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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 28, 2000
1940 Act File No. 811-07667
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
/X/ Amendment No. 4
(Check appropriate box or boxes)
BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST
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(Exact Name of Registrant as Specified in Charter)
210 University Boulevard, Suite 900, Denver, Colorado 80206
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (303) 329-0200
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Jack R. Thompson, 210 University Boulevard, Suite 900, Denver, CO 80206
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(Name and Address of Agent for Service)
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EXPLANATORY NOTE
This amendment to Registration Statement on Form N-1A (the
"Registration Statement") has been filed by the Registrant pursuant to
Section 8(b) of the Investment Company Act of 1940, as amended. However,
beneficial interests in the Registrant are not being registered under the
Securities Act of 1933, as amended (the "1933 Act") because such interests will
be issued solely in private placement transactions that do not involve any
"public offering" within the meaning of Section 4(2) of the 1933 Act.
Investments in the Registrant may only be made by investment companies, common
or commingled trust funds or similar organizations or entities that are
"accredited investors" within the meaning of Regulation D under the 1933 Act.
The Registration Statement does not constitute an offer to sell, or the
solicitation of an offer to buy, any beneficial interests in the Registrant.
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BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST
PART A
Responses to Items 1, 2, 3, 5 and 9 have been omitted pursuant to
General Instruction B.2.(b) of Form N-1A.
ITEM 4. INVESTMENT OBJECTIVES, PRINCIPAL INVESTMENT STRATEGIES AND RELATED RISKS
BACKGROUND
Berger/BIAM Worldwide Portfolios Trust, a Delaware business trust
("Worldwide Portfolios"), is registered as an open-end management investment
company. Worldwide Portfolios was organized on May 31, 1996. Worldwide
Portfolios is authorized to issue an unlimited number of interests in series.
Currently, the series comprising the Berger/BIAM International Portfolio (the
"Portfolio") is the only series established under Worldwide Portfolios, although
others may be added in the future.
INVESTMENTS IN THE PORTFOLIO ARE NOT DEPOSITS OR OBLIGATIONS OF,
OR GUARANTEED OR ENDORSED BY, ANY BANK (INCLUDING BANK OF IRELAND). INTERESTS IN
THE PORTFOLIO ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER GOVERNMENTAL AGENCY. AN
INVESTMENT IN THE PORTFOLIO IS SUBJECT TO INVESTMENT RISK, INCLUDING POSSIBLE
LOSS OF THE PRINCIPAL AMOUNT INVESTED.
The Portfolio commenced operations in October 1996 upon the
transfer to the Portfolio of assets held in a pooled trust (the "Pool")
maintained by Citizens Bank New Hampshire, for which BIAM provided day-to-day
portfolio management as sub-advisor since the inception of the Pool. At that
time, BIAM's bank holding company parent indirectly owned a 23.5% interest in
the parent of Citizens Bank New Hampshire. The investment objective, policies,
limitations, guidelines and strategies of the Pool were materially equivalent to
those of the Portfolio. Assets from the Pool were transferred to a separate fund
investing in the Portfolio which, in turn, transferred those assets to the
Portfolio in exchange for an interest in the Portfolio. As a result of this
transaction, the investment holdings in the Portfolio were the same as the
investment holdings in the portfolio of the Pool immediately prior to the
transfer, except for the seed capital provided by another party.
THE PORTFOLIO'S GOAL AND PRINCIPAL INVESTMENT STRATEGIES
The Portfolio's investment objective is long-term capital
appreciation. In pursuing that goal, the Portfolio primarily invests in a
portfolio consisting of common stocks of well-established foreign companies.
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The Portfolio's investment manager first identifies economic and
business themes that it believes provide a favorable framework for selecting
stocks. Using fundamental analysis, the investment manager then selects
individual companies best positioned to take advantage of opportunities
presented by these themes.
The Portfolio's investment manager generally looks for companies with:
- - Securities that are fundamentally undervalued relative to their long-term
prospective earnings growth rates, their historic valuation levels and
their competitors
- - Business operations predominantly in well-regulated and more stable foreign
markets
- - Substantial size and liquidity, strong balance sheets, proven management and
diversified earnings.
The Portfolio invests primarily in common stocks with 65% of its
total assets in securities of companies located in at least five different
countries outside the United States. Recently, the Portfolio has been weighted
toward countries in Western Europe, Australia and the Far East. However, it may
also invest in other foreign countries, including developing countries. A
majority of the Portfolio's assets are invested in mid-sized to large
capitalization companies. The Portfolio's investment manager will generally sell
a security when it no longer meets the manager's investment criteria or when it
has met the manager's expectations for appreciation.
PRINCIPAL RISKS
The Portfolio is designed for investors who are comfortable with
the risks of international investing and who intend to make a long-term
investment commitment. Like all managed funds, there is a risk that the
investment manager's strategy for managing the Portfolio may not achieve the
desired results. In addition, the price of common stock moves up and down in
response to corporate earnings and developments, economic and market conditions
and anticipated events. As a result, the price of the Portfolio's investments
may go down and you could lose money on your investment. There are additional
risks with investing in foreign countries, especially in developing countries --
specifically, economic, currency, information, political and transaction risks.
As a result of these additional risks, the Portfolio may be more volatile than a
domestic stock fund. In addition, foreign stocks may not move in concert with
the U.S. markets. The Portfolio's investments are often focused in a small
number of business sectors. In addition, the Portfolio may invest in certain
securities with unique risks, such as forward foreign currency contracts.
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See "Investment Techniques, Securities and Associated Risks" below
for more information on principal risks and other risks.
INVESTMENT TECHNIQUES, SECURITIES AND THE ASSOCIATED RISKS
Before investing in the Portfolio, make sure you understand the
risks involved. All investments involve risk. Generally, the greater the risk,
the greater the potential for return. The reverse is also generally true, the
lower the risk, the lower the potential for return.
The following glossary will help you further understand the risks
the Portfolio takes by investing in certain securities and investment techniques
used by the Portfolio. You may get more detailed information about the risks of
investing in the Portfolio in Part B, including a discussion of debt security
ratings in Appendix A to Part B.
RISK AND INVESTMENT GLOSSARY
BORROWING refers to a loan of money from a bank or other financial
institution undertaken by the Portfolio for temporary or emergency reasons only.
The Portfolio will not borrow more than 25% of its total assets. LEVERAGE RISK
CALL RISK is the possibility that an issuer may redeem or "call" a fixed income
security before maturity at a price below its current market price. An increase
in the likelihood of a call may reduce the security's price.
COMMON STOCK is a share of ownership (equity) interest in a company.
COMPANIES WITH LIMITED OPERATING HISTORIES are securities issued by companies
that have been in continuous operation for less than three years. Sometimes
called "unseasoned" issuers. MARKET, LIQUIDITY AND INFORMATION RISKS
CONVERTIBLE SECURITIES(1) are debt or equity securities which may be converted
on specified terms into stock of the issuer. MARKET, INTEREST RATE, PREPAYMENT
AND CREDIT RISKS
CORRELATION RISK occurs when the Portfolio "hedges" - uses one investment to
offset the Portfolio's position in another. If the two investments do not behave
in relation to one another the way Portfolio managers expect them to, then
unexpected results may occur.
CREDIT RISK means that the issuer of a security or the counterparty to an
investment contact may default or become unable to pay its obligations when due.
CURRENCY RISK happens when the Portfolio buys or sells a security denominated in
foreign currency. Foreign currencies "float" in value against the U.S. dollar.
Adverse changes in foreign currency values can cause investment losses when its
investments are converted to U.S. dollars.
DIVERSIFICATION means a diversified fund may not, with respect to at least 75%
of its assets, invest more than 5% in the securities of one company. A
nondiversified fund may be more volatile than a diversified fund because it
invests more of its assets in a smaller number of companies and the gains or
losses on a single stock
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will therefore have a greater impact on the fund's share price. The Portfolio is
a diversified fund.
FOREIGN SECURITIES(3) are issued by companies located outside of the United
States. The Portfolio considers a company to be located outside the United
States if the principal securities trading market for its equity securities is
located outside the U.S. or it is organized under the laws of, and has a
principal office in, a country other than the U.S. MARKET, CURRENCY,
TRANSACTION, LIQUIDITY, INFORMATION AND POLITICAL RISKS
FORWARD FOREIGN CURRENCY CONTRACTS(2,3) are privately negotiated contracts
committing the holder to purchase or sell a specified quantity of a foreign
currency on a predetermined future date at a predetermined price. HEDGING,
CREDIT, CORRELATION, OPPORTUNITY AND LEVERAGE RISKS
HEDGING RISK comes into play when the Portfolio uses a security whose value is
based on an underlying security or index to "offset" its position in another
security or currency. The objective of hedging is to offset potential losses in
one security with gains in the hedge. But a hedge can eliminate or reduce gains
as well as offset losses. (Also see "Correlation risk.")
ILLIQUID AND RESTRICTED SECURITIES are securities which, by rules of their issue
or by their nature, cannot be sold readily. These do not include liquid
Rule 144A securities. The Portfolio will not invest more than 15% of its net
assets in illiquid securities, including restricted securities not deemed to be
liquid. MARKET, LIQUIDITY AND TRANSACTION RISKS
INFORMATION RISK means that information about a security or issuer might not be
available, complete, accurate or comparable.
INITIAL PUBLIC OFFERING (IPO) is the sale of a company's securities to the
public for the first time. IPO companies can be small and have limited operating
histories. The price of IPO securities can be highly unstable due to prevailing
market psychology and the small number of shares available. In addition, the
quality and number of IPOs available for purchase may diminish in the future,
and their contribution to Portfolio performance may be less significant as the
Portfolio grows in size. MARKET, LIQUIDITY AND INFORMATION RISKS
INTEREST RATE RISK is the risk that changes in interest rates will adversely
affect the value of an investor's securities. When interest rates rise, the
value of fixed-income securities will generally fall. Conversely, a drop in
interest rates will generally cause an increase in the value of fixed income
securities. Longer term securities are subject to greater interest rate risk.
INVESTMENT GRADE BONDS are rated BBB (STANDARD & POOR'S) or Baa (MOODY'S) or
above. Bonds rated below investment grade are subject to greater credit risk
than investment grade bonds. INTEREST RATE, MARKET, CALL AND CREDIT RISKS
LENDING PORTFOLIO SECURITIES to qualified financial institutions is undertaken
in order to earn income. The Portfolio lends securities only on a fully
collateralized basis. The Portfolio may lend portfolio securities only up
to 33 1/3% of its total assets. CREDIT RISK
LEVERAGE RISK occurs in some securities or techniques that tend to magnify the
effect of small changes in an index or a market. This can result in a loss that
exceeds the amount that was invested in the contract.
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LIQUIDITY RISK occurs when investments cannot be sold readily. The Portfolio may
have to accept a less-than-desirable price to complete the sale of an illiquid
security or may not be able to sell it at all.
MARKET CAPITALIZATION is the total current market value of a company's
outstanding common stock.
MARKET RISK exists in all mutual funds and means the risk that the prices of
securities in a market, a sector or an industry will fluctuate, and that such
movements might reduce an investment's value.
OPPORTUNITY RISK means missing out on an investment opportunity because the
assets necessary to take advantage of it are committed to less advantageous
investments or strategies.
POLITICAL RISK comes into play with investments, particularly foreign
investments, which may be adversely affected by nationalization, taxation, war,
government instability or other economic or political actions or factors.
PREPAYMENT RISK is the risk that, as interest rates fall, borrowers are more
likely to refinance their debts. As a result, the principal on certain
fixed-income securities may be paid earlier than expected, which could cause
investment losses and cause prepaid amounts to have to be reinvested at a
relatively lower interest rate.
SECTOR FOCUS(3) occurs when a significant portion of the Portfolio's assets are
invested in a relatively small number of related industries. The Portfolio will
not concentrate more than 25% of its total assets in any one industry. Sector
focus may increase both market and liquidity risk. MARKET AND LIQUIDITY RISKS
SMALL AND MID-SIZED COMPANY SECURITIES are securities issued by small or
mid-sized companies, as measured by their market capitalization. The market
capitalization range targeted by the Portfolio appears under the heading "The
Portfolio's Goal and Principal Investment Strategies." In general, the smaller
the company, the greater its risks. MARKET, LIQUIDITY AND INFORMATION RISKS
SPECIAL SITUATIONS are companies about to undergo a structural, financial or
management change which may significantly affect the value of their securities.
MARKET AND INFORMATION RISKS
TRANSACTION RISK means that the Portfolio may be delayed or unable to settle a
transaction or that commissions and settlement expenses may be higher than
usual.
1. The Portfolio has no minimum quality standards for convertible securities,
although it will not invest in defaulted securities. It also will not
invest 20% or more of its assets in convertible securities rated below
investment grade or in unrated convertible securities that the advisor
considers to be below investment grade.
2. The Portfolio may use forwards only for hedging. The Portfolio's aggregate
obligations under these contracts may not exceed the total market value of
the assets being hedged, such as some or all of the value of the
Portfolio's securities denominated in a particular foreign currency.
3. The security or technique is emphasized by the Portfolio.
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The investment objective of the Portfolio is considered
fundamental, meaning that it cannot be changed without a vote of the investors
in the Portfolio.
ITEM 6. MANAGEMENT, ORGANIZATION AND CAPITAL STRUCTURE
MANAGEMENT AND INVESTMENT ADVICE
INVESTMENT MANAGERS
The following companies provide day-to-day investment management services to the
Portfolio:
BBOI WORLDWIDE LLC (BBOI) (210 University Blvd., Suite 700, Denver, CO 80206)
serves as the Portfolio's investment advisor. BBOI was formed in 1996 as a joint
venture between Berger LLC, and Bank of Ireland Asset Management (U.S.) Limited
(BIAM). As investment advisor, BBOI oversees, evaluates and monitors the
investment advisory services provided by BIAM as sub-advisor. BBOI receives a
fee at the annual rate of 0.90% of the Portfolio's average daily net assets.
BBOI also provides administrative services to the funds invested in the
Portfolio.
Berger LLC and BIAM entered into an agreement to dissolve BBOI Worldwide. The
dissolution of BBOI will have no effect on the investment advisory services
provided to the Portfolio or on the fees borne by the Portfolio for advisory
services. Contingent upon shareholder approval, when BBOI Worldwide is
dissolved, Berger LLC will become the Portfolio's advisor and BIAM will continue
to be responsible for day-to-day management of the Portfolio as sub-advisor. If
approved by shareholders, these advisory changes are expected to take place in
the first half of this year.
BANK OF IRELAND ASSET MANAGEMENT (U.S.) LIMITED (BIAM) ((20 Horseneck Lane,
Greenwich, CT 06830 (representative office); 26 Fitzwilliam Place, Dublin 2,
Ireland (main office)) serves as investment advisor or sub-advisor to pension
and profit-sharing plans and other institutional investors and mutual funds.
Bank of Ireland's investment management group was founded in 1966. As
sub-advisor, BIAM manages the investments in the Berger/BIAM International
Portfolio.
BIAM, using a team approach, has been the investment manager for the Portfolio
since its inception in 1996. BIAM is the sub-advisor to the Portfolio and is
part of Bank of Ireland's asset management group, established in 1966. Most of
the team of investment professionals have been with the group for at least ten
years.
PORTFOLIO TURNOVER. Portfolio changes are made whenever the Portfolio's
investment manager believes that the Portfolio's goal could be better achieved
by investment in another security, regardless of portfolio turnover. The
portfolio turnover for the Portfolio may exceed 100% per year, although it is
normally expected to range from 25% to 75%. A turnover rate of 100% means the
securities owned by the Portfolio were replaced once during the year. Higher
turnover rates may result in higher brokerage costs to the Portfolio and in
higher net taxable gains for investors in the
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Portfolio. Portfolio turnover is disclosed on the schedule of
Ratios/Supplementary Data incorporated by reference into Part B.
SPECIAL FUND STRUCTURE
The Portfolio is organized as a "master" fund in a "master/feeder" structure.
This means that all the assets of certain other "feeder" funds are invested in
the Portfolio, which serves as a larger "master" portfolio of securities and has
investment goals and policies identical to those of the feeder funds. The
feeders currently investing in the Portfolio are the Berger/BIAM International
Fund, the Berger/BIAM International CORE Fund and the International Equity Fund.
These funds have their own investment minimums and their own expenses so that
share price, performance and distributions will differ among feeders.
A feeder fund may withdraw its investment in the Portfolio at any time, if the
trustees determine that it is in the best interests of the fund to do so. In
that event, the fund might transfer to another master fund or hire its own
investment advisor. A withdrawal could result in the fund receiving an in-kind
distribution of portfolio securities from the Portfolio. In that case, the fund
could incur brokerage, tax or other charges if it converted the securities to
cash. The fund may have difficulty selling the securities and recovering the
amount of the investment redeemed in cash if the securities are illiquid. In
addition, an in-kind distribution could adversely affect the liquidity of the
Portfolio.
For more information on the master/feeder fund structure, see Part B.
DATE-RELATED INFORMATION
Mutual funds and businesses around the world could be adversely affected if
computers do not properly process date-related information. The Portfolio's
advisor is addressing these issues for its computers and is getting reasonable
assurances from the Portfolio's other major service providers that they too are
addressing these issues to preserve smooth functioning of the Portfolio's
trading, pricing, investor account, custodial and other operations. There can be
no assurances, however, that all problems will be avoided.
These computer problems could also adversely affect the Portfolio's investments.
Improperly functioning computers may disrupt securities markets generally or
result in overall economic uncertainty. Individual companies may also be
adversely affected by the cost of fixing their computers, which could be
substantial. The Portfolio's investment manager considers these issues when
evaluating investments for the Portfolio.
ITEM 7. PORTFOLIO INVESTOR INFORMATION
PRICING OF PORTFOLIO BENEFICIAL INTERESTS
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The price at which interests in the Portfolio are bought or sold
is the net asset value (NAV). The Portfolio's net asset value is determined by
adding the value of the Portfolio's investments, cash and other assets,
deducting liabilities, and then dividing that value by the total number of the
Portfolio's beneficial interests outstanding.
The net asset value of the Portfolio is determined at the close of
the regular trading session of the New York Stock Exchange (the "Exchange")
(normally 4:00 p.m., New York time) each day that the Exchange is open. The net
asset value of the Portfolio is not calculated on the days that the Exchange is
closed.
When the Portfolio calculates its net asset value, it values the
securities it holds at market value. Sometimes market quotes for some securities
are not available or are not representative of market value. Examples would be
when events occur that materially affect the value of a security at a time when
the security is not trading or when the securities are illiquid. In that case,
securities may be valued in good faith at fair value, using consistently applied
procedures decided on by the trustees. Money market instruments maturing within
60 days are valued at amortized cost, which approximates market value. Assets
and liabilities expressed in foreign currencies are converted into U.S. dollars
at the prevailing market rates quoted by one or more banks or dealers shortly
before the close of the Exchange.
The Portfolio's securities may trade on days that the Exchange is
closed and the Portfolio's net asset value is not calculated. As a result, the
net asset value may be affected and you will not be able to purchase or redeem
interests in the Portfolio.
PURCHASE OF BENEFICIAL INTERESTS
Beneficial interests in the Portfolio are issued solely in private
placement transactions which do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. Investments in the Portfolio may only
be made by investment companies, common or commingled trust funds or similar
organizations or entities that are "accredited investors" within the meaning of
Regulation D under the 1933 Act.
Each investor in the Portfolio may add to or reduce its investment
in the Portfolio on each day on which the net asset value is determined. There
is no minimum initial or subsequent investment in the Portfolio. However,
because the Portfolio intends to be as fully invested at all times as is
reasonably practicable in order to enhance the return on its assets, investments
should be made in federal funds (i.e., monies credited to the account of the
Portfolio's custodian bank by a Federal Reserve Bank).
Subject to approval by the Portfolio, you may purchase an interest
in the Portfolio with liquid securities that the Portfolio is eligible to
purchase. These securities must have a value that can be readily determined in
accordance with the Portfolio's valuation policies. You may pay
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for an interest in the Portfolio with securities only if it is the investment
manager's intention to retain them in the Portfolio. The Portfolio may amend or
terminate this practice at any time.
The Portfolio reserves the right to cease accepting investments in
the Portfolio at any time or to reject any investment order. No share
certificate will be issued representing interests in the Portfolio.
REDEMPTION OF BENEFICIAL INTERESTS
An investor in the Portfolio may redeem or withdraw all or any
portion of its investment at the net asset value next determined if a withdrawal
request in proper form is furnished by the investor to Worldwide Portfolios by
the designated cutoff time for each accredited investor. The proceeds of a
redemption or withdrawal will be paid by Worldwide Portfolios in federal funds
normally on the business day the withdrawal is effected, but in any event within
seven days.
The Portfolio intends to redeem investments only for cash,
although in order to protect the interest of remaining investors, it retains the
right to redeem investments in-kind under unusual circumstances. In-kind payment
means payment will be made in portfolio securities rather than cash. If this
occurs, the redeeming investor will incur transaction costs if it sells the
securities for cash. The redeeming investor may have difficulty selling the
securities and recovering the amount of the investment redeemed in cash if the
securities are illiquid. See Item 18 in Part B. Investments in the Portfolio may
not be transferred.
The right of any investor to receive payment with respect to any
withdrawal may be suspended or the payment of the withdrawal proceeds postponed
during any period in which the Exchange is closed (other than weekends or
holidays) or trading on the Exchange is restricted or, to the extent otherwise
permitted by the Investment Company Act of 1940, if an emergency exists.
DISTRIBUTIONS AND TAXES
The Portfolio determines its book net income and net realized
capital gains, if any, on each business day and allocates all such income and
gain allocable among the investors in the Portfolio at the time of such
determination in accordance with their interests, as set forth in the Trust
Instrument.
Under its anticipated method of operation, the Portfolio will not
be subject to any income tax. However, each investor in the Portfolio will be
allocated a share (as determined in accordance with the governing instruments of
Worldwide Portfolios) of the Portfolio's ordinary income and capital gain. The
determination of such allocated share will be made in accordance with the
Internal Revenue Code of 1986, as amended (the "Code"), and regulations
promulgated thereunder.
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It is intended that the Portfolio's assets, income and
distributions will be managed in such a way that an investor in the Portfolio
will be able to satisfy the requirements of Subchapter M of the Code, assuming
that the investor invested all of its assets in the Portfolio.
For more information on tax matters, see Item 19 in Part B.
ITEM 8. DISTRIBUTION ARRANGEMENTS
The Portfolio does not impose any front end sales load or
redemption fee on any purchase or redemption of an interest in the Portfolio,
nor does the Portfolio impose any 12b-1 distribution fee.
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PART B
ITEM 10. COVER PAGE
This Part B sets forth information which may be of interest to
investors but which is not necessarily included in Part A as it may be amended
from time to time. This Part B should be read only in conjunction with Part A, a
copy of which may be obtained by an investor without charge by writing Worldwide
Portfolios or calling 1-800-706-0539.
TABLE OF CONTENTS
Portfolio History B-1
Description of the Portfolio and Its Investments and Risks B-1
Management of the Portfolio B-14
Control Persons and Principal Holders of Securities B-18
Investment Advisory and Other Services B-19
Brokerage Allocation and Other Practices B-24
Capital Stock and Other Securities B-26
Purchase, Redemption and Pricing of Securities Being Offered B-28
Taxation of the Portfolio B-30
Underwriters B-31
Calculation of Performance Data B-31
Financial Statements B-31
Appendix A B-33
ITEM 12. PORTFOLIO HISTORY
Worldwide Portfolios is a Delaware business trust organized on May
31, 1996. The Portfolio was established on May 31, 1996, as a series of
Worldwide Portfolios. The Portfolio commenced operations upon the transfer to
the Portfolio of assets held in a pooled trust. See Item 4 in Part A for
additional information on the asset transfer.
ITEM 13. DESCRIPTION OF THE PORTFOLIO AND ITS INVESTMENTS AND RISKS
The Portfolio is a mutual fund, or an open-end, management
investment company. The Portfolio is a diversified fund. The investment
objective of the Portfolio is long-term capital appreciation. The Portfolio does
not invest to provide current income, although some income may be produced while
managing the Portfolio.
INVESTMENT POLICIES
Part A discusses the investment objective of the Portfolio and the
principal investment strategies to be employed to achieve that objective. It
also describes the principal risks
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of investing in the Portfolio. This section contains supplemental information
concerning the types of securities and other instruments in which the Portfolio
may invest, the investment policies and portfolio strategies that the Portfolio
may utilize and certain risks attendant to those investments, policies and
strategies.
COMMON AND PREFERRED STOCKS. Stocks represent shares of ownership
in a company. Generally, preferred stock has a specified dividend and ranks
after bonds and before common stocks in its claim on income for dividend
payments and on assets should the company be liquidated. After other claims are
satisfied, common stockholders participate in company profits on a pro-rata
basis. Profits may be paid out in dividends or reinvested in the company to help
it grow. Increases and decreases in earnings are usually reflected in a
company's stock price, so common stocks generally have the greatest appreciation
and depreciation potential of all corporate securities. While most preferred
stocks pay dividends, the Portfolio may purchase preferred stock where the
issuer has omitted, or is in danger of omitting, payment of its dividends. Such
investments would be made primarily for their capital appreciation potential.
All investments in stocks are subject to market risk, meaning that their prices
may move up and down with the general stock market, and that such movements
might reduce their value.
DEBT SECURITIES. Debt securities (such as bonds or debentures) are
fixed-income securities which bear interest and are issued by corporations or
governments. The issuer has a contractual obligation to pay interest at a stated
rate on specific dates and to repay principal on a specific maturity date. In
addition to market risk, debt securities are generally subject to two other
kinds of risk: credit risk and interest rate risk. Credit risk refers to the
ability of the issuer to meet interest or principal payments as they come due.
The lower the rating given a security by a rating service (such as Moody's
Investor Service ("Moody's") and Standard & Poor's ("S&P")), the greater the
credit risk the rating service perceives with respect to that security. The
Portfolio will not purchase any nonconvertible securities rated below investment
grade (Ba or lower by Moody's, BB or lower by S&P). In cases where the ratings
assigned by more than one rating agency differ, the Portfolio will consider the
security as rated in the higher category. If nonconvertible securities purchased
by the Portfolio are downgraded to below investment grade following purchase,
the trustees of Worldwide Portfolios, in consultation with the sub-advisor, will
determine what action, if any, is appropriate in light of all relevant
circumstances. For a further discussion of debt security ratings, see Appendix A
to this Part B.
Interest rate risk refers to the fact that the value of
fixed-income securities (like debt securities) generally fluctuates in response
to changes in interest rates. A decrease in interest rates will generally result
in an increase in the price of fixed-income securities held by the Portfolio.
Conversely, during periods of rising interest rates, the value of fixed-income
securities held by the Portfolio will generally decline. Longer-term securities
are generally more sensitive to interest rate changes and are more volatile than
shorter-term securities, but they generally offer higher yields to compensate
investors for the associated risks.
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Certain debt securities can also present prepayment risk. For
example, a security may contain redemption and call provisions. If an issuer
exercises these provisions when interest rates are declining, the Portfolio
could sustain investment losses as well as have to reinvest the proceeds from
the security at lower interest rates, resulting in a decreased return for the
Portfolio.
INITIAL PUBLIC OFFERINGS. The Portfolio may invest in a company's
securities at the time the company first offers securities to the public, that
is, at the time of the company's initial public offering or IPO. Although
companies can be any age or size at the time of their IPOs, they are often
smaller and have a limited operating history, which involve a greater potential
for the value of their securities to be impaired following the IPO. See
"Securities of Smaller Companies" and "Securities of Companies with Limited
Operating Histories" above.
Investors in IPOs can be adversely affected by substantial
dilution in the value of their shares, by sales of additional shares and by
concentration of control in existing management and principal shareholders. In
addition, all of the factors that affect stock market performance may have a
greater impact on the shares of IPO companies.
The price of a company's securities may be highly unstable at the
time of its IPO and for a period thereafter due to market psychology prevailing
at the time of the IPO, the absence of a prior public market, the small number
of shares available and limited availability of investor information. As a
result of this or other factors, the Portfolio's sub-advisor might decide to
sell an IPO security more quickly than it would otherwise, which may result in a
significant gain or loss and greater transaction costs to the Portfolio. Any
gains from shares held for 12 months or less will be treated as short-term
gains, taxable as ordinary income to the Portfolio's shareholders. In addition,
IPO securities may be subject to varying patterns of trading volume and may, at
times, be difficult to sell without an unfavorable impact on prevailing prices.
The effect of an IPO investment can have a magnified impact on the
Portfolio's performance when the Portfolio's asset base is small. Consequently,
IPOs may constitute a significant portion of the Portfolio's returns
particularly when the Portfolio is small. Since the number of securities issued
in an IPO is limited, it is likely that IPO securities will represent a smaller
component of the Portfolio's assets as it increases in size, and therefore have
a more limited effect on the Portfolio's performance.
There can be no assurance that IPOs will continue to be available
for the Portfolio to purchase. The number or quality of IPOs available for
purchase by the Portfolio may vary, decrease or entirely disappear. In some
cases, the Portfolio may not be able to purchase IPOs at the offering price, but
may have to purchase the shares in the aftermarket at a price greatly exceeding
the offering price, making it more difficult for the Portfolio to realize a
profit.
The sub-advisor's IPO trade allocation procedures govern which
mutual funds and other advised accounts participate in the allocation of any
IPO.
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FOREIGN SECURITIES. Investments in foreign securities involve some
risks that are different from the risks of investing in securities of U.S.
issuers, such as the risk of adverse political, social, diplomatic and economic
developments and, with respect to certain countries, the possibility of
expropriation, taxes imposed by foreign countries or limitations on the removal
of monies or other assets of the Portfolio. Moreover, the economies of
individual foreign countries will vary in comparison to the U.S. economy in such
respects as growth of gross domestic product, rate of inflation, capital
reinvestment, resources, self-sufficiency and balance of payments position.
Securities of some foreign companies, particularly those in developing
countries, are less liquid and more volatile than securities of comparable
domestic companies. Investing in the securities of developing countries may
involve exposure to economic structures that are less diverse and mature, and to
political systems that can be expected to have less stability than developed
countries. The Portfolio's investments may include American Depositary Receipts
(ADRs). The Portfolio may also invest in European Depositary Receipts (EDRs)
which are similar to ADRs, in bearer form, designed for use in the European
securities markets, and in Global Depositary Receipts (GDRs). Some of the
companies in which the Portfolio invests may be considered passive foreign
investment companies (PFICs), which are described in greater detail below.
There also may be less publicly available information about
foreign issuers and securities than domestic issuers and securities, and foreign
issuers generally are not subject to accounting, auditing and financial
reporting standards, requirements and practices comparable to those applicable
to domestic issuers. Also, there is generally less government supervision and
regulation of exchanges, brokers, financial institutions and issuers in foreign
countries than there is in the U.S. Foreign financial markets typically have
substantially less volume than U.S. markets. Foreign markets also have different
clearance and settlement procedures and, in certain markets, delays or other
factors could make it difficult to effect transactions, potentially causing the
Portfolio to experience losses or miss investment opportunities.
Costs associated with transactions in foreign securities are
generally higher than with transactions in U.S. securities. The Portfolio will
incur greater costs in maintaining assets in foreign jurisdictions and in buying
and selling foreign securities generally, resulting in part from converting
foreign currencies into U.S. dollars. In addition, the Portfolio might have
greater difficulty taking appropriate legal action with respect to foreign
investments in non-U.S. courts than with respect to domestic issuers in U.S.
courts, which may heighten the risk of possible losses through the holding of
securities by custodians and securities depositories in foreign countries.
Since the Portfolio will invest in securities denominated or
quoted in currencies other than the U.S. dollar, changes in foreign currency
exchange rates will affect the value of the investments in its portfolio and the
unrealized appreciation or depreciation of investments insofar as U.S. investors
are concerned. If the foreign currency in which a security is denominated
appreciates against the U.S. dollar, the dollar value of the security will
increase. Conversely, a decline in the exchange rate of the foreign currency
against the U.S. dollar would adversely affect the dollar value of the foreign
securities. Foreign currency exchange rates are determined by forces of supply
and demand on the foreign exchange markets, which are in turn affected by the
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international balance of payments and other economic and financial conditions,
government intervention, speculation and other factors.
PASSIVE FOREIGN INVESTMENT COMPANIES (PFICS). The Portfolio may
purchase the securities of certain companies considered Passive Foreign
Investment Companies (PFICs) under U.S. tax laws. For certain types of PFICs, in
addition to bearing their proportionate share of the Portfolio's expenses
(management fees and operating expenses), investors will also indirectly bear
similar expenses of such PFIC. PFIC investments also may be subject to less
favorable U.S. tax treatment, as discussed in Item 19 below.
HEDGING TRANSACTIONS. As described in Part A, the Portfolio is
authorized to make limited commitments in certain foreign currency forward
contracts, but only for the purpose of hedging, that is, protecting against the
risk of market movements that may adversely affect the value (in foreign
currency or U.S. dollar terms) of the Portfolio's securities or the price of
securities that the Portfolio is considering purchasing. The utilization of
forwards is also subject to policies and procedures which may be established by
the trustees from time to time. In addition, the Portfolio is not required to
hedge. Decisions regarding hedging are subject to the sub-advisor's judgment of
the cost of the hedge, its potential effectiveness and other factors the
sub-advisor considers pertinent.
A hedging transaction may partially protect the Portfolio from a decline in
the value of a particular security or its portfolio generally, although
hedging may also limit the Portfolio's opportunity to profit from favorable
price movements, and the cost of the transaction will reduce the potential
return on the security or the portfolio. In addition, hedging transactions do
not eliminate fluctuations in the prices of the underlying securities the
Portfolio owns or intends to acquire.
Use of these instruments by the Portfolio involves the potential
for a loss that may exceed the Portfolio's initial commitment to a forward
contract. However, the Portfolio is permitted to use forwards for hedging
purposes only, and only if the aggregate amount of its obligations under these
contracts does not exceed the total market value of the assets the Portfolio is
attempting to hedge, such as a portion or all of its exposure to equity
securities denominated in a particular currency. To help ensure that the
Portfolio will be able to meet its obligations under forward contracts entered
into by the Portfolio, the Portfolio will be required to maintain liquid assets
in a segregated account with its custodian bank or to set aside portfolio
securities to "cover" its position in these contracts.
The principal risks of the Portfolio utilizing forward contracts
are: (a) losses resulting from market movements not anticipated by the
Portfolio; (b) possible imperfect correlation between movements in the prices of
forwards and movements in the prices of the securities or positions hedged or
used to cover such positions; (c) lack of assurance that a liquid secondary
market will exist for any particular contract at any particular time; and (d)
the need for additional information and skills beyond those required for the
management of a portfolio of traditional securities. In addition, when the
Portfolio enters into an over-the-counter contract with a counterparty, the
Portfolio will assume counterparty credit risk, that is, the risk that the
counterparty
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will fail to perform its obligations, in which case the Portfolio could be worse
off than if the contract had not been entered into.
Any utilization of forwards or any other hedging technique
(investing, for example, in futures or options) is subject to policies and
procedures which may be established and changed by the trustees from time to
time without investor vote. Currently, the Portfolio is authorized to utilize
forward contracts only for hedging purposes and is not permitted to invest in
futures or options. If the trustees ever authorize the Portfolio to invest in
futures or options, such investments would be permitted solely for hedging
purposes, and the Portfolio would not be permitted to invest more than 5% of its
net assets at the time of purchase in initial margins for financial futures
transactions and premiums for options. In addition, the advisor or sub-advisor
may be required to obtain bank regulatory approval before the Portfolio engages
in futures and options transactions. The following information should be read in
conjunction with the information concerning the Portfolio's investment in
forwards and the risks of such investments contained in Part A.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS. A forward contract is
a privately negotiated agreement between two parties in which one party is
obligated to deliver a stated amount of a stated asset at a specified time in
the future and the other party is obligated to pay a specified invoice amount
for the asset at the time of delivery. The Portfolio currently intends that the
only forward contracts or commitments that it might use are forward foreign
currency exchange contracts and that it may use such contracts solely for
hedging purposes, although the Portfolio may enter into additional forms of
forward contracts or commitments in the future for hedging purposes if they
become available and advisable in light of the Portfolio's objective and
investment policies. Forward contracts generally are negotiated in an interbank
market conducted directly between traders (usually large commercial banks) and
their customers. Unlike futures contracts, which are standardized,
exchange-traded contracts, forward contracts can be specifically drawn to meet
the needs of the parties that enter into them. The parties to a forward contract
may agree to offset or terminate the contract before its maturity, or may hold
the contract to maturity and complete the contemplated exchange.
The following discussion summarizes the Portfolio's principal
uses of forward foreign currency exchange contracts ("forward currency
contracts"). The Portfolio may enter into forward currency contracts with
aggregate stated contract values of up to the value of the Portfolio's
assets. A forward currency contract is an obligation to buy or sell an amount
of a specified currency for an agreed price (which may be in U.S. dollars or
a foreign currency) on a specified date. The Portfolio will exchange foreign
currencies for U.S. dollars and for other foreign currencies in the normal
course of business and may buy and sell currencies through forward currency
contracts in order to fix a price (in terms of a specified currency) for
securities it has agreed to buy or sell ("transaction hedge"). The Portfolio
also may hedge some or all of its investments denominated in foreign currency
against a decline in the value of that currency relative to the U.S. dollar
by entering into forward currency contracts to sell an amount of that
currency (or a proxy currency whose price movements are expected to have a
high degree of correlation with the currency being hedged) approximating the
value of some or all of its portfolio securities denominated in that currency
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("position hedge"). The Portfolio also may enter into a forward currency
contract with respect to a currency where the Portfolio is considering the
purchase or sale of investments denominated in that currency but has not yet
selected the specific investments ("anticipatory hedge").
These types of hedging minimize the effect of currency
appreciation as well as depreciation, but do not eliminate fluctuations in the
underlying U.S. dollar equivalent value of the proceeds of or rates of return on
the Portfolio's foreign currency denominated portfolio securities. The matching
of the increase in value of a forward foreign currency exchange contract and the
decline in the U.S. dollar equivalent value of the foreign currency denominated
asset that is the subject of the hedge generally will not be precise. Shifting
the Portfolio's currency exposure from one foreign currency to another limits
the Portfolio's opportunity to profit from increases in the value of the
original currency and involves a risk of increased losses to the Portfolio if
the sub-advisor's projection of future exchange rates is inaccurate.
The Portfolio will cover outstanding forward currency contracts by
maintaining liquid portfolio securities denominated in the currency underlying
the forward contract or the currency being hedged. To the extent that the
Portfolio is not able to cover its forward currency positions with underlying
portfolio securities, the Portfolio's custodian will segregate cash or liquid
assets having a value equal to the aggregate amount of the Portfolio's
commitments under forward contracts entered into. If the value of the securities
used to cover a position or the value of segregated assets declines, the
Portfolio must find alternative cover or segregate additional cash or liquid
assets on a daily basis so that the value of the covered and segregated assets
will be equal to the amount of the Portfolio's commitments with respect to such
contracts.
While forward contracts are not currently regulated by the
Commodity Futures Trading Commission ("CFTC"), the CFTC may in the future assert
authority to regulate forward contracts. In such event, the Portfolio's ability
to utilize forward contracts may be restricted. The Portfolio may not always be
able to enter into forward contracts at attractive prices and may be limited in
its ability to use these contracts to hedge Portfolio assets. In addition, when
the Portfolio enters into a privately negotiated forward contract with a
counterparty, the Portfolio assumes counterparty credit risk, that is, the risk
that the counterparty will fail to perform its obligations, in which case the
Portfolio could be worse off than if the contract had not been entered into.
Unlike many exchange-traded futures contracts and options on futures, there are
no daily price fluctuation limits with respect to forward contracts and other
negotiated or over-the-counter instruments, and with respect to those contracts,
adverse market movements could therefore continue to an unlimited extent over a
period of time. However, the Portfolio intends to monitor its investments
closely and will attempt to renegotiate or close its positions when the risk of
loss to the Portfolio becomes unacceptably high.
CONVERTIBLE SECURITIES. The Portfolio may also purchase debt or
equity securities which are convertible into common stock when the sub-advisor
believes they offer the potential for a higher total return than nonconvertible
securities. While fixed income securities generally have a priority claim on a
corporation's assets over that of common stock, some of the convertible
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securities which the Portfolio may hold are high-yield/high-risk securities that
are subject to special risks, including the risk of default in interest or
principal payments which could result in a loss of income to the Portfolio or a
decline in the market value of the securities. Convertible securities often
display a degree of market price volatility that is comparable to common stocks.
The credit risk associated with convertible securities generally is reflected by
their ratings assigned by organizations such as Moody's Investors Service, Inc.,
and Standard & Poor's Corporation, or a similar determination of
creditworthiness by the sub-advisor. The Portfolio has no pre-established
minimum quality standards for convertible securities and may invest in
convertible securities of any quality, including lower rated or unrated
securities. However, the Portfolio will not invest in any security in default at
the time of purchase or in any nonconvertible debt securities rated below
investment grade, and the Portfolio will invest less than 20% of the market
value of its assets at the time of purchase in convertible securities rated
below investment grade. If convertible securities purchased by the Portfolio are
downgraded following purchase, or if other circumstances cause 20% or more of
the Portfolio's assets to be invested in convertible securities rated below
investment grade, the trustees of Worldwide Portfolios, in consultation with the
sub-advisor, will determine what action, if any, is appropriate in light of all
relevant circumstances. For a further discussion of debt security ratings, see
Appendix A to this Part B.
SECURITIES OF SMALLER COMPANIES. The Portfolio may invest in
securities of companies with small or mid-sized market capitalizations. Market
capitalization is defined as total current market value of a company's
outstanding common stock. Investments in companies with smaller market
capitalizations may involve greater risks and price volatility (that is, more
abrupt or erratic price movements) than investments in larger, more mature
companies since smaller companies may be at an earlier stage of development and
may have limited product lines, reduced market liquidity for their shares,
limited financial resources or less depth in management than larger or more
established companies. Smaller companies also may be less significant factors
within their industries and may have difficulty withstanding competition from
larger companies. While smaller companies may be subject to these additional
risks, they may also realize more substantial growth than larger or more
established companies.
LENDING OF SECURITIES. As discussed in Part A, the Portfolio may
lend its securities to qualified institutional investors who need to borrow
securities in order to complete certain transactions, such as covering short
sales, avoiding failures to deliver securities, or completing arbitrage
operations. By lending its securities, the Portfolio will be attempting to
generate income through the receipt of interest on the loan which, in turn, can
be invested in additional securities to pursue the Portfolio's investment
objective. Any gain or loss in the market price of the securities loaned that
might occur during the term of the loan would be for the account of the
Portfolio. The Portfolio may lend its portfolio securities to qualified brokers,
dealers, banks or other financial institutions, so long as the terms, the
structure and the aggregate amount of such loans are not inconsistent with the
Investment Company Act of 1940, or the Rules and Regulations or interpretations
of the Securities and Exchange Commission (the "Commission") thereunder, which
currently require that (a) the borrower pledge and maintain with the Portfolio
collateral consisting of cash, an irrevocable letter of credit or securities
issued or guaranteed by the U.S. government
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having a value at all times not less than 100% of the value of the securities
loaned, (b) the borrower add to such collateral whenever the price of the
securities loaned rises (i.e., the borrower "marks to the market" on a daily
basis), (c) the loan be made subject to termination by the Portfolio at any time
and (d) the Portfolio receive reasonable interest on the loan, which interest
may include the Portfolio's investing cash collateral in interest bearing
short-term investments, and (e) the Portfolio receive all dividends and
distributions on the loaned securities and any increase in the market value of
the loaned securities.
The Portfolio bears a risk of loss in the event that the other
party to a securities lending transaction defaults on its obligations and the
Portfolio is delayed in or prevented from exercising its rights to dispose of
the collateral, including the risk of a possible decline in the value of the
collateral securities during the period in which the Portfolio seeks to assert
these rights, the risk of incurring expenses associated with asserting these
rights and the risk of losing all or a part of the income from the transaction.
The Portfolio will not lend its portfolio securities if, as a result, the
aggregate value of such loans would exceed 33-1/3% of the value of the
Portfolio's total assets. Loan arrangements made by the Portfolio will comply
with all other applicable regulatory requirements, including the rules of the
New York Stock Exchange, which rules presently require the borrower, after
notice, to redeliver the securities within the normal settlement time of three
business days. All relevant facts and circumstances, including creditworthiness
of the broker, dealer or institution, will be considered in making decisions
with respect to the lending of securities, subject to review by Worldwide
Portfolio's trustees.
ILLIQUID AND RESTRICTED SECURITIES. The Portfolio is authorized to
invest in securities which are illiquid or not readily marketable because they
are subject to restrictions on their resale ("restricted securities") or
because, based upon their nature or the market for such securities, no ready
market is available. However, the Portfolio may not purchase any security, the
purchase of which would cause the Portfolio to invest more than 15% of its net
assets, measured at the time of purchase, in illiquid securities. Investments in
illiquid securities involve certain risks to the extent that the Portfolio may
be unable to dispose of such a security at the time desired or at a reasonable
price or, in some cases, may be unable to dispose of it at all. In addition, in
order to resell a restricted security, the Portfolio might have to incur the
potentially substantial expense and delay associated with effecting
registration. If securities become illiquid following purchase or other
circumstances cause more than 15% of the Portfolio's net assets to be invested
in illiquid securities, the trustees of Worldwide Portfolios, in consultation
with the sub-advisor, will determine what action, if any, is appropriate in
light of all relevant circumstances.
Repurchase agreements maturing in more than seven days will be
considered as illiquid for purposes of this restriction. Pursuant to guidelines
established by the trustees, the Portfolio's sub-advisor will determine whether
securities eligible for resale to qualified institutional buyers pursuant to
Rule 144A under the Securities Act of 1933 should be treated as illiquid
investments considering, among other things, the following factors: (1) the
frequency of trades and quotes for the security; (2) the number of dealers
wanting to purchase or sell the security and the number of other potential
purchasers; (3) dealer undertakings to make a market in the security; and
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(4) the nature of the security and the marketplace trades (e.g., the time needed
to dispose of the security, the method of soliciting offers, and the mechanics
of the transfer). The liquidity of the Portfolio's investments in Rule 144A
securities could be impaired if qualified institutional buyers become
uninterested in purchasing these securities.
REPURCHASE AGREEMENTS. The Portfolio may invest in repurchase
agreements with various financial organizations, including commercial banks,
registered broker-dealers and registered government securities dealers. A
repurchase agreement is a means of investing cash for a short period. A
repurchase agreement is an agreement under which the Portfolio acquires a debt
security (generally a debt security issued or guaranteed by the U.S. government
or an agency thereof, a banker's acceptance or a certificate of deposit) from a
commercial bank, broker or dealer, subject to resale to the seller at an agreed
upon price and date (normally, the next business day). A repurchase agreement
may be considered a loan collateralized by securities. The resale price reflects
an agreed upon interest rate effective for the period the instrument is held by
the Portfolio and is unrelated to the interest rate on the underlying
instrument.
In these transactions, the securities acquired by the Portfolio
(including accrued interest earned thereon) must have a total value equal to or
in excess of the value of the repurchase agreement and are held by the
Portfolio's custodian bank until repurchased. In addition, the trustees will
establish guidelines and standards for review by the sub-advisor of the
creditworthiness of any bank, broker or dealer party to a repurchase agreement
with the Portfolio. The Portfolio will not enter into a repurchase agreement
maturing in more than seven days if as a result more than 15% of the Portfolio's
net assets would be invested in such repurchase agreements and other illiquid
securities.
These transactions must be fully collateralized at all times by
debt securities (generally a security issued or guaranteed by the U.S.
Government or an agency thereof, a banker's acceptance or a certificate of
deposit), but involve certain risks, such as credit risk to the Portfolio if the
other party defaults on its obligation and the Portfolio is delayed or prevented
from liquidating the collateral. For example, if the other party to the
agreement defaults on its obligation to repurchase the underlying security at a
time when the value of the security has declined, the Portfolio may incur a loss
upon disposition of the security. If the other party to the agreement becomes
insolvent and subject to liquidation or reorganization under the bankruptcy or
other laws, a court may determine that the underlying security is collateral for
a loan by the Portfolio not within the control of the Portfolio and therefore
the realization by the Portfolio on such collateral may automatically be stayed
and delayed. Further, it is possible that the Portfolio may not be able to
substantiate its interest in the underlying security and may be deemed an
unsecured creditor of the other party to the agreement. The Portfolio expects
that these risks can be controlled through careful monitoring procedures.
SECURITIES OF COMPANIES WITH LIMITED OPERATING HISTORIES. The
Portfolio may invest in securities of companies with limited operating
histories. The Portfolio considers these to be securities of companies with a
record of less than three years' continuous operation, even including the
operations of any predecessors and parents. (These are sometimes referred to as
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"unseasoned issuers.") These companies by their nature have only a limited
operating history which can be used for evaluating the company's growth
prospects. As a result, investment decisions for these securities may place a
greater emphasis on current or planned product lines and the reputation and
experience of the company's management and less emphasis on fundamental
valuation factors than would be the case for more mature companies. In addition,
many of these companies may also be small companies and involve the risks and
price volatility associated with smaller companies.
SPECIAL SITUATIONS. The Portfolio may also invest in "special
situations." Special situations are companies that have recently experienced or
are anticipated to experience a significant change in structure, management,
products or services which may significantly affect the value of their
securities. Examples of special situations are companies being reorganized or
merged, companies emerging from bankruptcy, companies introducing unusual new
products or which enjoy particular tax advantages. Other examples are companies
experiencing changes in senior management, extraordinary corporate events,
significant changes in cost or capital structure or which are believed to be
probable takeover candidates. The opportunity to invest in special situations,
however, is limited and depends in part on the market's assessment of these
companies and their circumstances. By its nature, a "special situation" company
involves to some degree a break with the company's past experience. This creates
greater uncertainty and potential risk of loss than if the company were
operating according to long-established patterns. In addition, stocks of
companies in special situations may decline or not appreciate as expected if an
anticipated change or development does not occur or is not assessed by the
market as favorably as expected.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES. The Portfolio may
purchase and sell securities on a when-issued or delayed delivery basis.
However, the Portfolio does not currently intend to purchase or sell securities
on a when-issued or delayed delivery basis, if as a result more than 5% of its
net assets taken at market value at the time of purchase would be invested in
such securities. When-issued or delayed delivery transactions arise when
securities are purchased or sold by the Portfolio with payment and delivery
taking place in the future in order to secure what is considered to be an
advantageous price or yield. However, the yield available on a comparable
security when delivery takes place may vary from the yield on the security at
the time that the when-issued or delayed delivery transaction was entered into.
Any failure to consummate a when-issued or delayed delivery transaction may
result in the Portfolio missing the opportunity of obtaining a price or yield
considered to be advantageous. When-issued and delayed delivery transactions may
generally be expected to settle within one month from the date the transactions
are entered into, but in no event later than 90 days. However, no payment or
delivery is made by the Portfolio until it receives delivery or payment from the
other party to the transaction.
When the Portfolio purchases securities on a when-issued basis, it
will maintain in a segregated account with its custodian cash, U.S. government
securities or other liquid assets having an aggregate value equal to the amount
of such purchase commitments, until payment is made. If necessary, additional
assets will be placed in the account daily so that the value of the account will
equal or exceed the amount of the Portfolio's purchase commitments.
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PORTFOLIO TURNOVER. Portfolio turnover is disclosed on the
schedule of Ratios/Supplementary Data incorporated by reference into this Part
B. In pursuit of the Portfolio's investment objective, the sub-advisor
continuously monitors the Portfolio's investments and makes portfolio changes
whenever changes in investment themes, the fundamentals of any portfolio company
or the price of any portfolio security indicate to the sub-advisor that more
attractive alternatives exist or that the Portfolio's investment objective could
be better achieved by investment in another security, regardless of portfolio
turnover. In addition, portfolio turnover may increase as a result of large
amounts of purchases and redemptions of interests in the Portfolio due to
economic, market or other factors that are not within the control of management.
INVESTMENT RESTRICTIONS
The investment objective of the Portfolio is long-term capital
appreciation.
The Portfolio has adopted certain investment policies, strategies,
guidelines and procedures in pursuing its objective. These may be changed
without an investor vote. The principal policies and strategies used by the
Portfolio are described in Part A.
In addition, the Portfolio has adopted certain fundamental and
non-fundamental restrictions on its investments and other activities, which are
listed below. Fundamental restrictions may not be changed without the approval
of (i) 67% or more of the total beneficial interest of the Portfolio present at
a meeting of investors thereof if the holders of more than 50% of the total
beneficial interest are present or represented by proxy, or (ii) more than 50%
of the total beneficial interest of the Portfolio. Non-fundamental restrictions
may be changed in the future by action of the trustees without an investor vote.
The following fundamental restrictions apply to the Portfolio. The
Portfolio may not:
1. With respect to 75% of the Portfolio's total assets,
purchase the securities of any one issuer (except U.S. government securities) if
immediately after and as a result of such purchase (a) the value of the holdings
of the Portfolio in the securities of such issuer exceeds 5% of the value of the
Portfolio's total assets or (b) the Portfolio owns more than 10% of the
outstanding voting securities of such issuer.
2. Invest in any one industry (other than U.S. government
securities) 25% or more of the value of its total assets at the time of such
investment.
3. Borrow money, except from banks for temporary or emergency
purposes in amounts not to exceed 25% of the Portfolio's total assets (including
the amount borrowed) taken at market value, nor pledge, mortgage or hypothecate
its assets, except to secure permitted indebtedness and then only if such
pledging, mortgaging or hypothecating does not exceed 25% of the Portfolio's
total assets taken at market value. When borrowings exceed 5% of the Portfolio's
total assets, the Portfolio will not purchase portfolio securities.
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4. Act as a securities underwriter (except to the extent the
Portfolio may be deemed an underwriter under the Securities Act of 1933 in
disposing of a security), issue senior securities (except to the extent
permitted under the Investment Company Act of 1940), invest in real estate
(although it may purchase shares of a real estate investment trust), or invest
in commodities or commodity contracts except financial futures transactions,
futures contracts on securities and securities indices and options on such
futures, forward foreign currency exchange contracts, forward commitments or
securities index put or call options.
5. Make loans, except that the Portfolio may enter into
repurchase agreements and may lend portfolio securities in accordance with the
Portfolio's investment policies. The Portfolio does not, for this purpose,
consider the purchase of all or a portion of an issue of publicly distributed
bonds, bank loan participation agreements, bank certificates of deposit,
bankers' acceptances, debentures or other securities, whether or not the
purchase is made upon the original issuance of the securities, to be the making
of a loan.
In applying the industry concentration investment restriction (no.
2 above), the Portfolio uses the industry groups designated by the Financial
Times World Index Service.
The trustees have adopted additional non-fundamental investment
restrictions for the Portfolio. These limitations may be changed by the trustees
without a vote of investors. The non-fundamental investment restrictions include
the following:
1 With respect to 100% of the Portfolio's total assets, the
Portfolio may not purchase the securities of any one issuer (except U.S.
government securities) if immediately after and as a result of such purchase (a)
the value of the holdings of the Portfolio in the securities of such issuer
exceeds 5% of the value of the Portfolio's total assets or (b) the Portfolio
owns more than 10% of the outstanding voting securities of such issuer.
2 The Portfolio may not purchase securities on margin from a
broker or dealer, except that the Portfolio may obtain such short-term credits
as may be necessary for the clearance of transactions, and may not make short
sales of securities. This limitation shall not prohibit or restrict the
Portfolio from entering into futures, forwards and options contracts or from
making margin payments and other deposits in connection therewith.
3 The Portfolio may not purchase the securities of any other
investment company, except by purchase in the open market involving no
commission or profit to a sponsor or dealer (other than the customary broker's
commission).
4 The Portfolio may not invest in companies for the purposes
of exercising control of management.
B-13
<PAGE>
5 The Portfolio may not purchase any security, including any
repurchase agreement maturing in more than seven days, which is not readily
marketable, if more than 15% of the net assets of the Portfolio, taken at market
value at the time of purchase would be invested in such securities.
6 The Portfolio may not enter into any futures, forwards or
options, except that only for the purpose of hedging, the Portfolio may enter
into forward foreign currency exchange contracts with stated contract values of
up to the value of the Portfolio's assets.
7 The Portfolio may not purchase or sell securities on a
when-issued or delayed delivery basis, if as a result more than 5% of its net
assets taken at market value at the time of purchase would be invested in such
securities.
ITEM 13. MANAGEMENT OF THE PORTFOLIO
Worldwide Portfolios is supervised by trustees who are responsible
for major decisions about the Portfolio's policies and overall Portfolio
oversight. Worldwide Portfolio's board hires the companies that run day-to-day
Portfolio operations, such as the investment advisor and custodian.
The trustees and executive officers of Worldwide Portfolios are
listed below, together with information which includes their principal
occupations during the past five years and other principal business
affiliations.
MICHAEL OWEN, 114 A Gallatin Dr., Bozeman, MT 59718, DOB: 1937.
Self-employed as a financial and management consultant, and in real
estate development. From 1993 to June 1999, Dean, and from 1989 to
1993, a member of the Finance faculty, of the College of Business,
Montana State University. Formerly (1976-1989), Chairman and Chief
Executive Officer of Royal Gold, Inc. (mining). Chairman of the Board
of Berger Growth Fund and Berger Growth and Income Fund. Chairman of
the Trustees of Berger Investment Portfolio Trust, Berger
Institutional Products Trust, Berger/BIAM Worldwide Funds Trust,
Berger/BIAM Worldwide Portfolios Trust and Berger Omni Investment
Trust.
* JACK R. THOMPSON, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1949. President and a director since May 1999 (Executive Vice
President from February 1999 to May 1999) of Berger Growth Fund and
Berger Growth and Income Fund. President and a trustee since May 1999
(Executive Vice President from February 1999 to May 1999) of Berger
Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust, Berger/BIAM Worldwide Portfolios
Trust and Berger Omni Investment Trust. President and Director since
June, 1999 (Executive Vice President from February 1999 to June 1999)
of Berger LLC. Audit Committee Member of the Public Employees'
Retirement Association of Colorado (pension plan) since November 1997.
B-14
<PAGE>
Self-employed as a consultant from July 1995 through February 1999.
Director of Wasatch Advisors (investment management) from February
1997 to February 1999. Director of Janus Capital Corporation
(investment management) from June 1984 through June 1995, and
Executive Vice President of the Corporation from April 1989 through
June 1995. Treasurer of Janus Capital Corporation from November 1983
through October 1989. Trustee of the Janus Investment Funds from
December 1990 through June 1995, and Senior Vice President of the
Trust from May 1993 through June 1995. President and a director of
Janus Service Corporation (transfer agent) from January 1987 through
June 1995. President and a director of Fillmore Agency, Inc.
(advertising agency), from January 1990 through June 1995. Executive
Vice President and a director of Janus Capital International, Ltd.
(investment advisor) from September 1994 through June 1995. President
and a director of Janus Distributors, Inc. (broker/dealer), from May
1991 through June 1995. Director of IDEX Management, Inc. (investment
management), from January 1985 through June 1995. Trustee and Senior
Vice President of the of the Janus Aspen Funds from May 1993 through
June 1995
DENNIS E. BALDWIN, 3481 South Race Street, Englewood, CO 80110, DOB: 1928.
President, Baldwin Financial Counseling. Formerly (1978-1990), Vice
President and Denver Office Manager of Merrill Lynch Capital Markets.
Director of Berger Growth Fund and Berger Growth and Income Fund.
Trustee of Berger Investment Portfolio Trust, Berger Institutional
Products Trust, Berger/BIAM Worldwide Funds Trust, Berger/BIAM
Worldwide Portfolios Trust and Berger Omni Investment Trust.
LOUIS R. BINDNER, 1075 South Fox, Denver, CO 80223, DOB: 1925. President,
Climate Engineering, Inc. (building environmental systems). Director
of Berger Growth Fund and Berger Growth and Income Fund. Trustee of
Berger Investment Portfolio Trust, Berger Institutional Products
Trust, Berger/BIAM Worldwide Funds Trust, Berger/BIAM Worldwide
Portfolios Trust and Berger Omni Investment Trust.
KATHERINE A. CATTANACH, 672 South Gaylord, Denver, CO 80209, DOB: 1945.
Managing Principal, Sovereign Financial Services, Inc. (investment
consulting firm). Formerly (1981-1988), Executive Vice President,
Captiva Corporation, Denver, Colorado (private investment management
firm). Ph.D. in Finance (Arizona State University); Chartered
Financial Analyst (CFA). Director of Berger Growth Fund and Berger
Growth and Income Fund. Trustee of Berger Investment Portfolio Trust,
Berger Institutional Products Trust, Berger/BIAM Worldwide Funds
Trust, Berger/BIAM Worldwide Portfolios Trust and Berger Omni
Investment Trust.
* DENIS CURRAN, 20 Horseneck Lane, Greenwich, CT 06830, DOB: 1947. President
and a director since December 1994, and Senior Vice President and a
director from September 1991 to December 1994, of Bank of Ireland
Asset Management (U.S.) Limited (investment advisory firm). Member of
the Board of Managers and Chief Executive Officer on the Management
Committee of BBOI Worldwide LLC since November 1996. Trustee of
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios
Trust since November 1996.
B-15
<PAGE>
PAUL R. KNAPP, 33 North LaSalle Street, Suite 1900, Chicago, IL 60602,
DOB: 1945. Since 1991, Chairman, President, Chief Executive Officer
and a director of Catalyst Institute (international public policy
research organization focused primarily on financial markets and
institutions). Since September 1997, President, Chief Executive
Officer and a director of DST Catalyst, Inc. (international financial
markets consulting, software and computer services company, an 81%
owned subsidiary of DST Systems, Inc.) Director (since February 1998)
and a Vice President (February 1998 - November 1998) of West Side
Investments, Inc. (investments), a wholly-owned subsidiary of DST
Systems, Inc. Previously (1991 - September 1997), Chairman, President,
Chief Executive Officer and a director of Catalyst Consulting
(international financial institutions business consulting firm). Prior
thereto (1988-1991), President, Chief Executive Officer and a director
of Kessler Asher Group (brokerage, clearing and trading firm).
Director of Berger Growth Fund and Berger Growth and Income Fund.
Trustee of Berger Investment Portfolio Trust, Berger Institutional
Products Trust, Berger/BIAM Worldwide Funds Trust, Berger/BIAM
Worldwide Portfolios Trust and Berger Omni Investment Trust.
HARRY T. LEWIS, JR., 370 17th Street, Suite 3560, Denver, CO 80202, DOB:
1933. Self-employed as a private investor. Formerly (1981-1988),
Senior Vice President, Rocky Mountain Region, of Dain Bosworth
Incorporated and member of that firm's Management Committee. Director
of J.D. Edwards & Co. (computer software company) since 1995. Director
of Berger Growth Fund and Berger Growth and Income Fund. Trustee of
Berger Investment Portfolio Trust, Berger Institutional Products
Trust, Berger/BIAM Worldwide Funds Trust, Berger/BIAM Worldwide
Portfolios Trust and Berger Omni Investment Trust.
WILLIAM SINCLAIRE, 3049 S. Perry Park Road, Sedalia, CO 80135, DOB: 1928.
President, Santa Clara LLC (privately owned agriculture company).
Director of Berger Growth Fund and Berger Growth and Income Fund.
Trustee of Berger Investment Portfolio Trust, Berger Institutional
Products Trust, Berger/BIAM Worldwide Funds Trust, Berger/BIAM
Worldwide Portfolios Trust and Berger Omni Investment Trust.
* JANICE M. TEAGUE, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1954. Vice President and Secretary (since November 1998) and
Assistant Secretary (October 1996 to November 1998) of the Berger
Funds. Vice President (since October 1997), Secretary (since November
1998) and Assistant Secretary (September 1996 through November 1998)
with Berger LLC. Vice President and Secretary with Berger Distributors
LLC, since August 1998. Formerly, self-employed as a business
consultant from June 1995 through September 1996, Secretary of the
Janus Funds from January 1990 to May 1995 and Assistant Secretary of
Janus Capital Corporation from October 1989 to May 1995.
* DAVID J. SCHULTZ, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1950. Vice President and Treasurer (since November 1998) and
Assistant Treasurer (September 1996 to November 1998) of the Berger
Funds. Vice President (since February 1997) and Controller (since
August 1994) with Berger LLC. Chief Financial Officer and Treasurer
(since May 1996), Assistant Secretary (since August 1998) and
Secretary (May 1996 to August 1998) with Berger Distributors LLC
Formerly, Partner with Smith, Brock & Gwinn (accounting firm) from
January 1984 to August 1994.
B-16
<PAGE>
* BRIAN S. FERRIE, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1958. Vice President of the Berger Funds since November 1998.
Vice President (since February 1997) and Chief Compliance Officer
(since August 1994) with Berger LLC. Chief Compliance Officer with
Berger Distributors LLC, since May 1996. Formerly, Compliance Officer
with United Services Advisor, Inc., from January 1988 to July 1994,
and Director of Internal Audit of United Services Funds from January
1987 to July 1994.
* JOHN PAGANELLI, 210 University Boulevard, Suite 900, Denver, CO 80206,
DOB: 1967. Assistant Treasurer of the Berger Funds since November
1998. Vice President (since November 1998) and Manager of Accounting
(January 1997 through November 1998) with Berger LLC. Formerly,
Manager of Accounting (December 1994 through October 1996) and Senior
Accountant (November 1991 through December 1994) with Palmeri Fund
Administrators, Inc.
- ----------------
* Interested person (as defined in the Investment Company Act of 1940) of the
Portfolio and the Portfolio's advisor or sub-advisor.
The trustees of Worldwide Portfolios have adopted a trustee
retirement age of 75 years.
TRUSTEE COMPENSATION
Officers of Worldwide Portfolios receive no compensation from
Worldwide Portfolios. However, trustees of Worldwide Portfolios who are not
interested persons of the Portfolio's advisor or sub-advisor are compensated for
their services according to a fee schedule, allocated among the Berger Funds.
Neither the officers of Worldwide Portfolios nor the trustees receive any form
of pension or retirement benefit compensation from Worldwide Portfolios.
Set forth below is information regarding compensation paid or
accrued during the fiscal year ended September 30, 1999, for each trustee of the
Worldwide Portfolios and of the other Berger Funds.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
NAME AND POSITION WITH AGGREGATE AGGREGATE
BERGER FUNDS COMPENSATION COMPENSATION
FROM THE FROM
PORTFOLIO(1) ALL BERGER
FUNDS(2)
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Dennis E. Baldwin(3) $2,966 $47,600
- --------------------------------------------------------------------------------------------------------------------
Louis R. Bindner(3) $2,966 $47,600
- --------------------------------------------------------------------------------------------------------------------
Katherine A. Cattanach(3) $2,966 $47,600
- --------------------------------------------------------------------------------------------------------------------
Denis Curran(4),(6) $0 $0
- --------------------------------------------------------------------------------------------------------------------
B-17
<PAGE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Paul R. Knapp(3) $2,931 $47,000
- --------------------------------------------------------------------------------------------------------------------
Harry T. Lewis(3) $2,966 $47,600
- --------------------------------------------------------------------------------------------------------------------
Michael Owen(3) $3,590 $57,600
- --------------------------------------------------------------------------------------------------------------------
Jack R. Thompson(3)(4)(5) $ 0 $ 0
- --------------------------------------------------------------------------------------------------------------------
William Sinclaire(3) $2,966 $47,600
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Trustee compensation is paid by Worldwide Portfolios to its trustees and
borne indirectly pro rata by the investors in the Worldwide Portfolios.
(2) Includes the Berger Growth Fund, the Berger Growth and Income Fund, the
Berger Investment Portfolio Trust (seven series), the Berger Institutional
Products Trust (four series), the Berger/BIAM Worldwide Portfolios Trust (one
series), the Berger/BIAM Worldwide Funds Trust (three series) and the Berger
Omni Investment Trust (one series). Aggregate compensation figures do not
include first-year estimates for any Fund in existence for less than one year.
Of the aggregate amounts shown for each director/trustee, the following amounts
were deferred under applicable deferred compensation plans: Dennis E. Baldwin
$24,316; Louis R. Bindner $15,333; Katherine A. Cattanach $47,393; Michael Owen
$6,651; William Sinclaire $40,423.
(3) Director of Berger Growth Fund and Berger Growth and Income Fund. Trustee
of Berger Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust, Berger/BIAM Worldwide Portfolios Trust and
Berger Omni Investment Trust.
(4) Interested person of BBOI Worldwide LLC.
(5) President of Berger Growth Fund, Berger Growth and Income Fund, Berger
Investment Portfolio Trust, Berger Institutional Products Trust, Berger/BIAM
Worldwide Portfolios Trust, Berger/BIAM Worldwide Funds Trust and Berger Omni
Investment Trust.
(6) Trustee of Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide
Portfolios Trust.
Trustees may elect to defer receipt of all or a portion of their
fees pursuant to a fee deferral plan adopted by Worldwide Portfolios. Under the
plan, deferred fees are credited to an account and adjusted thereafter to
reflect the investment experience of whichever of the Berger Funds (or approved
money market funds) is designated by the trustees for this purpose. Pursuant to
an exemptive order of the Commission, Worldwide Portfolios is permitted to
purchase shares of the designated funds in order to offset its obligation to the
trustees participating in the plan. Purchases made pursuant to the plan are
excepted from any otherwise applicable investment restriction limiting the
purchase of securities of any other investment company. Worldwide Portfolios'
obligation to make payments of deferred fees under the plan is a general
obligation of Worldwide Portfolios.
The trustees of Worldwide Portfolios and the trustees of the funds
investing in the Portfolio are the same individuals. A majority of the trustees
of each of those trusts who are not "interested persons" (as defined in the
Investment Company Act of 1940) of either trust have adopted written procedures
reasonably appropriate to deal with potential conflicts of interest arising from
the fact that the same individuals are trustees of both trusts, up to and
including creating a new board of trustees for one or the other of the trusts.
ITEM 14. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
B-18
<PAGE>
As of January 4, 2000, holders of record of 5% or more of the
outstanding interests in the Portfolio were as follows:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
INVESTOR PERCENTAGE INTEREST
- --------------------------------------------------------------------------------------------------------
<S> <C>
Berger/BIAM International Fund 7.7%
- --------------------------------------------------------------------------------------------------------
International Equity Fund 3.9%
- --------------------------------------------------------------------------------------------------------
Berger/BIAM International CORE Fund 88.4%
- --------------------------------------------------------------------------------------------------------
</TABLE>
The address of each of the holders in the table above is 210
University Blvd. #900, Denver, CO 80206. Each is a series of the Berger/BIAM
Worldwide Funds Trust, a Delaware business trust. Holders of 25% or more of the
interests in the Portfolio may be deemed to be controlling persons of the
Portfolio.
As of the date of this Registration Statement, the officers and
trustees of Worldwide Portfolios as a group owned of record or beneficially no
interest in the Portfolio.
ITEM 15. INVESTMENT ADVISORY AND OTHER SERVICES
For more information concerning the advisor and the sub-advisor,
their controlling persons and affiliates, see Items 6 and 13 above.
INVESTMENT ADVISOR
The investment advisor to the Portfolio is BBOI Worldwide LLC
("BBOI Worldwide"), 210 University Boulevard, Denver, CO 80206. The advisor
oversees, evaluates and monitors the investment advisory services provided to
the Portfolio by the Portfolio's sub-advisor and is responsible for furnishing
general business management and administrative services to the Portfolio.
The advisor is a Delaware limited liability company formed in
1996. The advisor is a joint venture between Berger LLC and Bank of Ireland
Asset Management (U.S.) Limited ("BIAM"), the sub-advisor to the Portfolio,
which have both been in the investment advisory business for many years.
Berger LLC and BIAM each own a 50% membership interest in the
advisor and each have an equal number of representatives on the advisor's Board
of Managers. Berger LLC's role in the joint venture is to provide administrative
services, and BIAM's role is to provide international and global investment
management expertise. Agreement of representatives of both Berger LLC and BIAM
is required for all significant management decisions.
On January 19, 2000, Berger LLC and BIAM entered into an agreement
to dissolve BBOI Worldwide. The dissolution of BBOI will have no effect on the
investment advisory services
B-19
<PAGE>
provided to the Portfolio or on the fees borne by the Portfolio for advisory
services. Contingent upon shareholder approval, when BBOI Worldwide is
dissolved, Berger LLC will become the Portfolio's advisor and BIAM will continue
to be responsible for day-to-day management of the Portfolio as sub-advisor. If
approved by shareholders, these advisory changes are expected to take place in
the first half of this year.
Berger LLC has been in the investment advisory business for 25
years. It serves as investment advisor or sub-advisor to mutual funds and
institutional investors and had assets under management of approximately $6.1
billion as of December 31, 1999 Berger LLC is a subsidiary of Stilwell
Management Inc. ("Stilwell"), which owns more than 80% of Berger LLC, and is an
indirect subsidiary of Stilwell Financial, Inc. ("Stilwell Financial"), which in
turn is a wholly owned subsidiary of Kansas City Southern Industries, Inc.
("KCSI"). KCSI is a publicly traded holding company with principal operations in
rail transportation, through its subsidiary The Kansas City Southern Railway
Company, and financial asset management businesses. Stilwell also owns
approximately 32% of the outstanding shares of DST Systems, Inc. ("DST"), a
publicly traded information and transaction processing company which acts as the
investors' sub-transfer agent. DST, in turn, owns 100% of DST Securities, a
registered broker-dealer.
KCSI announced its intention to separate the transportation and
financial services segments through a proposed dividend of the stock of Stilwell
Financial. On July 12, 1999 KCSI announced that the Internal Revenue Service
issued a favorable tax ruling permitting KCSI to separate its financial services
segment from its transportation segment. Completion of this separation is
expected to occur in the year 2000.
SUB-ADVISOR
As permitted in its Investment Advisory Agreement with the
Portfolio, the advisor has delegated day-to-day portfolio management
responsibility to Bank of Ireland Asset Management (U.S.) Limited ("BIAM"). As
sub-advisor, BIAM manages the investments in the Portfolio and determines what
securities and other investments will be purchased, retained, sold or loaned,
consistent with the investment objective and policies established by the
trustees of Worldwide Portfolios. BIAM's main offices are at 26 Fitzwilliam
Place, Dublin 2, Ireland. BIAM maintains a representative office at 20 Horseneck
Lane, Greenwich, CT 06830. BIAM is an indirect wholly-owned subsidiary of Bank
of Ireland, a publicly traded, diversified financial services group with
business operations worldwide. Bank of Ireland provides investment management
services through a network of related companies, including BIAM which serves
primarily institutional clients in the United States and Canada. Bank of Ireland
and its affiliates managed assets for clients worldwide in excess of $42.9
billion as of September 30, 1999.
Bank of Ireland or its affiliates may have deposit, loan or other
commercial or investment banking relationships with the issuers of securities
which may be purchased by the Portfolio, including outstanding loans to such
issuers which could be repaid in whole or in part with the proceeds of
securities purchased by the Portfolio. Federal law prohibits BIAM, in making
investment decisions, from using material non-public information in its
possession or in the possession of any of its affiliates. In addition, in making
investment decisions for the Portfolio,
B-20
<PAGE>
BIAM will not take into consideration whether an issuer of securities proposed
for purchase or sale by the Portfolio is a customer of Bank of Ireland or its
affiliates.
INVESTMENT ADVISORY AGREEMENT AND SUB-ADVISORY AGREEMENT
Under the Investment Advisory Agreement between the advisor and
Berger/BIAM Worldwide Portfolios Trust with respect to the Portfolio, the
advisor oversees, evaluates and monitors the investment advisory services
provided to the Portfolio by the sub-advisor and is responsible for furnishing
general business management and administrative services to the Portfolio. Under
the Investment Advisory Agreement for the Portfolio, the advisor is compensated
for its services to the Portfolio by the payment of a fee at the annual rate of
0.90% of the average daily net assets of the Portfolio. The funds invested in
the Portfolio bear a pro rata portion of the fee paid by the Portfolio to the
advisor. The Investment Advisory Agreement provides that the advisor shall not
be liable for any error of judgment or mistake of law or for any loss arising
out of any investment or for any act or omission taken with respect to the
Portfolio, except for willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of reckless disregard of its obligations
and duties thereunder and except to the extent otherwise provided by law.
Under a written agreement, the Portfolio's advisor waives its
investment advisory fee to the extent that the Portfolio's annual operating
expenses in any fiscal year, including the investment advisory fee and custodian
fees, but excluding brokerage commissions, interest, taxes and extraordinary
expenses, exceed 1.00% of the Portfolio's average daily net assets for that
fiscal year. The agreement may not be terminated without the prior written
consent of the Portfolio by a vote of its Board of Trustees. Any such reduction
in the advisory fee paid by the Portfolio will also reduce the pro rata share of
the advisory fee borne indirectly by the funds invested in the Portfolio.
The Investment Advisory Agreement will continue in effect until
April 2000, and thereafter from year to year if such continuation is
specifically approved at least annually by the trustees or by vote of a majority
of the outstanding interests of the Portfolio and in either case by vote of a
majority of the trustees of Worldwide Portfolios who are not "interested
persons" (as that term is defined in the Investment Company Act of 1940) of the
Portfolio or the advisor. The Agreement is subject to termination by the
Portfolio or the advisor on 60 days' written notice, and terminates
automatically in the event of its assignment.
Under the Sub-Advisory Agreement between the advisor and the
sub-advisor, the advisor has delegated day-to-day portfolio management
responsibility to the sub-advisor. The sub-advisor manages the investments in
the Portfolio and determines what securities and other investments will be
purchased, retained, sold or loaned, consistent with the investment objective
and policies established by the trustees of Worldwide Portfolios. The Portfolio
pays no fees directly to the sub-advisor. The sub-advisor will receive from the
advisor a fee at the annual rate of 0.45% of the average daily net assets of the
Portfolio. During certain periods, the sub-advisor may voluntarily waive all or
a portion of its fee under the Sub-Advisory Agreement, which will not affect the
fee paid by the Portfolio to the advisor. The Sub-Advisory Agreement provides
that the sub-advisor shall not be liable for any error of judgment or mistake of
law or for any loss arising out of any investment or for any act or omission
taken with respect to the Portfolio, except for willful misfeasance, bad
B-21
<PAGE>
faith or gross negligence in the performance of its duties, or by reason of
reckless disregard of its obligations and duties thereunder and except to the
extent otherwise provided by law.
The Sub-Advisory Agreement will continue in effect until April
2000, and thereafter from year to year if such continuation is specifically
approved at least annually by the trustees or by vote of a majority of the
outstanding interests of the Portfolio and in either case by vote of a majority
of the trustees of Worldwide Portfolios who are not "interested persons" (as
that term is defined in the Investment Company Act of 1940) of the Portfolio or
the advisor or the sub-advisor. The Sub-Advisory Agreement is subject to
termination by the Portfolio, the advisor or the sub-advisor on 60 days' written
notice, and terminates automatically in the event of its assignment and in the
event of termination of the Investment Advisory Agreement.
TRADE ALLOCATIONS
Investment decisions for the Portfolio and other accounts advised
by the sub-advisor are made independently with a view to achieving each of their
respective investment objectives and after consideration of such factors as
their current holdings, availability of cash for investment and the size of
their investments generally. However, certain investment decisions may be
appropriate for the Portfolio and one or more such accounts. If the Portfolio
and other accounts advised by the sub-advisor are contemporaneously engaged in
the purchase or sale of the same security, the orders may be aggregated and/or
the transactions averaged as to price and allocated equitably to the Portfolio
and each participating account pursuant to procedures adopted by the Portfolio's
sub-advisor. While in some cases, this policy might adversely affect the price
paid or received by the Portfolio or other participating accounts, or the size
of the position obtained or liquidated, the sub-advisor will aggregate orders if
it believes that coordination of orders and the ability to participate in volume
transactions will result in the best overall combination of net price and
execution.
RESTRICTIONS ON PERSONAL TRADING
The advisor has adopted a Code of Ethics covering all board
members, officers, employees and other access persons (as defined below) of the
advisor who are not also covered by an approved Code of Ethics of an affiliated
person who is an investment advisor ("covered persons"). At present, there are
no persons who would be covered by the advisor's Code of Ethics who are not also
covered by the Code of Ethics of Berger LLC, which is an investment advisor
affiliated with the Advisor.
The advisor's Code, which is substantially similar to the Code of
Ethics adopted by Berger LLC, permits its covered persons to purchase and sell
securities for their own accounts in accordance with provisions governing
personal investing. The policy requires all covered persons to conduct their
personal securities transactions in a manner which does not operate adversely to
the interests of the Portfolio or the advisor's other advisory clients. Board
members and officers of the advisor, investment personnel and other designated
covered persons deemed to have access to current trading information ("access
persons") are required to pre-clear all transactions in securities not otherwise
exempt under the policy. Requests for authority to trade will be denied
pre-clearance when, among other reasons, the proposed personal transaction would
be contrary to the provisions
B-22
<PAGE>
of the policy or would be deemed to adversely affect any transaction then known
to be under consideration for or currently being effected on behalf of any
client account, including the Portfolio.
In addition to the pre-clearance requirements described above, the
Code subjects those covered persons deemed to be access persons to various
trading restrictions and reporting obligations. All reportable transactions are
reviewed for compliance with the policy. The policy is administered by the
advisor and the provisions of the policy are subject to interpretation by and
exceptions authorized by its board of managers.
The sub-advisor has also adopted a Code of Ethics which restricts
its officers, employees and other staff from personal trading in specified
circumstances, including among others prohibiting participation in initial
public offerings, prohibiting dealing in a security for the seven days before
and after any trade in that security on behalf of clients, prohibiting trading
in a security while an order is pending for any client on that same security,
and requiring profits from short-term trading in securities (purchase and sale
within a 60-day period) to be forfeited. In addition, staff of the sub-advisor
must report all of their personal holdings in securities annually and must
disclose their holdings in any private company if an investment in that same
company is being considered for clients. Staff of the sub-advisor are required
to pre-clear all transactions in securities not otherwise exempt under the Code
of Ethics and must instruct their broker to provide the sub-advisor with
duplicate confirmations of all such personal trades.
EXPENSES OF THE PORTFOLIO
Expenses of the Portfolio include, among others, its pro rata
share of the expenses of Worldwide Portfolios of which the Portfolio is a
series, such as: expenses of registering Worldwide Portfolios with securities
authorities; the compensation of its trustees who are not "interested persons"
(as that term is defined in the Investment Company Act of 1940) of the Trust,
the advisor or sub-advisor; expenses of preparing reports to investors and to
governmental offices and commissions; expenses of meetings of investors and
trustees of Worldwide Portfolios; legal fees; and insurance premiums of
Worldwide Portfolios. Expenses of the Portfolio also include, among others, the
fees payable to the advisor under the Investment Advisory Agreement; expenses
connected with the execution of portfolio transactions, including brokerage
commissions on purchases and sales of portfolio securities (which are considered
a cost of securities of the Portfolio); custodian fees; auditors' fees; interest
and taxes imposed on the Portfolio; transfer agent, recordkeeping and pricing
agent fees; and such other non-recurring and extraordinary items as may arise
from time to time.
Under a written agreement, the Portfolio's advisor waives its
investment advisory fee to the extent that the Portfolio's annual operating
expenses in any fiscal year, including the investment advisory fee and custodian
fees, but excluding brokerage commissions, interest, taxes and extraordinary
expenses, exceed 1.00% of the Portfolio's average daily net assets for that
fiscal year. The agreement may not be terminated without the prior written
consent of the Portfolio by a vote of its Board of Trustees. Any such reduction
in the advisory fee paid by the Portfolio will also reduce the pro rata share of
the advisory fee borne indirectly by investors in the Portfolio.
SERVICE ARRANGEMENTS FOR THE PORTFOLIO
B-23
<PAGE>
Under the Investment Advisory Agreement between the advisor and
the Portfolio, in addition to providing advisory services, the advisor is
responsible for providing or arranging for all managerial and administrative
services necessary for the operations of the Portfolio. The advisor is
responsible for providing certain of these services at its own expense, such as
compliance monitoring and investor communications, which have been delegated to
Berger LLC as part of a Sub-Administration Agreement. Other services are
procured from third party service providers at the Portfolio's own expense, such
as custody, recordkeeping and pricing services. The Portfolio has appointed IFTC
as recordkeeping and pricing agent to calculate the daily net asset value of the
Portfolio and to perform certain accounting and recordkeeping functions required
by the Portfolio. In addition, the Portfolio has appointed IFTC as its custodian
and transfer agent. IFTC has engaged State Street Bank and Trust Company ("State
Street") as sub-custodian for the Portfolio. For custodian, recordkeeping and
pricing services, the Portfolio pays fees directly to IFTC based on a percentage
of its net assets, subject to certain minimums and reimburses IFTC for certain
out-of-pocket expenses.
All of IFTC's fees are subject to reduction pursuant to an agreed
formula for certain earnings credits on the cash balances maintained with it as
custodian. Earnings credits received by the Portfolio are disclosed on the
Portfolio's Statement of Operations in the Annual Report incorporated by
reference into this Part B.
The following table shows the total dollar amounts of advisory
fees paid by the Portfolio to BBOI Worldwide for the periods indicated and the
amount of such fees waived on account of excess expenses under applicable
expense limitations:
BERGER/BIAM INTERNATIONAL PORTFOLIO
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
Fiscal Year Ended Investment Advisory Fee TOTAL
September 30, Advisory Fee Waiver
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1999 $2,010,000 $(17,000) $1,993,000
- --------------------------------------------------------------------------------------------------------------------
1998 $1,531,000 $(61,000) $1,470,000
- --------------------------------------------------------------------------------------------------------------------
1997* $ 560,000 $(61,000) $ 499,000
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
* Covers period from October 11, 1996 (commencement of operations of the
Portfolio) through the end of the Portfolio's first fiscal year on September 30,
1997. The investment advisory fee is paid by the Portfolio and is borne
indirectly pro rata by the investors invested in the Portfolio.
OTHER EXPENSE INFORMATION
The trustees of Worldwide Portfolios have authorized portfolio
transactions to be placed on an agency basis through DST Securities, Inc.
("DSTS"), a wholly-owned broker-dealer subsidiary of DST. When transactions are
effected through DSTS, the commission received by DSTS is credited against, and
thereby reduces, certain operating expenses that the Portfolio would otherwise
be obligated to pay. No portion of the commission is retained by DSTS. DSTS may
be
B-24
<PAGE>
considered an affiliate of Berger LLC due to the ownership interest of Stilwell
in both DST and Berger LLC.
ITEM 16. BROKERAGE ALLOCATION AND OTHER PRACTICES
Although the Portfolio retains full control over its own
investment policies, the sub-advisor is authorized to place the portfolio
transactions of the Portfolio. A report on the placement of brokerage business
is given to the trustees of Worldwide Portfolios every quarter, indicating the
brokers with whom portfolio business was placed and the basis for such
placement. The brokerage commissions paid by the Portfolio during the past two
fiscal years were as follows:
BROKERAGE COMMISSIONS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
Fiscal Year Fiscal Year Fiscal Year
Ended Ended Ended
September 30, September 30, September 30,
1999 1998 1997(2)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
BERGER/BIAM INTERNATIONAL $155,000 $225,000 $234,000
PORTFOLIO(1)
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
</TABLE>
(1) These are brokerage commissions paid by the Portfolio. Commissions paid the
Portfolio are borne indirectly pro rata by the mutual funds invested in the
Portfolio.
(2) Covers the period from October 11, 1996 (commencement of operations) to
September 30, 1997.
The Investment Advisory Agreement that the Portfolio has with the
advisor and the Sub-Advisory Agreement between the advisor and the sub-advisor
authorizes and directs portfolio transactions for the Portfolio to be placed
only with brokers and dealers who render satisfactory service in the execution
of orders at the most favorable prices and at reasonable commission rates.
However, the sub-advisor is specifically authorized to place such transactions
with a broker with whom it has negotiated a commission that is in excess of the
commission another broker or dealer would have charged for effecting that
transaction if the sub-advisor determines in good faith that such amount of
commission was reasonable in relation to the value of the brokerage and research
services provided by such broker viewed in terms of either that particular
transaction or the overall responsibilities of the sub-advisor.
In accordance with these provisions, the sub-advisor may place
portfolio brokerage business of the Portfolio with brokers who provide useful
research services to the sub-advisor. Such services could include computerized
on-line stock quotation systems and related data feeds from stock exchanges,
computerized trade order entry, execution and confirmation systems, fundamental
and technical analysis data and software, broker and other third-party equity
research, computerized stock market and business news services, economic
research, account performance data and computer hardware used for the receipt of
electronic research services.
B-25
<PAGE>
Any brokerage and research services the sub-advisor may receive
from brokers could be helpful to the sub-advisor in performing its investment
advisory responsibilities to the Portfolio, but they are not essential, and the
availability of such services from brokers does not reduce the responsibility of
the sub-advisor's advisory personnel to analyze and evaluate the securities in
which the Portfolio invests. Any brokerage and research services obtained as a
result of the Portfolio's brokerage business may also be useful to the
sub-advisor in making investment decisions for its other advisory accounts, and,
conversely, information obtained by reason of placement of brokerage business of
such other accounts may be used by the sub-advisor in rendering investment
advice to the Portfolio. Although such brokerage and research services may be
deemed to be of value to the sub-advisor, they are not expected to decrease the
expenses that the sub-advisor would otherwise incur in performing its investment
advisory services for the Portfolio nor will the fee that is received by the
sub-advisor from the advisor or the advisory fee received by the advisor from
the Portfolio be reduced as a result of the availability of such brokerage and
research services from brokers.
If the sub-advisor determines that any such brokerage or research
service has a mixed use, such that it also serves functions that do not assist
the sub-advisor in the investment decision-making process or otherwise benefits
the Portfolio, the sub-advisor may allocate the costs of such service
accordingly. Only that portion of the service that the sub-advisor determines
will assist it in the investment decision-making process or will otherwise
benefit the Portfolio may be paid for by the placement of the Portfolio's
brokerage business. The decision whether and how to allocate the costs of such
service presents a conflict of interest for the sub-advisor.
The trustees of Worldwide Portfolios have authorized portfolio
transactions to be placed on an agency basis through DST Securities, Inc.
("DSTS"), a wholly-owned broker-dealer subsidiary of DST. When transactions are
effected through DSTS, the commission received by DSTS is credited against, and
thereby reduces, certain operating expenses that the Portfolio would otherwise
be obligated to pay. No portion of the commission is retained by DSTS. DSTS may
be considered an affiliate of Berger LLC due to the ownership interest of
Stilwell in both DST and Berger LLC.
In selecting broker and dealers and in negotiating commissions,
the Portfolio's sub-advisor considers a number of factors, including among
others: the sub-advisor's knowledge of currently available negotiated commission
rates or prices of securities currently available and other current transaction
costs; the nature of the security being traded; the size and type of the
transaction; the nature and character of the markets for the security to be
purchased or sold; the desired timing of the trade; the activity existing and
expected in the market for the particular security; confidentiality; the quality
of the execution, clearance and settlement services; financial stability of the
broker or dealer; the existence of actual or apparent operational problems of
any broker or dealer; and research products or services provided. The trustees
have also authorized sales of interests in the Portfolio or shares of the funds
invested in the Portfolio by a broker-dealer and the recommendations of a
broker-dealer to its customers that they purchase such fund shares to be
considered as factors in the selection of broker-dealers to execute portfolio
transactions for the Portfolio. In addition, the sub-advisor may also consider
payments made by brokers to the Portfolio or the funds invested in the Portfolio
or to other persons on behalf of the Portfolio or such funds for services
provided to the Portfolio or fund for which it would otherwise be obligated to
pay, such as transfer agency fees. In placing portfolio business with any such
broker or dealer, the sub-advisor of the Portfolio will seek the best execution
of each transaction.
B-26
<PAGE>
ITEM 17. CAPITAL STOCK AND OTHER SECURITIES
Worldwide Portfolios is a Delaware business trust organized on
May 31, 1996. The Portfolio was established on May 31, 1996, as a series of
Worldwide Portfolios. The Portfolio commenced operations upon the transfer to
the Portfolio of assets held in a pooled trust. See Item 4 in Part A for
additional information on the asset transfer.
Worldwide Portfolios is authorized to sell unlimited interests in
series or portfolios. Currently, the series comprising the Portfolio is the only
series established under Worldwide Portfolios, although others may be added in
the future. Worldwide Portfolios is also authorized to establish multiple
classes of shares representing differing interests in an existing or new series.
Interests in the Portfolio are fully paid and nonassessable when sold. All
interests sold by the Portfolio participate in proportionately in distributions
by the Portfolio, and in the residual assets of the Portfolio in the event of
its liquidation.
Under Delaware law, investors in Worldwide Portfolios will enjoy
the same limitations on personal liability as extended to stockholders of a
Delaware corporation. Further, the Trust Instrument of Worldwide Portfolios
provides that no investor shall be personally liable for the debts, liabilities,
obligations and expenses incurred by, contracted for or otherwise existing with
respect to, the Trust or any particular series (portfolio) of the Trust.
However, the principles of law governing the limitations of liability of
beneficiaries of a business trust have not been authoritatively established as
to business trusts organized under the laws of one jurisdiction but operating or
owning property in other jurisdictions. In states that have adopted legislation
containing provisions comparable to the Delaware Business Trust Act, it is
believed that the limitation of liability of beneficial owners provided by
Delaware law should be respected. In those jurisdictions that have not adopted
similar legislative provisions, it is possible that a court might hold that
investors in Worldwide Portfolios are not entitled to the limitations of
liability set forth in Delaware law or the Trust Instrument and, accordingly,
that they may be personally liable for the obligations of Worldwide Portfolios.
In order to protect investors from such potential liability, the
Trust Instrument requires that every written obligation of Worldwide Portfolios
or any series thereof contain a statement to the effect that such obligation may
only be enforced against the assets of Worldwide Portfolios or such series. The
Trust Instrument also provides for indemnification from the assets of the
relevant series for all losses and expenses incurred by any investor by reason
of being or having been a investor, and that Worldwide Portfolios shall, upon
request, assume the defense of any such claim made against such investor for any
act or obligation of the relevant series and satisfy any judgment thereon from
the assets of that series.
As a result, the risk of a Portfolio investor incurring financial
loss on account of investor liability is limited to circumstances in which the
Portfolio itself would be unable to meet its obligations. Worldwide Portfolios
believes that, in view of the above, the risk of personal liability to investors
in the Portfolio is remote. The trustees intend to conduct the operations of
Worldwide Portfolios and the Portfolio so as to avoid, to the extent possible,
liability of investors for liabilities of Worldwide Portfolios or the Portfolio.
B-27
<PAGE>
CORPORATE GOVERNANCE AND OTHER INFORMATION
Neither Worldwide Portfolios nor the Portfolio is required to hold
annual investor or shareholder meetings unless required by the Investment
Company Act of 1940 or other applicable law or unless called by the trustees. If
investors owning at least 10% of the outstanding interest in Worldwide
Portfolios so request, a special investors' meeting will be held for the purpose
of considering the removal of a trustee. Special meetings will be held for other
purposes if the holders of at least 25% of the total beneficial interest in
Worldwide Portfolios so request. Subject to certain limitations, Worldwide
Portfolios will facilitate appropriate communications by investors desiring to
call a special meeting for the purpose of considering the removal of a trustee.
Investors in the Portfolio and the other series of Worldwide
Portfolios generally vote separately on matters relating to those respective
series, although they vote together and with the holders of any other series of
Worldwide Portfolios issued in the future in the election of trustees and on all
matters relating to the trust as a whole. Each investor in the Portfolio is
entitled to a vote proportionate to its interest in the Portfolio.
Interests in the Portfolio have non-cumulative voting rights,
which means that the holders of more than 50% of the beneficial interest in the
Portfolio voting for the election of trustees can elect 100% of the trustees if
they choose to do so and, in such event, the holders of the remaining less than
50% of the interest voting for the election of trustees will not be able to
elect any person or persons as trustees.
Interests in the Portfolio have no preemptive rights. There are no
sinking funds or arrearage provisions which may affect the rights of Portfolio
interests. Portfolio interests have no subscription rights or conversion rights.
Interests in the Portfolio may not be transferred.
Under governing corporate law, the Portfolio may enter into a
variety of corporate transactions, such as reorganizations, conversions,
mergers and asset transfers, or may be liquidated. Any such transaction would
be subject to a determination from the trustee that the transaction was in
the best interests of the Portfolio and its investors, and may require
obtaining investor approval.
ITEM 18. PURCHASE, REDEMPTION AND PRICING OF SECURITIES BEING OFFERED
Beneficial interests in the Portfolio are issued solely in private
placement transactions that do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. See Item 7 in Part A.
The net asset value of the Portfolio is determined once daily, at
the close of the regular trading session of the Exchange (normally 4:00 p.m.,
New York time, Monday through Friday) each day that the Exchange is open. The
Exchange is closed and the net asset value of the Portfolio is not determined on
weekends and on New Year's Day, Martin Luther King, Jr. Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day each year. The net asset value of interests in the Portfolio is
determined by dividing the total value of its assets, less liabilities, by the
total number of interests outstanding.
B-28
<PAGE>
The Portfolio's securities and other assets are valued as follows:
securities listed or traded primarily on national exchanges, The Nasdaq Stock
Market and foreign exchanges are valued at the last sale price on such markets,
or, if such a price is lacking for the trading period immediately preceding the
time of determination, such securities are valued at the mean of their current
bid and asked prices. Securities that are traded in the over-the-counter market
are valued at the mean between their current bid and asked prices. The market
value of individual securities held by the Portfolio will be determined by using
prices provided by pricing services which provide market prices to other mutual
funds or, as needed, by obtaining market quotations from independent
broker/dealers. Short-term money market securities maturing within 60 days are
valued on the amortized cost basis, which approximates market value. All assets
and liabilities initially expressed in terms of non-U.S. dollar currencies are
translated into U.S. dollars at the prevailing market rates as quoted by one or
more banks or dealers shortly before the close of the Exchange. Securities and
assets for which quotations are not readily available or are not representative
of market value may be valued at fair values determined in good faith pursuant
to consistently applied procedures established by the trustees. Examples would
be when events occur that materially affect the value of a security at a time
when the security is not trading or when the securities are illiquid.
Generally, trading in foreign securities markets is substantially
completed each day at various times prior to the close of the Exchange. The
values of foreign securities used in computing the net asset value of the
Portfolio are determined as of the earlier of such market close or the closing
time of the Exchange. Occasionally, events affecting the value of such
securities may occur between the times at which they are determined and the
close of the Exchange, or when the foreign market on which such securities trade
is closed but the Exchange is open, which will not be reflected in the
computation of net asset value. If during such periods, events occur which
materially affect the value of such securities, the securities may be valued at
their fair value as determined in good faith pursuant to consistently applied
procedures established by the trustees.
The Portfolio's securities may be listed primarily on foreign
exchanges or over-the-counter dealer markets which may trade on days when the
Exchange is closed (such as a customary U.S. holiday) and on which the
Portfolio's net asset value is not calculated. As a result, the net asset value
of the Portfolio may be significantly affected by such trading on days when
investors cannot purchase or redeem interests in the Portfolio.
The right of redemption may be suspended for any period during
which the Exchange is closed or the Commission determines that trading on the
Exchange is restricted, or when there is an emergency as determined by the
Commission as a result of which it is not reasonably practicable for the
Portfolio to dispose of securities owned by it or to determine the value of its
net assets, or for such other period as the Commission may by order permit for
the protection of investors in the Portfolio.
The Portfolio intends to redeem interests only for cash, although
it retains the right to redeem interests in-kind under unusual circumstances, in
order to protect the interests of the remaining investors, by the delivery of
securities selected from its assets at its discretion. The Portfolio is,
however, governed by Rule 18f-1 under the Investment Company Act of 1940
pursuant to which the Portfolio is obligated to redeem interests solely in cash
up to the lesser of $250,000 or 1% of the net assets of the Portfolio during any
90-day period for any one investor. Should
B-29
<PAGE>
redemptions by any investor during any 90-day period exceed such limitation, the
Portfolio will have the option of redeeming the excess in cash or in-kind. If
interests are redeemed in-kind, the redeeming investor generally will incur
brokerage costs in converting the assets to cash. The redeeming investor may
have difficulty selling the securities and recovering the amount of the
investment redeemed in cash if the securities are illiquid. The method of
valuing securities used to make redemption in-kind will be the same as the
method of valuing portfolio securities described above.
ITEM 19. TAXATION OF THE PORTFOLIO
It is anticipated that (1) the Portfolio will be treated for U.S.
federal income tax purposes as a partnership, and (2) for purposes of
determining whether a mutual fund investing in the Portfolio satisfies the
income and diversification requirements to maintain its status as a regulated
investment company under the Code, the investor in the Portfolio will be deemed
to own an allocable share of the Portfolio's assets and will be deemed to be
entitled to the Portfolio's income or loss attributable to that share. The
Portfolio intends to conduct its operations so as to enable its investors to
satisfy those requirements.
The Portfolio itself is not expected to be subject to federal
income tax, but each investor will be required to take into account for U.S.
federal income tax purposes its allocable share of the Portfolio's income,
gains, losses, deductions, credits and tax preference items, without regard to
whether it has received any cash distributions from the Portfolio.
Withdrawals by investors from the Portfolio generally will not
result in their recognizing any gain or loss for federal income tax purposes,
except that (1) gain will be recognized to the extent that any cash distributed
exceeds the basis of the investor's interest in the Portfolio prior to the
distribution, (2) income or gain will be recognized if the withdrawal is in
liquidation of the investor's entire interest in the Portfolio and includes a
disproportionate share of any unrealized receivables held by the Portfolio, and
(3) loss, if realized, will be recognized if the distribution is in liquidation
of that entire interest and consists solely of cash and/or unrealized
receivables. The basis of an investor's interest in the Portfolio generally
equals the amount of cash and the basis of any property that the investor
invests in the Portfolio, increased by the investor's share of income from the
Portfolio and decreased by the amount of any cash distributions and the basis of
any property distributed from the Portfolio.
Although, as described above, the Portfolio is not expected to be
subject to federal income tax, it will file appropriate income tax returns.
INCOME FROM FOREIGN SOURCES. Dividends and interest received by
the Portfolio on foreign securities may give rise to withholding and other
taxes imposed by foreign countries, although these taxes may be reduced by
applicable tax treaties. If the investor makes an election, each investor in
the Portfolio may be entitled either to deduct or, to pass through foreign
tax credit for its share of foreign taxes to its shareholders, subject to
limitations prescribed in the tax law.
If the Portfolio invests in a foreign corporation that is a
passive foreign investment company (a "PFIC"), special rules apply that may
affect the tax treatment of gains from the sale of the stock and may cause the
Portfolio to incur tax and IRS interest charges. However, the Portfolio
B-30
<PAGE>
may be eligible to elect one of two alternative tax treatments with respect to
PFIC shares which would avoid these taxes and charges, but also may affect,
among other things, the amount and character of gain or loss and the timing of
the recognition of income with respect to PFIC shares. Accordingly, the amounts,
character and timing of income distributed to investors in the Portfolio holding
PFIC shares may differ substantially as compared to a fund that did not invest
in PFIC shares.
INCOME FROM CERTAIN TRANSACTIONS. Some or all of the Portfolio's
investments may include transactions that are subject to special tax rules.
Gains or losses attributable to transactions in foreign currency may be treated
as ordinary income or loss. Investment in certain financial instruments, such as
options, futures contracts and forward contracts, may require annual recognition
of unrealized gains and losses. Transactions that are treated as "straddles" may
affect the character and/or time of recognizing other gains and losses of the
Portfolio. If the Portfolio enters into a transaction (such as a "short sale
against the box") that reduces the risk of loss on an appreciated financial
position that it already holds, the entry into the transaction may constitute a
constructive sale and require immediate recognition of gain.
The foregoing is not an exhaustive presentation of all tax issues
relevant to an investment in the Portfolio. Accordingly, investors are advised
to consult their own tax advisors with respect to the particular tax
consequences to them of an investment in the Portfolio.
ITEM 20. UNDERWRITERS
The Portfolio has no principal underwriter or distributor.
Eligible investors may continuously invest in the Portfolio.
ITEM 21. CALCULATION OF PERFORMANCE DATA
Not applicable.
ITEM 22. FINANCIAL STATEMENTS
Investors of record will receive unaudited semi-annual reports and
annual reports audited by the Portfolio's independent accountants.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 950 Seventeenth Street, Denver,
Colorado, acted as independent accountants for the Portfolio for the year ended
September 30, 1999. In that capacity, PricewaterhouseCoopers LLP audited the
financial statements of the Portfolio referenced below under "Financial
Information" and assisted the Portfolio in connection with the preparation of
its 1998 income tax returns.
PricewaterhouseCoopers LLP has been appointed to act as
independent accountants for the Portfolio for the fiscal year ended September
30, 2000. In that capacity, PricewaterhouseCoopers LLP will audit the financial
statements of the Portfolio and assist the Portfolio in connection with the
preparation of its 1999 income tax returns.
B-31
<PAGE>
FINANCIAL INFORMATION
The following financial statements are incorporated herein by
reference from the Annual Report on the Portfolio dated September 30, 1999,
along with the Report of Independent Accountants thereon dated November 4, 1999:
For Berger/BIAM International Portfolio:
Schedule of Investments as of September 30, 1999
Statement of Assets and Liabilities as of September 30, 1999
Statement of Operations for the Fiscal Year Ended September 30,
1999
Statement of Changes in Net Assets for the Fiscal Years Ended
September 30, 1999, and September 30, 1998.
Ratios/Supplementary Data for each of the periods shown.
Notes to Financial Statements, September 30, 1999.
B-32
<PAGE>
APPENDIX A
HIGH-YIELD/HIGH RISK CONVERTIBLE BONDS
The Portfolio may invest in convertible securities of any quality,
including unrated securities or securities rated below investment grade (Ba or
lower by Moody's, BB or lower by S&P). However, the Portfolio will not purchase
any security in default at the time of purchase. The Portfolio will not invest
more than 20% of the market value of its assets at the time of purchase in
convertible securities rated below investment grade.
Securities rated below investment grade are subject to greater
risk that adverse changes in the financial condition of their issuers or in
general economic conditions, or an unanticipated rise in interest rates, may
impair the ability of their issuers to make payments of interest and principal
or dividends. The market prices of lower grade securities are generally less
sensitive to interest rate changes than higher-rated investments, but more
sensitive to economic changes or individual corporate developments. Periods of
economic uncertainty and change can be expected to result in volatility of
prices of these securities. Lower rated securities also may have less liquid
markets than higher rated securities, and their liquidity as well as their value
may be adversely affected by poor economic conditions. Adverse publicity and
investor perceptions as well as new or proposed laws may also have a negative
impact on the market for high-yield/high-risk bonds. In the event of an
unanticipated default, the Portfolio will experience a reduction in its income
and could expect a decline in the market value of the securities affected. The
prices of these securities may be more volatile and the markets for them may be
less liquid than those for higher-rated securities.
Unrated securities, while not necessarily of lower quality than
rated securities, may not have as broad a market. Unrated securities will be
included in the Portfolio's percentage limits for investments rated below
investment grade, unless the Portfolio's sub-advisor deems such securities to be
the equivalent of investment grade. If securities purchased by the Portfolio are
downgraded following purchase, or if other circumstances cause the Portfolio to
exceed its percentage limits on assets invested in securities rated below
investment grade, the trustees of the Portfolio, in consultation with the
Portfolio's sub-advisor, will determine what action, if any, is appropriate in
light of all relevant circumstances.
Relying in part on ratings assigned by credit agencies in making
investments will not protect the Portfolio from the risk that the securities
will decline in value, since credit ratings represent evaluations of the safety
of principal, dividend and/or interest payments, and not the market values of
such securities. Moreover, such ratings may not be changed on a timely basis to
reflect subsequent events.
Although the market for high-yield debt securities has been in
existence for many years and from time to time has experienced economic
downturns, this market has involved a significant increase in the use of
high-yield debt securities to fund highly leverage corporate acquisitions and
restructurings. Past experience may not, therefore, provide an accurate
indication of future performance of the high-yield debt securities market,
particularly during periods of economic recession.
B-33
<PAGE>
Expenses incurred in recovering an investment in a defaulted
security may adversely affect the Portfolio's net asset value. Moreover, the
reduced liquidity of the secondary market for such securities may adversely
affect the market price of, and the ability of the Portfolio to value,
particular securities at certain times, thereby making it difficult to make
specific valuation determinations.
CORPORATE BOND RATINGS
The ratings of fixed-income securities by Moody's and Standard &
Poor's are a generally accepted measurement of credit risk. However, they are
subject to certain limitations. Ratings are generally based upon historical
events and do not necessarily reflect the future. In addition, there is a period
of time between the issuance of a rating and the update of the rating, during
which time a published rating may be inaccurate.
KEY TO MOODY'S CORPORATE RATINGS
Aaa-Bonds which are rated Aaa are judged to be of the best
quality. They carry the smallest degree of investment risk and are generally
referred to as "gilt edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized are
most unlikely to impair the fundamentally strong position of such issues.
Aa-Bonds which are rated Aa are judged to be of high quality by
all standards. Together with the Aaa group they comprise what are generally
known as high grade bonds. They are rated lower than the best bonds because
margins of protection may not be as large as in Aaa securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long-term risks appear somewhat larger than in Aaa
securities.
A-Bonds which are rated A possess many favorable investment
attributes and are to be considered as upper medium grade obligations. Factors
giving security to principal and interest are considered adequate but elements
may be present which suggest a susceptibility to impairment sometime in the
future.
Baa-Bonds which are rated Baa are considered as medium grade
obligations, i.e., they are neither highly protected nor poorly secured.
Interest payments and principal security appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.
Ba-Bonds which are rated Ba are judged to have speculative
elements; their future cannot be considered as well assured. Often the
protection of interest and principal payments may be very moderate and thereby
not well safeguarded during good and bad times over the future. Uncertainty of
position characterizes bonds of this class.
B-34
<PAGE>
B-Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may be
small.
Caa-Bonds which are rated Caa are of poor standing. Such issues
may be in default or there may be present elements of danger with respect to
principal or interest.
Ca-Bonds which are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in default or have other
marked shortcomings.
C-Bonds which are rated C are the lowest rated class of bonds
and issues so rated can be regarded as having extremely poor prospects of
ever attaining any real investment standing.
Note: Moody's applies numerical modifiers, 1, 2 and 3 in each
generic rating classification from Aa through B in its corporate bond rating
system. The modifier 1 indicates that the security ranks in the higher end of
its generic rating category; the modifier 2 indicates a mid-range ranking; and
the modifier 3 indicates that the issue ranks in the lower end of its generic
category.
KEY TO STANDARD & POOR'S CORPORATE RATINGS
AAA-Debt rated AAA has the highest rating assigned by Standard &
Poor's. Capacity to pay interest and repay principal is extremely strong.
AA-Debt rated AA has a very strong capacity to pay interest and
repay principal and differs from the higher rated issues only in small degree.
A-Debt rated A has a strong capacity to pay interest and repay
principal although it is somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than debt in higher rated
categories.
BBB-Debt rated BBB is regarded as having an adequate capacity to
pay interest and repay principal. Whereas it normally exhibits adequate
protection parameters, adverse economic conditions, or changing circumstances
are more likely to lead to a weakened capacity to pay interest and repay
principal for debt in this category than in higher rated categories.
BB, B, CCC, CC AND C-Debt rated BB, B, CCC, CC and C is regarded,
on balance, as predominantly speculative with respect to capacity to pay
interest and repay principal in accordance with the terms of the obligation. BB
indicates the lowest degree of speculation and C the highest degree of
speculation. While such debt will likely have some quality and protective
characteristics, these are out-weighed by the large uncertainties or major risk
exposures to adverse conditions.
C1-The rating C1 is reserved for income bonds on which no interest
is being paid.
D-Debt rated D is in default, and payment of interest and/or
repayment of principal is in arrears.
B-35
<PAGE>
PLUS (+) OR MINUS (-)-The ratings from "AA" to "CCC" may be
modified by the addition of a plus or minus sign to show relative standing
within the major rating categories.
B-36
<PAGE>
PART C OTHER INFORMATION
ITEM 23. EXHIBITS
The Exhibit Index following the signature pages below is
incorporated herein by reference.
ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
None.
ITEM 25. INDEMNIFICATION
Article IX, Section 2 of the Trust Instrument for Worldwide
Portfolios provides for indemnification of certain persons acting on behalf of
Worldwide Portfolios to the fullest extent permitted by the law. In general,
trustees, officers, employees and agents will be indemnified against liability
and against all expenses incurred by them in connection with any claim, action,
suit or proceeding (or settlement thereof) in which they become involved by
virtue of their trust office, unless their conduct is determined to constitute
willful misfeasance, bad faith, gross negligence or reckless disregard of their
duties, or unless it has been determined that they have not acted in good faith
in the reasonable belief that their actions were in or not opposed to the best
interests of Worldwide Portfolios. Worldwide Portfolios also may advance money
for these expenses, provided that the trustees, officers, employees or agents
undertake to repay Worldwide Portfolios if their conduct is later determined to
preclude indemnification. Worldwide Portfolios has the power to purchase
insurance on behalf of its trustees, officers, employees and agents, whether or
not it would be permitted or required to indemnify them for any such liability
under the Trust Instrument or applicable law, and Worldwide Portfolios has
purchased and maintains an insurance policy covering such persons against
certain liabilities incurred in their official capacities.
Section 16 of the Investment Advisory Agreement between BBOI
Worldwide and Worldwide Portfolios with respect to the Portfolio also provides
as follows:
"Worldwide Portfolios hereby indemnifies and holds harmless BBOI
Worldwide and its officers, managers, members, employees and
agents, and any controlling person thereof, and any person to whom
BBOI Worldwide has delegated any of its duties and
responsibilities pursuant to Section 13 hereof, including Bank of
Ireland Asset Management (U.S.) Limited, to which BBOI Worldwide
has delegated its duties and responsibilities specified in Section
2 of this Agreement (the "Sub-Advisor") and Berger LLC, to which
BBOI Worldwide has delegated its duties and responsibilities
specified in Section 3 of this Agreement (the
"Sub-Administrator"), from all losses, charges, claims and
liabilities, and all costs and expenses, including without
limitation reasonable attorneys' fees and disbursements, arising
from any action which BBOI Worldwide or the Sub-Advisor or the
Sub-Administrator takes or omits to take pursuant to written
instructions from the Trustees of Worldwide Portfolios based on
resolutions duly adopted by the Trustees, provided that no person
shall be indemnified hereunder against any liability to Worldwide
Portfolios or its shareholders (or any expenses incident to such
liability) arising out of their own
C-1
<PAGE>
willful misfeasance, bad faith or gross negligence in the
performance of their duties or by reason of their reckless
disregard of their duties or obligations under this Agreement.
"BBOI Worldwide hereby indemnifies and holds harmless Worldwide
Portfolios and its Trustees, officers, shareholders, employees and
agents, and any controlling person thereof, from all losses,
charges, claims and liabilities, and all costs and expenses,
including without limitation reasonable attorneys' fees and
disbursements, arising out of BBOI Worldwide's or the
Sub-Advisor's or the Sub-Administrator's willful misfeasance, bad
faith or gross negligence in the performance of its duties or by
reason of its reckless disregard of its duties or obligations
under this Agreement, provided that no person shall be indemnified
hereunder against any liability to Worldwide Portfolios or its
shareholders (or any expenses incident to such liability) arising
out of their own willful misfeasance, bad faith or gross
negligence in the performance of their duties or by reason of
their reckless disregard of their duties or obligations under this
Agreement."
Section 11 of the Sub-Advisory Agreement between BBOI Worldwide
and BIAM with respect to the Portfolio also provides as follows:
"BBOI Worldwide hereby indemnifies and holds harmless BIAM and its
officers, directors, shareholders, employees and agents, and any
controlling person thereof, from all losses, charges, claims and
liabilities, and all costs and expenses, including without
limitation reasonable attorneys' fees and disbursements, arising
out of any action which BIAM takes or omits to take pursuant to
written instructions from BBOI Worldwide, the Sub-Administrator,
or from officers or Trustees of Worldwide Portfolios, provided
that no person shall be indemnified hereunder against any
liability to Worldwide Portfolios or its shareholders (or any
expenses incident to such liability) arising out of such person's
own willful misfeasance, bad faith or gross negligence in the
performance of their duties or by reason of their reckless
disregard of their duties or obligations under this Agreement."
and
"BIAM hereby indemnifies and holds harmless BBOI Worldwide and
Worldwide Portfolios, and each of their Trustees, officers,
managers, shareholders, members, employees and agents, and any
controlling person thereof, from all losses, charges, claims and
liabilities, and all costs and expenses, including without
limitation reasonable attorneys' fees and disbursements, arising
out of BIAM's willful misfeasance, bad faith or gross negligence
in the performance of its duties or by reason of its reckless
disregard of its duties or obligations under this Agreement,
provided that no person shall be indemnified hereunder against any
liability to Worldwide Portfolios or its shareholders (or any
expenses incident to such liability) arising out of such person's
own willful misfeasance, bad faith or gross negligence in the
performance of their duties or by reason of their reckless
disregard of their duties or obligations under this Agreement."
ITEM 26. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISER
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<PAGE>
The business of BBOI Worldwide, the investment advisor of the
Portfolio, is described in Item 15 in Part B in this Registration Statement.
Information relating to the business and other connections of the officers and
managers of BBOI Worldwide (current and for the past two years) is listed in
Schedules A and D of BBOI Worldwide's Form ADV as filed with the Securities and
Exchange Commission (File No. 801-52264, dated October 1, 1999), which
information from such schedules is incorporated herein by reference.
The business of BIAM, the sub-advisor to the Berger/BIAM
International Portfolio, is also described in Item 15 in Part B. Information
relating to the business and other connections of the officers and directors of
BIAM (current and for the past two years) is listed in Schedules A and D of
BIAM's Form ADV as filed with the Securities and Exchange Commission (File No.
801-29606, dated June 25, 1999), which information from such schedules is
incorporated herein by reference.
ITEM 27. PRINCIPAL UNDERWRITERS
Not applicable.
ITEM 28. LOCATION OF ACCOUNTS AND RECORDS
The accounts, books and other documents required to be maintained
by Section 31(a) of the Investment Company Act of 1940 and the rules promulgated
thereunder are maintained as follows:
(a) Investor records and accounting records relating to cash
and other money balances; asset, liability, reserve,
capital, income and expense accounts; portfolio securities;
purchases and sales; and brokerage commissions are
maintained by the Registrant's Recordkeeping, Pricing and
Transfer Agent, Investors Fiduciary Trust Company ("IFTC"),
801 Pennsylvania, Kansas City, Missouri 64105. Other
records of the Registrant relating to purchases and sales;
the Trust Instrument, minute books and other trust records;
brokerage orders; performance information and other records
are maintained at the offices of the Registrant at 210
University Boulevard, Suite 900, Denver, Colorado 80206.
(b) Certain records relating to day-to-day portfolio management
of the Berger/BIAM International Portfolio are kept at Bank
of Ireland Asset Management (U.S.) Limited, 26 Fitzwilliam
Street, Dublin 2, Ireland; or at Bank of Ireland Asset
Management (U.S.) Limited, 20 Horseneck Lane, Greenwich,
Connecticut 06830.
ITEM 29. MANAGEMENT SERVICES
Not applicable.
ITEM 30. UNDERTAKINGS
C-3
<PAGE>
Not applicable.
C-4
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Investment Company Act of
1940, the Registrant, Berger/BIAM Worldwide Portfolios Trust, has duly caused
this amendment to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City and County of Denver, and
State of Colorado, on the 28th day of January, 2000.
BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST
--------------------------------------
(Registrant)
By/s/ Jack R. Thomspon
------------------------------------
Name: Jack R. Thompson
--------------------------------
Title: President
--------------------------------
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Jack R. Thompson, Janice M. Teague and
Lester R. Woodward, and each of them, his or her true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution, and in his or her name, place and stead, in any and all
capacities to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he or she might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents or any of them, or
their or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the Registration Statement has been signed below by the following
persons in the capacities indicated for Berger/BIAM Worldwide Portfolios Trust
and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C> <C>
/s/ Jack Thompson President (Principal January 28, 2000
- --------------------------- Executive Officer)
Jack Thompson and Trustee
/s/ David J. Schultz Vice President and January 28, 2000
- --------------------------- Treasurer (Principal
David J. Schultz Financial Officer)
/s/ John Paganelli Assistant Treasurer January 28, 2000
- --------------------------- (Principal Accounting
John Paganelli Officer)
</TABLE>
C-5
<PAGE>
<TABLE>
<S> <C> <C>
/s/ Dennis E. Baldwin Trustee January 28, 2000
- ---------------------------
Dennis E. Baldwin
/s/ Louis R. Bindner Trustee January 28, 2000
- ---------------------------
Louis R. Bindner
/s/ Katherine A. Cattanach Trustee January 28, 2000
- ---------------------------
Katherine A. Cattanach
/s/ Paul R. Knapp Trustee January 28, 2000
- ---------------------------
Paul R. Knapp
/s/ Harry T. Lewis, Jr. Trustee January 28, 2000
- ---------------------------
Harry T. Lewis, Jr.
/s/ Michael Owen Trustee January 28, 2000
- ---------------------------
Michael Owen
/s/ William Sinclaire Trustee January 28, 2000
- ---------------------------
William Sinclaire
</TABLE>
C-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
N-1A EDGAR
Exhibit Exhibit
No. No. Name of Exhibit
- --------------------------- ----------- ---------------------------
<S> <C> <C> <C> <C>
(1) Exhibit 23(a) Trust Instrument
(2) Exhibit 23(b) Bylaws
Exhibit 23(c) Not applicable
(3) Exhibit 23(d)-1 Form of Investment Advisory Agreement
between Berger/BIAM Worldwide Portfolios
Trust and BBOI Worldwide LLC with respect to
the Berger/BIAM International Portfolio
(4) Exhibit 23(d)-2 Form of Sub-Advisory Agreement between
BBOI Worldwide LLC and Bank of Ireland
Asset Management (U.S.) Limited with respect
to the Berger/BIAM International Portfolio
Exhibit 23(e) Not applicable
Exhibit 23(f) Not Applicable
(5) Exhibit 23(g) Form of Custody Agreement between IFTC and
Berger/BIAM Worldwide Portfolios Trust
(6) Exhibit 23(h) Form of Recordkeeping, Pricing Agent and Transfer
Agency Agreement
Exhibit 23(i) Not applicable
Exhibit 23(k) Not applicable
(7) Exhibit 23(l) Investment Letter from Initial Investors
Exhibit 23(m) Not applicable
Exhibit 23(o) Not Applicable
</TABLE>
- ---------------------------
Filed previously as indicated below and incorporated herein by reference:
(1) Filed as Exhibit 1 with Amendment No. 1 to Registrant's Registration
Statement on Form N-1A, filed October 8, 1996.
(2) Filed as Exhibit 2 with Amendment No. 1 to Registrant's Registration
Statement on Form N-1A, filed October 8, 1996.
(3) Filed as Exhibit 5.1 with Amendment No. 1 to Registrant's Registration
Statement on Form N-1A, filed October 8, 1996.
(4) Filed as Exhibit 5.2 with Amendment No. 1 to Registrant's Registration
Statement on Form N-1A, filed October 8, 1996.
(5) Filed as Exhibit 8 with Amendment No. 1 to Registrant's Registration
Statement on Form N-1A, filed October 8, 1996.
(6) Filed as Exhibit 9.1 with Amendment No. 1 to Registrant's Registration
Statement on Form N-1A, filed October 8, 1996.
(7) Filed as Exhibit 13 with Amendment No. 1 to Registrant's Registration
Statement on Form N-1A, filed October 8, 1996.
C-7
