the risk of a possible decline
in the value of the underlying securities during the period in
which the Fund seeks to assert these rights. Bankers Trust,
acting under the supervision of the Board of Trustees of the
Fund, reviews the creditworthiness of those banks and dealers
with which the Fund enters into repurchase agreements and
monitors on an ongoing basis the value of the securities
subject to repurchase agreements to ensure that it is
maintained at the required level.
Reverse Repurchase Agreements. The Fund may enter into reverse
repurchase agreements. In a reverse repurchase agreement the
Fund agrees to sell portfolio securities to financial
institutions such as banks and broker-dealers and to repurchase
them at a mutually agreed date and price. At the time the Fund
enters into a reverse repurchase agreement it will earmark
cash, U.S. Government Obligations or other high grade, liquid
debt instruments having a value equal to the repurchase price,
including accrued interest. Reverse purchase agreements
involve the risk that the market value of the securities sold
by the Fund may decline below the repurchase price of the
securities. Reverse repurchase agreements are considered to be
borrowings by the Fund for purposes of the limitations
described in "Additional Investment Limitations" below and in
the Fund's SAI. The Fund may only enter into reverse
repurchase agreements for temporary purposes to satisfy
redemptions and not for leverage.
When-Issued and Delayed-Delivery Securities. To secure prices
deemed advantageous at a particular time, the Fund may purchase
securities on a when-issued or delayed-delivery basis, in which
case delivery of the securities occurs beyond the normal
settlement period; payment for or delivery of the securities
would be made prior to the reciprocal delivery or payment by
the other party to the transaction. The Fund will enter into
when-issued or delayed-delivery transactions for the purpose of
acquiring securities and not for the purpose of leverage.
When-issued securities purchased by the Fund may include
securities purchased on a "when, as and if issued" basis under
which the issuance of the securities depends on the occurrence
of a subsequent event.
Securities purchased on a when-issued or delayed-delivery basis
may expose the Fund to risk because the securities may
experience fluctuations in value prior to their actual
delivery. The Fund does not accrue income with respect to a
when-issued or delayed-delivery security prior to its stated
delivery date. Purchasing securities on a when-issued or
delayed-delivery basis can involve the additional risk that the
yield available in the market when the delivery takes place may
be higher than that obtained in the transaction itself. Upon
purchasing a security on a when-issued or delayed-delivery
basis, the Fund will earmark cash, U.S. Government Obligations
or other high grade liquid debt instruments in an amount at
least equal to the when-issued or delayed-delivery commitment.
Securities Lending. The Fund may lend its investment
securities to qualified institutional investors for either
short-term or long-term purposes of realizing additional
income. Loans of securities by the Fund will be collateralized
by cash, letters of credit, or securities issued or guaranteed
by the U.S. Government or its agencies. The collateral will
equal at least 100% of the current market value of the loaned
securities, and such loans may not exceed 30% of the value of
the Fund's net assets. The risks in lending portfolio
securities, as with other extensions of credit, consist of
possible loss of rights in the collateral should the borrower
fail financially. In determining whether to lend securities,
Bankers Trust will consider all relevant facts and
circumstances, including the creditworthiness of the borrower.
Investment in Other Investment Companies. In accordance with
applicable law, the Fund may invest its assets in other money
market funds with comparable investment objectives. In
general, the Fund may not (1) purchase more than 3% of any
other money market fund's voting stock; (2) invest more than 5%
of its assets in any single money market fund; and (3) invest
more than 10% of its assets in other money market funds.
Illiquid Securities. The Fund may not invest more than 10% of
its net assets in securities which are illiquid or otherwise
not readily marketable (such securities may include securities
which are subject to legal or contractual restrictions on
resale and repurchase agreements with maturities over seven
days). If a security becomes illiquid after purchase by the
Fund, the Fund will normally sell the security as soon as is
reasonable practicable unless to do so would not be in the best
interests of shareholders.
Quality and Maturity of the Fund's Securities
The Fund will maintain a dollar-weighted average maturity of 90
days or less. All securities in which the Fund invests will
have or be deemed to have remaining maturities of 397 days or
less on the date of their purchase, will be denominated in U.S.
dollars and will have been granted the required ratings
established herein by two NRSROs (or one NRSRO if that NRSRO is
the only such NRSRO which provides such ratings), or if not so
rated, are believed by Bankers Trust, under the supervision of
the Fund's Board of Trustees, to be of comparable quality.
Currently, there are six rating agencies which have been
designated by the SEC as an NRSRO. These organizations and
their highest short-term rating category (which also may be
modified by a "+") are: Duff and Phelps Credit Rating Co., D-1;
Fitch Investors Services, LP, F-1; Moody's Investors Service
Inc., Prime-1; Standard & Poor's Rating Services, a Division of
McGraw Hill Companies, Inc., A-1; IBCA Ltd. and IBCA Inc., A-1;
Thomson BankWatch, Inc., TBW-1. A description of all short and
long-term ratings is provided in the Appendix to the SAI.
Bankers Trust, acting under the supervision of and procedures
adopted by the Board of Trustees, will also determine that all
securities purchased by the Fund present minimal credit risks.
Bankers Trust will cause the Fund to dispose of any security as
soon as practicable if the security is no longer of the
requisite quality, unless such action would not be in the best
interest of the Fund. High-quality, short-term instruments may
result in a lower yield than instruments with a lower quality
or longer term.
Additional Investment Limitations
The Fund may not invest more than 25% of its total assets in
the securities of issuers in any single industry (excluding
U.S. Government Obligations and repurchase agreements
collateralized by U.S. Government Obligations), except that,
under normal market conditions, more than 25% of the total
assets of the Fund will be invested in obligations of banks and
other financial institutions. As an operating policy, the Fund
may not invest more than 5% of its total assets in the
obligations of any one issuer except: (1) as may be permitted
by Rule 2a-7 under the 1940 Act; and (2) for U.S. Government
Obligations and repurchase agreements collateralized by U.S.
Government obligations, which may be purchased without
limitation. The Fund is also authorized to borrow, including
entering into reverse repurchase transactions, in an amount up
to 10% of its total assets and to pledge its assets to the same
extent in connection with these borrowings. At the time of an
investment, the Fund's aggregate holdings of repurchase
agreements having a remaining maturity of more than seven
calendar days (or which may not be terminated within seven
calendar days upon notice by the Fund), time deposits having
remaining maturities of more than seven calendar days and other
illiquid securities will not exceed 10% of the Fund's net
assets. If changes in the liquidity of certain securities
cause the Fund to exceed such 10% limit, the Fund will take
steps to bring the aggregate amount of its illiquid securities
back below 10% of its net assets as soon as practicable, unless
such action would not be in the best interest of the Fund. The
Fund's limitations on investment in a single industry and on
borrowing may not be changed without the approval of the
shareholders of the Fund. All other investment policies and
limitations described in this Memorandum may be changed by a
vote of the Board of Trustees.
The SAI contains further information on the Fund's investment
restrictions.
RISK FACTORS
The Fund is designed as a cash management vehicle for
institutional investors seeking high current income
approximating money market rates while remaining liquid with a
stable share price. The Fund adheres to the following
practices which enable it to attempt to maintain a $1.00 share
price: limiting average dollar-weighted maturity of the
securities held by the Fund to 90 days or less; buying
securities with remaining maturities of 397 days or less as
determined under Rule 2a-7 under the 1940 Act; and buying only
high-quality securities with minimal credit risks. The Fund
cannot guarantee a $1.00 share price, but these practices help
to minimize any price fluctuations that might result from
rising or declining interest rates. While the Fund invests in
high-quality money market securities, investors should be aware
that an investment in the Fund is not without risk. All money
market instruments, including U.S. Government Obligations, can
change in value when interest rates or an issuer's
creditworthiness changes.
To assist the Fund in remaining fully invested, the Fund has
requested that the Securities and Exchange Commission ("SEC")
grant it an order permitting the Fund and Bankers Trust jointly
to enter into repurchase agreements and other investments with
non-affiliated banks, broker-dealers or other issuers with
respect to amounts to be received on any day. Such investments
will be apportioned between the Fund and Bankers Trust in such
a manner as to maximize the investment of cash by the Fund.
While in the past the SEC has granted orders permitting similar
investments, there is no assurance that it will continue to do
so.
NET ASSET VALUE
On each day on which the Fund is open (each such day being a
"Valuation Day"), the net asset value per share of the Fund is
calculated at 5:30 p.m., New York time. The Fund is currently
open on each day, Monday through Friday, except (a) January
1st, Martin Luther King, Jr.'s Birthday (the third Monday in
January), Presidents' Day (the third Monday in February),
Memorial Day (the last Monday in May), July 4th, Labor Day (the
first Monday in September), Columbus Day (the second Monday in
October), Veteran's Day (November 11th), Thanksgiving Day (the
last Thursday in November) and December 25th; and (b) the
preceding Friday or the subsequent Monday when one of the
calendar determined holidays falls on a Saturday or Sunday,
respectively.
The net asset value per share of the Fund is computed by
dividing the value of the Fund's assets, less all liabilities,
by the total number of its shares outstanding. The Fund's net
asset value per share will normally be $1.00.
The Fund values its portfolio securities by using the amortized
cost method of valuation. This method involves valuing each
security held by the Fund at its cost at the time of its
purchase and thereafter assuming a constant amortization to
maturity of any discount or premium. Accordingly, immaterial
fluctuations in the market value of the securities held by the
Fund will not be reflected in the Fund's net asset value. All
cash receivables and current payments are valued at face value.
Other assets are valued at fair value as determined in good
faith by the Fund's Board of Trustees.
PURCHASE AND REDEMPTION OF SHARES
Purchase of Shares
The Fund accepts purchase orders for shares of the Fund at the
net asset value per share of the Fund next determined on each
Valuation Day. See "Net Asset Value" above. There is no sales
charge on the purchase of shares. There is no minimum required
initial investment amount. Shares of the Fund may be purchased
in only those states where they may be lawfully sold. The Fund
and 440 Distributors reserve the right to reject any purchase
order.
Purchase orders for shares of the Fund will receive, on any
Valuation Day, the net asset value next determined following
receipt by First Data, as the Fund's transfer agent (the
"Transfer Agent"), of such order. If a purchase order is
transmitted to the Transfer Agent prior to 5:30 p.m., New York
time, and if payment in the form of federal funds is received
on that day by Bankers Trust, as the Fund's custodian (the
"Custodian"), the shareholder will be invested as of that day
and will accrue the dividend declared on that day.
It is anticipated that the majority of investors in the Fund
will issue standing orders, effective on or before 5:30 p.m. of
each day on which the Fund is open, to invest in the Fund.
Shares must be purchased in accordance with procedures
established by Bankers Trust in connection with customers'
accounts.
Certificates for shares will not be issued. Each shareholder's
account will be maintained by the Transfer Agent.
Redemption of Shares
Shareholders may redeem shares at the net asset value per share
next determined on each Valuation Day. It is anticipated that
the majority of investors in the Fund will issue standing
orders to redeem shares of the Fund as necessary. Redemption
requests for shares of the Fund transmitted to the Transfer
Agent prior to 5:30 p.m., New York time, on each Valuation Day
will be redeemed on that day at the net asset value per share
next determined, and the redemption proceeds normally will be
delivered to the shareholder's account on that day; no dividend
will accrue on the day of the redemption. Payments for
redemptions will in any event be made within seven calendar
days following receipt of the request. Within the first five
Valuation Days of each month, the Fund pays dividends for the
preceding month. Dividends will not be reinvested in the Fund.
Redemption orders are processed without charge by the Fund.
TAXATION AND DISTRIBUTIONS
The Trust intends for the Fund to qualify annually and to elect
to be treated as a "regulated investment company" under the
Internal Revenue Code of 1986, as amended (the "Code").
Provided that the Fund continues to qualify as a regulated
investment company, the Fund will not be subject to U.S.
Federal income tax on its investment company taxable income and
net capital gains (the excess of net long-term capital gains
over net short-term capital losses), if any, that it
distributes to shareholders. The Fund intends to distribute to
its shareholders, at least annually, substantially all of its
investment company taxable income and net capital gains, and
therefore does not anticipate incurring a Federal income tax
liability.
The Fund determines its net income and realized capital gains,
if any, on each Valuation Day at 5:30 p.m. The Fund declares
dividends from its net income on each Valuation Day and pays
dividends in cash for the preceding month within the first five
Valuation Days of each month. The Fund reserves the right to
include realized short-term gains, if any, in such daily
dividends. Distributions of the Fund's realized long-term
capital gains, if any, and any undistributed net realized
short-term capital gains are normally declared and paid
annually in cash at the end of the fiscal year in which they
were earned to the extent they are not offset by any capital
loss carryforwards.
Dividends paid out of the Fund's investment company taxable
income will be taxable to a U.S. shareholder as ordinary
income, provided that such shareholder is not a tax-exempt
entity. Distributions of net capital gains, if any, designated
as capital gain dividends are taxable as long-term capital
gains, regardless of how long the shareholder has held the
Fund's shares, and are not eligible for the dividends-received
deduction. Shareholders should consult their own tax adviser
concerning the application of federal, state and local taxes to
the distributions they receive from the Fund.
The Trust is organized as a Massachusetts business trust and,
under current law, neither the Trust nor the Fund is liable for
any income or franchise tax in the Commonwealth of
Massachusetts, provided that the Fund continues to qualify as a
regulated investment company under Subchapter M of the Code.
PERFORMANCE INFORMATION AND REPORTS
From time to time, the Fund may report its "current yield"
and/or "effective yield". All yield figures are based on
historical earnings and are not intended to indicate future
performance. The "current yield" of the Fund refers to the
income generated by an investment in the Fund over a seven-day
period (which period will be stated in the advertisement).
This income is then "annualized;" that is, the amount of income
generated by the investment during that week is assumed to be
generated each week over a 52-week period and is shown as a
percentage of the investment. The "effective yield" is
calculated similarly but, when annualized, the income earned by
an investment in the Fund is assumed to be reinvested. The
"effective yield" will be slightly higher than the "current
yield" because of the compounding effect of this assumed
reinvestment.
Yield is a function of the quality, composition and maturity of
the securities held by the Fund and operating expenses of the
Fund. In particular, the Fund's yield will rise and fall with
short-term interest rates, which can change frequently and
sharply. In periods of rising interest rates, the yield of the
Fund will tend to be somewhat lower than prevailing market
rates, and in periods of declining interest rates, the yield
will tend to be somewhat higher. In addition, when interest
rates are rising, the inflow of net new money to the Fund from
the continuous sale of its shares will likely be invested by
the Fund in instruments producing higher yields than the
balance of the Fund's securities, thereby increasing the
current yield of the Fund. In periods of falling interest
rates, the opposite can be expected to occur. Accordingly,
yields will fluctuate and do not necessarily indicate future
results. While yield information may be useful in reviewing
the performance of the Fund, it may not provide a basis for
comparison with bank deposits, other fixed rate investments, or
other investment companies that may use a different method of
calculating yield.
From time to time reports to shareholders may compare the yield
of the Fund to that of other mutual funds with similar
investment objectives or to that of a particular index. The
yield of the Fund might be compared with, for example, the
IBC/Donoghue's Taxable First Tier Institutional Only Money Fund
Average, which is an average complied by IBC/Donoghue's Money
Fund Report, a widely recognized, independent publication that
monitors the performance of money market mutual funds.
Similarly, the yield of the Fund might be compared with
rankings prepared by Micropal Limited and/or Lipper Analytical
Services, Inc., which are widely recognized, independent
services that monitor the investment performance of mutual
funds. The yield of the Fund might also be compared with the
average yield reported by the Bank Rate Monitor for money
market deposit accounts offered by the 50 leading banks and
thrift institutions in the top five standard metropolitan
areas. Shareholders may make inquiries regarding the Fund's
performance by contacting the Fund at (508) 871-3140.
Shareholders will receive financial reports semi-annually that
include the Fund's financial statements, including a listing of
investment securities held by the Fund at those dates. Annual
reports are audited by independent accountants.
MANAGEMENT OF THE FUND AND TRUST
Board of Trustees
The affairs of the Fund and Trust are managed under the
supervision of the Trust's Board of Trustees (referred to
herein as the "Fund's Board of Trustees"). For more
information with respect to the Board of Trustees, see
"Management of the Trust" in the SAI. By virtue of the
responsibilities assumed by Bankers Trust, as administrator of
the Trust, the Trust does not need employees other than its
executive officers. None of the executive officers of the
Trust devotes full time to the affairs of the Fund or Trust.
Investment Adviser
The Trust has retained the services of Bankers Trust, as
investment adviser with respect to the Fund. Bankers Trust, a
New York banking corporation with principal offices at 280 Park
Avenue, New York, New York 10017, is a wholly-owned subsidiary
of Bankers Trust New York Corporation. Bankers Trust conducts
a variety of general banking and trust activities and is a
major wholesale supplier of financial services to the
international and domestic institutional markets. Investment
management is a core business of Bankers Trust, built on a
tradition of excellence from its roots as a trust bank founded
in 1903. As of March 31, 1995, Bankers Trust New York
Corporation was the ninth largest bank holding company in the
United States with total assets of approximately $104 billion.
Bankers Trust is one of the nation's largest and most
experienced investment managers, with approximately $210
billion in assets under management as of March 31, 1996.
Bankers Trust is also one of the nation's leading managers of
cash funds with approximately $50 billion in cash assets.
Bankers Trust's officers have had extensive experience in
managing investment funds having objectives similar to those of
the Fund.
Bankers Trust, subject to the supervision and direction of the
Board of Trustees, manages the Fund in accordance with the
Fund's investment objective and stated investment policies,
makes investment decisions for the Fund, places orders to
purchase and sell securities and other financial instruments on
behalf of the Fund and employs professional investment managers
and securities analysts who provide research services to the
Fund. All orders for investment transactions on behalf of the
Fund are placed by Bankers Trust with broker-dealers and other
financial intermediaries that it selects, including those
affiliated with Bankers Trust. A Bankers Trust affiliate will
be used in connection with a purchase or sale of an investment
for the Fund only if Bankers Trust believes that the
affiliate's charge for the transaction does not exceed usual
and customary levels. The Fund will not invest in obligations
for which Bankers Trust or any of its affiliates is the
ultimate obligor or accepting bank. The Fund may, however,
invest in the obligations of correspondents and customers of
Bankers Trust.
Under its Investment Advisory Agreement, Bankers Trust receives
a fee from the Fund, computed daily and paid monthly, at the
annual rate of 0.10% of the average daily net assets of the
Fund.
Bankers Trust has been advised by its counsel that, in
counsel's opinion, Bankers Trust currently may perform the
services for the Fund and Trust described in this Memorandum
and the SAI without violation of the Glass-Steagall Act or
other applicable banking laws or regulations. State laws on
this issue may differ from the interpretations of relevant
Federal law and banks and financial institutions may be
required to register as dealers pursuant to state securities
law.
Administrator
First Data, a subsidiary of First Data Corporation, One
Exchange Place, Boston, Massachusetts 02109, serves as the
Fund's administrator pursuant to an Administration Agreement
with the Trust. Under the terms of the Administration
Agreement, First Data generally assists in all aspects of the
Fund's operations, other than providing investment advice,
subject to the overall authority of the Board of Trustees.
Pursuant to the terms of the Administration Agreement, dated
April 16, 1996, the Trust has agreed to pay First Data a
monthly fee at the annual rate of 0.02% of the value of the
Trust's average monthly net assets not exceeding $2 billion;
0.01% of the Trust's monthly average net assets exceeding $2
billion but not exceeding $3 billion and 0.0075% of the Trust's
monthly average net assets exceeding $3 billion, in addition to
a flat fee of $70,000 per year per Fund. First Data and
Bankers Trust have agreed to waive their respective fees to the
extent necessary to maintain the Fund's expense ratio at 0.12%
of the Fund's average daily net assets.
Placement Agent
Under its Placement Agent Agreement with the Fund, 440
Distributors, as Placement Agent, serves as the Trust's
principal underwriter on a best efforts basis. In addition,
440 Distributors is a wholly-owned subsidiary of First Data.
The principal business address of 440 Distributors is 4400
Computer Drive, Westborough, Massachusetts 01581.
Custodian and Transfer Agent
Bankers Trust acts as custodian of the assets of the Fund and
serves as the transfer agent for the Fund.
Organization of the Trust
The Trust was organized on January 19, 1996 under the laws of
the Commonwealth of Massachusetts. The Fund is a separate
series of the Trust. The Trust offers shares of beneficial
interest of separate series, par value $0.001 per share. The
shares of the other series of the Trust are offered through
separate prospectuses. No series of shares has any preference
over any other series.
The Trust is an entity commodity known as a "Massachusetts
business trust." Under Massachusetts law, shareholders of such
a business trust may, under certain circumstances, be held
personally liable as partners for its obligations. However,
the risk of a shareholder incurring financial loss on account
of shareholder liability is limited to circumstances in which
both inadequate insurance existed and the Trust itself was
unable to meet its obligations.
When matters are submitted for shareholder vote, shareholders
of the Fund will have one vote for each full share held and
proportionate, fractional votes for fractional shares held. A
separate vote of the Fund is required on any matter affecting
the Fund on which shareholders are entitled to vote.
Shareholders of the Fund are not entitled to vote on Trust
matters that do not affect the Fund. There normally will be no
meetings of shareholders for the purpose of electing Trustees
unless and until such time as less than a majority of Trustees
holding office have been elected by shareholders, at which time
the Trustees then in office will call a shareholders' meeting
for the election of Trustees. Any Trustee may be removed from
office upon the vote of shareholders holding at least two-
thirds of the Trust's outstanding shares at a meeting called
for that purpose. The Trustees are required to call such a
meeting upon the written request of shareholders holding at
least 10% of the Trust's outstanding shares.
Shareholders of all the series of the Trust will vote together
to elect Trustees of the Trust and for certain other matters.
Under certain circumstances, the shareholders of one or more
series could control the outcome of these votes.
Expenses of the Trust
The Fund bears its own expenses. Operating expenses for the
Fund generally consist of all costs not specifically borne by
Bankers Trust, including investment advisory fees,
administration fees, fees for necessary professional services,
amortization of organizational expenses, the costs of
regulatory compliance and costs associated with maintaining
legal existence and shareholder relations. Bankers Trust has
agreed to reimburse the Fund to the extent required by
applicable state law for certain expenses that are described in
the SAI.
BT INSURANCE FUNDS TRUST
MANAGED ASSETS FUND
Investment Adviser
BANKERS TRUST COMPANY
Placement Agent
440 FINANCIAL DISTRIBUTORS, INC.
Custodian
BANKERS TRUST COMPANY
Administrator and Transfer Agent
FIRST DATA INVESTOR SERVICES GROUP, INC.
Independent Auditors
ERNST & YOUNG LLP
Counsel
WILLKIE FARR & GALLAGHER
No person has been authorized to give any information or to
make any representations other than those contained in the
Fund's Confidential Private Offering Memorandum, its
Confidential Statement of Additional Information in connection
with the offering of the Fund's shares and, if given or made,
such other information or representations must not be relied on
as having been authorized by the Trust. This Confidential
Private Offering Memorandum does not constitute an offer in any
state in which, or to any person to whom, such offer may not
lawfully be made.
BT INSURANCE FUNDS TRUST - MANAGED ASSETS FUND
CONFIDENTIAL STATEMENT OF ADDITIONAL INFORMATION
BT Insurance Funds Trust (the "Trust") is an open-end
management investment company that offers investors a selection
of investment portfolios, each having distinct investment
objectives and policies. This Confidential Statement of
Additional Information relates to the Managed Assets Fund (the
"Fund"). The Fund seeks a high level of current income
consistent with liquidity and the preservation of capital
through investment in high-quality money market instruments.
Shares of the Fund are sold by First Data Investor
Services Group, Inc. ("First Data"), the Trust's Distributor
(and the Fund's Placement Agent), primarily to clients and
customers of Bankers Trust Company ("Bankers Trust"). Bankers
Trust serves as the Fund's investment adviser (the "Adviser").
THE SECURITIES DESCRIBED HEREIN ARE OFFERED PURSUANT TO AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT OF 1933, AS AMENDED, AND HAVE NOT BEEN REGISTERED WITH OR
APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION OR ANY OTHER REGULATORY AUTHORITY OF ANY
JURISDICTION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS CONFIDENTIAL STATEMENT OF ADDITIONAL
INFORMATION. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
SHARES OF THE FUND ARE BEING OFFERED ONLY TO INVESTORS WHO
QUALIFY AS BOTH (1) ACCREDITED INVESTORS AS DEFINED UNDER
REGULATION D UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
(2) INSTITUTIONAL INVESTORS. SHARES OF THE FUND ARE NOT BEING
OFFERED TO INDIVIDUALS OR TO ENTITIES ORGANIZED FOR THE PURPOSE
OF INVESTING ON BEHALF OF INDIVIDUALS.
The Fund's confidential private offering memorandum,
which may be amended from time to time (the "Confidential
Private Offering Memorandum"), is dated September 18, 1996.
The Confidential Private Offering Memorandum provides the basic
information investors should know before investing, may be
obtained without charge by calling the Fund at (508) 871-3140.
This Confidential Statement of Additional Information, which is
not a Confidential Private Offering Memorandum, is intended to
provide additional information regarding the activities and
operations of the Trust and should be read in conjunction with
the Confidential Private Offering Memorandum. Capitalized
terms not otherwise defined in this Confidential Statement of
Additional Information have the meanings accorded to them in
the Fund's Confidential Private Offering Memorandum.
BANKERS TRUST COMPANY
Investment Adviser
FIRST DATA INVESTOR SERVICES GROUP, INC.
Administrator and Placement Agent
4400 Computer Drive Westborough, Massachusetts
01581 (508) 871-8500
INVESTMENT OBJECTIVES AND POLICIES
The Fund's Confidential Private Offering Memorandum
discusses the investment objective of the Fund and the policies
to be employed to achieve that objective. This section
contains supplemental information concerning the types of
securities and other instruments in which the Fund may invest,
the investment policies and portfolio strategies that the Fund
may utilize and certain risks attendant to those investments,
policies and strategies.
Obligations of Banks and Other Financial Institutions
For purposes of the Fund's investment policies with
respect to obligations of financial institutions including
banks, the assets of a bank will be deemed to include the
assets of its domestic and foreign branches. Obligations of
foreign branches of U.S. banks and foreign banks may be general
obligations of the parent bank in addition to the issuing bank
or may be limited by the terms of a specific obligation and by
government regulation. If Bankers Trust, acting under the
supervision of the Trust's Board of Trustees (hereinafter
called the "Board of Trustees"), deems the instruments to
present minimal credit risk, the Fund may invest in U.S. or
foreign financial institutions, including banks located in the
United Kingdom, Grand Cayman Island, Nassau, Japan and Canada.
Investments in these obligations may entail risks that are
different from those of investments in obligations of U.S.
domestic banks or other financial institutions because of
differences in political, regulatory and economic developments,
currency blockage, the possible imposition of withholding taxes
on interest payments, possible seizure or nationalization of
foreign deposits, difficulty or inability of pursuing legal
remedies and obtaining judgments in foreign courts, possible
establishment of exchange controls or the adoption of other
foreign governmental restrictions that might affect adversely
the payment of principal and interest on bank obligations.
Foreign branches of U.S. banks and foreign banks may also be
subject to less stringent reserve requirements and to different
accounting, auditing, reporting and recordkeeping standards
that those applicable to domestic branches of U.S. banks.
Commercial Paper
Commercial paper obligations in which the Fund may invest
are short-term, unsecured negotiable promissory notes of U.S.
or foreign corporations that at the time of purchase meet the
rating criteria described in the Confidential Private Offering
Memorandum. Investments in foreign commercial paper generally
involve risks similar to those described above relating to
obligations of financial institutions, including foreign banks
or foreign branches and subsidiaries of U.S. and foreign banks.
U.S. Government Obligations
The Fund may invest in direct obligations issued by the
U.S. Treasury or in obligations issued or guaranteed by the
U.S. Treasury or by agencies or instrumentalities of the U.S.
Government ("U.S. Government Obligations"). Certain short-term
U.S. Government Obligations, such as those issued by the
Government National Mortgage Association ("GNMA"), are
supported by the "full faith and credit" of the U.S.
Government; others, such as those of the Export-Import Bank of
the U.S., are supported by the right of the issuer to borrow
from the U.S. Treasury; others, such as those of the Federal
National Mortgage Association are solely the obligations of the
issuing entity but are supported by the discretionary authority
of the U.S. Government to purchase the agency's obligations;
and still others, such as those of the Student Loan Marketing
Association, are supported by the credit of the
instrumentality. No assurance can be given that the U.S.
Government would provide financial support to U.S. Government-
sponsored instrumentalities if it is not obligated to do so by
law.
Examples of the types of U.S. Government Obligations that
the Fund may hold include, in addition to those described above
and direct U.S. Treasury obligations, the obligations of the
Federal Housing Administration, Farmers Home Administration,
Small Business Administration, General Services Administration,
Central Bank for Cooperatives, Federal Farm Credit Banks,
Federal Farm Credit Banks Funding Corp., Federal Home Loan
Banks, Federal Home Loan Mortgage Corporation, Federal
Intermediate Credit Banks, Federal Land Banks and Maritime
Administration.
Reverse Repurchase Agreements
The Fund may borrow funds for temporary or emergency
purposes, such as meeting larger than anticipated redemption
requests, and not for leverage, by among other things, agreeing
to sell portfolio securities to financial institutions such as
banks and brokers-dealers and to repurchase them at a mutually
agreed date and price (a "reverse repurchase agreement"). At
the time the Fund enters into a reverse repurchase agreement it
will place in a segregated custodial account cash, U.S.
Government Obligations or high-grade liquid debt obligations
having a value equal to the repurchase price, including accrued
interest. Reverse repurchase agreements involve the risk that
the market value of the securities sold by the Fund may decline
below the repurchase price of those securities. Reverse
repurchase agreements are considered to be borrowings by the
Fund.
Rating Services
Ratings represent the opinions of rating services as to
the quality of the securities that they undertake to rate. It
should be emphasized, however, that ratings are relative and
subjective and are not absolute standards of quality. Although
these ratings are an initial criterion for selection of
portfolio investments, Bankers Trust also makes its own
evaluation of these securities, subject to review by the Board
of Trustees. After purchase by the Fund, an obligation may
cease to be rated or its rating may be reduced below the
minimum required for purchase by the Fund. Neither event would
require the Fund to eliminate the obligation from its
portfolio, but Bankers Trust will consider such an event in its
determination of whether the Fund should continue to hold the
obligation. A description of the ratings used herein and in
the Confidential Private Offering Memorandum is set forth in
the Appendix to this Confidential Statement of Additional
Information.
THE FOLLOWING FUNDAMENTAL INVESTMENT RESTRICTIONS AND
NON-FUNDAMENTAL INVESTMENT OPERATING POLICIES HAVE BEEN ADOPTED
BY THE TRUST, WITH RESPECT TO THE FUND BECAUSE OF REQUIREMENTS
OF FEDERAL SECURITIES LAWS OR REGULATIONS. UNLESS AN
INVESTMENT INSTRUMENT OR TECHNIQUE IS DESCRIBED IN THE
CONFIDENTIAL PRIVATE OFFERING MEMORANDUM, THE FUND MAY NOT
INVEST IN THAT INVESTMENT INSTRUMENT OR ENGAGE IN THAT
INVESTMENT TECHNIQUE.
Investment Restrictions
The investment restrictions below have been adopted by
the Trust with respect to the Fund as fundamental policies.
Under the 1940 Act, a "fundamental" policy may not be changed
without the "vote of a majority of the outstanding voting
securities" of the Fund - which is defined in the 1940 Act as
the lesser of (a) 67% or more of the shares of the Fund present
at a shareholder meeting of the Fund if the holders of more
than 50% of the outstanding shares of the Fund are present or
represented by proxy, or (b) more than 50% of the outstanding
shares of the Fund. The percentage limitations contained in
the restrictions listed below apply at the time of the purchase
of the securities.
As a matter of fundamental policy, the Fund may not:
1. Borrow money or mortgage or hypothecate assets of the
Fund, except that in an amount not to exceed 1/3 of the current
value of the Fund's total assets, it may borrow money as a
temporary measure for extraordinary or emergency purposes and
enter into reverse repurchase agreements or dollar roll
transactions, and except that it may pledge, mortgage or
hypothecate not more than 1/3 of such assets to secure such
borrowings (it is intended that money would be borrowed only
from banks or through reverse repurchase agreements and only
either to accommodate redemption requests while effecting an
orderly liquidation of portfolio securities or to maintain
liquidity in the event of an unanticipated failure to complete
a portfolio security transaction or other similar situations)
provided that collateral arrangements with respect to options
and futures, including deposits of initial deposit and
variation margin, are not considered a pledge of assets for
purposes of this restriction and except that assets may be
pledged to secure letters of credit solely for the purpose of
participating in a captive insurance company sponsored by the
Investment Company Institute: (As an operating policy, the Fund
may not engage in dollar roll transactions or options and
futures);
2. Underwrite securities issued by other persons except
insofar as the Trust or the Fund may technically be deemed an
underwriter under the Securities Act of 1933, as amended (the
"1933 Act"), in selling a portfolio security;
3. Make loans to other persons except (a) through the use of
repurchase agreements or the purchase of short-term obligations
or (b) by purchasing a portion of an issue of debt securities
of types distributed publicly or privately;
4. Purchase or sell real estate (including limited
partnership interests but excluding securities secured by real
estate or interests therein), interests in oil, gas or mineral
leases, commodities or commodity contracts (except futures and
option contracts) in the ordinary course of business (except
that the Fund may hold and sell, for the Fund's portfolio, real
estate acquired as a result of the Fund's ownership of
securities);
5. Concentrate its investments in any particular industry
(excluding U.S. Government Obligations), except that the Fund
will invest more than 25% of its total assets in the
obligations of banks and other financial institutions, and if
it is deemed appropriate for the achievement of the Fund's
investment objective, up to 25% of its total assets may be
invested in any other industry; and
6. Issue any "senior security" (as that term is defined in
the 1940 Act) if such issuance is specifically prohibited by
the 1940 Act or the rules and regulations promulgated
thereunder, provided that collateral arrangements with respect
to options and futures, including deposits of initial deposit
and variation margin, are not considered to be the issuance of
a senior security for purposes of this restriction.
The following investment limitations may be changed by a
vote of the Board of Trustees at anytime. As a matter of
operating policy, the Fund will not:
(i) purchase securities on margin;
(ii) make short sales of securities;
(iii) invest in warrants;
(iv) purchase any security if, as a result, more than 10% of
its net assets would be invested in securities that are deemed
illiquid because they are subject to legal or contractual
restrictions on resale or securities for which there are no
readily available market quotations;
(v) invest for the purpose of exercising control or
management; or
(vi) purchase securities of any investment company if such
purchase at the time thereof would cause:
(a) more than 10% of the Fund's total assets (taken at the
greater of cost or market value) to be invested in the
securities of such issuers; (b) more than 5% of the Fund's
total assets (taken at the greater of cost or market value) to
be invested in any one investment company; or (c) more than 3%
of the outstanding voting securities of any such issuer to be
held for the Fund.
Portfolio Transactions
Decisions to buy and sell securities and other financial
instruments for the Fund are made by Bankers Trust, which also
is responsible for placing these transactions, subject to the
overall review of the Board of Trustees. Although investment
requirements for the Fund are reviewed independently from those
of the other accounts managed by Bankers Trust, investments of
the type the Fund may make may also be made by these other
accounts. When the Fund and one or more other accounts managed
by Bankers Trust are prepared to invest in, or desire to
dispose of, the same security or other financial instrument,
available investments or opportunities for sales will be
allocated in a manner believed by Bankers Trust to be equitable
to each. In some cases this procedure may affect adversely the
price paid or received by the Fund or the size of the position
obtained or disposed of by the Fund.
Purchases and sales of securities on behalf of the Fund
will be principal transactions. These securities are normally
purchased directly from the issuer or from an underwriter or
market maker for the securities. The cost of securities
purchased from underwriters includes an underwriting commission
or concession and the prices at which securities are purchased
from and sold to dealers include a dealer's mark-up or mark-
down. U.S. Government Obligations are generally purchased from
underwriters or dealers, although certain newly issued U.S.
Government Obligations may be purchased directly from the U.S.
Treasury or from the issuing agency or instrumentality.
Over-the-counter purchases and sales are transacted
directly with principal market makers except in those cases in
which better prices and executions may be obtained elsewhere
and principal transactions are not entered into with persons
affiliated with the Fund except pursuant to exemptive rules or
orders adopted by the Securities and Exchange Commission (the
"SEC"). Under rules adopted by the SEC, broker-dealers may not
execute transactions on the floor of any national securities
exchange for the accounts of affiliated persons, but may effect
transactions by transmitting orders for execution.
In selecting dealers to execute portfolio transactions on
behalf of the Fund, Bankers Trust seeks the best overall terms
available. In assessing the best overall terms available for
any transaction, Bankers Trust will consider the factors it
deems relevant, including the breadth of the market in the
investment, the price of the investment and the financial
condition and execution capability of the dealer for the
specific transaction and on a continuing basis. In addition,
Bankers Trust is authorized, in selecting parties to execute a
particular transaction and in evaluating the best overall terms
available, to consider the brokerage services but not research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934, as amended) provided to the
Fund.
NET ASSET VALUE
The Confidential Private Offering Memorandum discusses
the time at which the net asset value per share of the Fund is
determined for purposes of sales and redemptions.
The valuation of the Fund's securities is based on their
amortized cost, which does not take into account unrealized
capital gains or losses. Amortized cost valuation involves
initially valuing an instrument at its cost and thereafter
assuming a constant amortization to maturity of any discount or
premium, generally without regard to the impact of fluctuating
interest rates on the market value of the instrument. Although
this method provided certainty in valuation, it may result in
periods during which value, as determined by amortized cost, is
higher or lower than the price the Fund would receive if its
sold the instrument.
The Fund's use of the amortized cost method of valuing
its securities is permitted by a rule adopted by the SEC.
Under this rule, the Fund must maintain a dollar-weighted
average portfolio maturity of 90 days or less, purchase only
instruments having remaining maturities of two years or less
and invest only in securities determined by or under the
supervision of the Board of Trustees to present minimal credit
risks.
Pursuant to the rule, the Board of Trustees also has
established procedures designed to allow investors in the Fund
to stabilize, to the extent reasonably possible, the investors'
price per share as computed for the purpose of sales and
redemptions at $1.00. These procedures include review of the
Fund's holdings by the Board of Trustees, at such intervals as
it deems appropriates, to determine whether the value of the
Fund's assets calculated by using available market quotations
or market equivalents deviates from such valuation based on
amortized cost.
The rule also provides that the extent of any deviation
between the value of the Fund's assets based on available
market quotations or market equivalents and such valuation
based on amortized cost must be examined by the Board of
Trustees. In the event the Board of Trustees determines that a
deviation exists that may result in material dilution or other
unfair results to investors or existing shareholders, pursuant
to the rule, the Board of Trustees must cause the Fund to take
such corrective action as the Board of Trustees regards as
necessary and appropriate, including: selling portfolio
instruments prior to maturity to realize capital gains or
losses or to shorten average portfolio maturity; withholding
dividends or paying distributions from capital or capital
gains; redeeming shares in kind; or valuing the Fund's assets
by using available market quotations.
PURCHASE AND REDEMPTION INFORMATION
The Trust may suspend the right of redemption or postpone
the date of payment for shares of the Fund during any period
when: (a) trading on the New York Stock Exchange ("NYSE") is
restricted by applicable rules and regulations of the SEC; (b)
the NYSE is closed for other than customary weekend and holiday
closings; (c) the SEC has by order permitted such suspension;
or (d) an emergency exists as determined by the SEC.
Under the terms of a Placement Agent Agreement, First
Data acts as placement agent on a "best efforts" basis with
respect to the sale of shares of the Fund. In addition to
First Data's duties as placement agent. First Data may, in its
discretion perform additional functions in connection with
transactions in the shares of the Fund.
MANAGEMENT OF THE TRUST
The Board of Trustees is composed of persons experienced
in financial matters who meet throughout the year to oversee
the activities of the Fund. In addition, the Trustees review
contractual arrangements with companies that provide services
to the Fund and review the Fund's performance.
The Trustees and officers of the Trust and their
principal occupations during the past five years are set forth
below. Their titles may have varied during that period.
Asterisks indicate those Trustees who are "interested persons"
(as defined in the 1940 Act) of the Trust. Unless otherwise
indicated, the address of each Trustee and officer is c/o One
Exchange Place, Boston, Massachusetts 02109.
Trustees and Officers
Name, Address
and Age
Position
Held with
the Trust
Principal
Occupations
During
Past 5 Years
Robert R.
Coby, 45
118 North
Drive
North
Massapequa,
NY 11758
Trustee
President of
Leadership
Capital Inc.
since 1995;
Chief
Operating
Officer of CS
First Boston
Investment
Management
(1994-1995);
President of
Blackhawk L.P.
(1993-1994);
Chief
Financial
Officer of
Equitable
Capital prior
to February
1993.
Desmond G.
Fitzgerald,
52
2015 West
Main Street
Stamford, CT
06902
Trustee
Chairman of
North American
Properties
Group since
January 1987.
James S.
Pasman, Jr.,
65
29 The
Trillium
Pittsburgh,
PA 15238
Trustee
Retired;
President and
Chief
Operations
Officer of
National
Intergroup
Inc. (1989-
1991).
William E.
Small, 54
Trustee
and
President
Executive Vice
President of
First Data
Investor
Services Group
Inc. ("First
Data") since
1994; Senior
Vice President
of The
Shareholder
Services
Group, Inc.
(1993-1994);
independent
consultant
(1990-1993).
Michael
Kardok, 36
Vice
President
and
Treasurer
Vice President
of First Data
since May
1994; Vice
President of
The Boston
Company
Advisors Inc.
prior to May
1994.
Julie A.
Tedesco, 38
Vice
President
and
Secretary
Counsel of
First Data
since May
1994; Counsel
of The Boston
Company
Advisors Inc.
(1992-1994);
Associate at
Hutchins,
Wheeler &
Dittmar prior
to July 1992.
Mr. Kardok and Ms. Tedesco also hold similar positions
for other investment companies for which 440 Distributors or an
affiliate serves as the principal underwriter.
No person who is an officer or director of Bankers Trust
is an officer or Trustee of the Trust. No director, officer or
employee of 440 Distributors or any of its affiliates will
receive any compensation from the Trust for serving as an
officer or Trustee of the Trust.
As of September 1, 1996 the Trustees and officers of the
Trust owned in the aggregate less than 1% of the shares of the
Fund or the Trust (all series taken together).
Investment Adviser
Under the terms of an Advisory Agreement between the Fund and
Bankers Trust, Bankers Trust manages the Fund subject to the
supervision and direction of the Board of Trustees. Bankers
Trust will: (i) act in strict conformity with the Fund's
Declaration of Trust, the 1940 Act and the Investment Advisers
Act of 1940, as the same may from time to time be amended; (ii)
manage the Fund in accordance with the Fund's investment
objectives, restrictions and policies, as stated herein and in
the Confidential Private Offering Memorandum; (iii) make
investment decision for the Fund; and (iv) place purchase and
sale orders for securities and other financial instruments on
behalf of the Fund.
Bankers Trust bears all expenses in connection with the
performance of services under the Advisory Agreement. The Fund
bears certain other expenses incurred in its operation,
including: taxes, interest, brokerage fees and commissions, if
any; fees of Trustees of the Trust who are not officers,
directors or employees of Bankers Trust. First Data or any of
their affiliates; SEC fees; administrative and services fees;
certain insurance premiums; outside auditing and legal
expenses; costs of maintenance of corporate existence; costs
attributable to investor services, including, without
limitation, telephone and personnel expenses; and printing
confidential private offering memoranda and confidential
statements of additional information for regulatory purposes
and for distribution to existing shareholders; costs of
shareholders' reports and meetings of shareholders, officers
and Trustees of the Trust; and any extraordinary expenses.
Bankers Trust may have deposit, loan and other commercial
banking relationships with the issuers of obligations which may
be purchased on behalf of the Fund, including outstanding loans
to such issuers which could be repaid in whole or in part with
the proceeds of securities so purchased. Such affiliates deal,
trade and invest for their own accounts in such obligations and
are among the leading dealers of various types of such
obligations. Bankers Trust has informed the Trust that, in
making its investment decisions, it does not obtain or use
material inside information in its possession or in the
possession of any of its affiliates. In making investment
recommendations for the Fund, Bankers Trust will not inquire or
take into consideration whether an issuer of securities
proposed for purchase or sale by the Fund is a customer of
Bankers Trust, its parent or its subsidiaries or affiliates
and, in dealing with its customers, Bankers Trust, its parent,
subsidiaries, and affiliates will not inquire or take into
consideration whether securities of such customers are held by
any fund managed by Bankers Trust or any such affiliate.
Administrator
First Data, One Exchange Place, Boston, Massachusetts
02109, serves as administrator of the Fund. As administrator,
First Data is obligated on a continuous basis to provide such
administrative services as the Board of Trustees reasonably
deems necessary for the proper administration of the Fund.
First Data will generally assist in all aspects of the Fund's
operations; supply and maintain office facilities (which may be
in First Data's own offices), statistical and research data,
data processing services, clerical, accounting, bookkeeping and
recordkeeping services (including without limitation the
maintenance of such books and records as are required under the
1940 Act and the rules thereunder, except as maintained by
other agents), internal auditing, executive and administrative
services, and stationery and office supplies; prepare reports
to shareholders or investors; prepare and file tax returns;
supply financial information and supporting data for reports to
and filings with the SEC and various state Blue Sky
authorities; supply supporting documentation for meetings of
the Board of Trustees; provide monitoring reports and
assistance regarding compliance with the Declaration of Trust,
by-laws, investment objectives and policies and with Federal
and state securities laws; arrange for appropriate insurance
coverage; calculate net asset values, net income and realized
capital gains or losses, and negotiate arrangements with, and
supervise and coordinate the activities of, agents and others
to supply services.
Custodian and Transfer Agent
Bankers Trust, 280 Park Avenue, New York, New York 10017,
serves as custodian for the Trust. As custodian, Bankers Trust
holds the Fund's assets. Bankers Trust will comply with the
self-custodian provisions of Rule 17f-2 under the 1940 Act.
First Data serves as transfer agent of the Trust. Under
its transfer agency agreement with the Trust, First Data
maintains the shareholder account records for the Fund, handles
certain communications between shareholders and the Fund and
causes to be distributed any dividends and distributions
payable by the Fund.
Use of Name
The Trust and Bankers Trust have agreed that the Trust
may use "BT" as part of its name for so long as Bankers Trust
serves as investment adviser. The Trust has acknowledged that
the term "BT" is used by and is a property right of certain
subsidiaries of Bankers Trust and that those subsidiaries
and/or Bankers Trust may be any time permit others to use that
term.
The Trust may be required, on 60-days' notice from
Bankers Trust at any time, to abandon use of the acronym "BT"
as part of its name. If this were to occur, the Trustees would
select an appropriate new name for the Trust, but there would
be no other material effect on the Trust, its shareholders or
activities.
Banking Regulatory Matters
Bankers Trust has been advised by its counsel that in its
opinion Bankers Trust may perform the services for the Fund
contemplated by the Advisory Agreement and other activities for
the Trust described in the Confidential Private Offering
Memorandum and this Confidential Statement of Additional
Information without violation of the Glass-Steagall Act or
other applicable banking laws or regulations. However, counsel
has pointed out that future changes in either Federal or state
statutes and regulations concerning the permissible activities
of banks or trust companies, as well as future judicial or
administrative decisions or interpretations or present and
future statutes and regulations, might prevent Bankers Trust
from continuing to perform those services for the Trust. If
the circumstances described above should change, the Board of
Trustees would review the Trust's relationship with Bankers
Trust and consider taking all actions necessary in the
circumstances. In addition, state securities law on this issue
may differ from interpretations of Federal law as expressed
herein and banks and financial institutions may be required to
register as dealer pursuant to state law.
Counsel and Independent Accountants
Willkie Farr & Gallagher, One Citicorp Center, 153 East
53rd Street, New York, New York 10022-4669, serves as Counsel
to the Trust and the Fund and from time to time provides
certain legal services to Bankers Trust. Ernst & Young LLP,
787 Seventh Avenue, New York, New York 10019, acts as
independent accountants of the Trust and the Fund.
ORGANIZATION OF THE TRUST
The Trust was organized on January 19, 1996 as an
unincorporated business association under the laws of the
Commonwealth of Massachusetts ("Massachusetts Business Trust").
The shares of each series participate equally in the earnings,
dividends and assets of the particular series. The Trust may
create and issue additional series of shares, and may divide
the shares of any series into one or more classes, in the
future. The Declaration of Trust of the Trust permits the
Trustees to divide or combine the shares into a greater or
lesser number of shares without thereby changing the
proportionate beneficial interest in a series. Each share
represents an equal proportionate interest in a series with
each other share. Shares when issued are fully paid and non-
assessable, except as set forth below. Shareholders are
entitled to one vote for each share held.
Share of the Trust do not have cumulative voting rights,
which means that holders of more than 50% of the shares voting
for the election of Trustees can elect all Trustees. Shares of
the Fund are not transferable nor do shares have preemptive,
conversion or subscription rights.
The Trust is not required to hold annual meetings of
shareholders but will hold special meetings of shareholders
when in the judgment of the Trustees it is necessary or
desirable to submit matters for a shareholder vote.
Shareholders have under certain circumstances the right to
communicate with other shareholders in connection with
requesting a meeting of shareholders for the purpose of
removing one or more Trustees without a meeting. Upon
liquidation of the Fund, shareholders of the Fund would be
entitled to share pro rata in the net assets of the Fund
available for distribution to shareholders.
Massachusetts law provides that shareholders could under
certain circumstances be held personally liable for the
obligations of the Trust. However, the Declaration of Trust
disclaims shareholder liability for acts or obligations of the
Trust and requires that notice of this disclaimer be given in
each agreement, obligation or instrument entered into or
executed by the Trust or a Trustee. The Declaration of Trust
provides for indemnification from the Trust's property for all
losses and expenses of any shareholder held personally liable
for the obligations of the Trust. Thus, the risk of
shareholders incurring financial loss on account of shareholder
liability is limited to circumstances in which the Trust itself
would be unable to meet its obligations, a possibility that the
Trust believes is remote. Upon payment of any liability
incurred by the Trust, the shareholder paying the liability
will be entitled to reimbursement from the general assets of
the Trust. The Trustees intend to conduct the operations of
the Trust in a manner so as to avoid, as far as possible,
ultimate liability of the shareholders for liabilities of the
Trust.
TAXES
The following is only a summary of certain tax
considerations generally affecting the Fund and its
shareholders, and is not intended as a substitute for careful
tax planning. Shareholders are urged to consult tax advisers
with specific reference to their tax situations.
As described above and in the Fund's Confidential Private
Offering Memorandum: the Fund is designed to provide investors
with liquidity and current income. The Fund is not intended to
constitute a balanced investment program and is not designed
for investors seeking capital gains, maximum income or maximum
tax-exempt income irrespective of fluctuations in principal.
The Trust intends that the Fund qualify as a separate
regulated investment company under the Internal Revenue Code of
1986, as amended (the "Code"). Provided that the Fund is a
regulated investment company, the Fund will not be liable for
Federal income taxes to the extent all of its taxable net
investment income and net realized long- and short-term capital
gains, if any, are distributed to its shareholders. Although
the Trust expects the Fund to be relieved of all or
substantially all Federal income taxes, depending upon the
extent of its activities in states and localities in which its
offices are maintained, in which its agents or independent
contractors are located or in which they are otherwise are
deemed to be conducting business, that portion of the Fund's
income which is treated as earned in any such state or locality
could be subject to state and local tax. Any such taxes paid
by the Fund would reduce the amount of income and gains
available for distribution to its shareholders.
While the Fund does not expect to realize net long-term
capital gains, any such gains realized will be distributed
annually as described in the Fund's Confidential Private
Offering Memorandum. Such distributions ("capital gain
dividends"), if any, will be taxable to non tax-exempt
shareholders as long-term capital gains, regardless of how long
a shareholder has held Fund shares.
PERFORMANCE INFORMATION
The "effective yield" of the Fund is an annualized
"yield" based on a compounding of the unannualized base period
return. These yields are each computed in accordance with a
standard method prescribed by the rules of the SEC, by first
determining the "net change in account value" for a
hypothetical account having a share balance of one share at the
beginning of a seven-day period (the "beginning account
value"). The net change in account value equals the value of
additional shares purchased with dividends from the original
share and dividends declared on both the original share and any
such additional shares. The unannualized "base period return"
equals the net change in account value divided by the beginning
account value. Realized gains or losses or changes in
unrealized appreciation or depreciation are not taken into
account in determining the net change in account value.
The yields are then calculated as follows:
Base Period Return = Net Change in Account Value
Beginning Account Value
Current Yield = Base Period Return x 365/7
Effective Yield = [(1 + Base Period Return)365/7] - 1
FINANCIAL STATEMENTS
The Fund's Annual Report, which, when available, will be
attached hereto and incorporated into this Confidential
Statement of Additional Information by reference, and Semi-
Annual Report will be provided, without charge, to each
shareholder as they become available.
BT INSURANCE FUNDS TRUST
MANAGED ASSET FUND
STATEMENT OF ASSET AND LIABILITIES
September 9, 1996
ASSETS:
Cash $100,000
Deferred organization costs
(Note 1) 6,000
Total Assets 106,000
LIABILITIES
Accrued organization costs
(Note 1) 6,000
NET ASSETS $100,000
Net Assets $100,000
Shares of Beneficial Interest
(unlimited number of shares
authorized) Outstanding 10,000
Net Asset Value, offering price and
redemption price per share of
beneficial interest outstanding $ 10,000
NOTES TO STATEMENT OF ASSETS AND LIABILITIES
1. BT Insurance Funds Trust (the "Trust") is registered under the
Investment Company Act of 1940, as amended, as an open-end
management investment company. The Trust was organized as a
Massachusetts business trust on January 19, 1996 with an unlimited
number of shares of beneficial interest with a par value of
$0.001. The Trust has had no operations other than organizational
matters and the issuance and sale on September 9, 1996 of 10,000
shares of the Managed Asset Fund (the "Fund"), a series of the
Trust, to 440 Financial Distributors, Inc.
Costs incurred by the Fund in connection with its organization and
the initial offering of its shares are estimated to be $6,000.
The organizational costs will be deferred and amortized on a
straight line basis over the period of benefit not to exceed sixty
months from the date upon which the Fund commences its investment
operations. If any of the initial shares of the Fund are redeemed
during the amortization period by any holder thereof, the
redemption proceeds will be reduced by a pro rata portion of the
then unamortized organization costs of the Fund.
2. The Fund intends to comply with the requirements of the
Internal Revenue Code of 1986, as amended, necessary to qualify as
a regulated investment company and to make the requisite
distributions of income to its shareholders that will be
sufficient to relieve it from all or substantially all federal
income taxes.
Report of Independent Auditors
Board of Trustees
BT Insurance Funds Trust Managed Asset Fund
We have audited the accompanying statement of assets and
liabilities of BT Insurance Funds Trust Managed Asset Fund as of
September 9, 1996. This statement of assets and liabilities is
the responsibility of the Fund's management. Our responsibility
is to express an opinion on this statement of assets and
liabilities on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
this statement of assets and liabilities is free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the statement
of assets and liabilities. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall statement of assets
and liabilities presentation. We believe that our audit provides
a reasonable basis for our opinion.
In our opinion, the statement of assets and liabilities referred
to above presents fairly, in all material respects, the financial
position of BT Insurance Funds Trust Managed Asset Fund at
September 9, 1996, in conformity with generally accepted
accounting principles.
ERNST & YOUNG LLP
New York, New York
September 12, 1996
APPENDIX
Description of Securities Ratings
Description of Duff & Phelps' corporate bond ratings:
AAA - Highest credit quality. The risk factors are
negligible being only slightly more than for risk-free U.S.
Treasury Funds.
Description of S&P commercial paper ratings:
Commercial paper rated A-1 by S&P indicates that the degree
of safety regarding timely payment is either overwhelming or very
strong. Those issues determined to possess overwhelming safety
characteristics are denoted A-1+.
Description of Moody's commercial paper ratings:
The rating Prime-1 is the highest commercial paper ratings
assigned by Moody's Issuers rated Prime-1 (or related supporting
institutions) are considered to have a superior capacity for
repayment of short-term promissory obligations.
Description of Fitch Investors Service's commercial paper ratings:
F-1+ - Exceptionally Strong Credit Quality. Issues assigned
this rating are regarded as having the strongest degree of
assurance for timely payment.
F-1 - Very Strong Credit Quality. Issues assigned this
rating reflect an assurance of timely payment only slightly less
in degree than the strongest issue.
Description of Duff & Phelps' commercial paper ratings:
Duff 1+ - Highest certainty of timely payment. Short term
liquidity, including internal operating factors and/or access to
alternative sources of funds, is outstanding, and safety is just
below risk free U.S. Treasury short term obligations.
Duff 1 - Very high certainty of timely payment. Liquidity
factors are excellent and supported by good fundamental protection
factors. Risk factors are minor.
Description of IBCA's Short-Term Ratings:
A1+ - Obligations supported by the highest capacity for
timely repayment.
A1 - Obligations supported by a strong capacity for timely
repayment.
Description of Thomson Bank Watch Short-Term Ratings:
TBW-1 - The highest category: indicates a very high
likelihood that principal and interest will be paid on a timely
basis.
TABLE OF CONTENTS
Investment Objectives and Policies
Net Asset Value
Purchase and Redemption Information
Management of the Trust
Organization of the Trust
Taxes
Performance Information
Financial Statements
Appendix: Description of Securities Ratings
Investment Adviser
BANKERS TRUST COMPANY
Placement Agent
440 FINANCIAL DISTRIBUTORS, INC.
Administrator and Transfer Agent
FIRST DATA INVESTOR SERVICES GROUP, INC.
Custodian
BANKERS TRUST COMPANY
Independent Accountants
ERNST & YOUNG LLP.
Counsel
WILLKIE FARR & GALLAGHER
No person has been authorized to give any information or
to make any representations other than those contained in the
Fund's Confidential Private Offering Memorandum or its
Confidential Statement of Additional Information in connection
with the offering of the Fund's shares and, if given or made,
such other information or representations must not be relied on
as having been authorized by the Trust. This Confidential
Statement of Additional Information does not constitute an
offer in any state in which, or to any person to whom, such
offer may not lawfully be made.
PART C
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS.
(A) FINANCIAL STATEMENTS
The financial statements called for by this Item
are incorporated
by reference to Part B and listed in Item 23
hereof.
(B) EXHIBITS
1. Declaration of Trust of the Registrant is hereby
incorporated by reference to the initial Registration Statement
filed with the Securities and Exchange Commission on January
26, 1996.
2. By-Laws of the Registrant are filed herewith.
3. Not Applicable.
4. Not Applicable.
5. Form of Investment Management Agreement between the
Registrant and
Bankers Trust Company is filed herewith.
6. Not Applicable.
7. Not Applicable.
8. Form of Custodian Agreement between the Registrant and
Bankers Trust Company is filed herewith.
9(a) Form of Administration Agreement between the Registrant
and First Data Investor Services Group, Inc. is filed herewith.
(b) Form of Transfer Agency and Services Agreement between
Registrant and First Data Investor Services Group, Inc. is
filed herewith.
10. Not Applicable.
11. Not Applicable.
12. Not Applicable.
13. Form of Purchase Agreement is filed herewith.
14. Not Applicable.
15. Not Applicable.
16. Not Applicable.
17. Not Applicable.
18. Not Applicable.
ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH
REGISTRANT.
Not applicable.
ITEM 26. NUMBER OF HOLDERS OF SECURITIES.
(1) (2)
TITLE OF CLASS NUMBER OF RECORD HOLDERS
(AS OF SEPTEMBER 9, 1996)
Beneficial Interests 1
ITEM 27. INDEMNIFICATION.
Reference is hereby made to Article IV and V of the
Registrant's Declaration of Trust, filed with Securities and
Exchange Commission on January 26, 1996.
The Trustees and officers of the Registrant and the
personnel of the Registrant's administrator are insured under
an errors and omissions liability insurance policy. The
Registrant and its officers are also insured under the fidelity
bond required by Rule 17g-1 under the Investment Company Act of
1940.
ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER.
Bankers Trust serves as investment adviser to each
Portfolio of the Trust. Bankers Trust, a New York banking
corporation, is a wholly owned subsidiary of Bankers Trust New
York Corporation. Bankers Trust conducts a variety of
commercial banking and trust activities and is a major
wholesale supplier of financial services to the international
institutional market.
To the knowledge of the Trust, none of the directors or
officers of Bankers Trust, except those set forth below, is or
has been at any time during the past two fiscal years engaged
in any other business, profession, vocation or employment of a
substantial nature, except that certain directors and officers
also hold various positions with and engage in business for
Bankers Trust New York Corporation. Set forth below are the
names and principal businesses of the directors and officers of
Bankers Trust who are or during the past two fiscal years have
been engaged in any other business, profession, vocation or
employment of a substantial nature. These persons may be
contacted c/o Bankers Trust Company, 130 Liberty Street, New
York, New York 10006.
NAME AND PRINCIPAL BUSINESS ADDRESS, PRINCIPAL OCCUPATION AND
OTHER INFORMATION
George B. Beitzel, 29 King Street, Chappaqua, NY 10514-3432.
Retired Senior Vice President and Director of International
Business Machines Corporation. Director of Bankers Trust and
Bankers Trust New York Corporation. Director of Computer Task
Group, Flight Safety International, Inc., Phillips Gas Company,
Phillips Petroleum Company, Caliber Systems, Inc. (formerly
Roadway Services, Inc.), Rohm and Hass Company and TIG
Holdings, Chairman Emeritus of Amherst College, and Chairman of
the Colonial Williamsburg Foundation.
Phillip A. Griffiths, Director, Institute for Advanced Study,
Olden Lane, Princeton, NJ 08540. Director of Bankers Trust
Company. Chairman, Committee on Science, Engineering and
Public Policy of the National Academies of Sciences and
Engineering & the Institute of Medicine; member, National
Academy of Sciences, American Academy of Arts and Sciences,
American Philosophical Society, member and chairman of the
Nominations Committee and Committee on Science and Engineering
Indicators, National Science Board, and trustee of North
Carolina School of Science and Mathematics and the Woodward
Academy. Former member of the board of directors, Research
Triangle Institute.
William R. Howell, J.C. Penney Company, Inc., P.O. Box 10001,
Dallas, TX 75301-0001. Chairman of the Board and Chief
Executive Officer, J.C. Penney Company, Inc. Director of
Bankers Trust and Bankers Trust New York Corporation. Also a
Director of Exxon Corporation, Halliburton Company, Warner-
Lambert Corporation, National Urban League, Inc. and the
National Retail Federation.
Jon M. Huntsman, Huntsman Corporation, 500 Huntsman Way, Salt
Lake City, UT 84108. Chairman and Chief Executive Officer,
Huntsman Corporation and other affiliated companies. Director
of Bankers Trust and Bankers Trust New York Corporation.
Chairman, chief executive officer and director of Sunstar
Corporation and JK Corp. Chairman and director of Co-Ex
Plastics Inc. and Global Polymers Corporation. Chairman of
Constar Corporation and Petrostar Corporation. President of
Autostar Corporation and Restar Corporation. Director of
Airstar Corporation, Consolidated Press International
(Australia), Razzleberry Foods Corporation and Thiokol
Corporation. General Partner of Huntsman Group Ltd., McLeod
Creek Partnership and Trustar Ltd. Chairman of Primary
Children's Medical Center Foundation, an overseer, The Wharton
School, University of Pennsylvania, an advisor, University of
Utah, Eccles Business School, founder of Huntsman Cancer
Institute, University of Utah, chairman and director of the
Huntsman Cancer Foundation, and a trustee and president of the
Jon and Karen Huntsman Foundation.
Vernon E. Jordan, Jr., Akin, Gump, Strauss, Hauer & Feld, LLP,
1333 New Hampshire Ave., N.W., Suite 400, Washington, DC 20036.
Senior Partner, Akin, Gump, Strauss, Hauer & Feld, LLP.
Director of Bankers Trust and Bankers Trust New York
Corporation. Also a Director of American Express Company,
Corning Incorporated, Dow Jones, Inc., J.C. Penney Company,
Inc., Revlon Group Incorporated, Ryder System, Inc., Sara Lee
Corporation, Union Carbide Corporation and Xerox Corporation, a
trustee of Brookings Institution, The Ford Foundation and
Howard University, and governor of the Joint Center for
Political and Economic Studies.
Harnish Maxwell, Philip Morris Companies Inc., 100 Park Avenue,
10th Floor, New York, NY 10017. Retired Chairman and Chief
Executive Officer, Philip Morris Companies Inc. Director of
Bankers Trust and Bankers Trust New York Corporation. Director
of The New Corporation Limited and Sola International Inc.
Frank N. Newman, President and Chief Executive Officer of
Bankers Trust Company and Bankers Trust New York Corporation,
130 Liberty Street, New York, NY 10006. Director of Bankers
Trust Company. Former Deputy Secretary of the United States
Treasury and former vice chairman of the board and director of
BankAmerica Corporation and Bank of America. Also a director
of Carnegie Hall.
N.J. Nicholas Jr., 15 West 53rd Street, New York, NY 10019.
Former President, Co-Chief Executive Officer and Director of
Time Warner Inc. Director of Bankers Trust and Bankers Trust
New York Corporation. Also a Director of Boston Scientific
Corporation and Xerox Corporation.
Russell E. Palmer, The Palmer Group, 3600 Market Street, Suite
530, Philadelphia, PA 19104. Chairman and Chief Executive
Officer of The Palmer Group. Director of Bankers Trust and
Bankers Trust New York Corporation. Former Dean of The Wharton
School, University of Pennsylvania and former chief executive
officer of Touche Ross & Co. (now Deloitte and Touche). Also
Director of Allied-Signal Inc., Contel Cellular, Inc., Federal
Home Loan Mortgage Corporation, GTE Corporation, Goodyear-Tire
& Rubber Company, Imasco Limited, The May Department Stores
Company and Safeguard Scientifics, Inc. Member, Radnor Venture
Partners Advisory Board, advisory board of the Controller
General of the United States, and a trustee, the University of
Pennsylvania.
Donald L. Stahelli, Chairman of the Board and Chief Executive
Officer, Continental Grain Company, 277 Park Avenue, 50th
Floor, New York, NY 10172. Director of Bankers Trust Company.
Also a director of ContiFinancial Corporation, Prudential Life
Insurance Company of America, National Committee on United
States-China Relations, America-China Society, U.S.-Russia
Trade Council, The Points of Light Foundation and New York City
Partnership, Vice Chairman of the U.S.-China Business Council,
member of the Advisory Board of Rabobank Nederland (Utrecht,
The Netherlands), Council on Foreign Relations and the
Executive Committee of the National Advisory Council of Brigham
Young University's Marriott School of Management and a trustee
of the American Graduate School of International Management.
Patricia Carry Stewart, c/o Office of the Secretary, 280 Park
Avenue - 17W, New York, NY 10017. Former Vice President, The
Edna McConnell Clark Foundation. Director of Bankers Trust and
Bankers Trust New York Corporation. Director, Borden Inc.,
Continental Corp. and Melville Corporation, director and vice
chair of Community Foundation for Palm Beach and Martin
Counties, and a trustee emerita of Cornell University.
George J. Vojta, Bankers Trust Company, 130 Liberty Street, New
York, NY 10006. Vice Chairman of the Board of Bankers Trust
and Bankers Trust New York Corporation. Director of Northwest
Airlines and Private Export Funding Corp., the New York State
Banking Board and St. Lukes-Roosevelt Hospital Center, a
partner of New York City Partnership and chairman, Wharton
Financial Services Center.
Item 29. Principal Underwriters
(a) In addition to BT Insurance Funds Trust, 440
Financial Distributors, Inc. (the "Distributor") currently acts
as distributor for The Galaxy Fund, The Galaxy VIP Fund, Galaxy
Fund II, Armada Funds (formerly known as NCC Funds), Panorama
Funds and the AMBAC Funds. The Distributor is registered with
the Securities and Exchange Commission as a broker-dealer and
is a member of the National Association of Securities Dealers.
The Distributor is a wholly-owned subsidiary of First Data
Corporation, 4400 Computer Drive, Westboro, MA 01581.
(b) The information required by this Item 29 (b) with
respect to each director, officer, or partner of 440 Financial
Distributors, Inc. is incorporated by reference to Schedule A
of Form BD filed by 440 Financial Distributors, Inc. with the
Securities and Exchange Commission pursuant to the Securities
Act of 1934 (File No. 8-45467).
(c) Not Applicable.
Item 30. Location of Accounts and Records
All accounts books and other documents required to be
maintained by Registrant by Section 31(a) of the Investment
Company Act of 1940 and the Rules thereunder will be maintained
at the offices of:
(1) Bankers Trust Global Investment Management
280 Park Avenue
New York, NY 10017
(2) 440 Financial Distributors, Inc.
4400 Computer Drive
Westboro, MA 01581
(3) Bankers Trust Company
280 Park Avenue
New York, NY 10017
(4) First Data Investor Services Group, Inc.
One Exchange Place
Boston, MA 02109
Item 31. Management Services
Not Applicable.
Item 32. Undertakings
Not Applicable.
SIGNATURES
Pursuant to the requirements of the Investment Company
Act of 1940, as amended, the Registrant has duly caused this
Registration Statement on Form N-1A to be signed on its behalf
by the undersigned, thereto duly authorized, in the City of
Boston and Commonwealth of Massachusetts on the ____ day of
September, 1996.
BT INSURANCE FUNDS TRUST
By JULIE A. TEDESCO
Julie A. Tedesco
Secretary
INDEX TO EXHIBITS
Exhibit Number Exhibit
2 By-Laws of the Registrant.
5 Form of Investment Management Agreement
between the Registrant and Bankers Trust Company.
8 Form of Custodian Agreement between the Registrant and
Bankers Trust Company.
9(a) Form of Administration Agreement between the
Registrant
and First Data Investor Services Group, Inc.
(b) Form of Transfer Agency and Services
Agreement
between Registrant and First Data Investor
Services
Group, Inc.
13 Form of Purchase Agreement.
16
SHARED/BANKERS/MISC/COM.DOC
15
A-1
A-2
g:\shared\bankers\partc.doc
G:\SHARED\3RDPARTY\PARIBAS\PEA#13.DOC
BY-LAWS
OF
BT INSURANCE FUNDS TRUST
TABLE OF CONTENTS
Page
ARTICLE I - DEFINITIONS
1
ARTICLE II - OFFICES
1
Section 1. Principal Office
1
Section 2. Other Offices
1
ARTICLE III - SHAREHOLDERS
1
Section 1. Meetings
1
Section 2. Notice of Meetings
1
Section 3. Record Date for Meetings and Other Purposes
2
Section 4. Proxies
2
Section 5. Inspection of Records
2
Section 6. Action without Meeting
2
ARTICLE IV - TRUSTEES
3
Section 1. Meetings of the Trustees
3
Section 2. Quorum and Manner of Acting
3
ARTICLE V - COMMITTEES
3
ARTICLE VI - OFFICERS
4
Section 1. General Provisions
4
Section 2. Term of Office and Qualifications
4
Section 3. Removal
4
Section 4. Powers and Duties of the Chairman/Chairmen
4
Section 5. Powers and Duties of the President
4
Section 6. Powers and Duties of Vice Presidents
5
Section 7. Powers and Duties of the Treasurer
5
Section 8. Powers and Duties of the Secretary
5
Section 9. Powers and Duties of Assistant Treasurers
6
Section 10. Powers and Duties of Assistant Secretaries
6
Section 11. Compensation of Officers and Trustees
6
ARTICLE VII - FISCAL YEAR
6
ARTICLE VIII - SEAL
6
TABLE OF CONTENTS (continued)
Page
ARTICLE IX - SUFFICIENCY AND WAIVERS OF NOTICE
6
ARTICLE X - CUSTODY OF SECURITIES
7
Section 1. Employment of a Custodian
7
Section 2. Action Upon Termination of Custodian Agreement
7
Section 3. Provisions of Custodian Contract
7
Section 4. Central Certificate System
8
Section 5. Acceptance of Receipts in Lieu of Certificates
8
ARTICLE XI - AMENDMENTS
8
ARTICLE XII - MISCELLANEOUS
8
BY-LAWS
OF
BT INSURANCE FUNDS TRUST
ARTICLE I
DEFINITIONS
The terms "By-laws," "Commission", "Custodian",
"Declaration", "Distributor", "Fund" or "Funds", "His",
"Interested Person", "Investment Adviser", "1940 Act", "Person",
"Series", "Shareholder", "Shares", "Transfer Agent", "Trust",
"Trust Property", "Trustees", and "vote of a majority of the
Shares outstanding and entitled to vote", have the respective
meanings given them in the Declaration of Trust of BT Insurance
Funds Trust dated January 19, 1996.
ARTICLE II
OFFICES
Section 1. Principal Office. Until changed by the
Trustees, the principal office of the Trust shall be in New York.
Section 2. Other Offices. The Trust may have offices in
such other places without as well as within the Commonwealth of
Massachusetts as the Trustees may from time to time determine.
ARTICLE III
SHAREHOLDERS
Section 1. Meetings. Meetings of the Shareholders of the
Trust or a Series thereof shall be held as provided in the
Declaration at such place within or without the Commonwealth of
Massachusetts as the Trustees shall designate. The holders of a
majority of outstanding Shares of the Trust or a Series thereof
present in person or by proxy shall constitute a quorum at any
meeting of the Shareholders of the Trust or a Series thereof.
Section 2. Notice of Meetings. Notice of all meetings of
the Shareholders, stating the time, place and purposes of the
meeting, shall be given by the Trustees by mail to each
Shareholder at his address as recorded on the register of the
Trust mailed at least ten (10) days and not more than sixty (60)
days before the meeting, provided, however, that notice of a
meeting need not be given to a shareholder to whom such notice
need not be given under the proxy rules of the Commission under
the 1940 Act and the Securities Exchange Act of 1934, as amended.
Only the business stated in the notice of the meeting shall be
considered at such meeting. Any adjourned meeting may be held as
adjourned without further notice. No notice need by given to any
Shareholder who shall have failed to inform the Trust of his
current address or if a written waiver of notice, executed before
or after the meeting by the Shareholder or his attorney thereunto
authorized, is filed with the records of the meeting.
Section 3. Record Date for Meetings and Other Purposes.
For the purpose of determining the Shareholders who are entitled
to notice of and to vote at any meeting, or to participate in any
distribution, or for the purpose of any other action, the Trustees
may from time to time close the transfer books for such period,
not exceeding thirty (30) days, as the Trustees may determine; or
without closing the transfer books the Trustees may fix a date not
more than sixty (60) days prior to the date of any meeting of
Shareholders or distribution or other action as a record date for
the determination of the persons to be treated as Shareholders of
record for such purposes, except for dividend payments which shall
be governed by the Declaration.
Section 4. Proxies. At any meeting of Shareholders, any
holder of Shares entitled to vote thereat may vote by proxy,
provided that no proxy shall be voted at any meeting unless it
shall have been placed on file with the Secretary, or with such
other officer or agent of the Trust as the Secretary may direct,
for verification prior to the time at which such vote shall be
taken. Proxies may be solicited in the name of one or more
Trustees or one or more of the officers of the Trust. Only
Shareholders of record on the record date shall be entitled to
vote. Each whole share shall be entitled to one vote as to any
matter on which it is entitled by the Declaration to vote, and
each fractional Share shall be entitled to a proportionate
fractional vote. When any Share is held jointly by several
persons, any one of them may vote at any meeting in person or by
proxy in respect of such Share, but if more than one of them shall
be present at such meeting in person or by proxy, and such joint
owners or their proxies so present disagree as to any vote to be
cast, such vote shall not be received in respect of such Share. A
proxy purporting to be executed by or on behalf of a Shareholder
shall be deemed valid unless challenged at or prior to its
exercise, and the burden of proving invalidity shall rest on the
challenger. If the holder of any such share is a minor or a
person of unsound mind, and subject to guardianship or the legal
control of any other person as regards the charge or management of
such Share, he may vote by his guardian or such other person
appointed or having such control, and such vote may be given in
person or by proxy.
Section 5. Inspection of Records. The records of the Trust
shall be open to inspection by Shareholders to the same extent as
is permitted shareholders of a Massachusetts business corporation.
Section 6. Action without Meeting. Any action which may be
taken by Shareholders may be taken without a meeting if a majority
of Shareholders entitled to vote on the matter (or such larger
proportion thereof as shall be required by law, the Declaration or
these By-laws for approval of such matter) consent to the action
in writing and the written consents are filed with the records of
the meetings of Shareholders. Such consents shall be treated for
all purposes as a vote taken at a meeting of Shareholders.
ARTICLE IV
TRUSTEES
Section 1. Meetings of the Trustees. The Trustees may in
their discretion provide for regular or stated meetings of the
Trustees. Notice of regular or stated meetings need not be given.
Meetings of the Trustees other than regular or stated meetings
shall be held whenever called by the President, or by any one of
the Trustees, at the time being in office. Notice of the time and
place of each meeting other than regular or stated meetings shall
be given by the Secretary or an Assistant Secretary or by the
officer or Trustee calling the meeting and shall be delivered to
each Trustee, either personally or by telephone or other standard
form of communication, at least 24 hours before the time at which
the meeting is to be held, or by first-class mail, postage
prepaid, addressed to the Director at his residence or usual place
of business and mailed at least 2 days before the day on which the
meeting is to be held. Such notice may, however, be waived by any
Trustee. Notice of a meeting need not be given to any Trustee if
a written waiver of notice, executed by him before or after the
meeting, is filed with the records of the meeting, or to any
Trustee who attends the meeting without protesting prior thereto
or at its commencement the lack of notice to him. A notice or
waiver of notice need not specify the purpose of any meeting. The
Trustees may meet by means of a telephone conference circuit or
similar communications equipment by means of which all persons
participating in the meeting can hear each other at the same time
and participation by such means shall be deemed to have been held
at a place designated by the Trustees at the meeting.
Participation in a telephone conference meeting shall constitute
presence in person at such meeting. Any action required or
permitted to be taken at any meeting of the Trustees may be taken
by the Trustees without a meeting if all the Trustees consent to
the action in writing and the written consents are filed with the
records of the Trustees' meetings. Such consents shall be treated
as a vote for all purposes.
Section 2. Quorum and Manner of Acting. A majority of the
Trustees shall be present in person at any regular or special
meeting of the Trustees in order to constitute a quorum for the
transaction of business at such meeting and (except as otherwise
required by law, the Declaration or these By-laws) the act of a
majority of the Trustees present at any such meeting, at which a
quorum is present, shall be the act of the Trustees. In the
absence of a quorum, a majority of the Trustees present may
adjourn the meeting from time to time until a quorum shall be
present. Notice of an adjourned meeting need not be given.
ARTICLE V
COMMITTEES
The Trustees may designate one or more committees of the
Board of Trustees, each consisting of 2 or more Trustees. To the
extent provided in the resolution, and permitted by law, the
committee or committees shall have and may exercise the powers of
the Board of Trustees in the management of the business and
affairs of the Trust and may authorize the seal of the Trust to be
affixed to all papers that may require it. Any committee or
committees shall have the name or names determined from time to
time by resolution adopted by the Board of Trustees. Each
committee shall keep regular minutes of its meetings and report
the same to the Board of Trustees when required. The members of a
committee present at any meeting, whether or not they constitute a
quorum, may appoint a Trustee to act in the place of an absent
member.
ARTICLE VI
OFFICERS
Section 1. General Provisions. The officers of the Trust
shall be a President, a Treasurer and a Secretary, who shall be
elected by the Trustees. The Trustees may elect or appoint such
other officers or agents as the business of the Trust may require,
including one or more Vice Presidents, one or more Assistant
Secretaries, and one or more Assistant Treasurers. The Trustees
may delegate to any officer or committee the power to appoint any
subordinate officers or agents.
Section 2. Term of Office and Qualifications. Except as
otherwise provided by law, the Declaration or these By-laws, the
President, the Treasurer and the Secretary shall each hold office
until his successor shall have been duly elected and qualified,
and all other officers shall hold office at the pleasure of the
Trustees. The Secretary and the Treasurer may be the same person.
A Vice President and the Treasurer or a Vice President and the
Secretary may be the same person, but the offices of Vice
President, Secretary and Treasury shall not be held by the same
person. The President shall hold no other office. Except as
above provided, any two offices may be held by the same person.
Any officer may be but none need be a Trustee or Shareholder.
Section 3. Removal. The Trustees, at any regular or
special meeting of the Trustees, may remove any officer without
cause, by a vote of a majority of the Trustees then in office.
Any officer or agent appointed by an officer or committee may be
removed with or without cause by such appointing officer or
committee.
Section 4. Powers and Duties of the Chairman. The Trustees
may, but need not, appoint from among their number a Chairman.
When present he shall preside at the meetings of the shareholders
and of the Trustees. He may call meetings of the Trustees and of
any committee thereof whenever he deems it necessary. He shall be
an executive officer of the Trust and shall have, with the
President, general supervision over the business and policies of
the Trust, subject to the limitations imposed upon the President,
as provided in Section 5 of this Article VI.
Section 5. Powers and Duties of the President. In the
absence of the Chairman, the President may call meetings of the
Trustees and of any Committee thereof when he deems it necessary
and shall preside at all meetings of the Shareholders. Subject to
the control of the Trustees and to the control of any Committees
of the Trustees, within their respective spheres, as provided by
the Trustees, he shall at all times exercise a general supervision
and direction over the affairs of the Trust. He shall have the
power to employ attorneys and counsel for the Trust or any Series
thereof and to employ such subordinate officers, agents, clerks
and employees as he may find necessary to transact the business of
the Trust or any Series thereof. He shall also have the power to
grant, issue, execute or sign such powers of attorney, proxies or
other documents as may be deemed advisable or necessary in
furtherance of the interests of the Trust or any Series thereof.
The President shall have such other powers and duties, as from
time to time may be conferred upon or assigned to him by the
Trustees.
Section 6. Powers and Duties of Vice Presidents. In the
absence or disability of the President, the Vice President or, if
there by more than one Vice President, any Vice President
designated by the Trustees shall perform all the duties and may
exercise any of the powers of the President, subject to the
control of the Trustees. Each Vice President shall perform such
other duties as may be assigned to him from time to time by the
Trustees and the President.
Section 7. Powers and Duties of the Treasurer. The
Treasurer shall be the principal financial and accounting officer
of the Trust. He shall deliver all funds of the Trust or any
Series thereof which may come into his hands to such Custodian as
the Trustees may employ pursuant to Article X of these By-laws.
He shall render a statement of condition of the finances of the
Trust or any Series thereof to the Trustees as often as they shall
require the same and he shall in general perform all the duties
incident to the office of a Treasurer and such other duties as
from time to time may be assigned to him by the Trustees. The
Treasurer shall give a bond for the faithful discharge of his
duties, if required so to do by the Trustees, in such sum and with
such surety or sureties as the Trustees shall require.
Section 8. Powers and Duties of the Secretary. The
Secretary shall keep the minutes of all meetings of the Trustees
and of the Shareholders in proper books provided for that purpose;
he shall have custody of the seal of the Trust; and he shall have
charge of the Share transfer books, lists and records unless the
same are in the charge of the Transfer Agent. He shall attend to
the giving and serving of all notices by the Trust in accordance
with the provisions of these By-laws and as required by law; and
subject to these By-laws, he shall in general perform all duties
incident to the office of Secretary and such other duties as from
time to time may be assigned to him by the Trustees.
Section 9. Powers and Duties of Assistant Treasurers. In
the absence or disability of the Treasurer, any officer designated
by the Trustees shall perform all the duties, and may exercise any
of the powers, of the Treasurer. Each officer shall perform such
other duties as from time to time may be assigned to him by the
Trustees. Each officer performing the duties and exercising the
powers of the Treasurer, if any, and any Assistant Treasurer,
shall give a bond for the faithful discharge of his duties, if
required so to do by the Trustees, in such sum and with such
surety or sureties as the Trustees shall require.
Section 10. Powers and Duties of Assistant Secretaries. In
the absence or disability of the Secretary, any Assistant
Secretary designated by the Trustees shall perform all the duties,
and may exercise any of the powers, of the Secretary. Each
Assistant Secretary shall perform such other duties as from time
to time may be assigned to him by the Trustees.
Section 11. Compensation of Officers and Trustees. Subject
to any applicable provisions of the Declaration, the compensation
of the officers and Trustees shall be fixed from time to time by
the Trustees or, in the case of officers, by any Committee or
officer upon whom such power may be conferred by the Trustees. No
officer shall be prevented from receiving such compensation as
such officer by reason of the fact that he is also a Trustee.
ARTICLE VII
FISCAL YEAR
The fiscal year of the Trust shall begin on the first day of
January in each year and shall end on the last day of December in
each year, provided, however, that the Trustees may from time to
time change the fiscal year. The fiscal year of the Trust shall
be the taxable year of each Series of the Trust.
ARTICLE VIII
SEAL
The Trustees may adopt a seal which shall be in such form
and shall have such inscription thereon as the Trustees may from
time to time prescribe.
ARTICLE IX
SUFFICIENCY AND WAIVERS OF NOTICE
Whenever any notice whatever is required to be given by law,
the Declaration or these By-laws, a waiver thereof in writing,
signed by the person or persons entitled to said notice, whether
before or after the time stated therein, shall be deemed
equivalent thereto. A notice shall be deemed to have been
telegraphed, cabled or wirelessed for the purposes of these By-
laws when it has been delivered to a representative of any
telegraph, cable or wireless company with instructions that it be
telegraphed, cabled or wirelessed.
ARTICLE X
CUSTODY OF SECURITIES
Section 1. Employment of a Custodian. The Trust shall
place and at all times maintain in the custody of one or more
Custodians (including any sub-custodian for the Custodian) all
funds, securities and similar investments included in the Trust
Property or the Trust Property allocated or belonging to a Series
thereof. The Custodian (and any sub-custodian) shall be a bank
having not less than $2,000,000 aggregate capital, surplus and
undivided profits and shall be appointed from time to time by the
Trustees, who shall fix its remuneration.
Section 2. Action Upon Termination of Custodian Agreement.
Upon termination of a Custodian Agreement or inability of the
Custodian to continue to serve, the Trustees shall promptly
appoint a successor custodian, but in the event that no successor
custodian can be found who has the required qualifications and is
willing to serve, the Trustees shall call as promptly as possible
a special meeting of the Shareholders of the Trust or a Series
thereof to determine whether the Trust or Series thereof shall
function without a custodian or shall be liquidated. If so
directed by vote of the holders of a majority of the outstanding
voting securities, the Custodian shall deliver and pay over all
Trust Property or the Trust Property allocated or belonging to a
Series thereof held by it as specified in such vote.
Section 3. Provisions of Custodian Contract. The following
provisions shall apply to the employment of a Custodian and to any
contract entered into with the Custodian so employed:
The Trustees shall cause to be delivered to the Custodian
all securities included in the Trust Property or the Trust
Property allocated or belonging to a Series thereof or to which
the Trust or such Series may become entitled, and shall order the
same to be delivered by the Custodian only in completion of a
sale, exchange, transfer, pledge, loan of securities to another
person, or other disposition thereof, all as the Trustees may
generally or from time to time require or approve or to a
successor Custodian; and the Trustees shall cause all funds
included in the Trust Property or the Trust Property allocated or
belonging to a Series thereof or to which it may become entitled
to be paid to the Custodian, and shall order the same disbursed
only for investment against delivery of the securities acquired,
or the return of cash held as collateral for loans of fund
securities, or in payment of expenses, including management
compensation, and liabilities of the Trust or Series thereof,
including distributions to shareholders, or for other proper Trust
purposes, or to a successor Custodian. Notwithstanding anything
to the contrary in these By-laws, upon receipt of proper
instructions, which may be standing instructions, the Custodian
may deliver funds in the following cases: In connection with
repurchase agreements, the Custodian shall transmit, prior to
receipt on behalf of the Trust or Series thereof of any securities
or other property, funds from the custodian account of the Trust
or Series thereof to a special custodian approved by the Trustees
of the Trust, which funds shall be used to pay for securities to
be purchased by the Trust or Series thereof subject to the
obligation of the Trust or Series thereof to sell and the seller's
obligation to repurchase such securities. In such case, the
securities shall be held in the custody of the special custodian.
In connection with the purchase or sale of financial futures
contracts, the Custodian shall transmit, prior to receipt on
behalf of the Trust of any securities or other property, funds
from the custodian account of the Trust or Series thereof in order
to furnish to and maintain funds with brokers as margin to
guarantee the performance of the futures obligations of the Trust
or Series thereof in accordance with the applicable requirements
of commodities exchanges and brokers.
Section 4. Central Certificate System. Subject to such
rules, regulations and orders as the Commission may adopt, the
Trustees may direct the Custodian to deposit all or any part of
the securities owned by the Trust or Series thereof in a system
for the central handling of securities established by a national
securities exchange or a national securities association
registered with the Commission under the Securities Exchange Act
of 1934, or such other person as may be permitted by the
Commission, or otherwise in accordance with the 1940 Act, pursuant
to which system all securities of any particular class or series
of any issuer deposited within the system are treated as fungible
and may be transferred or pledged by bookkeeping entry without
physical delivery of such securities, provided that all such
deposits shall be subject to withdrawal only upon the order of the
Trust or Series thereof.
Section 5. Acceptance of Receipts in Lieu of Certificates.
Subject to such rules, regulations and orders as the Commission
may adopt, the Trustees may direct the Custodian to accept written
receipts or other written evidences indicating purchases of
securities held in book-entry form in the Federal Reserve System
in accordance with regulations promulgated by the Board of
Governors of the Federal Reserve System and the local Federal
Reserve Banks in lieu of receipt of certificates representing such
securities.
ARTICLE XI
AMENDMENTS
These By-laws, or any of them, may be altered, amended or
repealed, or new By-laws may be adopted by (a) vote of a majority
of the Shares outstanding and entitled to vote or (b) by the
Trustees, provided however, that no By-law may be amended, adopted
or repealed by the Trustees if such amendment, adoption or repeal
requires, pursuant to law, the Declaration or these By-laws, a
vote of the Shareholders.
ARTICLE XII
MISCELLANEOUS
(A) Except as hereinafter provided, no officer or Trustee
of the Trust and no partner, officer, director or shareholder of
the Investment Adviser of the Trust (as that term is defined in
the Investment Company Act of 1940) or of the underwriter of the
Trust, and no Investment Adviser or underwriter of the Trust,
shall take long or short positions in the securities issued by the
Trust or any Series thereof.
(1) The foregoing provisions shall not prevent the
underwriter from purchasing Shares from the Trust or any Series if
such purchases are limited (except for reasonable allowances for
clerical errors, delays and errors of transmission and
cancellation of orders) to purchase for the purpose of filling
orders for such Shares received by the underwriter, and provided
that orders to purchase from the Trust or any Series thereof are
entered with the Trust or any Series thereof or the Custodian
promptly upon receipt by the underwriter of purchase orders for
such Shares, unless the underwriter is otherwise instructed by its
customer.
(2) The foregoing provision shall not prevent the
underwriter from purchasing Shares of the Trust or any Series
thereof as agent for the account of the Trust or any Series
thereof.
(3) The foregoing provisions shall not prevent the
purchase from the Trust or any Series thereof or from the
underwriter of Shares issued by the Trust or any Series thereof,
by any officer, or Trustee of the Trust or any Series thereof or
by any partner, officer, director or shareholder of the Investment
Adviser of the Trust or Series thereof or of the underwriter of
the Trust at the price available to the public generally at the
moment of such purchase, or as described in the then currently
effective Prospectus of the Trust.
(4) The foregoing shall not prevent the Investment
Adviser, or any affiliate thereof, of the Trust or any Series
thereof from purchasing Shares prior to the effectiveness of the
first registration statement relating to the Shares under the
Securities Act of 1933.
(B) Neither the Trust nor any Series thereof shall lend
assets of the Trust or of such Series to any officer or Trustee of
the Trust or Series, or to any partner, officer, director or
shareholder of, or person financially interested in, the
Investment Adviser of the Trust or Series or the underwriter of
the Trust.
(C) The Trust shall not impose any restrictions upon the
transfer of the Shares of the Trust or any Series thereof except
as provided in the Declaration or as may be required to comply
with federal or state securities laws, but this requirement shall
not prevent the charging of customary transfer agent fees.
(D) The Trust shall not permit any officer or Trustee of
the Trust, or any partner, officer or director of the Investment
Adviser of the Trust or any Series thereof or underwriter of the
Trust to deal for or on behalf of the Trust or a Series thereof
with himself as principal or agent, or with any partnership,
association or corporation in which he has a financial interest;
provided that the foregoing provisions shall not prevent (a)
officers and Trustees of the Trust or partners, officers or
directors of the Investment Adviser of the Trust or any Series
thereof or underwriter of the Trust from buying, holding or
selling shares in the Trust or a Series thereof, or from being
partners, officers or directors or otherwise financially
interested in the Investment Adviser of the Trust or any Series
thereof or any underwriter of the Trust; (b) purchases or sales of
securities or other property by the Trust or a Series thereof from
or to an affiliated person or to the Investment Adviser of the
Trust or any Series thereof or underwriter of the Trust if such
transaction is not prohibited by or is exempt from the applicable
provisions of the 1940 Act; (c) purchases of investments by the
Series of the Trust or sales of investments owned by the Trust or
a Series thereof through a security dealer who is, or one or more
of whose partners, shareholders, officers or directors is, an
officer or Trustee of the Trust, or a partner, officer or director
of the Investment Adviser of the Trust or any Series thereof or
underwriter of the Trust, if such transactions are handled in the
capacity of broker only and commissions charged do not exceed
customary brokerage charges for such services; (d) employment of
legal counsel, registrar, Transfer Agent, dividend disbursing
agent or Custodian who is, or has a partner, shareholder, officer,
or director who is, an officer or Trustee of the Trust, or a
partner, officer or director of the Investment Adviser of the
Trust or any Series thereof or underwriter of the Trust, if only
customary fees are charged for services to the Trust or Series
thereof; (e) sharing statistical research, legal and management
expenses and office hire and expenses with any other investment
company in which an officer or Trustee of the Trust, or a partner,
officer or director of the Investment Adviser of the Trust or a
Series thereof or underwriter of the Trust, is an officer or
director or otherwise financially interested.
g:\shared\bankers\trustdoc\bylaws.doc
- - 10 -
g:\shared\bankers\trustdoc\bylaws.doc
FORM OF INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT made as of , 1996 by and between BT
INSURANCE FUNDS TRUST, a Massachusetts trust (herein called the
"Trust"), regarding advisory services to be provided to MANAGED
ASSETS FUND (the "Portfolio"), a series of the Trust, and BANKERS
TRUST COMPANY (herein called the "Investment Adviser").
WHEREAS, the Portfolio is registered as an open-end, non-
diversified, management investment company under the Investment
Company Act of 1940;
WHEREAS, the Portfolio desires to retain the Investment
Adviser to render investment advisory and other services, and the
Investment Adviser is willing to so render such services on the
terms hereinafter set forth;
NOW, THEREFORE, this Agreement
W I T N E S S E T H:
- - - - - - - - - - - - - - -
In consideration of the promises and mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT. The Portfolio hereby appoints the
Investment Adviser to act as investment adviser to the Portfolio
for the period and on the terms set forth in this Agreement. The
Investment Adviser accepts such appointment and agrees to render
the services herein set forth for the compensation herein
provided.
2. MANAGEMENT. Subject to the supervision of the Board of
Trustees of the Portfolio, the Investment Adviser will provide a
continuous investment program for the Portfolio, including
investment research and management with respect to all securities,
investments, cash and cash equivalents in the Portfolio. The
Investment Adviser will determine from time to time what
securities and other investments will be purchased, retained or
sold by the Portfolio. The Investment Adviser will provide the
services rendered by it hereunder in accordance with the
Portfolio's investment objectives and policies as stated in the
then-current Prospectus and Statement of Additional Information.
The Investment Adviser further agrees that it:
(a) will conform with all applicable Rules and
Regulations of the Securities and Exchange Commission (herein
called the "Rules") and with the Securities Act of 1933, the
Securities Exchange Act of 1934, the Investment Company Act of
1940 (the "1940 Act") and the Investment Advisers Act of 1940, all
as amended, and will in addition conduct its activities under this
Agreement in accordance with regulations of the Board of Governors
of the Federal Reserve System pertaining to the investment
advisory activities of bank holding companies and their
subsidiaries;
(b) will place orders pursuant to its investment
determinations for the Portfolio either directly with the issuer
or with any broker or dealer selected by it. In placing orders
with brokers and dealers, the Investment Adviser will use its
reasonable best efforts to obtain the best net price and the most
favorable execution of its orders, after taking into account all
factors it deems relevant, including the breadth of the market in
the security, the price of the security, the financial condition
and execution capability of the broker or dealer, and the
reasonableness of the commission, if any, both for the specific
transaction and on a continuing basis. Consistent with this
obligation, the Investment Adviser may, to the extent permitted by
law, purchase and sell portfolio securities to and from brokers
and dealers who provide brokerage and research services (within
the meaning of Section 28(e) of the Securities Exchange Act of
1934) to or for the benefit of any fund and/or other accounts over
which the Investment Adviser or any of its affiliates exercises
investment discretion. Subject to the review of the Portfolio's
Board of Trustees from time to time with respect to the extent and
continuation of the policy, the Investment Adviser is authorized
to pay to a broker or dealer who provides such brokerage and
research services a commission for effecting a securities
transaction which is in excess of the amount of commission another
broker or dealer would have charged for effecting that transaction
if the Investment Adviser determines in good faith that such
commission was reasonable in relation to the value of the
brokerage and research services provided by such broker or dealer,
viewed in terms of either that particular transaction or the
overall responsibilities of the Investment Adviser with respect to
the accounts as to which it exercises investment discretion; and
(c) will maintain books and records with respect to
the Portfolio's securities transactions and will render to the
Board of Trustees such periodic and special reports as the Board
may request.
3. SERVICES NOT EXCLUSIVE. The investment management
services rendered by the Investment Adviser hereunder are not to
be deemed exclusive, and the Investment Adviser shall be free to
render similar services to others so long as its services under
this Agreement are not impaired thereby.
4. BOOKS AND RECORDS. In compliance with the requirements
of Rule 31a-3 of the Rules under the 1940 Act, the Investment
Adviser hereby agrees that all records which it maintains for the
Portfolio are the property of the Portfolio and further agrees to
surrender promptly to the Portfolio any of such records upon the
Portfolio's request. The Investment Adviser further agrees to
preserve for the periods prescribed by Rule 31a-2 under the 1940
Act the records required to be maintained by Rule 31a-1 under the
1940 Act and to comply in full with the requirements of Rule 204-2
under the Investment Advisers Act of 1940 pertaining to the
maintenance of books and records.
5. EXPENSES. During the term of this Agreement, the
Investment Adviser will pay all expenses incurred by it in
connection with its activities under this Agreement other than the
cost of securities (including brokerage commissions, if any)
purchased for the Portfolio.
In addition, if the expenses borne by the Portfolio in any
fiscal year of the Portfolio exceed the applicable expense
limitations imposed by the securities regulations of any state in
which the beneficial interest in the Portfolio are registered or
qualified for sale to the public, the Investment Adviser shall
reimburse the Portfolio for the excess expense to the extent
required by state law.
6. COMPENSATION. For the services provided and the
expenses assumed pursuant to this Agreement, the Portfolio will
pay the Investment Adviser and the Investment Adviser will accept
as full compensation therefor a fee, computed daily and payable
monthly, an amount equal to the annual rate of 0.10% of the
Portfolio's average daily net assets.
7. LIMITATION OF LIABILITY OF THE INVESTMENT ADVISER;
INDEMNIFICATION. (a) The Investment Adviser shall not be liable
for any error of judgment or mistake of law or for any loss
suffered by the Portfolio in connection with the matters to which
this Agreement relates, except a loss resulting from a breach of
fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith
or gross negligence on the part of the Investment Adviser in the
performance of its duties or from reckless disregard by it of its
obligations and duties under this Agreement.
(b) Subject to the exceptions and limitations
contained in Section 7(c) below:
(i) the Investment Adviser (hereinafter referred
to as a "Covered Person") shall be indemnified by the Portfolio to
the fullest extent permitted by law, against liability and against
all expenses reasonably incurred or paid by him in connection with
any claim, action, suit or proceeding in which he becomes
involved, as a party or otherwise, by virtue of his being or
having been the Investment Adviser of the Portfolio, and against
amounts paid or incurred by him in the settlement thereof;
(ii) the words "claim," "action," "suit," or
"proceeding" shall apply to all claims, actions, suits or
proceedings (civil, criminal or other, including appeals), actual
or threatened while in office or thereafter, and the words
"liability" and "expenses" shall include, without limitation,
attorneys' fees, costs, judgments, amounts paid in settlement,
fines, penalties and other liabilities.
(c) No indemnification shall be provided hereunder to
a Covered Person:
(i) who shall have been adjudicated by a court
or body before which the proceeding was brought (A) to be liable
to the Portfolio or its investors by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of
the duties involved in the conduct of his office or (B) not to
have acted in good faith in the reasonable belief that his action
was in the best interest of the Portfolio; or
(ii) in the event of a settlement, unless there
has been a determination that such Covered Person did not engage
in willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his office,
(A) by the court or other body approving
the settlement; or
(B) by at least a majority of those
Trustees who are neither Interested Persons of the Portfolio nor
are parties to the matter based upon a review of readily available
facts (as opposed to a full trial-type inquiry); or
(C) by written opinion of independent legal
counsel based upon a review of readily available facts (as opposed
to a full trial-type inquiry); provided, however, that any
shareholder of the Portfolio may, by appropriate legal
proceedings, challenge any such determination by the Trustees or
by independent counsel.
(d) The rights of indemnification herein provided may
be insured against by policies maintained by the Portfolio, shall
be severable, shall not be exclusive of or affect any other rights
to which any Covered Person may now or hereafter be entitled,
shall continue as to a person who has ceased to be a Covered
Person and shall inure to the benefit of the successors and
assigns of such person. Nothing contained herein shall affect any
rights to indemnification to which Portfolio personnel and any
other persons, other than a Covered Person, may be entitled by
contract or otherwise under law.
(e) Expenses in connection with the preparation and
presentation of a defense to any claim, suit or proceeding of the
character described in subsection (b) of this Section 7 may be
paid by the Portfolio from time to time prior to final disposition
thereof, upon receipt of an undertaking by or on behalf of such
Covered Person that such amount will be paid over by him to the
Portfolio if it is ultimately determined that he is not entitled
to indemnification under this Section 7; provided, however, that
either (i) such Covered Person shall have provided appropriate
security for such Undertaking, or (ii) the Portfolio shall be
insured against losses arising out of any such advance payments,
or (iii) either a majority of the Trustees who are neither
Interested Persons of the Portfolio nor parties to the matter, or
independent legal counsel in a written opinion, shall have
determined, based upon a review of readily available facts as
opposed to a trial-type inquiry or full investigation), that there
is reason to believe that such Covered Person will be entitled to
indemnification under this Section 7.
8. DURATION AND TERMINATION. This Agreement shall be
effective as to the Portfolio as of the date the Portfolio
commences investment operations after this Agreement shall have
been approved by the Board of Trustees of the Portfolio and the
investor(s) in the Portfolio in the manner contemplated by Section
15 of the 1940 Act and, unless sooner terminated as provided
herein, shall continue until the second anniversary of such date.
Thereafter, if not terminated, this Agreement shall continue in
effect as to the Portfolio for successive periods of 12 months
each, provided such continuance is specifically approved at least
annually (a) by the vote of a majority of those members of the
Board of Trustees of the Portfolio who are not parties to this
Agreement or interested persons of any such party, cast in person
at a meeting called for the purpose of voting on such approval,
and (b) by the Board of Trustees of the Portfolio by vote of a
majority of the outstanding voting securities of the Portfolio;
provided, however, that this Agreement may be terminated by the
Portfolio at any time, without the payment of any penalty, by the
Board of Trustees of the Portfolio or by vote of a majority of the
outstanding voting securities of the Portfolio on 60 days' written
notice to the Investment Adviser, or by the Investment Adviser as
to the Portfolio at any time, without payment of any penalty, on
90 days' written notice to the Portfolio. This Agreement will
immediately terminate in the event of its assignment. (As used in
this Agreement, the terms "majority of the outstanding voting
securities," "interested person" and "assignment" shall have the
same meanings as such terms have in the 1940 Act and the rules and
regulatory constructions thereunder.)
9. AMENDMENT OF THIS AGREEMENT. No material term of this
Agreement may be changed, waived, discharged or terminated orally,
but only by an instrument in writing signed by the party against
which enforcement of the change, waiver, discharge or termination
is sought, and no amendment of a material term of this Agreement
shall be effective until approved by vote of a majority of the
Portfolio's outstanding voting securities.
10. (A) REPRESENTATIONS AND WARRANTIES. The Investment
Adviser hereby represents and warrants as follows:
(1) The Investment Adviser is exempt from registration under the
Investment Advisers Act of 1940;
(2) The Investment Adviser has all requisite authority to enter
into, execute, deliver and perform its obligations under, this
Agreement;
(3) This Agreement is legal, valid and binding, and enforceable
in accordance with its terms; and
(4) The performance by the Investment Adviser of its obligations
under this Agreement does not conflict with any law to which it is
subject.
(B) COVENANTS. The Investment Adviser hereby
covenants and agrees that, so long as this Agreement shall remain
in effect,
(1) The Investment Adviser shall remain either exempt from, or
registered under, the registration provisions of the Investment
Advisers Act of 1940; and
(2) The performance by the Investment Adviser of its obligations
under this Agreement shall not conflict with any law to which it
is then subject.
11. NOTICES. Any notice required to be given pursuant to
this Agreement shall be deemed duly given if delivered or mailed
by registered mail, postage prepaid, (1) to the Investment Adviser
at 130 Liberty Street, New York, New York 10006; (2) to Mutual
Fund Services at One Bankers Trust Plaza, New York, New York 10006
or (3) to the Portfolio at 4400 Computer Drive, Westborough,
Massachusetts 01581.
12. WAIVER. With full knowledge of the circumstances and
the effect of its action, the Investment Adviser hereby waives any
and all rights which it may acquire in the future against the
property of any investor in the Portfolio, other than beneficial
interests in the Portfolio at their then net asset value, which
arise out of any action or inaction of the Portfolio under this
Agreement.
13. MISCELLANEOUS. The captions in this Agreement are
included for convenience of reference only and in no way define or
delimit any of the provisions hereof 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 and
shall be governed by the laws of the State of New York, without
reference to principles of conflicts of law.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of
the day and year first above written.
Attest: BT INSURANCE FUNDS TRUST
___________________________
_______________________________
Attest: BANKERS TRUST COMPANY
__________________________
_______________________________
Mutual Fund/Business Trust/Series
FORM OF CUSTODIAN AGREEMENT
AGREEMENT dated as of _________________ between BANKERS
TRUST COMPANY (the "Custodian") and BT INSURANCE FUNDS TRUST (the
"Customer").
WHEREAS, the Customer may be organized with one or more
series of shares, each of which shall represent an interest in a
separate portfolio of Securities and Cash (each as hereinafter
defined) (all such existing and additional series now or hereafter
listed on Exhibit A being hereafter referred to individually as a
"Portfolio" and collectively, as the "Portfolios"); and
WHEREAS, the Customer desires to appoint the Custodian as
custodian on behalf of the Portfolios under the terms and
conditions set forth in this Agreement, and the Custodian has
agreed to so act as custodian.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, the parties hereto agree as follows:
1. Employment of Custodian. The Customer hereby employs
the Custodian as custodian of all assets of each Portfolio which
are delivered to and accepted by the Custodian or any Subcustodian
(as that term is defined in Section 4) (the "Property") pursuant
to the terms and conditions set forth herein. Without limitation,
such Property shall include stocks and other equity interests of
every type, evidences of indebtedness, other instruments
representing same or rights or obligations to receive, purchase,
deliver or sell same and other non-cash investment property of a
Portfolio which is acceptable for deposit ("Securities") and cash
from any source and in any currency ("Cash"). The Custodian shall
not be responsible for any property of a Portfolio held or
received by the Customer or others and not delivered to the
Custodian or any Subcustodian.
2. Maintenance of Securities and Cash at Custodian and
Subcustodian Locations. Pursuant to Instructions, the Customer
shall direct the Custodian to (a) settle Securities transactions
and maintain cash in the country or other jurisdiction in which
the principal trading market for such Securities is located, where
such Securities are to be presented for payment or where such
Securities are acquired and (b) maintain cash and cash equivalents
in such countries in amounts reasonably necessary to effect the
Customer's transactions in such Securities. Instructions to
settle Securities transactions in any country shall be deemed to
authorize the holding of such Securities and Cash in that country.
3. Custody Account. The Custodian agrees to establish
and maintain one or more custody accounts on its books each in the
name of a Portfolio (each, an "Account") for any and all Property
from time to time received and accepted by the Custodian or any
Subcustodian for the account of such Portfolio. Upon delivery by
the Customer to the Custodian of any Property belonging to a
Portfolio, the Customer shall, by Instructions (as hereinafter
defined in Section 14), specifically indicate which Portfolio such
Property belongs or if such Property belongs to more than one
Portfolio shall allocate such Property to the appropriate
Portfolio. The Custodian shall allocate such Property to the
Accounts in accordance with the Instructions; provided that the
Custodian shall have the right, in its sole discretion, to refuse
to accept any Property that is not in proper form for deposit for
any reason. The Customer on behalf of each Portfolio,
acknowledges its responsibility as a principal for all of its
obligations to the Custodian arising under or in connection with
this Agreement, warrants its authority to deposit in the
appropriate Account any Property received therefor by the
Custodian or a Subcustodian and to give, and authorize others to
give, instructions relative thereto. The Custodian may deliver
securities of the same class in place of those deposited in the
Account.
The Custodian shall hold, keep safe and protect as custodian
for each Account, on behalf of the Customer, all Property in such
Account. All transactions, including, but not limited to, foreign
exchange transactions, involving the Property shall be executed or
settled solely in accordance with Instructions (which shall
specifically reference the Account for which such transaction is
being settled), except that until the Custodian receives
Instructions to the contrary, the Custodian will:
(a) collect all interest and dividends and all other
income and payments, whether paid in cash or in kind, on the
Property, as the same become payable and credit the same to the
appropriate Account;
(b) present for payment all Securities held in an Account
which are called, redeemed or retired or otherwise become payable
and all coupons and other income items which call for payment upon
presentation to the extent that the Custodian or Subcustodian is
actually aware of such opportunities and hold the cash received in
such Account pursuant to this Agreement;
(c) (i) exchange Securities where the exchange is purely
ministerial (including, without limitation, the exchange of
temporary securities for those in definitive form and the exchange
of warrants, or other documents of entitlement to securities, for
the Securities themselves) and (ii) when notification of a tender
or exchange offer (other than ministerial exchanges described in
(i) above) is received for an Account, endeavor to receive
Instructions, provided that if such Instructions are not received
in time for the Custodian to take timely action, no action shall
be taken with respect thereto;
(d) whenever notification of a rights entitlement or a
fractional interest resulting from a rights issue, stock dividend
or stock split is received for an Account and such rights
entitlement or fractional interest bears an expiration date, if
after endeavoring to obtain Instructions such Instructions are not
received in time for the Custodian to take timely action or if
actual notice of such actions was received too late to seek
Instructions, sell in the discretion of the Custodian (which sale
the Customer hereby authorizes the Custodian to make) such rights
entitlement or fractional interest and credit the Account with the
net proceeds of such sale;
(e) execute in the Customer's name for an Account,
whenever the Custodian deems it appropriate, such ownership and
other certificates as may be required to obtain the payment of
income from the Property in such Account;
(f) pay for each Account, any and all taxes and levies in
the nature of taxes imposed on interest, dividends or other
similar income on the Property in such Account by any governmental
authority. In the event there is insufficient Cash available in
such Account to pay such taxes and levies, the Custodian shall
notify the Customer of the amount of the shortfall and the
Customer, at its option, may deposit additional Cash in such
Account or take steps to have sufficient Cash available. The
Customer agrees, when and if requested by the Custodian and
required in connection with the payment of any such taxes to
cooperate with the Custodian in furnishing information, executing
documents or otherwise; and
(g) appoint brokers and agents for any of the ministerial
transactions involving the Securities described in (a) - (f),
including, without limitation, affiliates of the Custodian or any
Subcustodian.
4. Subcustodians and Securities Systems. The Customer
authorizes and instructs the Custodian to hold the Property in
each Account in custody accounts which have been established by
the Custodian with (a) one of its U.S. branches or another U.S.
bank or trust company or branch thereof located in the U.S. which
is itself qualified under the Investment Company Act of 1940, as
amended ("1940 Act"), to act as custodian (individually, a "U.S.
Subcustodian"), or a U.S. securities depository or clearing agency
or system in which the Custodian or a U.S. Subcustodian
participates (individually, a "U.S. Securities System") or (b) one
of its non-U.S. branches or majority-owned non-U.S. subsidiaries,
a non-U.S. branch or majority-owned subsidiary of a U.S. bank or a
non-U.S. bank or trust company, acting as custodian (individually,
a "non-U.S. Subcustodian"; U.S. Subcustodians and non-U.S.
Subcustodians, collectively, "Subcustodians"), or a non-U.S.
depository or clearing agency or system in which the Custodian or
any Subcustodian participates (individually, a "non-U.S.
Securities System"; U.S. Securities System and non-U.S. Securities
System, collectively, "Securities System"), provided that in each
case in which a U.S. Subcustodian or U.S. Securities System is
employed, each such Subcustodian or Securities System shall have
been approved by Instructions; provided further that in each case
in which a non-U.S. Subcustodian or non-U.S. Securities System is
employed, (a) such Subcustodian or Securities System either is (i)
a "qualified U.S. bank" as defined by Rule 17f-5 under the 1940
Act ("Rule 17f-5") or (ii) an "eligible foreign custodian" within
the meaning of Rule 17f-5 or such Subcustodian or Securities
System is the subject of an order granted by the U.S. Securities
and Exchange Commission ("SEC") exempting such agent or the
subcustody arrangements thereto from all or part of the provisions
of Rule 17f-5 and (b) the agreement between the Custodian and such
non-U.S. Subcustodian has been approved by Instructions; it being
understood that the Custodian shall have no liability or
responsibility for determining whether the approval by the
Customer of any Subcustodian or Securities System has been proper
under the 1940 Act or any rule or regulation thereunder.
Upon receipt of Instructions, the Custodian agrees to cease
the employment of any Subcustodian or Securities System with
respect to the Customer, and if desirable and practicable, appoint
a replacement subcustodian or securities system in accordance with
the provisions of this Section. In addition, the Custodian may,
at any time in its discretion, upon written notification to the
Customer, terminate the employment of any Subcustodian or
Securities System.
Upon request of the Customer, the Custodian shall deliver to
the Customer annually a certificate stating: (a) the identity of
each non-U.S. Subcustodian and non-U.S. Securities System then
acting on behalf of the Custodian and the name and address of the
governmental agency or other regulatory authority that supervises
or regulates such non-U.S Subcustodian and non-U.S. Securities
System; (b) the countries in which each non-U.S. Subcustodian or
non-U.S. Securities System is located; and (c) so long as Rule
17f-5 requires the Customer's Board of Trustees to directly
approve its foreign custody arrangements, such other information
relating to such non-U.S. Subcustodians and non-U.S. Securities
Systems as may reasonably be requested by the Customer to ensure
compliance with Rule 17f-5. So long as Rule 17f-5 requires the
Customer's Board of Trustees to directly approve its foreign
custody arrangements, the Custodian also shall furnish annually to
the Customer information concerning such non-U.S. Subcustodians
and non-U.S. Securities Systems similar in kind and scope as that
furnished to the Customer in connection with the initial approval
of this Agreement. Custodian agrees to promptly notify the
Customer if, in the normal course of its custodial activities, the
Custodian has reason to believe that any non-U.S. Subcustodian or
non-U.S. Securities System has ceased to be a qualified U.S. bank
or an eligible foreign custodian each within the meaning of Rule
17f-5 or has ceased to be subject to an exemptive order from the
SEC.
5. Use of Subcustodian. With respect to Property in an
Account which is maintained by the Custodian in the custody of a
Subcustodian employed pursuant to Section 4:
(a) The Custodian will identify on its books as belonging
to the Customer on behalf of a Portfolio, any Property held by
such Subcustodian.
(b) Any Property in the Account held by a Subcustodian
will be subject only to the instructions of the Custodian or its
agents.
(c) Property deposited with a Subcustodian will be
maintained in an account holding only assets for customers of the
Custodian.
(d) Any agreement the Custodian shall enter into with a
non-U.S. Subcustodian with respect to the holding of Property
shall require that (i) the Account will be adequately indemnified
or its losses adequately insured; (ii) the Securities are not
subject to any right, charge, security interest, lien or claim of
any kind in favor of such Subcustodian or its creditors except a
claim for payment in accordance with such agreement for their safe
custody or administration and expenses related thereto, (iii)
beneficial ownership of such Securities be freely transferable
without the payment of money or value other than for safe custody
or administration and expenses related thereto, (iv) adequate
records will be maintained identifying the Property held pursuant
to such Agreement as belonging to the Custodian, on behalf of its
customers and (v) to the extent permitted by applicable law,
officers of or auditors employed by, or other representatives of
or designated by, the Custodian, including the independent public
accountants of or designated by, the Customer be given access to
the books and records of such Subcustodian relating to its actions
under its agreement pertaining to any Property held by it
thereunder or confirmation of or pertinent information contained
in such books and records be furnished to such persons designated
by the Custodian.
6. Use of Securities System. With respect to Property in
the Account(s) which are maintained by the Custodian or any
Subcustodian in the custody of a Securities System employed
pursuant to Section 4:
(a) The Custodian shall, and the Subcustodian will be
required by its agreement with the Custodian to, identify on its
books such Property as being held for the account of the Custodian
or Subcustodian for its customers.
(b) Any Property held in a Securities System for the
account of the Custodian or a Subcustodian will be subject only to
the instructions of the Custodian or such Subcustodian, as the
case may be.
(c) Property deposited with a Securities System will be
maintained in an account holding only assets for customers of the
Custodian or Subcustodian, as the case may be, unless precluded by
applicable law, rule, or regulation.
(d) The Custodian shall provide the Customer with any
report obtained by the Custodian on the Securities System's
accounting system, internal accounting control and procedures for
safeguarding securities deposited in the Securities System.
7. Agents. The Custodian may at any time or times in its
sole discretion appoint (or remove) any other U.S. bank or trust
company which is itself qualified under the 1940 Act to act as
custodian, as its agent to carry out such of the provisions of
this Agreement as the Custodian may from time to time direct;
provided, however, that the appointment of any agent shall not
relieve the Custodian of its responsibilities or liabilities
hereunder.
8. Records, Ownership of Property, Statements, Opinions
of Independent Certified Public Accountants.
(a) The ownership of the Property whether Securities, Cash
and/or other property, and whether held by the Custodian or a
Subcustodian or in a Securities System as authorized herein, shall
be clearly recorded on the Custodian's books as belonging to the
appropriate Account and not for the Custodian's own interest. The
Custodian shall keep accurate and detailed accounts of all
investments, receipts, disbursements and other transactions for
each Account. All accounts, books and records of the Custodian
relating thereto shall be open to inspection and audit at all
reasonable times during normal business hours by any person
designated by the Customer. All such accounts shall be maintained
and preserved in the form reasonably requested by the Customer.
The Custodian will supply to the Customer from time to time, as
mutually agreed upon, a statement in respect to any Property in an
Account held by the Custodian or by a Subcustodian. In the
absence of the filing in writing with the Custodian by the
Customer of exceptions or objections to any such statement within
sixty (60) days of the mailing thereof, the Customer shall be
deemed to have approved such statement and in such case or upon
written approval of the Customer of any such statement, such
statement shall be presumed to be for all purposes correct with
respect to all information set forth therein.
(b) The Custodian shall take all reasonable action as the
Customer may request to obtain from year to year favorable
opinions from the Customer's independent certified public
accountants with respect to the Custodian's activities hereunder
in connection with the preparation of the Customer's Form N-1A and
the Customer's Form N-SAR or other periodic reports to the SEC and
with respect to any other requirements of the SEC.
(c) At the request of the Customer, the Custodian shall
deliver to the Customer a written report prepared by the
Custodian's independent certified public accountants with respect
to the services provided by the Custodian under this Agreement,
including, without limitation, the Custodian's accounting system,
internal accounting control and procedures for safeguarding Cash
and Securities, including Cash and Securities deposited and/or
maintained in a securities system or with a Subcustodian. Such
report shall be of sufficient scope and in sufficient detail as
may reasonably be required by the Customer and as may reasonably
be obtained by the Custodian.
(d) The Customer may elect to participate in any of the
electronic on-line service and communications systems offered by
the Custodian which can provide the Customer, on a daily basis,
with the ability to view on-line or to print on hard copy various
reports of Account activity and of Securities and/or Cash being
held in any Account. To the extent that such service shall
include market values of Securities in an Account, the Customer
hereby acknowledges that the Custodian now obtains and may in the
future obtain information on such values from outside sources that
the Custodian considers to be reliable and the Customer agrees
that the Custodian (i) does not verify or represent or warrant
either the reliability of such service nor the accuracy or
completeness of any such information furnished or obtained by or
through such service and (ii) shall be without liability in
selecting and utilizing such service or furnishing any information
derived therefrom.
9. Holding of Securities, Nominees, etc. Securities in
an Account which are held by the Custodian or any Subcustodian may
be held by such entity in the name of the Customer, on behalf of a
Portfolio, in the Custodian's or Subcustodian's name, in the name
of the Custodian's or Subcustodian's nominee, or in bearer form.
Securities that are held by a Subcustodian or which are eligible
for deposit in a Securities System as provided above may be
maintained with the Subcustodian or the Securities System in an
account for the Custodian's or Subcustodian's customers, unless
prohibited by law, rule, or regulation. The Custodian or
Subcustodian, as the case may be, may combine certificates
representing Securities held in an Account with certificates of
the same issue held by it as fiduciary or as a custodian. In the
event that any Securities in the name of the Custodian or its
nominee or held by a Subcustodian and registered in the name of
such Subcustodian or its nominee are called for partial redemption
by the issuer of such Security, the Custodian may, subject to the
rules or regulations pertaining to allocation of any Securities
System in which such Securities have been deposited, allot, or
cause to be allotted, the called portion of the respective
beneficial holders of such class of security in any manner the
Custodian deems to be fair and equitable.
10. Proxies, etc. With respect to any proxies, notices,
reports or other communications relative to any of the Securities
in any Account, the Custodian shall perform such services and only
such services relative thereto as are (i) set forth in Section 3
of this Agreement, (ii) described in Exhibit B attached hereto (as
such service therein described may be in effect from time to time)
(the "Proxy Service") and (iii) as may otherwise be agreed upon
between the Custodian and the Customer. The liability and
responsibility of the Custodian in connection with the Proxy
Service referred to in (ii) of the immediately preceding sentence
and in connection with any additional services which the Custodian
and the Customer may agree upon as provided in (iii) of the
immediately preceding sentence shall be as set forth in the
description of the Proxy Service and as may be agreed upon by the
Custodian and the Customer in connection with the furnishing of
any such additional service and shall not be affected by any other
term of this Agreement. Neither the Custodian nor its nominees or
agents shall vote upon or in respect of any of the Securities in
an Account, execute any form of proxy to vote thereon, or give any
consent or take any action (except as provided in Section 3) with
respect thereto except upon the receipt of Instructions relative
thereto.
11. Segregated Account. To assist the Customer in
complying with the requirements of the 1940 Act and the rules and
regulations thereunder, the Custodian shall, upon receipt of
Instructions, establish and maintain a segregated account or
accounts on its books for and on behalf of a Portfolio.
12. Settlement Procedures. Securities will be transferred,
exchanged or delivered by the Custodian or a Subcustodian upon
receipt by the Custodian of Instructions which include all
information required by the Custodian. Settlement and payment for
Securities received for an Account and delivery of Securities out
of such Account may be effected in accordance with the customary
or established securities trading or securities processing
practices and procedures in the jurisdiction or market in which
the transaction occurs, including, without limitation, delivering
Securities to the purchaser thereof or to a dealer therefor (or an
agent for such purchaser or dealer) against a receipt with the
expectation of receiving later payment for such Securities from
such purchaser or dealer, as such practices and procedures may be
modified or supplemented in accordance with the standard operating
procedures of the Custodian in effect from time to time for that
jurisdiction or market. Provided that the Custodian effects
transactions in accordance with the customary or established
securities trading or securities processing practice or procedures
in the applicable jurisdiction or market, it shall not be
responsible for any loss arising therefrom. Subject to the
exercise of reasonable care, the Custodian may elect to effect
transactions otherwise in a jurisdiction or market.
Notwithstanding that the Custodian may settle purchases and
sales against, or credit income to, an Account, on a contractual
basis, as outlined in the Investment Manager User Guide provided
to the Customer by the Custodian, the Custodian may, at its sole
option, reverse such credits or debits to the appropriate Account
in the event that the transaction does not settle, or the income
is not received in a timely manner, and the Customer agrees to
hold the Custodian harmless from any losses which may result
therefrom.
Except as otherwise may be agreed upon by the parties
hereto, the Custodian shall not be required to comply with
Instructions to settle the purchase of any Securities for an
Account unless there is sufficient Cash in such Account at the
time or to settle the sale of any Securities in such Account
unless such Securities are in deliverable form. Notwithstanding
the foregoing, if the purchase price of such securities exceeds
the amount of Cash in an Account at the time of settlement of such
purchase, the Custodian may, in its sole discretion, but in no way
shall have any obligation to, permit an overdraft in such Account
in the amount of the difference solely for the purpose of
facilitating the settlement of such purchase of securities for
prompt delivery for such Account. The Customer agrees to
immediately repay the amount of any such overdraft in the ordinary
course of business and further agrees to indemnify and hold the
Custodian harmless from and against any and all losses, costs,
including, without limitation the cost of funds, and expenses
incurred in connection with such overdraft. The Customer agrees
that it will not use the Account to facilitate the purchase of
securities without sufficient funds in the Account (which funds
shall not include the proceeds of the sale of the purchased
securities).
13. Permitted Transactions. The Customer agrees that it
will cause transactions to be made pursuant to this Agreement only
upon Instructions in accordance Section 14 and only for the
purposes listed below.
(a) In connection with the purchase or sale of Securities
at prices as confirmed by Instructions.
(b) When Securities are called, redeemed or retired, or
otherwise become payable.
(c) In exchange for or upon conversion into other
securities alone or other securities and cash pursuant to any plan
or merger, consolidation, reorganization, recapitalization or
readjustment.
(d) Upon conversion of Securities pursuant to their terms
into other securities.
(e) Upon exercise of subscription, purchase or other
similar rights represented by Securities.
(f) For the payment of interest, taxes, management or
supervisory fees, distributions or operating expenses.
(g) In connection with any borrowings by the Customer
requiring a pledge of Securities, but only against receipt of
amounts borrowed.
(h) In connection with any loans, but only against receipt
of collateral as specified in Instructions which shall reflect any
restrictions applicable to the Customer.
(i) For the purpose of redeeming shares of the capital
stock of the Customer against delivery of the shares to be
redeemed to the Custodian, a Subcustodian or the Customer's
transfer agent.
(j) For the purpose of redeeming in kind shares of the
Customer against delivery of the shares to be redeemed to the
Custodian, a Subcustodian or the Customer's transfer agent.
(k) For delivery in accordance with the provisions of any
agreement among the Customer, on behalf of a Portfolio, the
Custodian and a broker-dealer registered under the Securities
Exchange Act of 1934 and a member of the National Association of
Securities Dealers, Inc., relating to compliance with the rules of
The Options Clearing Corporation, the Commodities Futures Trading
Commission and of any registered national securities exchange, or
of any similar organization or organizations, regarding escrow or
other arrangements in connection with transactions by the
Customer.
(l) For release of Securities to designated brokers under
covered call options, provided, however, that such Securities
shall be released only upon payment to the Custodian of monies for
the premium due and a receipt for the Securities which are to be
held in escrow. Upon exercise of the option, or at expiration,
the Custodian will receive the Securities previously deposited
from broker. The Custodian will act strictly in accordance with
Instructions in the delivery of Securities to be held in escrow
and will have no responsibility or liability for any such
Securities which are not returned promptly when due other than to
make proper request for such return.
(m) For spot or forward foreign exchange transactions to
facilitate security trading or receipt of income from Securities
related transactions.
(n) Upon the termination of this Agreement as set forth in
Section 20.
(o) For other proper purposes.
The Customer agrees that the Custodian shall have no
obligation to verify the purpose for which a transaction is being
effected.
14. Instructions. The term "Instructions" means
instructions from the Customer in respect of any of the
Custodian's duties hereunder which have been received by the
Custodian at its address set forth in Section 21 below (i) in
writing (including, without limitation, facsimile transmission) or
by tested telex signed or given by such one or more person or
persons as the Customer shall have from time to time authorized in
writing to give the particular class of Instructions in question
and whose name and (if applicable) signature and office address
have been filed with the Custodian, or (ii) which have been
transmitted electronically through an electronic on-line service
and communications system offered by the Custodian or other
electronic instruction system acceptable to the Custodian, or
(iii) a telephonic or oral communication by one or more persons as
the Customer shall have from time to time authorized to give the
particular class of Instructions in question and whose name has
been filed with the Custodian; or (iv) upon receipt of such other
form of instructions as the Customer may from time to time
authorize in writing and which the Custodian has agreed in writing
to accept. Instructions in the form of oral communications shall
be confirmed by the Customer by tested telex or writing in the
manner set forth in clause (i) above, but the lack of such
confirmation shall in no way affect any action taken by the
Custodian in reasonable reliance upon such oral instructions prior
to the Custodian's receipt of such confirmation. Instructions may
relate to specific transactions or to types or classes of
transactions, and may be in the form of standing instructions.
The Custodian shall have the right to assume in the absence
of notice to the contrary from the Customer that any person whose
name is on file with the Custodian pursuant to this Section has
been authorized by the Customer to give the Instructions in
question and that such authorization has not been revoked. The
Custodian may act upon and conclusively rely on, without any
liability to the Customer or any other person or entity for any
losses resulting therefrom, any Instructions reasonably believed
by it to be furnished by the proper person or persons as provided
above.
15. Standard of Care. The Custodian shall be responsible
for the performance of only such duties as are set forth herein or
contained in Instructions given to the Custodian which are not
contrary to the provisions of this Agreement. The Custodian will
use reasonable care with respect to the safekeeping of Property in
each Account and, except as otherwise expressly provided herein,
in carrying out its obligations under this Agreement. So long as
and to the extent that it has exercised reasonable care, the
Custodian shall not be responsible for the title, validity or
genuineness of any Property or other property or evidence of title
thereto received by it or delivered by it pursuant to this
Agreement and shall be held harmless in acting upon, and may
conclusively rely on, without liability for any loss resulting
therefrom, any notice, request, consent, certificate or other
instrument reasonably believed by it to be genuine and to be
signed or furnished by the proper party or parties, including,
without limitation, Instructions, and shall be indemnified by the
Customer for any losses, damages, costs and expenses (including,
without limitation, the fees and expenses of counsel) incurred by
the Custodian and arising out of action taken or omitted with
reasonable care by the Custodian hereunder or under any
Instructions. The Custodian shall be liable to the Customer for
any act or omission to act of any Subcustodian to the same extent
as if the Custodian committed such act itself. Where, under
applicable law, regulation, or practice (in order to facilitate
the settlement of transactions related thereto), or where the
Customer otherwise elects, Securities are held in a Securities
System in a particular market, the Custodian shall only be
responsible or liable for losses arising from employment of such
Securities System caused by the Custodian's own failure to
exercise reasonable care. Where the Custodian otherwise elects to
employ a Securities System for holding Securities in a particular
market, the Custodian shall be liable to the Customer for any act
or omission of any Securities System to the same extent as if the
Custodian committed such act itself. In the event of any loss to
the Customer by reason of the failure of the Custodian or a
Subcustodian to utilize reasonable care, the Custodian shall be
liable to the Customer to the extent of the Customer's actual
damages at the time such loss was discovered without reference to
any special conditions or circumstances. In no event shall the
Custodian be liable for any consequential or special damages. The
Custodian shall be entitled to rely, and may act, on advice of
counsel (who may be counsel for the Customer) on all matters and
shall be without liability for any action reasonably taken or
omitted pursuant to such advice.
In the event the Customer subscribes to an electronic on-
line service and communications system offered by the Custodian,
the Customer shall be fully responsible for the security of the
Customer's connecting terminal, access thereto and the proper and
authorized use thereof and the initiation and application of
continuing effective safeguards with respect thereto and agree to
defend and indemnify the Custodian and hold the Custodian harmless
from and against any and all losses, damages, costs and expenses
(including the fees and expenses of counsel) incurred by the
Custodian as a result of any improper or unauthorized use of such
terminal by the Customer or by any others.
All collections of funds or other property paid or
distributed in respect of Securities in an Account, including
funds involved in third-party foreign exchange transactions, shall
be made at the risk of the Customer.
Subject to the exercise of reasonable care, the Custodian
shall have no liability for any loss occasioned by delay in the
actual receipt of notice by the Custodian or by a Subcustodian of
any payment, redemption or other transaction regarding Securities
in each Account in respect of which the Custodian has agreed to
take action as provided in Section 3 hereof. The Custodian shall
not be liable for any loss resulting from, or caused by, or
resulting from acts of governmental authorities (whether de jure
or de facto), including, without limitation, nationalization,
expropriation, and the imposition of currency restrictions;
devaluations of or fluctuations in the value of currencies;
changes in laws and regulations applicable to the banking or
securities industry; market conditions that prevent the orderly
execution of securities transactions or affect the value of
Property; acts of war, terrorism, insurrection or revolution;
strikes or work stoppages; the inability of a local clearing and
settlement system to settle transactions for reasons beyond the
control of the Custodian; hurricane, cyclone, earthquake, volcanic
eruption, nuclear fusion, fission or radioactivity, or other acts
of God.
The Custodian shall have no liability in respect of any
loss, damage or expense suffered by the Customer, insofar as such
loss, damage or expense arises from the performance of the
Custodian's duties hereunder by reason of the Custodian's reliance
upon records that were maintained for the Customer by entities
other than the Custodian prior to the Custodian's employment under
this Agreement.
The provisions of this Section shall survive termination of
this Agreement.
16. Investment Limitations and Legal or Contractual
Restrictions or Regulations. The Custodian shall not be liable to
the Customer and the Customer agrees to indemnify the Custodian
and its nominees, for any loss, damage or expense suffered or
incurred by the Custodian or its nominees arising out of any
violation of any investment restriction or other restriction or
limitation applicable to the Customer or any Portfolio pursuant to
any contract or any law or regulation. The provisions of this
Section shall survive termination of this Agreement.
17. Fees and Expenses. The Customer agrees to pay to the
Custodian such compensation for its services pursuant to this
Agreement as may be mutually agreed upon in writing from time to
time and the Custodian's reasonable out-of-pocket or incidental
expenses in connection with the performance of this Agreement,
including (but without limitation) legal fees as described herein
and/or deemed necessary in the judgment of the Custodian to keep
safe or protect the Property in the Account. The initial fee
schedule is attached hereto as Exhibit C. The Customer hereby
agrees to hold the Custodian harmless from any liability or loss
resulting from any taxes or other governmental charges, and any
expense related thereto, which may be imposed, or assessed with
respect to any Property in an Account and also agrees to hold the
Custodian, its Subcustodians, and their respective nominees
harmless from any liability as a record holder of Property in such
Account. The Custodian is authorized to charge the applicable
Account for such items and the Custodian shall have a lien on the
Property in the applicable Account for any amount payable to the
Custodian under this Agreement, including but not limited to
amounts payable pursuant to the last paragraph of Section 12 and
pursuant to indemnities granted by the Customer under this
Agreement. The provisions of this Section shall survive the
termination of this Agreement.
18. Tax Reclaims. With respect to withholding taxes
deducted and which may be deducted from any income received from
any Property in an Account, the Custodian shall perform such
services with respect thereto as are described in Exhibit D
attached hereto and shall in connection therewith be subject to
the standard of care set forth in such Exhibit D. Such standard
of care shall not be affected by any other term of this Agreement.
19. Amendment, Modifications, etc. No provision of this
Agreement may be amended, modified or waived except in a writing
signed by the parties hereto. No waiver of any provision hereto
shall be deemed a continuing waiver unless it is so designated.
No failure or delay on the part of either party in exercising any
power or right under this Agreement operates as a waiver, nor does
any single or partial exercise of any power or right preclude any
other or further exercise thereof or the exercise of any other
power or right.
20. Termination. (a) Termination of Entire Agreement.
This Agreement may be terminated by the Customer or the Custodian
by ninety (90) days' written notice to the other; provided that
notice by the Customer shall specify the names of the persons to
whom the Custodian shall deliver the Securities in each Account
and to whom the Cash in such Account shall be paid. If notice of
termination is given by the Custodian, the Customer shall, within
ninety (90) days following the giving of such notice, deliver to
the Custodian a written notice specifying the names of the persons
to whom the Custodian shall deliver the Securities in each Account
and to whom the Cash in such Account shall be paid. In either
case, the Custodian will deliver such Securities and Cash to the
persons so specified, after deducting therefrom any amounts which
the Custodian determines to be owed to it under Sections 12, 17,
and 23. In addition, the Custodian may in its discretion withhold
from such delivery such Cash and Securities as may be necessary to
settle transactions pending at the time of such delivery. The
Customer grants to the Custodian a lien and right of setoff
against the Account and all Property held therein from time to
time in the full amount of the foregoing obligations. If within
ninety (90) days following the giving of a notice of termination
by the Custodian, the Custodian does not receive from the Customer
a written notice specifying the names of the persons to whom the
Custodian shall deliver the Securities in each Account and to whom
the Cash in such Account shall be paid, the Custodian, at its
election, may deliver such Securities and pay such Cash to a bank
or trust company doing business in the State of New York to be
held and disposed of pursuant to the provisions of this Agreement,
or may continue to hold such Securities and Cash until a written
notice as aforesaid is delivered to the Custodian, provided that
the Custodian's obligations shall be limited to safekeeping.
(b) Termination as to One or More Portfolios. This
Agreement may be terminated by the Customer or the Custodian as to
one or more Portfolios (but less than all of the Portfolios) by
delivery of an amended Exhibit A deleting such Portfolios, in
which case termination as to such deleted Portfolios shall take
effect ninety (90) days after the date of such delivery, or such
earlier time as mutually agreed. The execution and delivery of an
amended Exhibit A which deletes one or more Portfolios shall
constitute a termination of this Agreement only with respect to
such deleted Portfolio(s), shall be governed by the preceding
provisions of Section 20 as to the identification of a successor
custodian and the delivery of Cash and Securities of the
Portfolio(s) so deleted to such successor custodian, and shall not
affect the obligations of the Custodian and the Customer hereunder
with respect to the other Portfolios set forth in Exhibit A, as
amended from time to time.
21. Notices. Except as otherwise provided in this
Agreement, all requests, demands or other communications between
the parties or notices in connection herewith (a) shall be in
writing, hand delivered or sent by telex, telegram, cable,
facsimile or other means of electronic communication agreed upon
by the parties hereto addressed, if to the Customer, to:
BT Insurance Funds Trust
c/o Bankers Trust Company
4 Albany Street, 2nd Floor
New York, NY 10006
Attention: William ODell
Phone: (212) 250-2838
Fax: (212) 250-4462
if to the Custodian, to:
Bankers Trust Company
16 Wall Street, 4th Floor
New York, NY 10005
Attention: Vince Fiordimondo
Phone: (212) 618-3602
Fax: (212) 618-3823
or in either case to such other address as shall have been
furnished to the receiving party pursuant to the provisions hereof
and (b) shall be deemed effective when received, or, in the case
of a telex, when sent to the proper number and acknowledged by a
proper answerback.
22. Several Obligations of the Portfolios. With respect
to any obligations of the Customer on behalf of each Portfolio and
each of its related Accounts arising out of this Agreement, the
Custodian shall look for payment or satisfaction of any obligation
solely to the assets and property of the Portfolio and such
Accounts to which such obligation relates as though the Customer
had separately contracted with the Custodian by separate written
instrument with respect to each Portfolio and its related
Accounts. No Portfolio shall be liable for the obligations or
liabilities of any other Portfolio. No shareholder, trustee,
director, officer, employee or agent of any Portfolio shall be
subject to claims against or obligations of any other Portfolio to
any extent whatsoever, but the Portfolio only shall be liable.
23. Security for Payment. To secure payment of all
obligations due hereunder, the Customer hereby grants to Custodian
a continuing security interest in and right of setoff against each
Account and all Property held therein from time to time in the
full amount of such obligations; provided that, if there is more
than one Account and the obligations secured pursuant to this
Section can be allocated to a specific Account or the Portfolio
related to such Account, such security interest and right of
setoff will be limited to Property held for that Account only and
its related Portfolio. Should the Customer fail to pay promptly
any amounts owed hereunder, Custodian shall be entitled to use
available Cash in the Account or applicable Account, as the case
may be, and to dispose of Securities in the Account or such
applicable Account as is necessary. In any such case and without
limiting the foregoing, Custodian shall be entitled to take such
other action(s) or exercise such other options, powers and rights
as Custodian now or hereafter has as a secured creditor under the
New York Uniform Commercial Code or any other applicable law.
24. Representations and Warranties.
(a) The Customer hereby represents and warrants to the
Custodian that:
(i) the employment of the Custodian and the terms of
this Agreement do not violate any obligation by which the Customer
is bound, whether arising by contract, operation of law or
otherwise;
(ii) this Agreement has been duly authorized by
appropriate action and when executed and delivered will be binding
upon the Customer and each Portfolio in accordance with its terms;
and
(iii) the Customer will deliver to the Custodian such
evidence of such authorization as the Custodian may reasonably
require, whether by way of a certified resolution or otherwise.
(b) The Custodian hereby represents and warrants to the
Customer that:
(i) its employment as Custodian and the terms of
this Agreement do not violate any obligation by which the
Custodian is bound, whether arising by contract, operation of law
or otherwise;
(ii) this Agreement has been duly authorized by
appropriate action and when executed and delivered will be binding
upon the Custodian in accordance with its terms;
(iii) the Custodian will deliver to the Customer such
evidence of such authorization as the Customer may reasonably
require, whether by way of a certified resolution or otherwise;
and
(iv) Custodian is qualified as a custodian under
Section 26(a) of the 1940 Act and warrants that it will remain so
qualified or upon ceasing to be so qualified shall promptly notify
the Customer in writing.
25. Governing Law and Successors and Assigns. This
Agreement shall be governed by the law of the State of New York
and shall not be assignable by either party, but shall bind the
successors in interest of the Customer and the Custodian.
26. Publicity. Customer shall furnish to Custodian at its
office referred to in Section 21 above, prior to any distribution
thereof, copies of any material prepared for distribution to any
persons who are not parties hereto that refer in any way to the
Custodian, provided that the Customer may refer in its prospectus
and other documents to the Custodian in the manner set forth in
Exhibit E attached to this contract. Customer shall not
distribute or permit the distribution of such materials if
Custodian reasonably objects in writing within ten (10) business
days of receipt thereof (or such other time as may be mutually
agreed) after receipt thereof. The provisions of this Section
shall survive the termination of this Agreement.
27. Representative Capacity and Binding Obligation. A
copy of the [Declaration of Trust/Trust Instrument] of the
Customer is on file with The Secretary of the Commonwealth of
Massachusetts, and notice is hereby given that this Agreement is
not executed on behalf of the Trustees of the Customer as
individuals, and the obligations of this Agreement are not binding
upon any of the Trustees, officers or shareholders of the Customer
individually but are binding only upon the assets and property of
the Portfolios.
The Custodian agrees that no shareholder, trustee or officer
of the Customer may be held personally liable or responsible for
any obligations of the Customer arising out of this Agreement.
28. Affiliation Between Custodian and Adviser and
Customer. It is understood that the trustees, officers,
employees, agents and shareholders of the Customer, and the
officers, directors, employees, agents and shareholders of the
Customers Investment Adviser, Bankers Trust Company ("Adviser"),
are or may be interested in Custodian as directors, officers,
employees, agents, stockholders, or otherwise, and that the
directors, officers, employees, agents or stockholders of
Custodian may be interested in the Customer as trustees, officers,
employees, agents, shareholders, or otherwise, or in Adviser as
officers, directors, employees, agents, shareholders or otherwise.
(i) No trustee, officer, employee or agent of the Customer, and
no officer, director, employee or agent of the Adviser acting
pursuant to any provision of the Investment Advisory Agreement
(the "Advisory Agreement") between the Customer and Adviser, shall
have physical access to the assets of the Customer held by
Custodian or be authorized or permitted to withdraw any
investments of the Customer, nor shall Custodian deliver any
assets of the Customer to any such person. No officer, director,
employee or agent of Custodian who holds any similar position with
the Customer or who performs duties under the Advisory Agreement
shall have access to the assets of the Trust.
(ii) Subject to Section 14 hereof, nothing in this Section 28
shall prohibit any officer, employee or agent of the Customer, or
any officer, employee or agent of the Adviser, from giving
Instructions to Custodian as long as no such Instruction results
in delivery of or access to assets of the Customer prohibited by
subclause (i) of this Section 28.
29. Submission to Jurisdiction. Any suit, action or
proceeding arising out of this Agreement may be instituted in any
State or Federal court sitting in the City of New York, State of
New York, United States of America, and the Customer irrevocably
submits to the non-exclusive jurisdiction of any such court in any
such suit, action or proceeding and waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have
to the laying of venue of any such suit, action or proceeding
brought in such a court and any claim that such suit, action or
proceeding was brought in an inconvenient forum.
30. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original.
This Agreement shall become effective when one or more
counterparts have been signed and delivered by each of the parties
hereto.
31. Confidentiality. The parties hereto agree that each
shall treat confidentially the terms and conditions of this
Agreement and all information provided by each party to the other
regarding its business and operations. All confidential
information provided by a party hereto shall be used by any other
party hereto solely for the purpose of rendering services pursuant
to this Agreement and, except as may be required in carrying out
this Agreement, shall not be disclosed to any third party without
the prior consent of such providing party. The foregoing shall
not be applicable to any information that is publicly available
when provided or thereafter becomes publicly available other than
through a breach of this Agreement, or that is required or
requested to be disclosed by any bank or other regulatory examiner
of the Custodian, Customer, or any Subcustodian, any auditor of
the parties hereto, by judicial or administrative process or
otherwise by applicable law or regulation.
32. Severability. If any provision of this Agreement is
determined to be invalid or unenforceable, such determination
shall not affect the validity or enforceability of any other
provision of this Agreement.
33. Headings. The headings of the paragraphs hereof are
included for convenience of reference only and do not form a part
of this Agreement.
BT INSURANCE FUNDS TRUST
By:
__________________________
Name:
Title:
BANKERS TRUST COMPANY
By:
__________________________
Name: John P. Zori
Title: Vice President
EXHIBIT A
To Custodian Agreement dated as of ____________ between
Bankers Trust Company and BT Insurance Funds Trust.
LIST OF PORTFOLIOS
The following is a list of Portfolios referred to in the
first WHEREAS clause of the above-referred to Custodian Agreement.
Terms used herein as defined terms unless otherwise defined shall
have the meanings ascribed to them in the above-referred to
Custodian Agreement.
Dated as of: _____________ BT INSURANCE FUNDS TRUST
By:
__________________________
Name:
Title:
BANKERS TRUST COMPANY
By:
__________________________
Name: John P. Zori
Title: Vice President
EXHIBIT B
To Custodian Agreement dated as of ______________ between
Bankers Trust Company and BT Insurance Funds Trust.
PROXY SERVICE
The following is a description of the Proxy Service referred
to in Section 10 of the above referred to Custodian Agreement.
Terms used herein as defined terms shall have the meanings
ascribed to them therein unless otherwise defined below.
The Custodian provides a service, described below, for the
transmission of corporate communications in connection with
shareholder meetings relating to Securities held in Argentina,
Australia, Austria, Canada, Denmark, Finland, France, Germany,
Greece, Hong Kong, Indonesia, Ireland, Italy, Japan, Korea,
Malaysia, Mexico, Netherlands, New Zealand, Pakistan, Poland,
Singapore, South Africa, Spain, Sri Lanka, Sweden, United Kingdom,
United States, and Venezuela. For the United States and Canada,
the term "corporate communications" means the proxy statements or
meeting agenda, proxy cards, annual reports and any other meeting
materials received by the Custodian. For countries other than the
United States and Canada, the term "corporate communications"
means the meeting agenda only and does not include any meeting
circulars, proxy statements or any other corporate communications
furnished by the issuer in connection with such meeting. Non-
meeting related corporate communications are not included in the
transmission service to be provided by the Custodian except upon
request as provided below.
The Custodian's process for transmitting and translating
meeting agendas will be as follows:
1) If the meeting agenda is not provided by the issuer in
the English language, and if the language of such agenda is in the
official language of the country in which the related security is
held, the Custodian will as soon as practicable after receipt of
the original meeting agenda by a Subcustodian provide an English
translation prepared by that Subcustodian.
2) If an English translation of the meeting agenda is
furnished, the local language agenda will not be furnished unless
requested.
Translations will be free translations and neither the
Custodian nor any Subcustodian will be liable or held responsible
for the accuracy thereof or any direct or indirect consequences
arising therefrom, including without limitation arising out of any
action taken or omitted to be taken based thereon.
If requested, the Custodian will, on a reasonable efforts
basis, endeavor to obtain any additional corporate communication
such as annual or interim reports, proxy statements, meeting
circulars, or local language agendas, and provide them in the form
obtained.
Timing in the voting process is important and, in that
regard, upon receipt by the Custodian of notice from a
Subcustodian, the Custodian will provide a notice to the Customer
indicating the deadline for receipt of its instructions to enable
the voting process to take place effectively and efficiently. As
voting procedures will vary from market to market, attention to
any required procedures will be very important. Upon timely
receipt of voting instructions, the Custodian will promptly
forward such instructions to the applicable Subcustodian. If
voting instructions are not timely received, the Custodian shall
have no liability or obligation to take any action.
For Securities held in markets other than those set forth in
the first paragraph, the Custodian will not furnish the material
described above or seek voting instructions. However, if
requested to exercise voting rights at a specific meeting, the
Custodian will endeavor to do so on a reasonable efforts basis
without any assurance that such rights will be so exercised at
such meeting.
If the Custodian or any Subcustodian incurs extraordinary
expenses in exercising voting rights related to any Securities
pursuant to appropriate instructions or direction (e.g., by way of
illustration only and not by way of limitation, physical presence
is required at a meeting and/or travel expenses are incurred),
such expenses will be reimbursed out of the Account containing
such Securities unless other arrangements have been made for such
reimbursement.
It is the intent of the Custodian to expand the Proxy
Service to include jurisdictions which are not currently included
as set forth in the second paragraph hereof. The Custodian will
notify the Customer as to the inclusion of additional countries or
deletion of existing countries after their inclusion or deletion
and this Exhibit B will be deemed to be automatically amended to
include or delete such countries as the case may be.
Dated as of: ______________ BT INSURANCE
FUNDS TRUST
By:
__________________________
Name:
Title:
BANKERS TRUST COMPANY
By:
__________________________
Name: John P. Zori
Title: Vice President
EXHIBIT C
To Custodian Agreement dated as of ______________ between
Bankers Trust Company and BT Insurance Funds Trust.
CUSTODY FEE SCHEDULE
This Exhibit C shall be amended upon delivery by the Custodian of
a new Exhibit C to the Customer and acceptance thereof by the
Customer and shall be effective as of the date of acceptance by
the Customer or a date agreed upon between the Custodian and the
Customer.
EXHIBIT D
To Custodian Agreement dated as of _____________ between
Bankers Trust Company and BT Insurance Funds Trust.
TAX RECLAIMS
Pursuant to Section 18 of the above referred to Custodian
Agreement, the Custodian shall perform the following services with
respect to withholding taxes imposed or which may be imposed on
income from Property in any Account. Terms used herein as defined
terms shall unless otherwise defined have the meanings ascribed to
them in the above referred to Custodian Agreement.
When withholding tax has been deducted with respect to
income from any Property in an Account, the Custodian will
actively pursue on a reasonable efforts basis the reclaim process,
provided that the Custodian shall not be required to institute any
legal or administrative proceeding against any Subcustodian or
other person. The Custodian will provide fully detailed
advices/vouchers to support reclaims submitted to the local
authorities by the Custodian or its designee. In all cases of
withholding, the Custodian will provide full details to the
Customer. If exemption from withholding at the source can be
obtained in the future, the Custodian will notify the Customer and
advise what documentation, if any, is required to obtain the
exemption. Upon receipt of such documentation from the Customer,
the Custodian will file for exemption on the Customer's behalf and
notify the Customer when it has been obtained.
In connection with providing the foregoing service, the
Custodian shall be entitled to apply categorical treatment of the
Customer according to the Customer's nationality, the particulars
of its organization and other relevant details that shall be
supplied by the Customer. It shall be the duty of the Customer to
inform the Custodian of any change in the organization, domicile
or other relevant fact concerning tax treatment of the Customer
and further to inform the Custodian if the Customer is or becomes
the beneficiary of any special ruling or treatment not applicable
to the general nationality and category or entity of which the
Customer is a part under general laws and treaty provisions. The
Custodian may rely on any such information provided by the
Customer.
In connection with providing the foregoing service, the
Custodian may also rely on professional tax services published by
a major international accounting firm and/or advice received from
a Subcustodian in the jurisdictions in question. In addition, the
Custodian may seek the advice of counsel or other professional tax
advisers in such jurisdictions. The Custodian is entitled to
rely, and may act, on information set forth in such services and
on advice received from a Subcustodian, counsel or other
professional tax advisers and shall be without liability to the
Customer for any action reasonably taken or omitted pursuant to
information contained in such services or such advice.
Dated as of: _______________ BT INSURANCE FUNDS TRUST
By:
_________________________
Name:
Title:
BANKERS TRUST COMPANY
By:
__________________________
Name: John P. Zori
Title: Vice President
EXHIBIT E
To Custodian Agreement dated as of __________________
between Bankers Trust Company and BT Insurance Funds Trust.
APPROVED REFERENCE TO CUSTODIAN
"Bankers Trust acts as Custodian of the assets of the Trust and
the Portfolio..."
- 16 -
- 2 -
FORM OF ADMINISTRATION AGREEMENT
THIS ADMINISTRATION AGREEMENT is made as of ,
1996, by and between FIRST DATA INVESTOR SERVICES GROUP, INC., a
Massachusetts corporation ("FDISG"), and BT INSURANCE FUNDS TRUST,
a Massachusetts business trust (the "Trust").
WITNESSETH:
WHEREAS, the Trust desires to retain FDISG to render certain
administrative services to each portfolio of the Trust listed on
Schedule A annexed hereto and incorporated herein, as the same may
be amended from time to time (collectively, the "Funds"); and
WHEREAS, FDISG is willing to render such services;
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, it is agreed between the parties
hereto as follows:
1. Appointment. The Trust hereby appoints FDISG to act
as Administrator on the terms set forth in this Agreement. FDISG
accepts such appointment and agrees to render the services herein
set forth for the compensation herein provided. In the event that
the Trust decides to retain FDISG to act as Administrator
hereunder with respect to one or more portfolios other than the
Funds, the Trust shall notify FDISG in writing. If FDISG is
willing to render such services, it shall notify the Trust in
writing whereupon such portfolio shall become a Fund hereunder.
2. Delivery of Documents. The Trust has furnished FDISG
with copies properly certified or authenticated of each of the
following:
(a) The Trust's Declaration of Trust (the
"Declaration of Trust") filed with the Commonwealth of
Massachusetts and all amendments thereto;
(b) The Trust's Registration Statement on Form N-1A
(the "Registration Statement") under the Securities Act of 1933
and under the 1940 Act, as filed with the Securities and Exchange
Commission ("SEC") on January 26, 1996, relating to shares of
beneficial interest of the Trust, the $.001 par value per share,
and all amendments thereto; and
(c) Each Fund's most recent prospectus and statement
of additional information, and all amendments and supplements
thereto (collectively, the "Prospectuses").
The Trust will furnish FDISG from time to time with copies,
properly certified or authenticated, of all amendments of or
supplements to the foregoing. Furthermore, the Trust will provide
FDISG with any other documents that FDISG may reasonably request
and will notify FDISG as soon as possible of any matter materially
affecting the performance by FDISG of its services under this
Agreement.
3. Duties as Administrator. Subject to the supervision
and direction of the Trust, FDISG, as Administrator, will assist
in supervising various aspects of the Trust's administrative
operations and undertakes to perform the following specific
services:
(a) Maintaining office facilities (which may be in
the offices of FDISG or a corporate affiliate);
(b) Furnishing statistical and research data, data
processing services, clerical services, and internal legal,
executive and administrative services and stationery and office
supplies in connection with the foregoing;
(c) Furnishing corporate secretarial services
including preparation and distribution of materials for Board of
Trustees meetings (Board meetings in excess of five in any
calendar year and shareholder meetings shall involve an additional
reasonable charge as may be agreed upon by the parties hereto);
(d) Accounting and bookkeeping services (including
maintenance of such accounts, books and records of the Trust as
may be required by Section 31(a) of the 1940 Act and the rules
thereunder);
(e) Internal auditing;
(f) Valuing the assets of each Fund and calculating
the net asset value of the shares of each Fund at the close of
trading on the New York Stock Exchange (the "NYSE") on each day on
which the NYSE is open for trading and at such other times as the
Board of Trustees may reasonably request;
(g) Calculating the net income and realized capital
gains or losses of each Fund;
(h) Accumulating information for and, subject to
approval by the Trust's Treasurer, preparing reports to the
Trust's shareholders of record and the SEC including, but not
necessarily limited to, Annual Reports and Semi-Annual Reports on
Form N-SAR;
(i) Preparing and filing various reports or other
documents required by federal, state and other applicable laws and
regulations, other than those filed or required to be filed by the
Trust's investment adviser (the "Adviser") or transfer agent;
(j) Preparing and filing the Trust's tax returns;
(k) Assisting the Adviser in monitoring and
developing compliance procedures for the Trust which will include,
among other matters, procedures to assist the Adviser in
monitoring compliance with each Fund's investment objective,
policies, restrictions, tax matters and applicable laws and
regulations; and
(l) Preparing and furnishing the Trust (at the
Trust's request) with performance information (including yield and
total return information) calculated in accordance with applicable
U.S. securities laws and reporting to external databases such
information as may reasonably be requested; and
(m) Performing the "Routine Projects" and "Special
Projects" on Schedule B annexed hereto and incorporated herein.
In performing all services under this Agreement, FDISG: (a)
shall act in conformity with the Declaration of Trust, the
Prospectuses, the Registration Statements and the instructions and
directions of the Trust or the Adviser, and will conform to and
comply with the requirements of the Investment Company Act of 1940
("1940 Act") and all other applicable federal or state laws and
regulations; and (b) will consult with legal counsel to the Trust,
as necessary or appropriate. Furthermore, FDISG shall not have or
be required to have any authority to supervise the investment or
reinvestment of the securities or other properties which comprise
the assets of the Trust or any of the Funds and shall not provide
any investment advisory services to the Trust or any of the Funds.
4. Compensation and Allocation of Expenses. FDISG shall
bear all expenses in connection with the performance of its
services under this Agreement, except as indicated below.
(a) FDISG may from time to time employ such person
or persons as FDISG may believe to be particularly suited to
assist it in performing services under this Agreement. Such
person or persons may be officers or employees of FDISG. The
compensation of such person or persons shall be paid by FDISG and
no obligation shall be incurred on behalf of the Trust in such
respect.
(b) FDISG shall not be required to pay any of the
following expenses which may be incurred by the Trust: membership
dues in the Investment Company Institute or any similar
organization; investment advisory expenses; costs of printing and
mailing stock certificates, prospectuses, reports and notices;
interest on borrowed money; brokerage commissions; stock exchange
listing fees; taxes and fees payable to Federal, state and other
governmental agencies; fees of Trustees of the Trust who are not
affiliated with FDISG; outside auditing expenses; outside legal
expenses; or other expenses not specified in this Section 4 which
may be properly payable by the Trust.
(c) For the services to be rendered, the facilities
to be furnished and the payments to be made by FDISG, as provided
for in this Agreement, the Funds will pay FDISG on the first
business day of each month a fee for the previous month as set
forth on Schedule C annexed hereto and incorporated herein. The
fee for the period from the date the Registration Statement is
declared effective by the SEC to the end of the month during which
the Registration Statement is declared effective shall be prorated
according to the proportion that such period bears to the full
monthly period. Upon any termination of this Agreement before the
end of any month, the fee for such part of a month shall be
prorated according to the proportion which such period bears to
the full monthly period and shall be payable upon the date of
termination of this Agreement. For the purpose of determining
fees payable to FDISG, the value of each Fund's net assets shall
be computed at the times and in the manner specified in the
Registration Statement.
(d) The Trust shall compensate FDISG for its
services rendered pursuant to this Agreement in accordance with
the fees set forth above. Such fees do not include out-of-pocket
disbursements of FDISG for which FDISG shall be entitled to bill
separately. Out-of-pocket disbursements shall include, but shall
not be limited to, the items specified in Schedule D annexed
hereto and incorporated herein. Schedule D may be modified by
FDISG upon not less than thirty (30) days' prior written notice to
the Trust with the Trust's consent.
(e) FDISG will bill the Trust for out-of-pocket
expenses as soon as practicable after the end of each calendar
month, and such billings will be detailed in accordance with the
out-of-pocket schedule. The Trust will pay to FDISG the amount of
such billing within thirty (30) days of receipt.
(f) The Trust acknowledges that the fees that FDISG
charges the Trust under this Agreement reflect the allocation of
risk between the parties hereto, including the disclaimer of
warranties in Section 7 and the limitations on liability in
Section 5. Modifying the allocation of risk from what is stated
here would affect the fees that FDISG charges, and in
consideration of those fees, the Trust agrees to the stated
allocation of risk.
5. Limitation of Liability.
(a) FDISG, its directors, officers, employees,
shareholders and agents shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the Trust
in connection with the performance of its obligations and duties
under this Agreement, except a loss resulting from FDISG's willful
misfeasance, bad faith or negligence in the performance of such
obligations and duties, or by reason of its reckless disregard
thereof.
(b) Notwithstanding any provision in this Agreement
to the contrary, FDISG's cumulative liability to the Trust for all
losses, claims, suits, controversies, breaches, or damages
("Liability Claims") for any cause whatsoever arising out of or
related to this Agreement and regardless of the form of action or
legal theory, shall not exceed One Million Dollars ($1,000,000),
plus any and all amounts available to FDISG or to the Company in
respect of such Claims under FDISG's liability insurance, which
FDISG agrees continuously to maintain in principal coverage
amounts of at least Five Million Dollars ($5,000,000) at all times
during the term of this Agreement and for at least one (1) year
thereafter. FDISG agrees to furnish initial certification of such
insurance coverage and immediate notification of any modification
or termination of such coverage thereafter.
(c) Each party shall have the duty to mitigate
damages for which the other party may become responsible.
(d) notwithstanding anything in this AGREEMENT TO
THE CONTRARY, IN NO EVENT SHALL EITHER PARTY HERETO, ITS
AFFILIATES OR ANY OF ITS OR THEIR DIRECTORS, OFFICERS, EMPLOYEES,
AGENTS OR SUBCONTRACTORS BE LIABLE UNDER ANY THEORY OF TORT,
CONTRACT, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY FOR
LOST PROFITS, EXEMPLARY, PUNITIVE, SPECIAL, INCIDENTAL, INDIRECT
OR CONSEQUENTIAL DAMAGES, EACH OF WHICH IS HEREBY EXCLUDED BY
AGREEMENT OF THE PARTIES REGARDLESS OF WHETHER SUCH DAMAGES WERE
FORESEEABLE OR WHETHER EITHER PARTY OR ANY ENTITY HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES.
6. Indemnification.
(a) The Trust shall indemnify and hold FDISG harmless
from and against any and all claims, costs, expenses (including
reasonable attorneys' fees), losses, damages, charges, payments
and liabilities of any sort or kind which may be asserted against
FDISG or for which FDISG may be held to be liable in connection
with this Agreement or FDISG's performance hereunder (a "Claim"),
unless such Claim resulted from a negligent act or omission to act
or bad faith by FDISG in the performance of its duties hereunder.
(b) In any case in which the Trust may be asked to
indemnify or hold FDISG harmless, FDISG will notify the Trust in
writing promptly after identifying any situation which it believes
presents or appears likely to present a claim for indemnification
against the Trust although the failure to do so shall not prevent
recovery by FDISG unless the Trust is prejudiced by such failure
to notify and shall keep the Trust advised with respect to all
developments concerning such situation. The Trust shall have the
option to defend FDISG against any Claim which may be the subject
of this indemnification, and, in the event that the Trust so
elects, such defense shall be conducted by counsel chosen by the
Trust and satisfactory to FDISG, and thereupon the Trust shall
take over complete defense of the Claim and FDISG shall sustain no
further legal or other expenses in respect of such Claim. FDISG
will not confess any Claim or make any compromise in any case in
which the Trust will be asked to provide indemnification, except
with the Trust's prior written consent. The obligations of the
parties hereto under this Section 6 shall survive the termination
of this Agreement.
7. EXCLUSION OF WARRANTIES. THIS IS A SERVICE AGREEMENT.
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, FDISG DISCLAIMS
ALL OTHER REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, MADE
TO THE TRUST OR ANY OTHER PERSON, INCLUDING, WITHOUT LIMITATION,
ANY WARRANTIES REGARDING QUALITY, SUITABILITY, MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE (IRRESPECTIVE OF ANY
COURSE OF DEALING, CUSTOM OR USAGE OF TRADE) OF ANY SERVICES OR
ANY GOODS PROVIDED INCIDENTAL TO SERVICES PROVIDED UNDER THIS
AGREEMENT. FDISG DISCLAIMS ANY WARRANTY OF TITLE OR NON-
INFRINGEMENT EXCEPT AS OTHERWISE SET FORTH IN THIS AGREEMENT.
8. Term and Termination of Agreement.
(a) This Agreement shall become effective on the
date first written above and shall continue for a period of one
(1) year (the "Initial Term"), unless earlier terminated pursuant
to the terms of this Agreement. Thereafter, this Agreement shall
automatically be renewed for successive terms of one (1) year
("Renewal Terms") each.
(b) Either party may terminate this Agreement at the
end of the Initial Term or at the end of any subsequent Renewal
Term upon not than less than ninety (90) days' or more than one
hundred-eighty (180) days' prior written notice to the other
party.
(c) In the event a termination notice is given by
the Trust, all expenses associated with the movement of records
and materials and conversion thereof will be borne by the Trust.
(d) If a party hereto is guilty of a material
failure to perform its duties and obligations hereunder (a
"Defaulting Party") resulting in a material loss to the other
party, such other party (the "Non-Defaulting Party") may give
written notice thereof to the Defaulting Party, and if such
material breach shall not have been remedied within thirty (30)
days after such written notice is given, then the Non-Defaulting
Party may terminate this Agreement by giving thirty (30) days'
written notice of such termination to the Defaulting Party. If
FDISG is the Non-Defaulting Party, its termination of this
Agreement shall not constitute a waiver of any other rights or
remedies of FDISG with respect to services performed prior to such
termination or rights of FDISG to be reimbursed for out-of-pocket
expenses. In all cases, termination by the Non-Defaulting Party
shall not constitute a waiver by the Non-Defaulting Party of any
other rights it might have under this Agreement or otherwise
against the Defaulting Party.
9. Modifications and Waivers. No change, termination,
modification, or waiver of any term or condition of the Agreement
shall be valid unless in writing signed by each party. No such
writing shall be effective as against FDISG unless said writing is
executed by an Executive Vice President or the President of FDISG.
A party's waiver of a breach of any term or condition in the
Agreement shall not be deemed a waiver of any subsequent breach of
the same or another term or condition.
10. No Presumption Against Drafter. FDISG and the Trust
have jointly participated in the negotiation and drafting of this
Agreement. The Agreement shall be construed as if drafted jointly
by the Trust and FDISG, and no presumptions arise favoring any
party by virtue of the authorship of any provision of this
Agreement.
11. Publicity. Neither FDISG nor the Trust shall release
or publish news releases, public announcements, advertising or
other publicity relating to this Agreement or to the transactions
contemplated by it without prior review and written approval of
the other party; provided, however, that either party may make
such disclosures as are required by legal, accounting or
regulatory requirements after making reasonable efforts in the
circumstances to consult in advance with the other party.
12. Severability. The parties intend every provision of
this Agreement to be severable. If a court of competent
jurisdiction determines that any term or provision is illegal or
invalid for any reason, the illegality or invalidity shall not
affect the validity of the remainder of this Agreement. In such
case, the parties shall in good faith modify or substitute such
provision consistent with the original intent of the parties.
Without limiting the generality of this paragraph, if a court
determines that any remedy stated in this Agreement has failed of
its essential purpose, then all other provisions of this
Agreement, including the limitations on liability and exclusion of
damages, shall remain fully effective.
13. Miscellaneous.
(a) Any notice or other instrument authorized or
required by this Agreement to be given in writing to the Trust or
FDISG shall be sufficiently given if addressed to the party and
received by it at its office set forth below or at such other
place as it may from time to time designate in writing.
To the Trust:
c/o Bankers Trust Company
Four Albany Street
New York, New York 10006
Attention: Brian Wixted
With a copy to:
Burton Leibert, Esq.
Willkie Farr & Gallagher
153 East 53rd Street
New York, New York 10022
To FDISG:
First Data Investor Services Group, Inc.
53 State Street
Boston, Massachusetts 02109-2873
Attention: Vincent Fabiani
(b) This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective
successors and permitted assigns and is not intended to confer
upon any other person any rights or remedies hereunder. This
Agreement may not be assigned or otherwise transferred by either
party hereto, without the prior written consent of the other
party, which consent shall not be unreasonably withheld; provided,
however, that FDISG may, in its sole discretion, assign all its
right, title and interest in this Agreement to an affiliate,
parent or subsidiary. FDISG may, in its sole discretion, engage
subcontractors to perform any of the obligations contained in this
Agreement to be performed by FDISG, provided however, that FDISG
shall be as fully responsible to the Trust for the acts and
omissions of any subcontractor as it is for its own acts and
omissions.
(c) The laws of the Commonwealth of Massachusetts,
excluding the laws on conflicts of laws, shall govern the
interpretation, validity, and enforcement of this Agreement. All
actions arising from or related to this Agreement shall be brought
in the state and federal courts sitting in the City of Boston, and
FDISG and the Trust hereby submit themselves to the exclusive
jurisdiction of those courts.
(d) This Agreement may be executed in any number of
counterparts each of which shall be deemed to be an original and
which collectively shall be deemed to constitute only one
instrument.
(e) The captions of this Agreement are included for
convenience of reference only and in no way define or delimit any
of the provisions hereof or otherwise affect their construction or
effect.
14. Confidentiality.
(a) The parties agree that the Proprietary
Information (defined below) and the contents of this Agreement
(collectively "Confidential Information") are confidential
information of the parties and their respective licensers. The
Trust and FDISG shall exercise reasonable care to safeguard the
confidentiality of the Confidential Information of the other. The
Trust and FDISG may each use the Confidential Information only to
exercise its rights or perform its duties under this Agreement.
Except as required by law, the Trust and FDISG shall not
duplicate, sell or disclose to others the Confidential Information
of the other, in whole or in part, without the prior written
permission of the other party. The Trust and FDISG may, however,
disclose Confidential Information to its employees who have a need
to know the Confidential Information to perform work for the
other, provided that each shall use reasonable efforts to ensure
that the Confidential Information is not duplicated or disclosed
by its employees in breach of this Agreement. The Trust and FDISG
may also disclose the Confidential Information to independent
contractors, auditors and professional advisors, provided they
first agree in writing to be bound by the confidentiality
obligations substantially similar to this Section 14.
Notwithstanding the previous sentence, in no event shall either
the Trust or FDISG disclose the Confidential Information to any
competitor of the other without specific, prior written consent.
(b) Proprietary Information means:
(i) any data or information that is completely
sensitive material, and not generally known to the public,
including, but not limited to, information about product plans,
marketing strategies, finance, operations, customer relationships,
customer profiles, sales estimates, business plans, and internal
performance results relating to the past, present or future
business activities of the Trust or FDISG, their respective
subsidiaries and affiliated companies and the customers, clients
and suppliers of any of them;
(ii) any scientific or technical information,
design, process, procedure, formula, or improvement that is
commercially valuable and secret in the sense that its
confidentiality affords the Trust or FDISG a competitive advantage
over its competitors; and
(iii) all confidential or proprietary concepts,
documentation, reports, data, specifications, computer software,
source code, object code, flow charts, databases, inventions,
know-how, show-how and trade secrets, whether or not patentable or
copyrightable.
(c) Confidential Information includes, without
limitation, all documents, inventions, substances, engineering and
laboratory notebooks, drawings, diagrams, specifications, bills of
material, equipment, prototypes and models, and any other tangible
manifestation of the foregoing of either party hereto which now
exist or come into the control or possession of the other party
hereto.
(d) The Trust acknowledges that breach of the
restrictions on use, dissemination or disclosure of any
Confidential Information would result in immediate and irreparable
harm, and money damages would be inadequate to compensate FDISG
for that harm. FDISG shall be entitled to equitable relief, in
addition to all other available remedies, to redress any such
breach.
15. Force Majeure. No party shall be liable for any
default or delay in the performance of its obligations under this
Agreement if and to the extent such default or delay is caused,
directly or indirectly, by (i) fire, flood, elements of nature or
other acts of God; (ii) any outbreak or escalation of hostilities,
war, riots or civil disorders in any country, (iii) any act or
omission of the other party or any governmental authority; or (iv)
nonperformance by a third party or any similar cause beyond the
reasonable control of such party, including without limitation,
failures or fluctuations in telecommunications or other equipment.
In any such event, the non-performing party shall be excused from
any further performance and observance of the obligations so
affected only for so long as such circumstances prevail and such
party continues to use commercially reasonable efforts to
recommence performance or observance as soon as practicable.
16. Limitation of Trustee/Shareholder Liability. A copy
of the Declaration of Trust of the Trust dated january 19, 1996 is
on file with the Secretary of the Commonwealth of Massachusetts,
and notice is hereby given that this instrument is executed on
behalf of the Trustees of the Trust as Trustees and not
individually and that the obligations of this instrument are not
binding upon any of the Trustees or the Trust's shareholders
individually but are binding only upon the assets and property of
the Trust.
17. Entire Agreement. This Agreement, including all
Schedules hereto, constitutes the entire agreement between the
parties with respect to the subject matter hereof and supersedes
all prior and contemporaneous proposals, agreements, contracts,
representations, and understandings, whether written or oral,
between the parties with respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be duly executed and delivered by their duly
authorized officers as of the date first written above.
FIRST DATA INVESTOR SERVICES GROUP, INC.
By:
Name:
Title:
bankers trust company
By:
Name:
Title:
SCHEDULE A
Names of Funds
bt insurance funds trust 440 FINANCIAL DISTRIBUTORS, INC.
By:_____________________________
By:_______________________________
Name:___________________________
Name:_____________________________
Title:____________________________
Title:______________________________
schedule b
Fund Accounting and Administrative Services
Routine Projects
o Daily, Weekly, and Monthly Reporting
o Portfolio and General Ledger Accounting
o Daily Pricing of all Securities
o Daily Valuation and NAV Calculation
o Comparison of NAV to market movement
o Review of price tolerance/fluctuation report
o Research items appearing on the price exception report
o Weekly cost monitoring along with market-to-market
valuations in accordance with Rule 2a7
o Preparation of monthly ex-dividend monitor
o Daily cash reconciliation with the custodian bank
o Daily updating of price and rate information to the Transfer
Agent/Insurance Agent
o Daily support and report delivery to Portfolio Management
o Daily calculation of fund advisor fees and waivers
o Daily calculation of distribution rates
o Daily maintenance of each fund's general ledger including
expense accruals
o Daily price notification to other vendors as required
o Calculation of 30-day adjusted SEC yields
o Preparation of month-end reconciliation package
o Monthly reconciliation of fund expense records
o Preparation of monthly pay down gain/loss summaries
o Preparation of all annual and semi-annual audit work papers
o Preparation and Printing of Financial Statements
o Providing Shareholder Tax Information to Transfer Agent
o Producing Drafts of IRS and State Tax Returns
o Treasury Services including:
Provide Officer for the fund
Expense Accrual Monitoring
Determination of Dividends
Prepare materials for review by the board, e.g., 2a-
7,10f-3, 17a-7, 17e-1
Tax and Financial Counsel
o Monthly Compliance Testing including section 817H
o Provide 1940 Act attorney to assist in organization
o Prepare agenda and background materials for legal approval
at Board Meetings; make
presentations where appropriate; prepare minutes; follow up
on issues
o Review and filing of Form N-SAR
o Review and filing of Annual and Semi-Annual Financial
Reports
o Assistance in Preparation of Fund Registration Statements
o Review of all Sales Material and Advertising
o Coordinate all aspects of the printing and mailing process
with outside printers for all
shareholder publication
schedule b (CONTINUED)
o Support for all quarterly board meetings
o Preparation of proxy materials for one meeting per year
o Annual update Post-Effective Amendment (PEA)
o Prospectus supplements as needed
o Consultations regarding legal issues as needed
o SEC audit report
o Arrange insurance coverage
o Support for one special board meeting per year and consent
votes where needed
o One additional PEA (other than annual update)
o One exemptive order application
o Assist with marketing strategy and product development
Special Projects*
o Proxy material preparation for additional meetings beyond
one per year
o N-14 preparation (merger document)
o Additional PEAs beyond two per year
o Prospectus simplification
o Additional exemptive order applications beyond one per year
o Extraordinary non-recurring projects - e.g., arranging CDSC
financing programs
o Basic sales, mutual funds, and product training to branch
and sales representatives
*Charged on a project-by-project basis.
schedule c
Fees (On an Annual Basis)
$70,000 per Fund per annum, plus
2.0 basis points on first $2 billion in aggregate assets
1.0 basis point on next $3 billion in aggregate assets
0.75 basis point on excess
Start-Up Fees
$20,000 per Fund start-up fee
fdisg reserves the right to renegotiate the fees set forth on this
schedule c and in section 4 of the agreement should the actual
services required vary materially from the assumptions provided.
It is specifically understood by the parties that fees for those
services provided by fdisg which are not described in section 3 of
the agreement or which are not included on Schedule B under
"Routine Projects" will be charged separately by fdisg and are not
included in the fees referenced above.
SCHEDULE D
Out-of-Pocket Expenses
Out-of-pocket expenses include, but are not limited to, the
following:
- - Overnight delivery and courier service
- - Telephone and telecommunications charges (including fax)
- - Terminals, transmitting lines and any expenses incurred in
connection with such lines
- - Any other unusual expenses in association with the services
rendered under this Agreement, such as excessive duplicating
charges
- - Pricing services
- - Vendor set-up charges for Blue Sky services
FDISG reserves the right to renegotiate the fees set forth on this
Schedule D and in Section 4 of the Agreement should the actual
services required vary materially from the assumptions provided.
g:\shared\bankers\agmts\admin5.doc 5
g:\shared\bankers\agmts\admin5.doc
TRANSFER AGENCY AND SERVICES AGREEMENT
THIS AGREEMENT, dated as of this day of ,
1996 between BT Insurance Funds Trust (the "Fund"), a
Massachusetts business trust having its principal place of
business at 53 State Street Boston Massachusetts 02109 and FIRST
DATA INVESTOR SERVICES GROUP, INC. ("FDISG"), a Massachusetts
corporation with principal offices at 4400 Computer Drive
Westboro, Massachusetts 01581.
WITNESSETH
WHEREAS, the Fund desires to appoint FDISG as its transfer
agent, dividend disbursing agent and agent in connection with
certain other activities; and
WHEREAS, FDISG desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants and
promises hereinafter set forth, the Fund and FDISG agree as
follows:
Article 1 Definitions.
1.1 Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the
following meanings:
(a) "Articles of Incorporation" shall mean the Articles of
Incorporation, Declaration of Trust, or other similar
organizational document as the case may be, of the Fund as the
same may be amended from time to time.
(b) "Authorized Person" shall be deemed to include (i) any
authorized officer of the Fund; or (ii) any person, whether or not
such person is an officer or employee of the Fund, duly authorized
to give Oral Instructions or Written Instructions on behalf of the
Fund as indicated in writing to FDISG from time to time.
(c) "Board of Directors" shall mean the Board of Directors or
Board of Trustees of the Fund, as the case may be.
(d) "Commission" shall mean the Securities and Exchange
Commission.
(e) "Custodian" refers to any custodian or subcustodian of
securities and other property which the Fund may from time to time
deposit, or cause to be deposited or held under the name or
account of such a custodian pursuant to a Custodian Agreement.
(f) "1934 Act" shall mean the Securities Exchange Act of 1934
and the rules and regulations promulgated thereunder, all as
amended from time to time.
(g) "1940 Act" shall mean the Investment Company Act of 1940 and
the rules and regulations promulgated thereunder, all as amended
from time to time.
(h) "Oral Instructions" shall mean instructions, other than
Written Instructions, actually received by FDISG from a person
reasonably believed by FDISG to be an Authorized Person;
(i) "Prospectus" shall mean the most recently dated Fund
Prospectus and Statement of Additional Information, including any
supplements thereto if any, which has become effective under the
Securities Act of 1933 and the 1940 Act.
(j) "Shares" refers collectively to such shares of capital stock
or beneficial interest, as the case may be, or class thereof, of
the Fund as may be issued from time to time.
(k) "Shareholder" shall mean a record owner of Shares of the
Fund.
(l) "Written Instructions" shall mean a written communication
signed by a person reasonably believed by FDISG to be an
Authorized Person and actually received by FDISG. Written
Instructions shall include manually executed originals and
authorized electronic transmissions, including telefacsimile of a
manually executed original or other process.
Article 2 Appointment of FDISG.
The Fund hereby appoints and constitutes FDISG as transfer agent
and dividend disbursing agent for Shares of the Fund and as
shareholder servicing agent for the Fund and FDISG hereby accepts
such appointments and agrees to perform the duties hereinafter set
forth.
Article 3 Duties of FDISG.
3.1 FDISG shall be responsible for:
(a) Administering and/or performing the customary services of a
transfer agent; acting as service agent in connection with
dividend and distribution functions; and for performing
shareholder account and administrative agent functions in
connection with the issuance, transfer and redemption or
repurchase (including coordination with the Custodian) of Shares
of the Fund, as more fully described in the written schedule of
Duties of FDISG annexed hereto as Schedule A and incorporated
herein, and in accordance with the terms of the Prospectus of the
Fund, applicable law and the procedures established from time to
time between FDISG and the Fund.
(b) Recording the issuance of Shares and maintaining pursuant to
Rule 17Ad-10(e) under the 1934 Act a record of the total number of
Shares of the Fund which are authorized, based upon data provided
to it by the Fund, and issued and outstanding. FDISG shall
provide the Fund on a regular basis with the total number of
Shares which are authorized and issued and outstanding and shall
have no obligation, when recording the issuance of Shares, to
monitor the issuance of such Shares or to take cognizance of any
laws relating to the issue or sale of such Shares, which functions
shall be the sole responsibility of the Fund.
(c) Notwithstanding any of the foregoing provisions of this
Agreement, FDISG shall be under no duty or obligation to inquire
into, and shall not be liable for: (i) the legality of the
issuance or sale of any Shares; (ii) the legality of the
redemption of any Shares, or the propriety of the amount to be
paid therefor; (iii) the legality of the declaration of any
dividend by the Board of Directors, or the legality of the
issuance of any Shares in payment of any dividend; or (iv) the
legality of any recapitalization or readjustment of the Shares.
3.2 In addition to the duties set forth herein, FDISG shall
perform such other duties and functions, and shall be paid such
amounts therefor, as may from time to time be agreed upon in
writing between the Fund and FDISG.
Article 4 Recordkeeping and Other Information.
4.1 FDISG shall create and maintain all records required of it
pursuant to its duties hereunder and as set forth in Schedule A in
accordance with all applicable laws, rules and regulations,
including records required by Section 31(a) of the 1940 Act.
Where applicable, such records shall be maintained by FDISG for
the periods and in the places required by Rule 31a-2 under the
1940 Act.
4.2 To the extent required by Section 31 of the 1940 Act, FDISG
agrees that all such records prepared or maintained by FDISG
relating to the services to be performed by FDISG hereunder are
the property of the Fund and will be preserved, maintained and
made available in accordance with such section, and will be
surrendered promptly to the Fund on and in accordance with the
Fund's request.
4.3 In case of any requests or demands for the inspection of
Shareholder records of the Fund, FDISG will endeavor to notify the
Fund of such request and secure Written Instructions as to the
handling of such request. FDISG reserves the right, however, to
exhibit the Shareholder records to any person whenever it is
advised by its counsel that it may be held liable for the failure
to comply with such request.
Article 5 Fund Instructions.
5.1 FDISG will have no liability when acting upon Written or
Oral Instructions believed to have been executed or orally
communicated by an Authorized Person and will not be held to have
any notice of any change of authority of any person until receipt
of a Written Instruction thereof from the Fund. FDISG will also
have no liability when processing Share certificates with the
proper countersignature of FDISG which it reasonably believes to
bear the proper manual or facsimile signatures of the officers of
the Fund.
5.2 At any time, FDISG may request Written Instructions from the
Fund and may seek advice from legal counsel for the Fund (with the
Fund's consent), or its own legal counsel, with respect to any
matter arising in connection with this Agreement, and subject to
Section 11.1, it shall not be liable for any action taken or not
taken or suffered by it in good faith in accordance with such
Written Instructions or in accordance with the opinion of counsel
for the Fund. Written Instructions requested by FDISG will be
provided by the Fund within a reasonable period of time.
5.3 FDISG, its officers, agents or employees, shall accept Oral
Instructions or Written Instructions given to them by any person
representing or acting on behalf of the Fund only if said
representative is an Authorized Person. The Fund agrees that all
Oral Instructions shall be followed within one business day by
confirming Written Instructions, and that the Fund's failure to so
confirm shall not impair in any respect FDISG's right to rely on
Oral Instructions.
Article 6 Compensation.
6.1 The Fund will compensate FDISG for the performance of its
obligations hereunder in accordance with the fees set forth in the
written Fee Schedule annexed hereto as Schedule B and incorporated
herein.
6.2 In addition to those fees set forth in Section 6.1 above,
the Fund agrees to pay, and will be billed separately for,
out-of-pocket expenses incurred by FDISG in the performance of its
duties hereunder. Out-of-pocket expenses shall include, but shall
not be limited to, the items specified in the written schedule of
out-of-pocket charges annexed hereto as Schedule C and
incorporated herein. Schedule C may be modified by written
agreement between the parties. Unspecified out-of-pocket expenses
shall be limited to those out-of-pocket expenses approved in
writing by the Fund and reasonably incurred by FDISG in the
performance of its obligations hereunder.
6.3 The Fund agrees to pay all fees and out-of-pocket expenses
within fifteen (15) days following the receipt of the respective
invoice.
6.4 The Fund acknowledges that the fees that FDISG charges the
Fund under this Agreement reflect the allocation of risk between
the parties, including the disclaimer of warranties in Section 9.3
and the limitations on liability and exclusion of remedies in
Section 11.2 and Article 12. Modifying the allocation of risk
from what is stated here would affect the fees that FDISG charges,
and in consideration of those fees, the Fund agrees to the stated
allocation of risk.
Article 7 Documents.
In connection with the appointment of FDISG, the Fund shall, on or
before the date this Agreement goes into effect, but in any case
within a reasonable period of time for FDISG to prepare to perform
its duties hereunder, deliver or caused to be delivered to FDISG
the documents set forth in the written schedule of Fund Documents
annexed hereto as Schedule D.
Article 8 Transfer Agent System.
8.1 FDISG shall retain title to and ownership of any and all
data bases, computer programs, screen formats, report formats,
interactive design techniques, derivative works, inventions,
discoveries, patentable or copyrightable matters, concepts,
expertise, patents, copyrights, trade secrets, and other related
legal rights utilized by FDISG in connection with the services
provided by FDISG to the Fund herein (the "FDISG System").
8.2 FDISG hereby grants to the Fund a limited license to the
FDISG System for the sole and limited purpose of having FDISG
provide the services contemplated hereunder and nothing contained
in this Agreement shall be construed or interpreted otherwise and
such license shall immediately terminate upon the termination of
this Agreement.
Article 9 Representations and Warranties.
9.1 FDISG represents and warrants to the Fund that:
(a) it is a corporation duly organized, existing and in good
standing under the laws of the Commonwealth of Massachusetts;
(b) it is empowered under applicable laws and by its Articles of
Incorporation and By-Laws to enter into and perform this
Agreement;
(c) all requisite corporate proceedings have been taken to
authorize it to enter into this Agreement;
(d) it is duly registered with its appropriate regulatory agency
as a transfer agent and such registration will remain in effect
for the duration of this Agreement; and
(e) it has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and
obligations under this Agreement.
9.2 The Fund represents and warrants to FDISG that:
(a) it is duly organized, existing and in good standing under
the laws of the jurisdiction in which it is organized;
(b) it is empowered under applicable laws and by its Article of
Incorporation and By-Laws to enter into this Agreement;
(c) all corporate proceedings required by said Articles of
Incorporation, By-Laws and applicable laws have been taken to
authorize it to enter into this Agreement;
(d) a registration statement under the Securities Act of 1933,
as amended, and the 1940 Act on behalf of the Fund is currently
effective and will remain effective with respect to all Shares of
the Fund being offered for sale and to the extent required by law,
all appropriate state securities law filings have been made and
will continue to be made, with respect to all Shares of the Fund
being offered for sale; and
(e) all outstanding Shares are validly issued, fully paid and
non-assessable and when Shares are hereafter issued in accordance
with the terms of the Fund's Articles of Incorporation and its
Prospectus, such Shares shall be validly issued, fully paid and
non-assessable.
9.3 THIS IS A SERVICE AGREEMENT. EXCEPT AS EXPRESSLY PROVIDED
IN THIS AGREEMENT, FDISG DISCLAIMS ALL OTHER REPRESENTATIONS OR
WARRANTIES, EXPRESS OR IMPLIED, MADE TO THE FUND OR ANY OTHER
PERSON, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES REGARDING
QUALITY, SUITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE OR OTHERWISE (IRRESPECTIVE OF ANY COURSE OF DEALING,
CUSTOM OR USAGE OF TRADE) OF ANY SERVICES OR ANY GOODS PROVIDED
INCIDENTAL TO SERVICES PROVIDED UNDER THIS AGREEMENT. FDISG
DISCLAIMS ANY WARRANTY OF TITLE OR NON-INFRINGEMENT EXCEPT AS
OTHERWISE SET FORTH IN THIS AGREEMENT.
Article 10 Indemnification.
10.1 FDISG shall not be responsible for and the Fund shall
indemnify and hold FDISG harmless from and against any and all
claims, costs, expenses (including reasonable attorneys' fees),
losses, damages, charges, payments and liabilities of any sort or
kind which may be asserted against FDISG or for which FDISG may be
held to be liable (a "Claim") arising out of or attributable to
any of the following:
(a) any actions of FDISG required to be taken pursuant to this
Agreement unless such Claim resulted from a negligent act or
omission to act or bad faith by FDISG in the performance of its
duties hereunder;
(b) FDISG's reasonable reliance on, or reasonable use of
information, data, records and documents (including but not
limited to magnetic tapes, computer printouts, hard copies and
microfilm copies) received by FDISG from the Fund, or any
authorized third party acting on behalf of the Fund in the
performance of FDISG's duties and obligations hereunder;
(c) the reliance on, or the implementation of, any Written or
Oral Instructions or any other instructions or requests of the
Fund;
(d) the offer or sale of shares in violation of any requirement
under the securities laws or regulations of any state that such
shares be registered in such state or in violation of any stop
order or other determination or ruling by any state with respect
to the offer or sale of such shares in such state; and
(e) the Fund's refusal or failure to materially comply with the
terms of this Agreement, or any Claim which arises out of the
Fund's negligence or misconduct or the material breach of any
representation or warranty of the Fund made herein.
10.2 In any case in which the Fund may be asked to indemnify or
hold FDISG harmless, FDISG will notify the Fund in writing
promptly after identifying any situation which it believes
presents or appears likely to present a claim for indemnification
against the Fund although the failure to do so shall not prevent
recovery by FDISG and shall keep the Fund advised with respect to
all developments concerning such situation. The Fund shall have
the option to defend FDISG against any Claim which may be the
subject of this indemnification, and, in the event that the Fund
so elects, such defense shall be conducted by counsel chosen by
the Fund and satisfactory to FDISG, and thereupon the Fund shall
take over complete defense of the Claim and FDISG shall sustain no
further legal or other expenses in respect of such Claim. FDISG
will not confess any Claim or make any compromise in any case in
which the Fund will be asked to provide indemnification, except
with the Fund's prior written consent. The obligations of the
parties hereto under this Article 10 shall survive the termination
of this Agreement.
10.3 Any claim for indemnification under this Agreement must be
made prior to the earlier of:
(a) one year after the Fund becomes aware of the event for which
indemnification is claimed; or
(b) one year after the earlier of the termination of this
Agreement or the expiration of the term of this Agreement.
10.4 Except for remedies that cannot be waived as a matter of law
(and injunctive or provisional relief), the provisions of this
Article 10 shall be FDISGs sole and exclusive remedy for claims
or other actions or proceedings to which the Funds
indemnification obligations pursuant to this Article 10 may apply.
Article 11 Standard of Care.
11.1 FDISG shall at all times act in good faith and agrees to use
its best efforts within commercially reasonable limits to ensure
the accuracy of all services performed under this Agreement, but
assumes no responsibility for loss or damage to the Fund unless
said errors are caused by FDISG's own negligence, bad faith or
willful misconduct or that of its employees.
11.2 Notwithstanding any provision in this Agreement to the
contrary, FDISG's cumulative liability (to the Fund) for all
Claims arising out of or related to this Agreement and regardless
of the form of action or legal theory shall not exceed one million
($1,000,000) dollars plus any and all amounts available to FDISG
or the Fund in respect of such Claims under FDISG's liability
insurance, which FDISG agrees to maintain in principal coverage
amounts of at least five million dollars ($5,000,000) at all times
during the term of this Agreement. FDISG agrees to furnish
initial certification of such insurance coverage upon the
execution of this Agreement and subsequent certification of such
coverage upon the request of the Fund. Fund understands the
limitation on FDISG's damages to be a reasonable allocation of
risk and Fund expressly consents with respect to such allocation
of risk. In allocating risk under the Agreement, the parties
agree that the damage limitation set forth above shall apply to
any alternative remedy ordered by a court in the event such court
determines that sole and exclusive remedy provided for in the
Agreement fails of its essential purpose.
11.3 Each party shall have the duty to mitigate damages for
which the other party may become responsible.
Article 12 Consequential Damages.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO
EVENT SHALL EITHER PARTY, ITS AFFILIATES OR ANY OF ITS OR THEIR
DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE
UNDER ANY THEORY OF TORT, CONTRACT, STRICT LIABILITY OR OTHER
LEGAL OR EQUITABLE THEORY FOR LOST PROFITS, EXEMPLARY, PUNITIVE,
SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, EACH OF
WHICH IS HEREBY EXCLUDED BY AGREEMENT OF THE PARTIES REGARDLESS OF
WHETHER SUCH DAMAGES WERE FORESEEABLE OR WHETHER EITHER PARTY OR
ANY ENTITY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Article 13 Term and Termination.
13.1 This Agreement shall be effective on the date first written
above and shall continue for a period of one (1) year (the
"Initial Term").
13.2 Upon the expiration of the Initial Term, this Agreement
shall automatically renew for successive terms of one (1) years
("Renewal Terms") each, unless the Fund or FDISG provides written
notice to the other of its intent not to renew. Such notice must
be received not less than ninety (90) days and not more than one-
hundred eighty (180) days prior to the expiration of the Initial
Term or the then current Renewal Term.
13.3 In the event a termination notice is given by the Fund, all
expenses associated with movement of records and materials and
conversion thereof to a successor transfer agent will be borne by
the Fund.
13.4 If a party hereto is guilty of a material failure to perform
its duties and obligations hereunder (a "Defaulting Party") the
other party (the "Non-Defaulting Party") may give written notice
thereof to the Defaulting Party, and if such material breach shall
not have been remedied within thirty (30) days after such written
notice is given, then the Non-Defaulting Party may terminate this
Agreement by giving thirty (30) days written notice of such
termination to the Defaulting Party. If FDISG is the
Non-Defaulting Party, its termination of this Agreement shall not
constitute a waiver of any other rights or remedies of FDISG with
respect to services performed prior to such termination of rights
of FDISG to be reimbursed for out-of-pocket expenses. In all
cases, termination by the Non-Defaulting Party shall not
constitute a waiver by the Non-Defaulting Party of any other
rights or remedies it might have under this Agreement or otherwise
against the Defaulting Party.
Article 14 Confidentiality.
14.1 The parties agree that the Proprietary Information (defined
below) and the contents of this Agreement (collectively
"Confidential Information") are confidential information of the
parties and their respective licensors. The Fund and FDISG shall
exercise at least the same degree of care, but not less than
reasonable care, to safeguard the confidentiality of the
Confidential Information of the other as it would exercise to
protect its own confidential information of a similar nature. The
Fund and FDISG may use the Confidential Information only to
exercise its rights under this Agreement. Except as required by
law, the Fund and FDISG shall not duplicate, sell or disclose to
others the Confidential Information of the other, in whole or in
part, without the prior written permission of the other party.
The Fund and FDISG may, however, disclose Confidential Information
to its employees who have a need to know the Confidential
Information to perform work for the other, provided that each
shall use reasonable efforts to ensure that the Confidential
Information is not duplicated or disclosed by its employees in
breach of this Agreement. The Fund and FDISG may also disclose
the Confidential Information to independent contractors, auditors,
and professional advisors, provided they first agree in writing to
be bound by the confidentiality obligations substantially similar
to this Section 14.1. Notwithstanding the previous sentence, in
no event shall either the Fund or FDISG disclose the Confidential
Information to any competitor of the other without specific, prior
written consent.
14.2 Proprietary Information means:
(a) any data or information that is competitively sensitive
material, and not generally known to the public, including, but
not limited to, information about product plans, marketing
strategies, finance, operations, customer relationships, customer
profiles, sales estimates, business plans, and internal
performance results relating to the past, present or future
business activities of the Fund or FDISG, their respective
subsidiaries and affiliated companies and the customers, clients
and suppliers of any of them;
(b) any scientific or technical information, design, process,
procedure, formula, or improvement that is commercially valuable
and secret in the sense that its confidentiality affords the Fund
or FDISG a competitive advantage over its competitors; and
(c) all confidential or proprietary concepts, documentation,
reports, data, specifications, computer software, source code,
object code, flow charts, databases, inventions, know-how,
show-how and trade secrets, whether or not patentable or
copyrightable.
14.3 Confidential Information includes, without limitation, all
documents, inventions, substances, engineering and laboratory
notebooks, drawings, diagrams, specifications, bills of material,
equipment, prototypes and models, and any other tangible manifes-
tation of the foregoing of either party which now exist or come
into the control or possession of the other.
Article 15 Force Majeure.
15.1 No party shall be liable for any default or delay in the
performance of its obligations under this Agreement if and to the
extent such default or delay is caused, directly or indirectly, by
(i) fire, flood, elements of nature or other acts of God; (ii) any
outbreak or escalation of hostilities, war, riots or civil
disorders in any country, (iii) any act or omission of the other
party or any governmental authority; or (iv) nonperformance by a
third party or any similar cause beyond the reasonable control of
such party, including without limitation, failures or fluctuations
in telecommunications or other equipment. In any such event, the
non-performing party shall be excused from any further performance
and observance of the obligations so affected only for as long as
such circumstances prevail and such party continues to use
commercially reasonable efforts to recommence performance or
observance as soon as practicable.
15.2 Notwithstanding the foregoing Section 15.1, FDSIG agrees to
maintain a Business Contingency Plan for the purpose of mitigating
the disruption of the services provided to the Fund hereunder
which may result from an uncontrollable event as described in
Section 15.1.
Article 16 Assignment and Subcontracting.
This Agreement, its benefits and obligations shall be binding upon
and inure to the benefit of the parties hereto and their
respective successors and permitted assigns. This Agreement may
not be assigned or otherwise transferred by either party hereto,
without the prior written consent of the other party, which
consent shall not be unreasonably withheld; provided, however,
that FDISG may, in its sole discretion, assign all its right,
title and interest in this Agreement to an affiliate, parent or
subsidiary. FDISG may, in its sole discretion, engage
subcontractors to perform any of the obligations contained in this
Agreement to be performed by FDISG, provided however, that FDISG
shall be as fully responsible to the Fund for the acts and
omissions of any subcontractor as it is for its own acts and
omissions.
Article 17 Notice.
Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Fund or FDISG, shall be
sufficiently given if addressed to that party and received by it
at its office set forth below or at such other place as it may
from time to time designate in writing.
To the Fund:
Attention: __________________
To FDISG:
First Data Investor Services Group, Inc.
4400 Computer Drive
Westboro, Massachusetts 01581
Attention: President
with a copy to FDISG's General Counsel
Article 18 Governing Law/Venue.
The laws of the Commonwealth of Massachusetts, excluding the laws
on conflicts of laws, shall govern the interpretation, validity,
and enforcement of this agreement. All actions arising from or
related to this Agreement shall be brought in the state and
federal courts sitting in the City of Boston, and FDISG and Client
hereby submit themselves to the exclusive jurisdiction of those
courts.
Article 19 Counterparts.
This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original; but such counterparts
shall, together, constitute only one instrument.
Article 20 Captions.
The captions of this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions
hereof or otherwise affect their construction or effect.
Article 21 Publicity.
Neither FDISG nor the Fund shall release or publish news releases,
public announcements, advertising or other publicity relating to
this Agreement or to the transactions contemplated by it without
the prior review and written approval of the other party;
provided, however, that either party may make such disclosures as
are required by legal, accounting or regulatory requirements after
making reasonable efforts in the circumstances to consult in
advance with the other party.
Article 22 Relationship of Parties/Non-Solicitation.
22.1 The parties agree that they are independent contractors and
not partners or co-venturers and nothing contained herein shall be
interpreted or construed otherwise.
22.2 During the term of this Agreement and for one (1) year
afterward, the neither party shall recruit, solicit, employ or
engage, for the itself or others, the employees of the other
party.
Article 23 Limitation of Trustee/Shareholder Liability.
A copy of the Declaration of Trust of the Fund is on file with the
Secretary of the Commonwealth of Massachusetts, and notice is
hereby given that this instrument is executed on behalf of the
Trustees of the Fund as Trustees and not individually and that the
obligations of this instrument are not binding upon any of the
Trustees or Shareholders individually but are binding only upon
the assets and property of the Fund.
Article 24 Entire Agreement; Severability.
24.1 This Agreement, including Schedules, Addenda, and Exhibits
hereto, constitutes the entire Agreement between the parties with
respect to the subject matter hereof and supersedes all prior and
contemporaneous proposals, agreements, contracts, representations,
and understandings, whether written or oral, between the parties
with respect to the subject matter hereof. No change,
termination, modification, or waiver of any term or condition of
the Agreement shall be valid unless in writing signed by each
party. No such writing shall be effective as against FDISG unless
said writing is executed by a Senior Vice President, Executive
Vice President, or President of FDISG. A partys waiver of a
breach of any term or condition in the Agreement shall not be
deemed a waiver of any subsequent breach of the same or another
term or condition.
24.2 The parties intend every provision of this Agreement to be
severable. If a court of competent jurisdiction determines that
any term or provision is illegal or invalid for any reason, the
illegality or invalidity shall not affect the validity of the
remainder of this Agreement. In such case, the parties shall in
good faith modify or substitute such provision consistent with the
original intent of the parties. Without limiting the generality
of this paragraph, if a court determines that any remedy stated in
this Agreement has failed of its essential purpose, then all other
provisions of this Agreement, including the limitations on
liability and exclusion of damages, shall remain fully effective.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their duly authorized officers, as of the day
and year first above written.
[Name of Fund]
By:
Title:
FIRST DATA INVESTOR SERVICES GROUP, INC.
By:
Title:
Schedule A
DUTIES OF FDISG
1. Shareholder Information. FDISG shall maintain a record
of the number of Shares held by each Shareholder of record which
shall include name, address, taxpayer identification and which
shall indicate whether such Shares are held in certificates or
uncertificated form.
2. Shareholder Services. FDISG shall respond as appropriate
to all inquiries and communications from Shareholders relating to
Shareholder accounts with respect to its duties hereunder and as
may be from time to time mutually agreed upon between FDISG and
the Fund.
3. Mailing Communications to Shareholders; Proxy Materials.
FDISG will address and mail to Shareholders of the Fund, all
reports to Shareholders, dividend and distribution notices and
proxy material for the Fund's meetings of Shareholders. In
connection with meetings of Shareholders, FDISG will prepare
Shareholder lists, mail and certify as to the mailing of proxy
materials, process and tabulate returned proxy cards, report on
proxies voted prior to meetings, act as inspector of election at
meetings and certify Shares voted at meetings.
4. Sales of Shares
(a) FDISG shall not be required to issue any Shares of the Fund
where it has received a Written Instruction from the Fund or
official notice from any appropriate authority that the sale of
the Shares of the Fund has been suspended or discontinued. The
existence of such Written Instructions or such official notice
shall be conclusive evidence of the right of FDISG to rely on such
Written Instructions or official notice.
(b) In the event that any check or other order for the payment of
money is returned unpaid for any reason, FDISG will endeavor to:
(i) give prompt notice of such return to the Fund or its designee;
(ii) place a stop transfer order against all Shares issued as a
result of such check or order; and (iii) take such actions as
FDISG may from time to time deem appropriate.
5. Transfer and Repurchase
(a) FDISG shall process all requests to transfer or redeem Shares
in accordance with the transfer or repurchase procedures set forth
in the Fund's Prospectus.
(b) FDISG will transfer or repurchase Shares upon receipt of Oral
or Written Instructions or otherwise pursuant to the Prospectus
and Share certificates, if any, properly endorsed for transfer or
redemption, accompanied by such documents as FDISG reasonably may
deem necessary.
(c) FDISG reserves the right to refuse to transfer or repurchase
Shares until it is satisfied that the endorsement on the
instructions is valid and genuine. FDISG also reserves the right
to refuse to transfer or repurchase Shares until it is satisfied
that the requested transfer or repurchase is legally authorized,
and it shall incur no liability for the refusal, in good faith, to
make transfers or repurchases which FDISG, in its good judgement,
deems improper or unauthorized, or until it is reasonably
satisfied that there is no basis to any claims adverse to such
transfer or repurchase.
(d) When Shares are redeemed, FDISG shall, upon receipt of the
instructions and documents in proper form, deliver to the
Custodian and the Fund or its designee a notification setting
forth the number of Shares to be repurchased. Such repurchased
shares shall be reflected on appropriate accounts maintained by
FDISG reflecting outstanding Shares of the Fund and Shares
attributed to individual accounts.
(e) FDISG shall, upon receipt of the monies provided to it by the
Custodian for the repurchase of Shares, pay such monies as are
received from the Custodian, all in accordance with the procedures
described in the written instruction received by FDISG from the
Fund.
(f) FDISG shall not process or effect any repurchase with respect
to Shares of the Fund after receipt by FDISG or its agent of
notification of the suspension of the determination of the net
asset value of the Fund.
6. Dividends
(a) Upon the declaration of each dividend and each capital gains
distribution by the Board of Directors of the Fund with respect to
Shares of the Fund, the Fund shall furnish or cause to be
furnished to FDISG Written Instructions setting forth the date of
the declaration of such dividend or distribution, the ex-dividend
date, the date of payment thereof, the record date as of which
Shareholders entitled to payment shall be determined, the amount
payable per Share to the Shareholders of record as of that date,
the total amount payable on the payment date and whether such
dividend or distribution is to be paid in Shares at net asset
value.
(b) On or before the payment date specified in such resolution of
the Board of Directors, the Fund will provide FDISG with
sufficient cash to make payment to the Shareholders of record as
of such payment date.
(c) If FDISG does not receive sufficient cash from the Fund to
make total dividend and/or distribution payments to all
Shareholders of the Fund as of the record date, FDISG will, upon
notifying the Fund, withhold payment to all Shareholders of record
as of the record date until sufficient cash is provided to FDISG.
7. In addition to and neither in lieu nor in contravention of
the services set forth above, FDISG shall: (i) perform all the
customary services of a transfer agent, registrar, dividend
disbursing agent and agent of the dividend reinvestment and cash
purchase plan as described herein consistent with those
requirements in effect as at the date of this Agreement. The
detailed definition, frequency, limitations and associated costs
(if any) set out in the attached fee schedule, include but are not
limited to: maintaining all Shareholder accounts, preparing
Shareholder meeting lists, mailing proxies, tabulating proxies,
mailing Shareholder reports to current Shareholders, withholding
taxes on U.S. resident and non-resident alien accounts where
applicable, preparing and filing U.S. Treasury Department Forms
1099 and other appropriate forms required with respect to
dividends and distributions by federal authorities for all
Shareholders.
Schedule B
Fee Schedule
Schedule C
OUT-OF-POCKET EXPENSES
The Fund shall reimburse FDISG monthly for applicable
out-of-pocket expenses, including, but not limited to the
following items:
- - Microfiche/microfilm production
- - Magnetic media tapes and freight
- - Printing costs, including certificates, envelopes, checks
and stationery
- - Postage (bulk, pre-sort, ZIP+4, barcoding, first class)
direct pass through to the Fund
- - Due diligence mailings
- - Telephone and telecommunication costs, including all lease,
maintenance and line costs
- - Ad hoc reports
- - Proxy solicitations, mailings and tabulations
- - Daily & Distribution advice mailings
- - Shipping, Certified and Overnight mail and insurance
- - Year-end form production and mailings
- - Terminals, communication lines, printers and other equipment
and any expenses incurred in connection with such terminals and
lines
- - Duplicating services
- - Courier services
- - Incoming and outgoing wire charges
- - Federal Reserve charges for check clearance
- - Overtime, as approved by the Fund
- - Temporary staff, as approved by the Fund
- - Travel and entertainment, as approved by the Fund
- - Record retention, retrieval and destruction costs,
including, but not limited to exit fees charged by third party
record keeping vendors
- - Third party audit reviews
- - Ad hoc SQL time
- - All Systems enhancements after the conversion at the rate of
$100.00 per hour
- - Insurance
- - Such other miscellaneous expenses reasonably incurred by
FDISG in performing its duties and responsibilities under this
Agreement.
The Fund agrees that postage and mailing expenses will be paid on
the day of or prior to mailing as agreed with FDISG. In addition,
the Fund will promptly reimburse FDISG for any other unscheduled
expenses incurred by FDISG whenever the Fund and FDISG mutually
agree that such expenses are not otherwise properly borne by FDISG
as part of its duties and obligations under the Agreement.
Schedule D
Fund Documents
- - Certified copy of the Articles of Incorporation of the Fund,
as amended
- - Certified copy of the By-laws of the Fund, as amended,
- - Copy of the resolution of the Board of Directors authorizing
the execution and delivery of this Agreement
- - Specimens of the certificates for Shares of the Fund, if
applicable, in the form approved by the Board of Directors of the
Fund, with a certificate of the Secretary of the Fund as to such
approval
- - All account application forms and other documents relating
to Shareholder accounts or to any plan, program or service offered
by the Fund
- - Certified list of Shareholders of the Fund with the name,
address and taxpayer identification number of each Shareholder,
and the number of Shares of the Fund held by each, certificate
numbers and denominations (if any certificates have been issued),
lists of any accounts against which stop transfer orders have been
placed, together with the reasons therefore, and the number of
Shares redeemed by the Fund
- - All notices issued by the Fund with respect to the Shares in
accordance with and pursuant to the Articles of Incorporation or
By-laws of the Fund or as required by law and shall perform such
other specific duties as are set forth in the Articles of
Incorporation including the giving of notice of any special or
annual meetings of shareholders and any other notices required
thereby.
contract\ta\openend\bt\agr2.doc single5.wpd-Rev. 4/96
BT INSURANCE FUNDS TRUST
FORM OF PURCHASE AGREEMENT
BT Insurance Funds Trust (the "Trust"), a Massachusetts
business trust, and First Data Investor Services Group, Inc.
("First Data"), hereby agree as follows:
1. The Trust hereby offers First Data and First Data
hereby agrees to purchase 100,000 Shares (the "Shares") at $1.00
per share of the Trust's Managed Assets Fund (the "Portfolio"),
with par value of $.001 per share. The Shares are the "initial
shares" of the Portfolio. First Data hereby acknowledges receipt
of a purchase confirmation reflecting the purchase of 100,000
Shares, and the Trust hereby acknowledges receipt from First Data
of funds in the amount of $100,000 in full payment for the Shares.
2. First Data represents and warrants to the Trust that
the Shares are being acquired for investment purposes and not for
the purpose of distribution.
3. First Data agrees that if it or any direct or indirect
transferee of the Shares redeems the Shares prior to the fifth
anniversary of the date that the Portfolio begins its investment
activities, the redemption proceeds payable to First Data or such
transferee will be reduced by an amount equal to the number
resulting from multiplying the Portfolio's total unamortized costs
by a fraction, the numerator of which is equal to the number of
Shares redeemed by First Data or such transferee and the
denominator of which is equal to the number of shares of the
Portfolio outstanding as of the date of such redemption, as long
as the administrative position of the staff of the Securities and
Exchange Commission requires such reimbursement.
4. The Trust represents that a copy of its Declaration of
Trust is on file at the Secretary of State's Office.
5. This Agreement has been executed on behalf of the
Trust by the undersigned officer of the Trust in his capacity as
an officer of the Trust. The obligations of this Agreement shall
be binding only upon the assets and property of each individual
Portfolio and not upon the assets and property of any other
portfolio of the Trust and shall not be binding upon any Director,
officer or shareholder of a Portfolio or the Trust individually.
6. This agreement shall be governed by, and construed and
interpreted in accordance with, the laws of The Commonwealth of
Massachusetts.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the _______ day of ________, 1996.
Attest: BT INSURANCE FUNDS TRUST
By: Name:
Title:
Attest: FIRST DATA INVESTOR
SERVICES GROUP, INC.
By: Name:
Title:
