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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 19, 1996
1933 Act File No. 333-05677
1940 Act File No. 811-07669
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / /
Pre-Effective Amendment No. 1 /X/
Post-Effective Amendment No. / /
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / /
Amendment No. 1 /X/
(Check appropriate box or boxes)
BERGER/BIAM WORLDWIDE FUNDS 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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Gerard M. Lavin, 210 University Boulevard, Suite 900, Denver, CO 80206
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(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of this registration statement.
Registrant has elected to register an indefinite number of its shares of
beneficial interest pursuant to Rule 24f-2 under the Investment Company Act of
1940. Amount of registration fee previously paid: $500.00.
The series of the Berger/BIAM Worldwide Funds Trust covered by this registration
statement are "feeder funds" in a "master/feeder" fund arrangement. This
registration statement includes a signature page for the master trust,
Berger/BIAM Worldwide Portfolios Trust.
REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS
MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A
FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
<PAGE>
BERGER/BIAM WORLDWIDE FUNDS TRUST
SHARES OF BENEFICIAL INTEREST
($.01 Par Value)
Cross-Reference Sheet Pursuant to Rule 481
I. Berger/BIAM International Fund
ITEM NO. AND CAPTION IN FORM N-1A NUMBER OF SECTION
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A. PROSPECTUS
1. Cover Page Cover Page
2. Synopsis Section 1
3. Condensed Financial Information Not Applicable
4. General Description of Registrant Sections 2, 3, 4 and 15
5. Management of the Fund Sections 5, 6 and 7
5A. Management's Discussion of Fund Performance Will be in Annual Report
6. Capital Stock and Other Securities Sections 14, 15 and 16
7. Purchase of Securities Being Offered Sections 7, 8, 9, 10, 12
and 13
8. Redemption or Repurchase Section 11
9. Pending Legal Proceedings Not Applicable
B. STATEMENT OF ADDITIONAL INFORMATION
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History Section 14
13. Investment Objectives and Policies Sections 1 and 2
14. Management of the Fund Section 3
15. Control Persons and Principal Holders
of Securities Sections 3 and 14
16. Investment Advisory and Other Services Sections 3, 4, 5 and 14
17. Brokerage Allocation and Other Practices Sections 1, 5 and 6
18. Capital Stock and Other Securities Section 14
19. Purchase, Redemption and Pricing of
Securities Being Offered Sections 7, 8, 10, 11 and
12
20. Tax Status Section 9
21. Underwriters Section 7
22. Calculations of Performance Data Section 13
23. Financial Statements Financial Statements
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BERGER/BIAM WORLDWIDE FUNDS TRUST
SHARES OF BENEFICIAL INTEREST
($.01 Par Value)
Cross-Reference Sheet Pursuant to Rule 481
II. Berger/BIAM International Institutional Fund
ITEM NO. AND CAPTION IN FORM N-1A NUMBER OF SECTION
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A. PROSPECTUS
1. Cover Page Cover Page
2. Synopsis Section 1
3. Condensed Financial Information Not Applicable
4. General Description of Registrant Sections 2, 3, 4 and 15
5. Management of the Fund Sections 5, 6 and 7
5A. Management's Discussion of Fund Performance Will be in Annual Report
6. Capital Stock and Other Securities Sections 14, 15 and 16
7. Purchase of Securities Being Offered Sections 7, 8, 9, 10, 12
and 13
8. Redemption or Repurchase Section 11
9. Pending Legal Proceedings Not Applicable
B. STATEMENT OF ADDITIONAL INFORMATION
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History Section 14
13. Investment Objectives and Policies Sections 1 and 2
14. Management of the Fund Section 3
15. Control Persons and Principal Holders
of Securities Sections 3 and 14
16. Investment Advisory and Other Services Sections 3, 4, 5 and 14
17. Brokerage Allocation and Other Practices Sections 1, 5 and 6
18. Capital Stock and Other Securities Section 14
19. Purchase, Redemption and Pricing
of Securities Being Offered Sections 7, 8, 10, 11 and
12
20. Tax Status Section 9
21. Underwriters Section 7
22. Calculations of Performance Data Section 13
23. Financial Statements Financial Statements
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BERGER/BIAM WORLDWIDE FUNDS TRUST
SHARES OF BENEFICIAL INTEREST
($.01 Par Value)
Cross-Reference Sheet Pursuant to Rule 481
III. Berger/BIAM International CORE Fund
ITEM NO. AND CAPTION IN FORM N-1A NUMBER OF SECTION
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A. PROSPECTUS
1. Cover Page Cover Page
2. Synopsis Section 1
3. Condensed Financial Information Not Applicable
4. General Description of Registrant Sections 2, 3, 4 and 15
5. Management of the Fund Sections 5, 6 and 7
5A. Management's Discussion of Fund Performance Will be in Annual Report
6. Capital Stock and Other Securities Sections 14, 15 and 16
7. Purchase of Securities Being Offered Sections 7, 8, 9, 10, 12
and 13
8. Redemption or Repurchase Section 11
9. Pending Legal Proceedings Not Applicable
B. STATEMENT OF ADDITIONAL INFORMATION
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History Section 14
13. Investment Objectives and Policies Sections 1 and 2
14. Management of the Fund Section 3
15. Control Persons and Principal Holders
of Securities Sections 3 and 14
16. Investment Advisory and Other Services Sections 3, 4, 5 and 14
17. Brokerage Allocation and Other Practices Sections 1, 5 and 6
18. Capital Stock and Other Securities Section 14
19. Purchase, Redemption and Pricing
of Securities Being Offered Sections 7, 8, 10, 11 and
12
20. Tax Status Section 9
21. Underwriters Section 7
22. Calculations of Performance Data Section 13
23. Financial Statements Financial Statements
<PAGE>
EXPLANATORY NOTE
This Registration Statement of Berger/BIAM Worldwide Funds Trust contains
the following:
Three Prospectuses
One for the Berger/BIAM International Fund
One for the Berger/BIAM International Institutional Fund
One for the Berger/BIAM International CORE Fund
Three Statements of Additional Information
One for the Berger/BIAM International Fund
One for the Berger/BIAM International Institutional Fund
One for the Berger/BIAM International CORE Fund
One Part C
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SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED AUGUST 19, 1996
PROSPECTUS
BERGER/BIAM INTERNATIONAL FUND
The Berger/BIAM International Fund (the "Fund") is a "no-load" mutual fund,
more technically referred to as an open-end management investment company,
organized as a diversified series of the Berger/BIAM Worldwide Funds Trust
("Trust"). The investment objective of the Fund is long-term capital
appreciation. The Fund seeks to achieve this objective by investing all of its
investable assets in the Berger/BIAM International Portfolio (the "Portfolio")
which, in turn, invests primarily in common stocks of well established companies
located outside the United States. The Portfolio intends to diversify its
holdings among several countries and to have, under normal market conditions, at
least 65% of the Portfolio's total assets invested in the securities of
companies located in at least five countries, not including the United States.
UNLIKE MANY OTHER MUTUAL FUNDS WHICH DIRECTLY ACQUIRE AND MANAGE THEIR OWN
PORTFOLIOS OF SECURITIES, THE FUND SEEKS ITS INVESTMENT OBJECTIVE BY INVESTING
ALL OF ITS INVESTABLE ASSETS IN THE PORTFOLIO, AS DESCRIBED ABOVE. Accordingly,
the investment performance of the Fund will derive from the investment
performance of the Portfolio. The Portfolio is an open-end management
investment company and a diversified series of a separate trust known as the
Berger/BIAM Worldwide Portfolios Trust ("Worldwide Portfolios"). The
Portfolio's investment objective and policies are identical to those of the
Fund. The Portfolio is advised by BBOI Worldwide LLC ("BBOI Worldwide" or the
"Advisor"), which has delegated daily portfolio management of the Portfolio to
Bank of Ireland Asset Management (U.S.) Limited ("BIAM" or the "Sub-Advisor").
For further information about the Fund's investment objective and structure, see
"Investment Objective and Policies and Risk Factors", "Introduction" and
"Additional Information About Master/Feeder Structure".
This Prospectus sets forth concisely the information about the Fund that a
prospective investor should consider before investing. Investors are advised to
retain this Prospectus for future reference. Additional information about the
Fund has been filed with the Securities and Exchange Commission. A copy of the
Statement of Additional Information, which is incorporated in its entirety by
reference, is available upon request without charge by writing to the Fund at
P.O. Box 5005, Denver, CO 80217, or by calling 1-800-333-1001. Prospectuses are
also available upon request for the following funds advised by Berger
Associates, Inc.: the Berger 100 Fund, the Berger Growth and Income Fund, the
Berger Small Company Growth Fund and the Berger New Generation Fund.
INVESTMENTS IN THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK (INCLUDING BANK OF IRELAND). SHARES OF THE FUND ARE NOT
FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD, OR ANY OTHER GOVERNMENTAL AGENCY. AN INVESTMENT IN THE FUND IS
SUBJECT TO INVESTMENT RISK, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL AMOUNT
INVESTED.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any State.
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STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL SECURITIES IN ANY
STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH STATE.
The date of this Prospectus and the Statement of Additional Information
referred to above is _______________, 1996.
<PAGE>
Table of Contents
Section Page
----
1. Fee Tables............................................................... 1
2. Introduction............................................................. 2
3. Investment Objective and Policies and Risk Factors....................... 3
4. Portfolio Turnover....................................................... 11
5. Additional Information About Master/Feeder Structure..................... 11
6. Management and Investment Advice......................................... 12
7. Expenses of the Fund..................................................... 16
8. Policies of the Fund to Promote Sales of Fund Shares..................... 18
9. How to Purchase Shares in the Fund....................................... 19
10. How the Net Asset Value Is Determined................................... 21
11. Open Account System and Share Certificates.............................. 22
12. How To Redeem or Sell Fund Shares....................................... 22
13. Exchange Privilege and Systematic Withdrawal Plan....................... 25
14. Tax-Sheltered Retirement Plans.......................................... 26
15. Income Dividends, Capital Gains Distributions and Tax Treatment......... 27
16. Additional Information.................................................. 29
17. Performance............................................................. 30
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1. FEE TABLES
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases 0%
Maximum Sales Load Imposed on Reinvested Dividends 0%
Deferred Sales Load 0%
Redemption Fees 0%*
Exchange Fee 0%
* There will be a $10 wire service charge if redemption proceeds are
requested by wire.
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)*
TOTAL
FUND
INVESTMENT OPERATING
ADVISORY EXPENSES
FEE OTHER (AFTER
(AFTER WAIVER) 12B-1 FEE EXPENSES** WAIVER)
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Berger/BIAM
International Fund 0.85%*** 0.25% 0.68% 1.78%***
* Annual Fund Operating Expenses include the Fund's pro rata portion of the
annual operating expenses of the Portfolio, which are borne indirectly by
the Fund.
** Other Expenses primarily include administrative services fees and
registration fees paid by the Fund and custodian fees paid by the Portfolio
and are based on estimated expenses for the first year of operations of the
Fund and the Portfolio.
*** Although the Fund does not pay an investment advisory fee directly to an
investment advisor, it bears indirectly, as an investor in the Portfolio,
its pro rata portion of the advisory fee paid by the Portfolio to the
Advisor. Until at least April 30, 1998, the Advisor has agreed voluntarily
to waive its investment advisory fee to the extent that the Portfolio's
normal 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. Absent the waiver, the
Investment Advisory Fee would be 0.90% and Total Fund Operating Expenses
would be estimated to be 1.83%.
EXAMPLES
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return, and (2) redemption at the end of each time period:
1 YEAR 3 YEARS
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Berger/BIAM International Fund $18* $56*
* Based on estimated expenses for the first year of operations of the Fund
and the Portfolio, after waiver.
THE EXPENSES SET FORTH IN THE PRECEDING TABLES SHOULD NOT BE CONSIDERED A
REPRESENTATION OF PAST OR FUTURE EXPENSES, AND ACTUAL EXPENSES MAY BE GREATER OR
LESS THAN THOSE SHOWN. THE ASSUMED 5% ANNUAL RETURN IS HYPOTHETICAL AND SHOULD
NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE ANNUAL RETURNS, WHICH MAY
BE GREATER OR LESS THAN THE ASSUMED AMOUNT.
As a result of the 12b-1 fee paid by the Fund, over time long-term
shareholders in the Fund may pay more than the economic equivalent of the
maximum front end sales charge permitted for mutual funds by the National
Association of Securities Dealers, Inc. While the investment advisory fee for
the Portfolio is higher than that paid by most other mutual funds, it is
comparable to the investment advisory fee paid by many other international
equity funds.
Total Fund Operating Expenses include the Fund's pro rata share of the
aggregate annual operating expenses of the Portfolio, in which all of the
investable assets of the Fund are invested. The trustees of the Trust believe
that the investment in the Portfolio by investors in addition to the Fund may
enable the Portfolio to achieve economies of scale which could reduce expenses
and, accordingly, that the aggregate per share expenses of the Fund and the
Fund's pro rata share of the expenses of the Portfolio will be less than or
approximately equal to the expenses the Fund would incur if it retained the
services of an investment advisor and the assets of the Fund were invested
directly in the type of securities held by the Portfolio.
The purpose of the preceding tables is to assist the investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly or indirectly. The Fund's expenses are described in greater
detail under "Management and Investment Advice", "Expenses of the Fund", and
"Policies of the Fund to Promote Sales of Fund Shares".
2. INTRODUCTION
The Berger/BIAM International Fund is an open-end, diversified
management investment company commonly referred to as a "mutual fund". The Fund
is a "no-load" fund, meaning that a buyer pays no commissions or sales load when
buying shares of the Fund, although the Fund pays certain costs of distributing
its shares. See "Policies of the Fund to Promote Sales of Fund Shares". This
Prospectus describes the securities offered by the Fund.
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The Fund is a series of the Berger/BIAM Worldwide Funds Trust, a
Delaware business trust, and invests in the Portfolio that, in turn, invests in
securities in accordance with an investment objective, policies and limitations
that are identical to those of the Fund. This is sometimes called a
master/feeder fund structure, because the Fund and other investors who invest in
the Portfolio "feed" shareholders' investments into the Portfolio, a "master"
fund. The structure looks like this:
Shareholders
BUY SHARES IN [down arrow]
Fund
INVESTS IN [down arrow]
Portfolio
INVESTS IN [down arrow]
Stocks and
Other Securities
The trustees of the Trust believe that this structure may benefit
shareholders, since investment in the Portfolio by investors in addition to the
Fund may enable the Portfolio to achieve economies of scale which could reduce
expenses. For more information about this structure, see "Additional
Information About Master/Feeder Structure".
3. INVESTMENT OBJECTIVE AND POLICIES AND RISK FACTORS
The investment objective of the Fund is long-term capital appreciation. The
Fund seeks to achieve this objective by investing all of its investable assets
in the Portfolio which, in turn, invests primarily in common stocks of well
established companies located outside the United States. A company will be
considered 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. The Portfolio may also invest in securities other than common stock if
the Sub-Advisor believes these are likely to be the best suited at that time to
achieve the Portfolio's objective. These include equity-related securities
(such as preferred stocks and convertible securities), debt securities issued by
foreign governments or foreign corporations, U.S. or foreign short-term
investments or other securities described on the following pages. The Portfolio
intends to diversify its holdings among several countries and to have, under
normal market conditions, at least 65% of the Portfolio's total assets invested
in the securities of companies located in at least five countries, not including
the United States. Current income is not an investment objective of the Fund
and any income produced will be only of
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secondary importance as a by-product of the investment selection process used to
achieve the Fund's objective.
INVESTMENT SELECTION
In selecting its portfolio securities, the Portfolio places primary
emphasis on fundamentally undervalued stocks as determined by a range of
characteristics, including relatively low price/earnings multiples, dividend
yield, consistency of earnings growth and cash flow, financial strength,
realizable asset value and liquidity. Securities of companies with medium to
large market capitalizations usually constitute the majority of the Portfolio's
investments. The Portfolio currently considers medium to large market
capitalizations to be those in excess of $1 billion. Market capitalization is
defined as total current market value of a company's outstanding common stock.
In addition, the Portfolio is presently anticipated to be weighted largely
toward companies located in Western Europe (for example, the United Kingdom,
Germany, France, Italy, Spain, Switzerland, the Netherlands, Sweden, Ireland and
Finland), Australia and the Far East (for example, Japan, Hong Kong, Singapore,
Malaysia, Thailand, Indonesia and the Philippines). However, the Portfolio is
free to invest in companies of any size and in companies located in other
foreign countries, including developing countries.
INVESTMENT DECISION MAKING PROCESS
The Sub-Advisor's investment approach is based on "bottom-up" fundamental
analysis of individual companies within a framework of dynamic economic and
business themes that are believed to provide the best opportunities for
effective stock selection. Stock selection decisions are guided by:
- - GLOBAL ECONOMIC AND BUSINESS THEMES. The Sub-Advisor identifies
economic and business themes and trends that have the potential to
support the long-term growth prospects of companies best positioned to
take advantage of them. These themes and trends may transcend
political and geographic boundaries and may be global or regional in
nature. Current themes and trends include, for example, worldwide
growth in telecommunications and multimedia, rapid economic development
in the Pacific Basin, global healthcare trends and unique consumer
franchises.
- - FUNDAMENTAL ANALYSIS. The Sub-Advisor seeks to identify companies
that it believes are best positioned to benefit from the identified
themes and trends. It conducts an extensive "bottom-up" analysis
seeking individual quality companies with stocks that are
fundamentally undervalued relative to their long-term prospective
earnings growth rate, their historic valuation levels and their peer
group. This process
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includes examining financial statements, evaluating management and
products, assessing competitive position and strengths, as well as
analyzing the economic variables affecting the company's operating
environment. This in-depth, fundamental analysis is believed to be
the most important step in identifying stock selections for the
Portfolio.
Actual country weightings are a by-product of the bottom-up stock
selection approach. Accordingly, the country in which a company is located is
considered by the Sub-Advisor to be less important than the diversity of its
sources of earnings and earnings growth.
WHY INVEST IN THIS FUND?
The Advisor believes there is substantial opportunity for long-term
capital growth in foreign markets, as certain foreign economies may grow more
rapidly than the U.S. economy. In addition, boundaries and borders no longer
define or confine the operations of many of the world's business entities.
Companies raise capital, purchase raw materials, manufacture and distribute
products on a worldwide basis. Many profitable, successful companies benefit
from global economic growth, including companies in foreign markets. The Fund
seeks to take advantage of the investment opportunities created by an
increasingly global economy.
One reason for investing internationally is the opportunity to earn
higher investment returns. On a total return basis, foreign stocks represented
by the Morgan Stanley Capital International EAFE (Europe, Australasia, Far East)
Index outperformed U.S. stocks represented by the Standard & Poor's 500 Stock
Index in all but two rolling ten-year periods ended 1981 through 1995. Of
course, during this time there were shorter periods when U.S. stocks had higher
returns, and there have been periods when the EAFE Index produced negative
returns. Accordingly, investors in foreign equity securities should have a
long-term investment perspective, as international markets tend to be more
volatile than the U.S. market.
International investing also expands investment opportunities. The
U.S. percentage of the world's stock market capitalization has decreased over
the past 20 years. Today, more than half of the world's stock market
capitalization consists of non-U.S. stocks and companies. Since foreign stocks
do not always move in tandem with U.S. stocks and with each other, international
investing also has the potential to add diversification to an all- U.S. stock
portfolio by spreading investments across a number of markets.
Investors who wish to diversify their portfolio internationally can do
so by investing directly in foreign stocks, but they may find it difficult to
make purchases and
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<PAGE>
sales, obtain reliable information, hold securities in safekeeping and manage
the conversion of the value of their international investments into U.S.
dollars. Investing in the Fund, however, eliminates these complications. With
a single investment, the investor owns a diversified international investment
portfolio that is actively managed by experienced professionals. BIAM, the
Portfolio's Sub-Advisor, has extensive experience in dealing with foreign
markets and with brokers and custodian banks around the world. BIAM also has
the benefit of an established information network and believes the Fund offers a
convenient and cost-effective means of investing internationally.
Of course, as an international fund, the Fund entails special risks as
described below. The Fund seeks to reduce these risks through diligent research
and diversification.
SECURITIES, INVESTMENT PRACTICES AND RISK FACTORS
Since the shares of the Fund represent an investment in the Portfolio,
which in turn primarily represents an investment in common stocks, investors
should understand that the net asset value of the Fund will change as the market
value of the securities held in the Portfolio changes and that the value of a
Fund share will go up and down. Investors should also be aware that investment
in foreign securities carries additional risks not present when investing in
domestic securities. See "Foreign Securities" below.
The Fund is not intended as a complete or balanced investment vehicle,
but rather as an investment for persons who are in a financial position to
assume the risk and share price volatility associated with foreign investments.
As a result, the Fund should be considered as a long-term investment vehicle.
The investment objective of the Fund and the Portfolio is considered
fundamental, meaning that it cannot be changed without a vote of the
shareholders of the Fund and, as to the Portfolio's objective, of the investors
in the Portfolio. There can be no assurance that the Fund's or the Portfolio's
investment objective will be realized. Following is additional information
about some of the specific types of securities in which the Portfolio may
invest.
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
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<PAGE>
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 in the Statement of Additional Information.
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 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 currency would adversely
affect the value of the securities expressed in dollars. Foreign currency
exchange rates are determined by forces of supply and demand on the foreign
exchange markets, which are in turn affected by the international balance of
payments and other economic and financial conditions, government intervention,
speculation and other factors.
CONVERTIBLE SECURITIES. The Portfolio may purchase securities that
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 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 being rated below
investment grade by organizations such as
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<PAGE>
Moody's Investors Service, Inc., and Standard & Poor's Corporation, or being of
similar creditworthiness in the determination of 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 net 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 the Statement of Additional Information.
SECURITIES OF SMALLER COMPANIES. The Portfolio may invest in
securities of companies with small or medium 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 well
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 well
established companies.
LENDING PORTFOLIO SECURITIES. The Portfolio may lend its securities
to qualified institutional investors such as brokers, dealers or other financial
organizations. This practice permits the Portfolio to earn income, which, in
turn, can be invested in additional securities to pursue its investment
objective. Loans of securities by the Portfolio will be collateralized by cash,
letters of credit, or securities issued or guaranteed by the U.S. Government or
its agencies. The collateral will equal at least 100% of the current market
value of the loaned securities, marked-to-market on a daily basis. 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
any security if, as a result of such loan, the aggregate value of securities
then on loan would exceed 33-1/3% of the market value of the Portfolio's total
assets.
HEDGING TRANSACTIONS. The Portfolio is authorized to make limited
commitments in certain forward contracts, but only for the
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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. Forward contracts are obligations between two parties
to exchange particular goods or instruments (such as foreign currencies) at a
set price on a future date. The Portfolio currently intends that it will use
forward contracts only for hedging purposes and that it may enter into forward
foreign currency exchange contracts, provided the aggregate value of all
outstanding contracts does not exceed the value of the Portfolio's assets.
Although a hedging transaction may, for example, partially protect the Portfolio
from a decline in the foreign exchange price of a particular security or its
portfolio generally, hedging may also limit the potential return to the
Portfolio due to positive foreign exchange movements, and the cost of the
transaction will reduce the potential return on the security or the portfolio.
In addition, forward foreign currency exchange contracts do not eliminate
fluctuations in the prices of the underlying securities the Portfolio owns or
intends to acquire.
The Portfolio will generally enter into forward foreign currency
exchange contracts either with respect to specific transactions or with respect
to the Portfolio's security positions. For example, the Portfolio may enter
into a forward contract in order to fix the price (in terms of a specified
currency, which may be U.S. dollars or a foreign currency) for securities it has
agreed to buy or sell or is considering buying or selling. Further, when the
Sub-Advisor believes that a particular foreign currency in which some or all of
the Portfolio's investments are denominated may decline compared to the U.S.
dollar, the Portfolio may enter into a forward contract to sell the currency
that is expected to decline (or another currency which acts as a proxy for that
currency). However, the Portfolio will be permitted to make such investments
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 securities
denominated in a specific foreign currency. To ensure that the Portfolio will
be able to meet its obligations under its forward foreign currency exchange
contracts, the Portfolio will be required to place liquid assets in a segregated
account with its custodian bank or to set aside securities to "cover" its
commitments in these contracts.
Forward foreign currency exchange contracts are privately negotiated
(i.e., over-the-counter) and the parties may agree to offset or terminate the
contract before its maturity or may hold the contract to maturity and complete
the contemplated delivery of the underlying foreign currency. Transactions in
forward foreign currency exchange contracts by the Portfolio involve the
potential for a loss that may exceed the amount of commitment the Portfolio
would be permitted to make in those contracts under its investment limitations.
The principal risks of the
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Portfolio's use of forward foreign currency exchange contracts are: (a) losses
resulting from currency market movements not anticipated by the Portfolio;
(b) possible imperfect correlation between movements in the prices of forward
contracts and movements in the spot (i.e., cash) prices of the currencies hedged
or used to cover such positions; (c) lack of assurance that the Portfolio will
be able to enter into an offset or termination of the contract at any particular
time; (d) the need for additional information and skills beyond those required
for the management of a portfolio of traditional securities; and (e) possible
need to defer closing out certain forward contracts in order to facilitate the
Fund's qualification for beneficial tax treatment afforded "regulated investment
companies" under the Internal Revenue Code of 1986. 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 will fail to perform its obligations, in which case the Portfolio
could be worse off than if the contract had not been entered into.
Although they currently have no intention of doing so, the trustees of
Worldwide Portfolios may, without shareholder approval, authorize the Portfolio
to invest in certain types of other instruments for hedging purposes, such as
financial futures and options. Appropriate notice to shareholders will be
provided of any intention to commence investing in such instruments. Additional
detail concerning the Portfolio's transactions in forwards, futures and options
and the risks of such investments can be found in the Statement of Additional
Information.
ILLIQUID 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. 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. Certain restricted securities, such as Rule 144A
securities, may be treated as liquid under this restriction if a determination
is made that such securities are readily marketable. 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.
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INVESTMENT RESTRICTIONS
In addition to its investment objective, the Portfolio has adopted a
number of restrictions on its investments and other activities that may not be
changed without shareholder approval. For example, the Portfolio may not borrow
money, except borrowing undertaken from banks for temporary or emergency
purposes in amounts not to exceed 25% of the market value of its total assets
(including the amount borrowed) and may not make loans (except that the
Portfolio may lend portfolio securities and enter into repurchase agreements in
accordance with its investment policies). The Portfolio may not invest in any
one industry 25% or more of the value of its total assets at the time of
investment, nor invest in commodities, except, only for the purpose of hedging,
the Portfolio may invest in forward foreign currency exchange contracts and
other instruments as specified in greater detail above and in the Statement of
Additional Information.
Further, with respect to 100% of its total assets, the Portfolio may
not purchase securities of any issuer (except U.S. Government securities) if,
immediately after and as a result of such purchase, the value of the Portfolio's
holdings in the securities of that issuer exceeds 5% of the value of its total
assets or it owns more than 10% of the outstanding voting securities or of any
class of securities of such issuer, although this restriction may be reduced to
apply to 75% or more of the Portfolio's total assets without a shareholder vote.
Also, 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 would be invested in such securities, although this
restriction may be changed without shareholder approval. For more detail about
the Portfolio's investment restrictions, see the Statement of Additional
Information.
4. PORTFOLIO TURNOVER
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 shares of the Fund or interests in the
Portfolio due to economic, market or other factors that are not within the
control of management. Although the annual portfolio turnover rate of the
Portfolio will vary, it is normally expected to range from 25% to 75%.
5. ADDITIONAL INFORMATION ABOUT MASTER/FEEDER STRUCTURE
Unlike other mutual funds that directly acquire and manage their own
portfolios of securities, the Fund (referred to as a feeder fund) seeks to
achieve its investment objective by investing all of its investable assets in
the Portfolio (referred to as a
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master fund). This two-tier structure is known as a master/feeder. The Fund
has the same investment objective and policies as the Portfolio. The Fund will
invest only in the Portfolio, and the Fund's shareholders will therefore acquire
only an indirect interest in the investments of the Portfolio.
In addition to selling a beneficial interest to the Fund, the
Portfolio may sell beneficial interests to other mutual funds or institutional
investors (that is, other feeder funds). Such investors will invest in the
Portfolio on the same terms and conditions and will pay their proportionate
share of the Portfolio's expenses. However, the other investors investing in
the Portfolio are not required to issue their shares at the same public offering
price as the Fund due to potential differences in expense structures.
Accordingly, investors in the Fund should be aware that these differences may
result in differences in returns experienced by investors in the different funds
that invest in the Portfolio. Such differences in returns are common in this
type of mutual fund structure and are also present in other mutual fund
structures. Information concerning other investors in the Portfolio (for
example, other feeder funds) is available from the Fund at 1-800-333-1001.
The investment objective of the Fund may not be changed without the
approval of the Fund's shareholders. The investment objective of the Portfolio
may not be changed without the approval of the investors in the Portfolio,
including the Fund. If the objective of the Portfolio changes and the
shareholders of the Fund do not approve a parallel change in the Fund's
investment objective, the trustees of the Trust will consider other
alternatives, including seeking an alternative investment vehicle or directly
retaining the Fund's own investment advisor. Shareholders will be given at
least 30 days' written notice prior to any change in the investment objective of
the Fund or the Portfolio.
Smaller funds investing in the Portfolio may be materially affected by
the actions of larger funds investing in the Portfolio. For example, if a
larger fund invests or withdraws from the Portfolio, the remaining funds may
experience lower or higher pro rata operating expenses. Lower returns could
possibly result from a large withdrawal. However, this possibility also exists
for traditionally structured funds which have large or institutional investors.
Also, a fund with a greater pro rata ownership in the Portfolio could have
effective voting control over the operations of the Portfolio.
Whenever the Fund is requested to vote as an investor in the Portfolio
on matters pertaining to the Portfolio (other than a vote by the Fund to
continue the operation of the Portfolio upon the withdrawal of another investor
in the Portfolio), the Fund will hold a meeting of its shareholders and will
cast all of its votes as an investor in the Portfolio in the same proportion as
directed by the votes of the Fund's shareholders. Fund shareholders who do not
vote will not affect the votes cast by the Fund at the meeting of the Portfolio
investors. The percentage of the votes representing the Fund's shareholders who
do not vote will be voted by the Fund in the same proportion as the Fund's
shareholders who do, in fact, vote.
The Fund may withdraw its investment in the Portfolio at any time, if
the trustees of the Trust determine that it is in the best interests of the Fund
to do so. Certain
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changes in the Portfolio's investment objective, policies and limitations may
require the Fund to withdraw its investment in the Portfolio. Upon any such
withdrawal, the trustees would consider what action might be taken, including
investing the Fund's assets in another pooled investment entity having the same
investment objective and policies as the Fund or retaining an investment advisor
to manage the Fund's assets in accordance with the investment policies described
above with respect to the Portfolio. Any such withdrawal could result in a
distribution in kind of portfolio securities (as opposed to a cash distribution)
from the Portfolio. If securities are distributed, the Fund could incur
brokerage, tax or other charges in converting the securities to cash. In
addition, a distribution in kind may adversely affect the liquidity of the Fund.
This Prospectus and the Statement of Additional Information contain
more detailed information about this master/feeder organizational structure,
including information related to: (i) the investment objective, policies and
restrictions of the Fund and the Portfolio; (ii) the trustees and officers of
the Trust and Worldwide Portfolios, and the management of the Fund and the
Portfolio; (iii) portfolio transactions and brokerage commissions; (iv) the
Fund's shares, including the rights and liabilities of its shareholders; (v)
additional performance information, including the method used to calculate total
return; and (vi) the determination of the value of the shares of the Fund. The
master/feeder fund structure is still relatively new and lacks a substantial
history.
6. MANAGEMENT AND INVESTMENT ADVICE
The trustees of the Trust are responsible for major decisions relating
to the Fund's policies and objective. They also oversee the operation of the
Fund by its officers and review the investment performance of the Fund on a
regular basis. The trustees of Worldwide Portfolios have overall responsibility
for operation of the Portfolio. A majority of the trustees of the Trust and
Worldwide Portfolios who are not "interested persons" (as defined in the
Investment Company Act of 1940) of the Trust or Worldwide Portfolios
("Independent Trustees") have adopted written procedures reasonably appropriate
to deal with potential conflicts of interest arising from the fact that the same
individuals are trustees of the Trust and Worldwide Portfolios, up to and
including creating a new board of trustees for the Trust or Worldwide
Portfolios. Additional information concerning the trustees and officers of the
Trust and Worldwide Portfolios is furnished in the Statement of Additional
Information under the heading "Management of the Fund."
THE ADVISOR -- GENERAL BUSINESS MANAGEMENT AND INVESTMENT OVERSIGHT
The investment advisor to the Portfolio is BBOI Worldwide LLC (the
"Advisor" or "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, such as coordinating certain matters relating to the operations of
the Portfolio and monitoring the Portfolio's compliance with all applicable
federal and state securities laws. Currently, the Advisor serves in this
capacity only to the Portfolio.
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The Advisor is a Delaware limited liability company formed in 1996.
Since the Advisor was only recently formed, it has no prior experience as an
investment advisor. However, Berger Associates, Inc. ("Berger Associates"),
which owns 100% of the Advisor, has been in the investment advisory business for
over 20 years. Berger Associates serves as investment advisor or sub-advisor to
mutual funds, pension and profit-sharing plans, and institutional and private
investors, and has assets under management of more than $3.5 billion as of April
30, 1996. Kansas City Southern Industries, Inc. ("KCSI") owns approximately 80%
of the outstanding shares of Berger Associates. 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. Also, see below under "Pending Sale of Interest in
Advisor".
THE SUB-ADVISOR -- EXPERIENCED INTERNATIONAL INVESTMENT MANAGEMENT
Since its founding in 1966, Bank of Ireland's investment management
group has become recognized among international and global investment managers,
serving clients in Europe, the United States, Canada, Australia and South
Africa. Bank of Ireland Asset Management (U.S.) Limited ("BIAM"), the Sub-
Advisor to the Portfolio, is an indirect wholly-owned subsidiary of Bank of
Ireland. Bank of Ireland, founded in 1783, is 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 $16 billion as of April 30, 1996.
As permitted in its Investment Advisory Agreement with the Portfolio,
the Advisor has delegated day-to-day portfolio management responsibility to
BIAM, as the Sub-Advisor. 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 serves as investment advisor or sub-advisor to pension and
profit-sharing plans and other institutional investors and mutual funds. BIAM's
main offices are at 26 Fitzwilliam Place, Dublin 2, Ireland. BIAM maintains a
representative office at 2 Greenwich Plaza, Greenwich, CT 06830.
All investment decisions made for the Portfolio by the Sub-Advisor are
made by a team of BIAM investment personnel. No one individual is primarily
responsible for making the day-to-day investment decisions for the Portfolio.
Most of the investment professionals at BIAM have been with BIAM at least 10
years.
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
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in part with the proceeds of securities purchased by the Portfolio. Federal law
prohibits the Sub-Advisor, 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, the
Sub-Advisor 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.
ADVISORY FEES
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. Until at
least April 30, 1998, the Advisor has agreed voluntarily to waive the investment
advisory fee paid by the Portfolio under the Investment Advisory Agreement to
the extent that the Portfolio's normal 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. Any reduction
in the advisory fee paid by the Portfolio will also reduce the pro rata share of
the advisory fee borne indirectly by the Fund.
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.
PENDING SALE OF INTEREST IN ADVISOR
As mentioned above, the Portfolio's Advisor, BBOI Worldwide, is a
limited liability company formed in 1996 and 100% owned by Berger Associates.
BBOI Worldwide was organized by Berger Associates in anticipation of forming a
joint venture with BIAM for the purpose of managing international and global
mutual funds. Pursuant to the Amended and Restated Operating Agreement of BBOI
Worldwide LLC, dated as of May 1, 1996, between Berger Associates and BIAM (the
"Joint Venture Agreement"), BIAM (or an affiliate) has agreed to acquire a 50%
interest in the Advisor and thereby enter into a joint venture with Berger
Associates to become effective upon receipt of all regulatory approvals. Berger
Associates' role in the joint venture will be to provide administration and
marketing, and BIAM's role will be to provide international and global
investment management expertise. Day-to-day portfolio management of the
Portfolio will continue to be provided by BIAM under the Sub-Advisory Agreement.
The Joint Venture Agreement provides that Berger Associates and BIAM
will each own a 50% membership interest in the Advisor and each will have an
equal number of representatives on the Advisor's Board of Managers. Agreement
of representatives of both Berger Associates and BIAM will be required for all
significant management decisions.
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BIAM's acquisition of an interest in the Advisor is subject to
approval of the Federal Reserve Board of the United States and the Central Bank
of Ireland. In the event the joint venture is not consummated, Berger
Associates anticipates continuing to provide the Fund with administrative
services, and BIAM has agreed to continue to serve as the Sub-Advisor to the
Portfolio for a period of not less than six months thereafter, on usual and
customary contractual terms.
Consummation of BIAM's acquisition of a membership interest in the
Advisor might be deemed to effect a change of control in the Advisor and thereby
an "assignment" (as defined in the Investment Company Act of 1940) and
termination of the Portfolio's Investment Advisory and Sub-Advisory Agreements.
However, the trustees of Worldwide Portfolios have considered the terms of the
joint venture and various factors related to the proposal, including that the
day-to-day management of the Portfolio by BIAM is not proposed to change. On
the basis of the factors considered, the trustees, including the Independent
Trustees of Worldwide Portfolios voting separately, have approved new Investment
Advisory and Sub-Advisory Agreements that will come into effect upon
consummation of the joint venture and any change of control in the Advisor that
may be deemed to result. The new Agreements have also been approved by the
Portfolio's initial investors. The new Agreements are identical in their terms
to the initial Agreements described in this Prospectus, except for commencement
date. No further trustee or shareholder vote is anticipated to approve the new
Agreements upon consummation of the joint venture. Accordingly, prospective
investors should consider BIAM's pending acquisition of an interest in the
Advisor at the time they consider their initial investment in the Fund.
7. EXPENSES OF THE FUND
The Fund is allocated and bears indirectly its pro rata share of the
aggregate annual operating expenses of the Portfolio, since all of the
investable assets of the Fund are invested in 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
Independent Trustees; 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,
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; the fees payable to the Advisor under the Investment
Advisory Agreement; and such other non-recurring and extraordinary items as may
arise from time to time.
Until at least April 30, 1998, the Advisor has agreed voluntarily to
waive the investment advisory fee paid by the Portfolio under the Investment
Advisory Agreement to the extent that the Portfolio's normal operating expenses
in any fiscal year, including the investment advisory fee and custodian fees,
but excluding brokerage commissions, interest,
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taxes and extraordinary expenses, exceed 1.00% of the Portfolio's average daily
net assets for that fiscal year. Any reduction in the advisory fee paid by the
Portfolio will also reduce the pro rata share of the advisory fee borne
indirectly by the Fund.
Expenses of the Fund include, among others, its pro rata share of the
expenses of the Trust, such as: expenses of registering the Trust with
securities authorities; expenses of meetings of the shareholders of the Trust;
and legal fees. Expenses of the Fund also include, among others, registration
and filing fees incurred in registering shares of the Fund with securities
authorities; 12b-1 fees; taxes imposed on the Fund; the fee payable to the
Advisor under the Administrative Services Agreement; and such other non-
recurring and extraordinary items as may arise from time to time.
SERVICE ARRANGEMENTS FOR THE FUND
Under the Administrative Services Agreement with the Fund, the Advisor
serves as the administrator of the Fund. In this capacity, it is responsible
for administering and managing all aspects of the Fund's day-to-day operations,
subject to the oversight of the trustees of the Trust. The Advisor is
responsible, at its expense, for furnishing (or procuring other parties to
furnish) all administrative services reasonably necessary for the operation of
the Fund, including recordkeeping and pricing services, custodian services,
transfer agency and dividend disbursing services, tax and audit services,
insurance, printing and mailing to shareholders of prospectuses and other
required communications, and certain other administrative and recordkeeping
services, such as coordinating matters relating to the operations of the Fund,
monitoring the Fund's status as a "regulated investment company" under the
Internal Revenue Code, coordinating registration of sufficient Fund shares under
federal and state securities laws, and arranging for and supervising the
preparation of registration statements, tax returns, proxy materials, financial
statements and reports for filing with regulatory authorities and distribution
to shareholders of the Fund. Under the Administrative Services Agreement, the
Fund pays the Advisor a fee at an annual rate equal to the lesser of (i) 0.45%
of its average daily net assets, or (ii) the Advisor's annual cost to provide or
procure these services (including the fees of any services providers whose
services are procured by the Advisor), plus an additional 0.02% of the Fund's
average daily net assets. The trustees of the Trust regularly review amounts
paid to and expenditures incurred by the Advisor pursuant to the Administrative
Services Agreement. In addition, in the event that the Advisor's duties under
the Administrative Services Agreement are delegated to another party, the
Advisor may take into account, in calculating the cost of such services, only
the costs incurred by such other party in discharging the delegated duties.
Arrangements may be entered into by the Advisor or its affiliates with
certain organizations (broker-dealers, recordkeepers and administrators) to
provide subtransfer agency, recordkeeping, shareholder communications,
subaccounting and/or other services to investors purchasing shares of the Fund
through investment programs or pension plans
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established or serviced by those organizations. The Advisor or its affiliates
may pay fees to these organizations for their services. For purposes of
determining the Advisor's cost of providing or procuring transfer agency,
dividend disbursing or other services under the Administrative Services
Agreement, the Advisor may take into account only the fees that otherwise would
be paid for by the Advisor if all the investors who own Fund shares through the
organization were instead direct registered record holders of shares in the
Fund.
Under a Sub-Administration Agreement between the Advisor and Berger
Associates, Berger Associates has been delegated the responsibility to perform
certain of the administrative and recordkeeping services required under the
Administrative Services Agreement and to procure, at the Advisor's expense,
third parties to provide the services not provided by Berger Associates. Under
the Sub-Administration Agreement, Berger Associates is paid a fee by the Advisor
of 0.25% of the Fund's average daily net assets for its services. During
certain periods, Berger Associates may voluntarily waive all or a portion of its
fee from the Advisor, which will not affect the fee paid by the Fund to the
Advisor under the Administrative Services Agreement. Investors Fiduciary Trust
Company ("IFTC") has been appointed to provide recordkeeping and pricing
services to the Fund, including calculating the daily net asset value of the
Fund, and to perform certain accounting and recordkeeping functions that it
requires. In addition, IFTC has been appointed to serve as the Fund's
custodian, transfer agent and dividend disbursing agent. IFTC has engaged DST
Systems, Inc. ("DST"), as sub-transfer agent to provide transfer agency and
dividend disbursing services for the Fund. The fees of Berger Associates, IFTC
and DST are all paid by the Advisor. Approximately 40% of the outstanding
shares of DST are owned by KCSI, which also owns approximately 80% of the
outstanding shares of Berger Associates.
SERVICE ARRANGEMENTS FOR THE PORTFOLIO
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 preparing investor communications, which have been
delegated to Berger Associates as part of the Sub-Administration Agreement
discussed above. 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.
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reimburses IFTC for certain out-of-pocket expenses.
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.
DISTRIBUTOR
The distributor (principal underwriter) of the Fund's shares is First
Fund Distributors, Inc. (the "Distributor"), 4455 East Camelback Road, Suite
261-E, Phoenix, AZ 85018. The Distributor is compensated and reimbursed for its
costs in distributing Fund shares by Berger Associates. See "Policies of the
Fund to Promote Sales of Fund Shares" below.
8. POLICIES OF THE FUND TO PROMOTE SALES OF FUND SHARES
The Fund has adopted a Rule 12b-1 plan (the "Plan") pursuant to
Rule 12b-1 under the Investment Company Act of 1940, which permits the Fund to
pay certain costs for the distribution of its own shares. The Plan provides for
the payment to Berger Associates of a 12b-1 fee of 0.25% per annum of the Fund's
average daily net assets to finance activities primarily intended to result in
the sale of Fund shares. The expenses paid by Berger Associates under the Plan
may include, but are not limited to, payments made to, and costs incurred by,
the Fund's Distributor in connection with the distribution of the Fund's shares;
payments made to and expenses of persons (including employees of Berger
Associates) who are engaged in, or provide support services in connection with,
the distribution of Fund shares, such as answering routine telephone inquiries
and processing shareholder requests for information; compensation (including
incentive compensation and/or continuing compensation based on the amount of
customer assets maintained in the Fund) paid to securities dealers, financial
institutions and other organizations which render distribution and
administrative services in connection with the distribution of the Fund's
shares, including services to shareholders of the Fund and prospective
investors; costs related to the formulation and implementation of marketing and
promotional activities, including direct mail promotions and television, radio,
newspaper, magazine and other mass media advertising; costs of printing and
distributing prospectuses and reports to prospective shareholders of the Fund;
costs involved in preparing, printing and distributing sales literature for the
Fund; costs involved in obtaining whatever information, analyses and reports
with respect to marketing and
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promotional activities on behalf of the Fund that Berger Associates or the
Distributor deems advisable; and such other costs as may from time to time be
agreed upon by the Fund. Such payments are to be made by the Fund to Berger
Associates with respect to each fiscal year of the Fund without regard to the
actual distribution expenses incurred by Berger Associates in such year; that
is, if the distribution expenditures incurred by Berger Associates are less than
the total of such payments in such year, the difference is not to be reimbursed
to the Fund by Berger Associates, and if the distribution expenditures incurred
by Berger Associates are more than the total of such payments, the excess is not
to be reimbursed to Berger Associates by the Fund. From time to time Berger
Associates or the Distributor may engage in activities which jointly promote the
sale of the shares of all or other Berger Funds or Berger/BIAM Funds, which
costs are not readily identifiable as related to any one fund. In such cases,
the cost of the activity will be allocated among the funds involved on the basis
of their respective net assets, unless otherwise directed by the trustees.
The current 12b-1 Plan will continue in effect until April 1997, and
from year to year thereafter if approved at least annually by the trustees and
the Independent Trustees of the Trust who have no direct or indirect financial
interest in the operation of the Plan or any related agreements by votes cast in
person at a meeting called for such purpose. The Plan may not be amended to
increase materially the amount to be spent on distribution of shares of the Fund
without shareholder approval.
The trustees of Worldwide Portfolios have authorized the Sub-Advisor
to consider sales of shares of the Fund by a broker-dealer or the
recommendations of a broker-dealer to its customers that they purchase Fund
shares as a factor in the selection of broker-dealers to execute securities
transactions for the Portfolio. In placing portfolio business with such broker-
dealers, the Sub-Advisor will seek the best execution of each transaction.
9. HOW TO PURCHASE SHARES IN THE FUND
(i) Minimum Initial Investment -- $2,000.00. To purchase shares in
the Fund, simply complete the application form enclosed with this Prospectus.
Then mail it with a check payable to "Berger Funds" to the Fund in care of DST
Systems, Inc., the Fund's sub-transfer agent, as follows:
Berger Funds
c/o DST Systems, Inc.
P.O. Box 419958
Kansas City, MO 64141
A confirmation indicating the details of the transaction will be sent to you
promptly. Unless you specify full shares only, the purchase will be made in
full and fractional shares calculated to three decimal places.
In addition, Fund shares may be purchased through certain
broker-dealers that have established mutual fund programs and certain other
organizations connected with pension and retirement plans. These
broker-dealers and other organizations may charge
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investors a transaction or other fee for their services, may require different
minimum initial and subsequent investments than the Fund and may impose other
charges or restrictions different from those applicable to shareholders who
invest in the Fund directly. Fees charged by these organizations will have the
effect of reducing a shareholder's total return on an investment in Fund shares.
No such charge will be paid by an investor who purchases the Fund shares
directly from the Fund as described above.
The Fund will, at its discretion, accept orders transmitted by these
organizations although not accompanied by payment for the shares being
purchased. Payment must be received by the Fund within three business days
after acceptance of the order. The price at which a purchase will be effected
is based on the next calculation of net asset value after the order is received
by the Fund's transfer agent, sub-transfer agent or any other authorized agent
of the Fund.
(ii) MINIMUM SUBSEQUENT INVESTMENTS -- $50.00. Shareholders may, at
any time, purchase additional shares subject to a minimum investment of $50.00.
A check made payable to "Berger Funds" in the amount to be invested, should be
sent to the Fund, c/o DST Systems, Inc., P.O. Box 419958, Kansas City, MO
64141. Please be sure to give your name and account number. You will receive a
confirmation of every transaction.
(iii) AUTOMATIC INVESTMENT PLAN. By completing the Automatic
Investment Plan section of the application, you may authorize the Fund to debit
your bank account for the periodic purchase of Fund shares on or about the
5th or 20th day of each month. Automatic investments are subject to the minimum
initial investment of $2,000, a minimum investment of $50.00 per month and are
unrestricted as to the permitted maximum. You will receive confirmation of
automatic investments after the end of each calendar quarter.
(iv) TELEPHONE AND ONLINE INVESTMENTS. The Fund will, at its
discretion, accept purchase orders from existing shareholders by telephone or,
via their personal computer, through online service providers or other online
access points approved by the Fund, although not accompanied by payment for the
shares being purchased. To receive the net asset value for a specific day, a
telephone or online purchase request must be received before the close of the
New York Stock Exchange on that day. Payment for shares ordered in this way
must be received by the Fund's transfer agent within three business days after
acceptance of the order. In order to make sure that payment is received on
time, shareholders are encouraged to remit payment by wire or electronic funds
transfer, or by overnight delivery. If payment is not received on time, the
Fund may cancel the order and redeem shares held in the shareholder's account to
compensate the Fund for any decline in the value of the purchased shares.
Telephone and online purchase orders may not exceed four times the value of an
account on the date the order is placed (shares previously purchased by
telephone or online are included in computing such value only if payment has
been received). See "How to Redeem or Sell Fund Shares - Telephone and Online
Redemptions" for procedures for telephone transactions.
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(v) PAYMENT AND TERMS OF OFFERING. Payment for shares purchased
should be made by check or money order drawn on a United States bank and made
payable to the Berger Funds. Checks not made payable to the Berger Funds, the
account registrant, transfer agent or retirement account custodian will not be
accepted. Alternatively, payment for shares purchased may be made by wire or
electronic funds transfer from the investor's bank to DST Systems, Inc., after
ordering shares by telephone or online. Please call 1-800-551-5849 for current
wire or electronic funds transfer instructions. The Fund will not accept
purchases by cash or credit card or checks drawn on foreign banks unless
provision is made for payment through a U.S. bank in U.S. dollars.
The Fund reserves the right in its sole discretion to withdraw all or
any part of the offering made by this Prospectus or to reject purchase orders,
when in the judgment of management, such withdrawal or rejection is in the best
interest of the Fund. The Fund also reserves the right at any time to waive the
minimum investment requirements applicable to initial or subsequent investments
or to increase the minimums following notice. No application to purchase shares
is binding on the Fund until accepted in writing.
10. HOW THE NET ASSET VALUE IS DETERMINED
The price of the Fund's shares is based on the net asset value of the
Fund, which 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 per share net asset value of the Fund is
determined by dividing the total value of its assets, less liabilities, by the
total number of shares outstanding. Since the Fund will invest all of its
investable assets in the Portfolio, the value of the Fund's investable assets
will be equal to the value of its beneficial interest in the Portfolio.
The Portfolio's securities and other assets are valued as follows:
securities are valued at market value or, if market quotations are not readily
available, at their fair value determined in good faith pursuant to consistently
applied procedures established by the trustees. Money market instruments
maturing within 60 days are valued at amortized cost, 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. See the Statement of Additional Information for more detailed
information.
Generally, trading in foreign securities markets is substantially
completed each day at various times prior to the close of the Exchange. The
values of foreign securities used in computing the net asset value of the shares
of the Fund are determined as of the earlier of such market close or the closing
time of the Exchange. Occasionally, events affecting the value of such
securities may occur between the times at which they are determined and the
close of the Exchange, or when the foreign market on which such securities trade
is closed but the Exchange is open, which will not be reflected in the
computation of net asset value. If during such periods, events occur which
materially affect the value of such securities, the securities will be valued at
their fair market value as
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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 customary U.S. holidays) and the Fund's net asset
value is not calculated. As a result, the net asset value of the Fund may be
significantly affected by such trading on days when shareholders cannot purchase
or redeem shares of the Fund.
Since the Fund does not impose any front end sales load or redemption
fee, both the purchase price and the redemption price of a Fund share are the
same and will be equal to the next calculated net asset value of a share of the
Fund.
11. OPEN ACCOUNT SYSTEM AND SHARE CERTIFICATES
Unless otherwise directed, all investor accounts are maintained on a
book-entry basis. Share certificates will not be issued unless requested by the
shareholder. Shares purchased by dividend reinvestment or under an Automatic
Investment Plan, and shares redeemed under a Systematic Withdrawal Plan, will be
confirmed after the end of each calendar quarter. Following any other
investment or redemption, the investor will receive a printed confirmation
indicating the dollar amount of the transaction, the per share price of the
transaction and the number of shares purchased or redeemed.
12. HOW TO REDEEM OR SELL FUND SHARES
(i) SHARE REDEMPTIONS BY MAIL. The Fund will buy back (redeem), at
current net asset value, all shares of the Fund offered for redemption. The
redemption price of shares tendered for redemption will be the net asset value
next determined after receipt of all required documents by the Fund's transfer
agent, sub-transfer agent or other authorized agent of the Fund. To receive the
net asset value for a specific day, a redemption request must be received before
the close of the Exchange on that day. Shareholders who purchased their shares
directly from the Fund may redeem all or part of their shares in the Fund by
sending a written request to the Fund, c/o DST Systems, Inc., P.O. Box 419958,
Kansas City, MO 64141. The written request for redemption must be signed by
each registered owner exactly as the shares are registered and must clearly
identify the account and the number of shares or the dollar amount to be
redeemed. If a share certificate has been issued, the certificate, properly
endorsed by the registered owner, must be submitted with the written redemption
request.
The signatures of the redeeming shareholders must be guaranteed by a
national or state bank, a member firm of a domestic stock exchange or the
National Association of Securities Dealers (NASD), a credit union, a federal
savings and loan association or another eligible guarantor institution if the
redemption: exceeds $100,000; is being made payable other than exactly as
registered; is being mailed to an address which has been changed within 30 days
of the redemption request; or is being mailed to an address other than the one
on record. A notary public is not an acceptable guarantor. The Fund also
reserves the right to
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require a signature guarantee under other circumstances. The signature
guarantees must appear, together with the signatures of the registered owners,
(i) on the written request for redemption which clearly identifies the account
and the number of shares to be redeemed, (ii) on a separate instrument of
assignment ("stock power") which may be obtained from a bank or broker, or
(iii) on any share certificates tendered for redemption. The use of signature
guarantees is intended to protect the shareholder and the Fund from a possibly
fraudulent application for redemption.
Additional documents are required for redemptions by corporations,
executors, administrators, trustees and guardians. If there is doubt as to what
additional documents are required, please write the Fund, c/o DST Systems, Inc.,
P.O. Box 419958, Kansas City, MO 64141, or call DST at 1-800-551-5849.
(ii) TELEPHONE AND ONLINE REDEMPTIONS. All shareholders have
Telephone and Online Transaction Privileges to authorize purchases, exchanges or
redemptions unless they specifically decline this service on the account
application or by writing to the Fund, c/o DST Systems, Inc., P.O. Box 419958,
Kansas City, MO 64141. Shareholders may redeem shares by telephone or, via
their personal computer, through online service providers or other online access
points approved by the Fund. The telephone and online redemption option is not
available for shares held in retirement accounts sponsored by the Fund.
Telephone redemption requests may be made by calling DST Systems, Inc., at 1-
800-551-5849. To receive the net asset value for a specific day, a redemption
request must be received before the close of the Exchange on that day. As
discussed above, certain requests must be in writing and the signature of a
redeeming shareholder must be signature guaranteed, and therefore shares may not
be redeemed by telephone or online, if the redemption: exceeds $100,000; is
being made payable other than exactly as registered; is being mailed to an
address which has been changed within 30 days of the redemption request; is
being mailed to an address other than the one on record; or the shares are
represented by share certificates issued to the shareholder.
All telephone and online transactions are recorded and written
confirmations indicating the details of all telephone and online transactions
will promptly be sent to the shareholder of record. Prior to accepting a
telephone or online order, the shareholder placing the order may be required to
provide certain identifying information. A shareholder electing to communicate
instructions by telephone or online may be giving up some level of security that
would otherwise be present were the shareholder to request a transaction in
writing. Neither the Fund nor its transfer agent or Advisor assume
responsibility for the authenticity of instructions communicated by telephone or
online which are reasonably believed to be genuine and which comply with the
foregoing procedures. The Fund, and/or its transfer agent, may be liable for
losses resulting from unauthorized or fraudulent telephone or online
instructions in the event these procedures are not followed.
In times of extreme economic or market conditions, redeeming shares by
telephone or online may be difficult. The Fund may terminate or modify the
procedures concerning the telephone or online redemption and wire transfer
services at any time,
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although shareholders of the Fund will be given at least 60 days' prior notice
of any termination or material modification. The Advisor may, at its own risk,
waive certain of these redemption requirements.
(iii) PAYMENT FOR REDEEMED SHARES. Payment for shares redeemed upon
written request will be made by check and generally will be mailed within three
business days after receipt by the transfer agent of the properly executed
redemption request and any outstanding certificates for the shares to be
redeemed. Payment for shares redeemed by telephone or online will be made by
check payable to the account name(s) and address exactly as registered, and
generally will be mailed within three business days following the date of the
request for redemption.
A shareholder may request that payment for redeemed shares of the Fund
be made by wire or electronic funds transfer. Shareholders may elect to use
these services on the account application or by providing the Fund with a
signature guaranteed letter requesting these services and designating the bank
to receive all wire or electronic funds transfers. A shareholder may change the
predesignated bank of record by providing the Fund with written, signature
guaranteed instructions. Wire and electronic funds transfers are subject to a
$1,000 minimum and a $100,000 maximum limitation. Redemption proceeds paid by
wire transfer will be transmitted to the shareholder's predesignated bank
account on the next business day after receipt of the shareholder's redemption
request. There is a $10 fee for each wire payment for shares redeemed by the
Fund. Redemption proceeds paid by electronic funds transfer will be
electronically transmitted to the shareholder's predesignated bank account on
the second business day after receipt of the shareholder's redemption request.
There is no fee for electronic funds transfer of proceeds from the redemption of
Fund shares.
A shareholder may also request that payment for redeemed shares of a
Cash Account Trust portfolio be made by wire or electronic funds transfer and
should review the Cash Account Trust portfolio prospectus for procedures and
charges applicable to redemptions by wire and electronic funds transfers. See
below under "Exchange Privilege and Systematic Withdrawal Plan" for more
information concerning the Cash Account Trust portfolios.
Shareholders may encounter delays in redeeming shares purchased by
check (other than cashier's or certified checks), electronic funds transfer or
through the Automatic Investment Program if the redemption request is made
within 15 days after the date of purchase. In those situations, the redemption
check will be mailed within 15 days after the transfer agent's receipt of the
purchase instrument, provided that it has not been dishonored or cancelled
during that time. The foregoing policy is to ensure that all payments for the
shares being redeemed have been honored. In addition to the foregoing
restrictions, no redemption payment can be made for shares which have been
purchased by telephone or online order until full payment for the shares has
been received. In any event, valid redemption requests concerning shares for
which full payment has been made will be priced at the net asset value next
determined after receipt of the request.
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<PAGE>
(iv) REDEMPTIONS BY THE FUND. As a means of reducing its expenses,
the Fund is authorized to redeem involuntarily all shares held in accounts with
a value of less than $2,000. Such redemptions will be permitted only when the
account is reduced below the minimum value by redemption, and not by declines in
per share net asset value. As a result, accounts established with the
applicable minimum investment might be subject to redemption after only a small
redemption has been made by the shareholder. At least 60 days' written notice
will be given to a shareholder before such an account is redeemed. During that
time, the shareholder may add sufficient funds to the account to meet or exceed
the minimum. If this condition is not met, the shares will be redeemed at the
per share net asset value next determined after the 60th day following the
notice. A check for the proceeds will be sent to the shareholder unless a share
certificate has been issued, in which case payment will be made upon surrender
of the certificate.
13. EXCHANGE PRIVILEGE AND SYSTEMATIC WITHDRAWAL PLAN
(i) EXCHANGES. By telephoning the Fund at 1-800-551-5849, writing to
the Fund, in care of DST at P.O. Box 419958, Kansas City, MO 64141, or, via
their personal computer through online service providers or other online access
points approved by the Fund, any shareholder may exchange, without charge, any
or all of the shareholder's shares in the Fund, subject to stated minimums, for
shares of any of the publicly available Berger Funds or Berger/BIAM Funds or for
shares of the Money Market Portfolio, the Government Securities Portfolio or the
Tax-Exempt Portfolio of the Cash Account Trust (the "CAT Portfolios"),
separately managed, unaffiliated money market funds. Exchanges may be made only
if the Berger Fund, Berger/BIAM Fund or CAT Portfolio with which you wish to
exchange your shares is registered in your state of residence. The exchange
privilege with the CAT Portfolios does not constitute an offering or
recommendation of the shares of any such CAT Portfolio by the Fund, its Advisor
or Sub-Advisor or Berger Associates. Berger Associates is compensated for
administrative services it performs with respect to the CAT Portfolios.
It is your responsibility to obtain and read a prospectus of the
Berger Fund, Berger/BIAM Fund or CAT Portfolio into which you are exchanging.
By giving exchange instructions, a shareholder will be deemed to have
acknowledged receipt of the prospectus for the Berger Fund, Berger/BIAM Fund or
CAT Portfolio being purchased. You may make up to four exchanges out of the
Fund during the calendar year. This limit helps keep the Fund's net asset base
stable and reduces the Fund's administrative expenses. There currently is no
limit on exchanges out of the three CAT Portfolios. In times of extreme
economic or market conditions, exchanging Fund or CAT Portfolio shares by
telephone or online may be difficult. See "How to Redeem or Sell Fund Shares -
Telephone and Online Redemptions" for procedures for telephone and online
transactions.
Redemptions of shares in connection with exchanges into or out of the
Fund are made at the net asset value per share next determined after the
exchange request is received. To receive a specific day's price, your letter,
call or online order must be received before that day's close of the Exchange.
A day or more delay may be experienced prior to the investment of the redemption
proceeds into a CAT Portfolio. Each exchange
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represents the sale of shares from one fund and the purchase of shares in
another, which may produce a gain or loss for U.S. Federal income tax purposes.
All exchanges out of the Fund are subject to the minimum and
subsequent investment requirements of the fund or CAT Portfolio into which
shares are being exchanged. Exchanges will be accepted only if the registration
of the two accounts is identical. Neither the Fund, the Berger Funds, the
Berger/BIAM Funds or the CAT Portfolios, nor their transfer agents or advisors,
assume responsibility for the authenticity of exchange instructions communicated
in writing, by telephone or online which are believed to be genuine. See "How
to Redeem or Sell Fund Shares - Telephone and Online Redemptions" for procedures
for telephone and online transactions. All shareholders have Telephone and
Online Transaction Privileges to authorize exchanges unless they specifically
decline this service on the account application or by writing to the Fund,
c/o DST Systems, Inc., P.O. Box 419958, Kansas City, MO 64141.
(ii) SYSTEMATIC WITHDRAWAL PLAN. A shareholder who owns shares of the
Fund worth at least $5,000 at the current net asset value may establish a
Systematic Withdrawal account from which a fixed sum, minimum of $50, will be
paid to the shareholder monthly, quarterly, semiannually or annually. You will
receive confirmation of systematic withdrawals after the end of each calendar
quarter.
For more information regarding the Systematic Withdrawal Plan and
forms to open such accounts, please write to the Fund, c/o DST Systems, Inc.,
P.O. Box 419958, Kansas City, MO 64141, or call 1-800-551-5849.
14. TAX-SHELTERED RETIREMENT PLANS
The Fund offers several tax-qualified retirement plans for adoption by
individuals and employers. Participants in these plans can accumulate shares of
the Fund on a tax-deferred basis.
The Fund offers both a profit-sharing plan and a money purchase
pension plan for employers and self-employed persons. Contributions to these
plans are tax-deductible and earnings are tax-exempt until distributed. Under
the profit-sharing plan, the employer or self-employed person can adjust their
contributions from year to year. Under the money purchase pension plan, the
employer or self-employed person must commit to a contribution each year. When
these plans are adopted by self-employed persons, they are commonly referred to
as Keogh or HR 10 plans.
The Fund also offers an Individual Retirement Account ("IRA").
Individuals who have compensation, but who are either not covered by existing
qualified retirement plans and do not have spouses covered by such plans, or do
not have incomes which exceed certain amounts, may contribute tax-deductible
dollars to an IRA. Individuals who are covered by existing retirement plans or
have spouses covered by such plans, and whose incomes exceed the applicable
amounts, are not permitted to deduct their IRA contributions for U.S. Federal
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income tax purposes. However, whether an individual's contributions are
deductible or not, the earnings on his or her IRA are not taxed until the
account is distributed.
The Fund also offers a 403(b) Custodial Account. Employees of certain
tax-exempt organizations and public schools may contribute tax-deductible
dollars to these accounts, on which earnings are tax-exempt until distributed.
In order to receive the necessary materials to create a profit-sharing
or money purchase pension plan account, an IRA account or a 403(b) Custodial
Account, please write to the Fund, c/o BBOI Worldwide, P.O. Box 5005, Denver, CO
80217, or call 1-800-333-1001. Trustees for existing 401(k) or other plans
interested in utilizing Fund shares as an investment or investment alternative
in their plans should contact the Fund at 1-800-333-1001.
15. INCOME DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAX TREATMENT
The Fund intends to declare dividends representing the Fund's net
investment income annually, normally in December. It is also the present policy
of the Fund to distribute annually all of its net realized capital gains.
Dividends declared and payable to shareholders of record on a specified date in
December will be deemed to have been received by shareholders on December 31 for
tax purposes if paid during January the following year.
The Fund is treated as a separate entity for tax purposes and intends
to elect and maintain qualification to be treated as a regulated investment
company under Subchapter M of the Internal Revenue Code of 1986, as amended.
The Fund's qualification as a regulated investment company will depend on the
Portfolio maintaining its status as a partnership for tax purposes. If the Fund
qualifies under Subchapter M and meets certain minimum distribution
requirements, the Fund generally will not be liable for U.S. Federal income tax
on the amount of its earnings that are timely distributed. If the Fund
distributes annually less than 98% of its income and gain, it may be subject to
a nondeductible excise tax equal to 4% of the shortfall.
All dividends and capital gains distributions paid by the Fund will be
automatically reinvested in shares of the Fund at the net asset value on the ex-
dividend date unless an investor specifically requests that either dividends or
distributions, or both, be paid in cash. The election to receive dividends or
distributions in cash or to reinvest them in Fund shares may be changed by
calling the Fund at 1-800-551-5849 or by written request to the Fund, c/o DST
Systems, Inc., P.O. Box 419958, Kansas City, MO 64141, and must be received at
least ten days prior to the record date of any dividend or capital gains
distribution.
The Fund will inform its shareholders of the amount and nature of such
income or gains resulting from their investment in the Fund. Dividends paid by
the Fund from net investment income and distributions from net short-term
capital gains in excess of any net long-term capital losses, whether received in
cash or reinvested, generally will be taxable as ordinary income. Distributions
received from the Fund designated as long-term
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capital gains (net of capital losses), whether received in cash or reinvested,
will be taxable as long-term capital gains without regard to the length of time
a shareholder has owned shares in the Fund. Any loss on the redemption or other
sale or exchange of the Fund's shares held for six months or less will be
treated as a long-term capital loss to the extent of any long-term capital gain
distribution received on the shares. If a shareholder is exempt from U.S.
Federal income tax, the shareholder will not generally be taxed on amounts
distributed by the Fund.
Investment income received by the Fund, directly or through the
Portfolio, from sources within foreign countries may be subject to foreign
withholding and other taxes withheld at the source. The U.S. has entered into
tax treaties with many foreign countries that, in some circumstances, may
entitle the Fund or Portfolio to a reduced rate of tax or exemption from tax on
such income. It is impossible to determine the effective rate of foreign tax in
advance since the amount of the Portfolio's assets to be invested within various
countries will fluctuate and the extent to which tax refunds will be recovered
is uncertain. If, directly or through the Portfolio, more than 50% in value of
the Fund's total assets at the close of its taxable year consists of securities
of foreign corporations, the Fund may elect to "pass-through" to its
shareholders the income taxes paid by the Fund to foreign governments during a
year. Under this election, each shareholder will be required to include the
shareholder's pro rata portion of these foreign taxes in gross income, but will
be able to deduct (as an itemized deduction for shareholders who itemize) or
claim a foreign tax credit for such amount (subject to various limitations). If
the election is not made, foreign taxes will be treated as an expense of the
Fund.
At certain levels of taxable income, the Internal Revenue Code
provides a preferential tax rate for long-term capital gains. Long-term capital
gains of taxpayers other than corporations are taxed at a 28% maximum rate,
whereas ordinary income is taxed at a 39.6% maximum rate. Capital losses
continue to be deductible only against capital gains plus (in the case of
taxpayers other than corporations) $3,000 of ordinary income annually ($1,500
for married individuals filing separately).
Some shareholders may be subject to 31% "backup withholding" on
dividends, capital gains distributions and redemption payments made by the Fund.
Backup withholding generally will apply to shareholders who fail to provide the
Fund with their correct taxpayer identification number or to make required
certifications. Backup withholding is not an additional tax. Any amounts
withheld may be credited against a shareholder's U.S. Federal income tax
liability.
The foregoing is only a brief summary of the U.S. Federal income tax
considerations affecting the Fund and its shareholders. See "Income Dividends,
Capital Gains Distributions and Tax Treatment" in the Statement of Additional
Information for more information regarding taxation. Potential investors should
consult their tax advisors with specific reference to their own tax situation.
-29-
<PAGE>
16. ADDITIONAL INFORMATION
The Trust is a Delaware business trust organized on May 31, 1996. The
Fund was established on May 31, 1996, as a series or fund under the Trust.
Since the Trust and the Fund were only recently organized, they have no prior
operating history, although the Fund calculates its performance taking into
account the prior performance of a trust fund whose assets were transferred into
the Portfolio as described under "Performance" below. As of the date of this
Prospectus, all of the outstanding shares of the Fund were held by Berger
Associates, which provided the seed capital necessary to establish the Trust.
The Trust is authorized to issue an unlimited number of shares of
beneficial interest in series. The Trust is also authorized to establish
multiple classes of shares representing differing interests in an existing or
new series. As of the date of this Prospectus, the series comprising the
Berger/BIAM International Fund is one of three series established under the
Trust, although others may be added in the future. Shares of the Fund are fully
paid and nonassessable when issued. Each share has a par value of $.01. All
shares issued by the Fund participate equally in dividends and other
distributions by the Fund, and in the residual assets of the Fund in the event
of its liquidation.
Shareholders of the Berger/BIAM International Fund and the other funds
or series of the Berger/BIAM Worldwide Funds Trust generally vote separately on
matters relating to those respective funds, although they vote together and with
the holders of any other series of the Trust issued in the future in the
election of trustees of the Trust and on all matters relating to the Trust as a
whole. Each full share of the Fund has one vote. Shares of the Fund have
noncumulative voting rights, which means that the holders of more than 50% of
the shares voting for the election of trustees can elect 100% of the trustees if
they choose to do so and, in such event, the holders of the remaining less than
50% of the shares voting for the election of trustees will not be able to elect
any person or persons as trustees. The Fund is not required to hold annual
shareholder meetings unless required by the Investment Company Act of 1940 or
other applicable law or unless called by the trustees.
If shareholders owning at least 10% of the outstanding shares of the
Berger/BIAM Worldwide Funds Trust so request, a special shareholders' meeting
will be held for the purpose of considering the removal of a trustee of the
Trust. Special meetings will be held for other purposes if the holders of at
least 25% of the outstanding shares of the Trust so request. Subject to certain
limitations, the Trust will facilitate appropriate communications by
shareholders desiring to call a special meeting for the purpose of considering
the removal of a trustee.
The Fund invests all of its investable assets in the Portfolio, a
series of Worldwide Portfolios, which is also a Delaware business trust divided
into series. Investors in each series of Worldwide Portfolios will vote
separately or together in the same manner as shareholders of the Trust's series.
For more information on the Trust and Worldwide Portfolios, see "Additional
Information" in the Statement of Additional Information.
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<PAGE>
The Glass-Steagall Act prohibits a depository institution (such as a
bank) from underwriting or distributing most securities and from affiliating
with businesses engaged in certain similar activities. BIAM believes, based on
advice of its counsel, that it may perform the services for the Fund
contemplated by this Prospectus consistent with the Glass-Steagall Act and other
applicable banking laws and regulations. However, future changes in either
Federal or state statutes and regulations concerning the permissible activities
of banks and their affiliates, as well as future judicial or administrative
decisions or interpretations of present and future statutes and regulations,
might prevent BIAM from continuing to perform those services for the Fund.
State laws on this issue may differ from the interpretations of relevant Federal
law and banks and financial institutions may be required to register as dealers
pursuant to state securities law. If the circumstances described above should
change, the trustees of the Trust and Worldwide Portfolios would review the
relationships with BIAM and consider taking all actions appropriate under the
circumstances.
17. PERFORMANCE
From time to time in advertisements, the Fund may discuss its
performance ratings as published by recognized mutual fund statistical services,
such as Lipper Analytical Services, Inc., CDA Investment Technologies, Inc.,
Morningstar, Inc., or Value Line Investment Survey or by publications of general
interest such as THE WALL STREET JOURNAL, INVESTOR'S BUSINESS DAILY, BARRON'S,
FINANCIAL WORLD or KIPLINGER'S PERSONAL FINANCE MAGAZINE. In addition, the Fund
may compare its performance to that of recognized broad-based securities market
indices, including the Morgan Stanley Capital International EAFE (Europe,
Australasia, Far East) Index, the Dow Jones World Index, the Standard & Poor's
500 Stock Index, the Nasdaq Composite Index, or more narrowly-based indices
which reflect the market sectors in which the Fund invests.
The total return of the Fund is calculated for any specified period of
time by assuming the purchase of shares of the Fund at the net asset value at
the beginning of the period. Each dividend or other distribution paid by the
Fund is assumed to have been reinvested at the net asset value on the
reinvestment date. The total number of shares then owned as a result of this
process is valued at the net asset value at the end of the period. The
percentage increase is determined by subtracting the initial value of the
investment from the ending value and dividing the remainder by the initial
value.
The Fund's total return reflects the Fund's performance over a stated
period of time. An average annual total return reflects the hypothetical
annually compounded return that would have produced the same total return if the
Fund's performance had been constant over the entire period. Total return
figures are based on the overall change in value of a hypothetical investment in
the Fund. Because average annual total returns for more than one year tend to
smooth out variations in the Fund's return, investors should recognize that such
figures are not the same as actual year-by-year results.
Any performance figures for the Fund are based upon historical results
and do not assure future performance. The investment return and principal value
of an investment
-31-
<PAGE>
will fluctuate so that an investor's shares, when redeemed, may be worth more or
less than their original cost.
The Portfolio commenced operations upon the transfer to the Portfolio
of assets held in a pooled trust (the "Pool") maintained by First NH Investment
Services Corp., for which BIAM has provided day-to-day portfolio management as
sub-advisor since the inception of the Pool. BIAM's bank holding company parent
indirectly owns a 23.5% interest in the parent of First NH Investment Services
Corp. The Pool had substantially the same investment objective, policies and
limitations of the Fund and the Portfolio. Assets from the Pool were
transferred to a separate "feeder" 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 (in which the Fund invests all of its investable assets) 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 Berger Associates.
The Pool was not a registered investment company since it was exempt
from registration under the Investment Company Act of 1940 (the "1940 Act").
Since, in a practical sense, the Pool constitutes the "predecessor" of the
Portfolio, the Fund calculates its performance for periods commencing prior to
the transfer of the Pool's assets to the Portfolio by including the Pool's total
return, adjusted to reflect the deduction of fees and expenses applicable to the
Fund as stated in the Fee Table above in this Prospectus (that is, adjusted to
reflect estimated expenses, including the Fund's pro rata share of the aggregate
annual operating expenses, net of fee waivers, of the Portfolio in which all of
the investable assets of the Fund are invested). These fees and expenses
include 12b-1 fees.
The performance data set forth below includes the performance of the
Pool for periods before the Fund's and the Portfolio's registration statements
became effective. As noted above, the Pool was not registered under the 1940
Act and thus was not subject to certain investment restrictions that are imposed
by the 1940 Act. If the Pool had been registered under the 1940 Act, the Pool's
performance might have been adversely affected.
AVERAGE ANNUAL TOTAL RETURN
FOR PERIODS ENDED JUNE 30, 1996
BERGER/BIAM
INTERNATIONAL FUND(1) EAFE INDEX(2)
1-YEAR 16.30% 13.62%
3-YEAR 11.91% 10.76%
5-YEAR 13.39% 10.33%
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<PAGE>
SINCE INCEPTION(3) 11.76% 4.26%
(1) Total return for the Fund has been adjusted to reflect estimated expenses
of the Fund, including the Fund's pro rata share of the aggregate annual
operating expenses, net of fee waivers, of the Portfolio in which all of the
investable assets of the Fund are invested.
(2) Source: Morgan Stanley Capital International (MSCI). The MSCI EAFE
Index is a market capitalization weighted index composed of companies
representative of the market structure of 30 developed market countries in
Europe, Australasia and the Far East.
(3) Covers the period since July 31, 1989.
All of the foregoing performance data were calculated in accordance
with methods prescribed by the Securities and Exchange Commission which are
discussed in more detail under the heading "Performance Information" in the
Statement of Additional Information.
Shareholders with questions should write to the Fund, c/o BBOI
Worldwide, P.O. Box 5005, Denver, CO 80217, or call 1-303-329-0200 or
1-800-333-1001.
<PAGE>
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED AUGUST 19, 1996
PROSPECTUS
BERGER/BIAM INTERNATIONAL INSTITUTIONAL FUND
The Berger/BIAM International Institutional Fund (the "Fund") is a
"no-load" mutual fund, more technically referred to as an open-end management
investment company, organized as a diversified series of the Berger/BIAM
Worldwide Funds Trust ("Trust"). The investment objective of the Fund is long-
term capital appreciation. The Fund seeks to achieve this objective by
investing all of its investable assets in the Berger/BIAM International
Portfolio (the "Portfolio") which, in turn, invests primarily in common stocks
of well established companies located outside the United States. The Portfolio
intends to diversify its holdings among several countries and to have, under
normal market conditions, at least 65% of the Portfolio's total assets invested
in the securities of companies located in at least five countries, not including
the United States.
UNLIKE MANY OTHER MUTUAL FUNDS WHICH DIRECTLY ACQUIRE AND MANAGE THEIR
OWN PORTFOLIOS OF SECURITIES, THE FUND SEEKS ITS INVESTMENT OBJECTIVE BY
INVESTING ALL OF ITS INVESTABLE ASSETS IN THE PORTFOLIO, AS DESCRIBED ABOVE.
Accordingly, the investment performance of the Fund will derive from the
investment performance of the Portfolio. The Portfolio is an open-end
management investment company and a diversified series of a separate trust known
as the Berger/BIAM Worldwide Portfolios Trust ("Worldwide Portfolios"). The
Portfolio's investment objective and policies are identical to those of the
Fund. The Portfolio is advised by BBOI Worldwide LLC ("BBOI Worldwide" or the
"Advisor"), which has delegated daily portfolio management of the Portfolio to
Bank of Ireland Asset Management (U.S.) Limited ("BIAM" or the "Sub-Advisor").
For further information about the Fund's investment objective and structure, see
"Investment Objective and Policies and Risk Factors", "Introduction" and
"Additional Information About Master/Feeder Structure".
The Fund is designed primarily for direct investment by institutional
investors such as pension and profit sharing plans, employee benefit trusts,
endowments, foundations and corporations, as well as high net worth individuals.
Shares of the Fund are also offered through certain financial intermediaries
that may charge their customers transaction or other fees with respect to the
customers' investment in the Fund.
This Prospectus sets forth concisely the information about the Fund
that a prospective investor should consider before investing. Investors are
advised to retain this Prospectus for future reference. Additional information
about the Fund has been filed with the Securities and Exchange Commission. A
copy of the Statement of Additional Information, which is incorporated in its
entirety by reference, is available upon request without charge by writing to
the Fund at P.O. Box 5005, Denver, CO 80217, or by calling 1-800-[________].
Prospectuses are also available upon request for the following funds advised by
Berger Associates, Inc.: the Berger 100 Fund, the Berger Growth and Income
Fund, the Berger Small Company Growth Fund and the Berger New Generation Fund.
INVESTMENTS IN THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY, ANY BANK (INCLUDING BANK OF IRELAND). SHARES OF THE
FUND ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE
<PAGE>
CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER GOVERNMENTAL AGENCY. AN
INVESTMENT IN THE FUND IS SUBJECT TO INVESTMENT RISK, INCLUDING POSSIBLE LOSS OF
THE PRINCIPAL AMOUNT INVESTED.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL SECURITIES IN ANY
STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH STATE.
The date of this Prospectus and the Statement of Additional
Information referred to above is _________________, 1996.
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any State.
<PAGE>
Table of Contents
SECTION PAGE
- ------- ----
1. Fee Tables............................................................... 1
2. Introduction............................................................. 2
3. Investment Objective and Policies and Risk Factors....................... 3
4. Portfolio Turnover....................................................... 11
5. Additional Information About Master/Feeder Structure..................... 11
6. Management and Investment Advice......................................... 12
7. Expenses of the Fund..................................................... 16
8. Purchase of Shares in the Fund........................................... 18
9. Net Asset Value.......................................................... 20
10. Open Account System and Share Certificates.............................. 21
11. Redemption of Fund Shares............................................... 21
12. Exchange Privilege...................................................... 24
13. Plans and Programs...................................................... 25
14. Income Dividends, Capital Gains Distributions and Tax Treatment......... 25
15. Additional Information.................................................. 27
16. Performance............................................................. 28
<PAGE>
1. FEE TABLES
SHAREHOLDER TRANSACTION EXPENSES
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Maximum Sales Load Imposed on Purchases 0%
- --------------------------------------------------------------------------------
Maximum Sales Load Imposed on Reinvested Dividends 0%
- --------------------------------------------------------------------------------
Deferred Sales Load 0%
- --------------------------------------------------------------------------------
Redemption Fees 0%
- --------------------------------------------------------------------------------
Exchange Fee 0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)*
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TOTAL
FUND
INVESTMENT OPERATING
ADVISORY EXPENSES
FEE OTHER (AFTER
(AFTER WAIVER) EXPENSES** WAIVER)
- --------------------------------------------------------------------------------
Berger/BIAM International
Institutional Fund 0.85%*** 0.50% 1.35%***
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
* Annual Fund Operating Expenses include the Fund's pro rata portion of the
annual operating expenses of the Portfolio, which are borne indirectly by
the Fund.
** Other Expenses primarily include administrative services fees paid by the
Fund and custodian fees paid by the Portfolio and are based on estimated
expenses for the first year of operations of the Fund and the Portfolio.
*** Although the Fund does not pay an investment advisory fee directly to an
investment advisor, it bears indirectly, as an investor in the Portfolio,
its pro rata portion of the advisory fee paid by the Portfolio to the
Advisor. Until at least April 30, 1998, the Advisor has agreed voluntarily
to waive its investment advisory fee to the extent that the Portfolio's
normal 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. Absent the waiver, the
Investment Advisory Fee would be 0.90% and Total Fund Operating Expenses
would be estimated to be 1.40%.
EXAMPLES
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return, and (2) redemption at the end of each time period:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1 YEAR 3 YEARS
- --------------------------------------------------------------------------------
-1-
<PAGE>
- --------------------------------------------------------------------------------
Berger/BIAM International Institutional Fund $14* $43*
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
* Based on estimated expenses for the first year of operations of the Fund
and the Portfolio, after waiver.
THE EXPENSES SET FORTH IN THE PRECEDING TABLES SHOULD NOT BE
CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES, AND ACTUAL EXPENSES MAY
BE GREATER OR LESS THAN THOSE SHOWN. THE ASSUMED 5% ANNUAL RETURN IS
HYPOTHETICAL AND SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
ANNUAL RETURNS, WHICH MAY BE GREATER OR LESS THAN THE ASSUMED AMOUNT.
Total Fund Operating Expenses include the Fund's pro rata share of the
aggregate annual operating expenses of the Portfolio, in which all of the
investable assets of the Fund are invested. The trustees of the Trust believe
that the investment in the Portfolio by investors in addition to the Fund may
enable the Portfolio to achieve economies of scale which could reduce expenses
and, accordingly, that the aggregate per share expenses of the Fund and the
Fund's pro rata share of the expenses of the Portfolio will be less than or
approximately equal to the expenses the Fund would incur if it retained the
services of an investment advisor and the assets of the Fund were invested
directly in the type of securities held by the Portfolio. While the investment
advisory fee for the Portfolio is higher than that paid by most other mutual
funds, it is comparable to the investment advisory fee paid by many other
international equity funds.
The purpose of the preceding tables is to assist the investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly or indirectly. The Fund's expenses are described in greater
detail under "Management and Investment Advice", and "Expenses of the Fund".
2. INTRODUCTION
The Berger/BIAM International Institutional Fund is an open-end,
diversified management investment company commonly referred to as a "mutual
fund". The Fund is a "no-load" fund, meaning that a buyer pays no commissions
or sales load when buying shares of the Fund. This Prospectus describes the
securities offered by the Fund.
The Fund is a series of the Berger/BIAM Worldwide Funds Trust, a Delaware
business trust, and invests in the Portfolio that, in turn, invests in
securities in accordance with an investment objective, policies and limitations
that are identical to those of the Fund. This is sometimes called a
master/feeder fund structure, because the Fund and other investors who invest in
the Portfolio "feed" shareholders' investments into the Portfolio, a "master"
fund. The structure looks like this:
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<PAGE>
Shareholders
BUY SHARES IN [down arrow]
Fund
INVESTS IN [down arrow]
Portfolio
INVESTS IN [down arrow]
Stocks and
Other Securities
The trustees of the Trust believe that this structure may benefit
shareholders, since investment in the Portfolio by investors in addition to the
Fund may enable the Portfolio to achieve economies of scale which could reduce
expenses. For more information about this structure, see "Additional
Information About Master/Feeder Structure".
The Fund is designed primarily for direct investment by institutional
investors such as pension and profit sharing plans, employee benefit trusts,
endowments, foundations and corporations, as well as high net worth individuals.
Shares of the Fund are also offered through certain financial intermediaries
that may charge their customers transaction or other fees with respect to the
customers' investment in the Fund.
3. INVESTMENT OBJECTIVE AND POLICIES AND RISK FACTORS
The investment objective of the Fund is long-term capital
appreciation. The Fund seeks to achieve this objective by investing all of its
investable assets in the Portfolio which, in turn, invests primarily in common
stocks of well established companies located outside the United States. A
company will be considered 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. The Portfolio may also invest in securities other
than common stock if the Sub-Advisor believes these are likely to be the best
suited at that time to achieve the Portfolio's objective. These include equity-
related securities (such as preferred stocks and convertible securities), debt
securities issued by foreign governments or foreign corporations, U.S. or
foreign short-term investments or other securities described on the following
pages. The Portfolio intends to diversify its holdings among several countries
and to have, under normal market conditions, at least 65% of the Portfolio's
total assets invested in the securities of companies located in at least five
countries, not including the United States. Current income is not an investment
objective of the Fund and any income produced will be only of
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<PAGE>
secondary importance as a by-product of the investment selection process used to
achieve the Fund's objective.
INVESTMENT SELECTION
In selecting its portfolio securities, the Portfolio places primary
emphasis on fundamentally undervalued stocks as determined by a range of
characteristics, including relatively low price/earnings multiples, dividend
yield, consistency of earnings growth and cash flow, financial strength,
realizable asset value and liquidity. Securities of companies with medium to
large market capitalizations usually constitute the majority of the Portfolio's
investments. The Portfolio currently considers medium to large market
capitalizations to be those in excess of $1 billion. Market capitalization is
defined as total current market value of a company's outstanding common stock.
In addition, the Portfolio is presently anticipated to be weighted largely
toward companies located in Western Europe (for example, the United Kingdom,
Germany, France, Italy, Spain, Switzerland, the Netherlands, Sweden, Ireland and
Finland), Australia and the Far East (for example, Japan, Hong Kong, Singapore,
Malaysia, Thailand, Indonesia and the Philippines). However, the Portfolio is
free to invest in companies of any size and in companies located in other
foreign countries, including developing countries.
INVESTMENT DECISION MAKING PROCESS
The Sub-Advisor's investment approach is based on "bottom-up"
fundamental analysis of individual companies within a framework of dynamic
economic and business themes that are believed to provide the best opportunities
for effective stock selection. Stock selection decisions are guided by:
- - GLOBAL ECONOMIC AND BUSINESS THEMES. The Sub-Advisor identifies
economic and business themes and trends that have the potential to
support the long-term growth prospects of companies best positioned to
take advantage of them. These themes and trends may transcend
political and geographic boundaries and may be global or regional in
nature. Current themes and trends include, for example, worldwide
growth in telecommunications and multimedia, rapid economic
development in the Pacific Basin, global healthcare trends and unique
consumer franchises.
- - FUNDAMENTAL ANALYSIS. The Sub-Advisor seeks to identify companies
that it believes are best positioned to benefit from the identified
themes and trends. It conducts an extensive "bottom-up" analysis
seeking individual quality companies with stocks that are
fundamentally undervalued relative to their long-term prospective
earnings growth rate, their historic valuation levels and their peer
group. This process
-4-
<PAGE>
includes examining financial statements, evaluating management and
products, assessing competitive position and strengths, as well as
analyzing the economic variables affecting the company's operating
environment. This in-depth, fundamental analysis is believed to be
the most important step in identifying stock selections for the
Portfolio.
Actual country weightings are a by-product of the bottom-up stock
selection approach. Accordingly, the country in which a company is located is
considered by the Sub-Advisor to be less important than the diversity of its
sources of earnings and earnings growth.
WHY INVEST IN THIS FUND?
The Advisor believes there is substantial opportunity for long-term
capital growth in foreign markets, as certain foreign economies may grow more
rapidly than the U.S. economy. In addition, boundaries and borders no longer
define or confine the operations of many of the world's business entities.
Companies raise capital, purchase raw materials, manufacture and distribute
products on a worldwide basis. Many profitable, successful companies benefit
from global economic growth, including companies in foreign markets. The Fund
seeks to take advantage of the investment opportunities created by an
increasingly global economy.
One reason for investing internationally is the opportunity to earn
higher investment returns. On a total return basis, foreign stocks represented
by the Morgan Stanley Capital International EAFE (Europe, Australasia, Far East)
Index outperformed U.S. stocks represented by the Standard & Poor's 500 Stock
Index in all but two rolling ten-year periods ended 1981 through 1995. Of
course, during this time there were shorter periods when U.S. stocks had higher
returns, and there have been periods when the EAFE Index produced negative
returns. Accordingly, investors in foreign equity securities should have a
long-term investment perspective, as international markets tend to be more
volatile than the U.S. market.
International investing also expands investment opportunities. The
U.S. percentage of the world's stock market capitalization has decreased over
the past 20 years. Today, more than half of the world's stock market
capitalization consists of non-U.S. stocks and companies. Since foreign stocks
do not always move in tandem with U.S. stocks and with each other, international
investing also has the potential to add diversification to an all- U.S. stock
portfolio by spreading investments across a number of markets.
Investors who wish to diversify their portfolio internationally can do
so by investing directly in foreign stocks, but they may find it difficult to
make purchases and
-5-
<PAGE>
sales, obtain reliable information, hold securities in safekeeping and manage
the conversion of the value of their international investments into U.S.
dollars. Investing in the Fund, however, eliminates these complications. With
a single investment, the investor owns a diversified international investment
portfolio that is actively managed by experienced professionals. BIAM, the
Portfolio's Sub-Advisor, has extensive experience in dealing with foreign
markets and with brokers and custodian banks around the world. BIAM also has
the benefit of an established information network and believes the Fund offers a
convenient and cost-effective means of investing internationally.
Of course, as an international fund, the Fund entails special risks as
described below. The Fund seeks to reduce these risks through diligent research
and diversification.
SECURITIES, INVESTMENT PRACTICES AND RISK FACTORS
Since the shares of the Fund represent an investment in the Portfolio,
which in turn primarily represents an investment in common stocks, investors
should understand that the net asset value of the Fund will change as the market
value of the securities held in the Portfolio changes and that the value of a
Fund share will go up and down. Investors should also be aware that investment
in foreign securities carries additional risks not present when investing in
domestic securities. See "Foreign Securities" below.
The Fund is not intended as a complete or balanced investment vehicle,
but rather as an investment for persons who are in a financial position to
assume the risk and share price volatility associated with foreign investments.
As a result, the Fund should be considered as a long-term investment vehicle.
The investment objective of the Fund and the Portfolio is considered
fundamental, meaning that it cannot be changed without a vote of the
shareholders of the Fund and, as to the Portfolio's objective, of the investors
in the Portfolio. There can be no assurance that the Fund's or the Portfolio's
investment objective will be realized. Following is additional information
about some of the specific types of securities in which the Portfolio may
invest.
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
-6-
<PAGE>
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 in the Statement of Additional Information.
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 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 currency would adversely
affect the value of the securities expressed in dollars. Foreign currency
exchange rates are determined by forces of supply and demand on the foreign
exchange markets, which are in turn affected by the international balance of
payments and other economic and financial conditions, government intervention,
speculation and other factors.
CONVERTIBLE SECURITIES. The Portfolio may purchase securities that
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 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 being rated below
investment grade by organizations such as
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Moody's Investors Service, Inc., and Standard & Poor's Corporation, or being of
similar creditworthiness in the determination of 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 net 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 the Statement of Additional Information.
SECURITIES OF SMALLER COMPANIES. The Portfolio may invest in
securities of companies with small or medium 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 well
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 well
established companies.
LENDING PORTFOLIO SECURITIES. The Portfolio may lend its securities
to qualified institutional investors such as brokers, dealers or other financial
organizations. This practice permits the Portfolio to earn income, which, in
turn, can be invested in additional securities to pursue its investment
objective. Loans of securities by the Portfolio will be collateralized by cash,
letters of credit, or securities issued or guaranteed by the U.S. Government or
its agencies. The collateral will equal at least 100% of the current market
value of the loaned securities, marked-to-market on a daily basis. 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
any security if, as a result of such loan, the aggregate value of securities
then on loan would exceed 33-1/3% of the market value of the Portfolio's total
assets.
HEDGING TRANSACTIONS. The Portfolio is authorized to make limited
commitments in certain forward contracts, but only for the
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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. Forward contracts are obligations between two parties
to exchange particular goods or instruments (such as foreign currencies) at a
set price on a future date. The Portfolio currently intends that it will use
forward contracts only for hedging purposes and that it may enter into forward
foreign currency exchange contracts, provided the aggregate value of all
outstanding contracts does not exceed the value of the Portfolio's assets.
Although a hedging transaction may, for example, partially protect the Portfolio
from a decline in the foreign exchange price of a particular security or its
portfolio generally, hedging may also limit the potential return to the
Portfolio due to positive foreign exchange movements, and the cost of the
transaction will reduce the potential return on the security or the portfolio.
In addition, forward foreign currency exchange contracts do not eliminate
fluctuations in the prices of the underlying securities the Portfolio owns or
intends to acquire.
The Portfolio will generally enter into forward foreign currency
exchange contracts either with respect to specific transactions or with respect
to the Portfolio's security positions. For example, the Portfolio may enter
into a forward contract in order to fix the price (in terms of a specified
currency, which may be U.S. dollars or a foreign currency) for securities it has
agreed to buy or sell or is considering buying or selling. Further, when the
Sub-Advisor believes that a particular foreign currency in which some or all of
the Portfolio's investments are denominated may decline compared to the U.S.
dollar, the Portfolio may enter into a forward contract to sell the currency
that is expected to decline (or another currency which acts as a proxy for that
currency). However, the Portfolio will be permitted to make such investments
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 securities
denominated in a specific foreign currency. To ensure that the Portfolio will
be able to meet its obligations under its forward foreign currency exchange
contracts, the Portfolio will be required to place liquid assets in a segregated
account with its custodian bank or to set aside securities to "cover" its
commitments in these contracts.
Forward foreign currency exchange contracts are privately negotiated
(i.e., over-the-counter) and the parties may agree to offset or terminate the
contract before its maturity or may hold the contract to maturity and complete
the contemplated delivery of the underlying foreign currency. Transactions in
forward foreign currency exchange contracts by the Portfolio involve the
potential for a loss that may exceed the amount of commitment the Portfolio
would be permitted to make in those contracts under its investment limitations.
The principal risks of the
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Portfolio's use of forward foreign currency exchange contracts are: (a) losses
resulting from currency market movements not anticipated by the Portfolio;
(b) possible imperfect correlation between movements in the prices of forward
contracts and movements in the spot (i.e., cash) prices of the currencies hedged
or used to cover such positions; (c) lack of assurance that the Portfolio will
be able to enter into an offset or termination of the contract at any particular
time; (d) the need for additional information and skills beyond those required
for the management of a portfolio of traditional securities; and (e) possible
need to defer closing out certain forward contracts in order to facilitate the
Fund's qualification for beneficial tax treatment afforded "regulated investment
companies" under the Internal Revenue Code of 1986. 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 will fail to perform its obligations, in which case the Portfolio
could be worse off than if the contract had not been entered into.
Although they currently have no intention of doing so, the trustees of
Worldwide Portfolios may, without shareholder approval, authorize the Portfolio
to invest in certain types of other instruments for hedging purposes, such as
financial futures and options. Appropriate notice to shareholders will be
provided of any intention to commence investing in such instruments. Additional
detail concerning the Portfolio's transactions in forwards, futures and options
and the risks of such investments can be found in the Statement of Additional
Information.
ILLIQUID 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. 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. Certain restricted securities, such as Rule 144A
securities, may be treated as liquid under this restriction if a determination
is made that such securities are readily marketable. 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.
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INVESTMENT RESTRICTIONS
In addition to its investment objective, the Portfolio has adopted a
number of restrictions on its investments and other activities that may not be
changed without shareholder approval. For example, the Portfolio may not borrow
money, except borrowing undertaken from banks for temporary or emergency
purposes in amounts not to exceed 25% of the market value of its total assets
(including the amount borrowed) and may not make loans (except that the
Portfolio may lend portfolio securities and enter into repurchase agreements in
accordance with its investment policies). The Portfolio may not invest in any
one industry 25% or more of the value of its total assets at the time of
investment, nor invest in commodities, except, only for the purpose of hedging,
the Portfolio may invest in forward foreign currency exchange contracts and
other instruments as specified in greater detail above and in the Statement of
Additional Information.
Further, with respect to 100% of its total assets, the Portfolio may
not purchase securities of any issuer (except U.S. Government securities) if,
immediately after and as a result of such purchase, the value of the Portfolio's
holdings in the securities of that issuer exceeds 5% of the value of its total
assets or it owns more than 10% of the outstanding voting securities or of any
class of securities of such issuer, although this restriction may be reduced to
apply to 75% or more of the Portfolio's total assets without a shareholder vote.
Also, 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 would be invested in such securities, although this
restriction may be changed without shareholder approval. For more detail about
the Portfolio's investment restrictions, see the Statement of Additional
Information.
4. PORTFOLIO TURNOVER
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 shares of the Fund or interests in the
Portfolio due to economic, market or other factors that are not within the
control of management. Although the annual portfolio turnover rate of the
Portfolio will vary, it is normally expected to range from 25% to 75%.
5. ADDITIONAL INFORMATION ABOUT MASTER/FEEDER STRUCTURE
Unlike other mutual funds that directly acquire and manage their own
portfolios of securities, the Fund (referred to as a feeder fund) seeks to
achieve its investment objective by investing all of its investable assets in
the Portfolio (referred to as a
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master fund). This two-tier structure is known as a master/feeder. The Fund
has the same investment objective and policies as the Portfolio. The Fund will
invest only in the Portfolio, and the Fund's shareholders will therefore acquire
only an indirect interest in the investments of the Portfolio.
In addition to selling a beneficial interest to the Fund, the
Portfolio may sell beneficial interests to other mutual funds or institutional
investors (that is, other feeder funds). Such investors will invest in the
Portfolio on the same terms and conditions and will pay their proportionate
share of the Portfolio's expenses. However, the other investors investing in
the Portfolio are not required to issue their shares at the same public offering
price as the Fund due to potential differences in expense structures.
Accordingly, investors in the Fund should be aware that these differences may
result in differences in returns experienced by investors in the different funds
that invest in the Portfolio. Such differences in returns are common in this
type of mutual fund structure and are also present in other mutual fund
structures. Information concerning other investors in the Portfolio (for
example, other feeder funds) is available from the Fund at 1-800-[_________].
The investment objective of the Fund may not be changed without the
approval of the Fund's shareholders. The investment objective of the Portfolio
may not be changed without the approval of the investors in the Portfolio,
including the Fund. If the objective of the Portfolio changes and the
shareholders of the Fund do not approve a parallel change in the Fund's
investment objective, the trustees of the Trust will consider other
alternatives, including seeking an alternative investment vehicle or directly
retaining the Fund's own investment advisor. Shareholders will be given at
least 30 days' written notice prior to any change in the investment objective of
the Fund or the Portfolio.
Smaller funds investing in the Portfolio may be materially affected by
the actions of larger funds investing in the Portfolio. For example, if a
larger fund invests or withdraws from the Portfolio, the remaining funds may
experience lower or higher pro rata operating expenses. Lower returns could
possibly result from a large withdrawal. However, this possibility also exists
for traditionally structured funds which have large or institutional investors.
Also, a fund with a greater pro rata ownership in the Portfolio could have
effective voting control over the operations of the Portfolio.
Whenever the Fund is requested to vote as an investor in the Portfolio
on matters pertaining to the Portfolio (other than a vote by the Fund to
continue the operation of the Portfolio upon the withdrawal of another investor
in the Portfolio), the Fund will hold a meeting of its shareholders and will
cast all of its votes as an investor in the Portfolio in the same proportion as
directed by the votes of the Fund's shareholders. Fund shareholders who do not
vote will not affect the votes cast by the Fund at the meeting of the Portfolio
investors. The percentage of the votes representing the Fund's shareholders who
do not vote will be voted by the Fund in the same proportion as the Fund's
shareholders who do, in fact, vote.
The Fund may withdraw its investment in the Portfolio at any time, if
the trustees of the Trust determine that it is in the best interests of the Fund
to do so. Certain
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changes in the Portfolio's investment objective, policies and limitations may
require the Fund to withdraw its investment in the Portfolio. Upon any such
withdrawal, the trustees would consider what action might be taken, including
investing the Fund's assets in another pooled investment entity having the same
investment objective and policies as the Fund or retaining an investment advisor
to manage the Fund's assets in accordance with the investment policies described
above with respect to the Portfolio. Any such withdrawal could result in a
distribution in kind of portfolio securities (as opposed to a cash distribution)
from the Portfolio. If securities are distributed, the Fund could incur
brokerage, tax or other charges in converting the securities to cash. In
addition, a distribution in kind may adversely affect the liquidity of the Fund.
This Prospectus and the Statement of Additional Information contain
more detailed information about this master/feeder organizational structure,
including information related to: (i) the investment objective, policies and
restrictions of the Fund and the Portfolio; (ii) the trustees and officers of
the Trust and Worldwide Portfolios, and the management of the Fund and the
Portfolio; (iii) portfolio transactions and brokerage commissions; (iv) the
Fund's shares, including the rights and liabilities of its shareholders; (v)
additional performance information, including the method used to calculate total
return; and (vi) the determination of the value of the shares of the Fund. The
master/feeder fund structure is still relatively new and lacks a substantial
history.
6. MANAGEMENT AND INVESTMENT ADVICE
The trustees of the Trust are responsible for major decisions relating
to the Fund's policies and objective. They also oversee the operation of the
Fund by its officers and review the investment performance of the Fund on a
regular basis. The trustees of Worldwide Portfolios have overall responsibility
for operation of the Portfolio. A majority of the trustees of the Trust and
Worldwide Portfolios who are not "interested persons" (as defined in the
Investment Company Act of 1940) of the Trust or Worldwide Portfolios
("Independent Trustees") have adopted written procedures reasonably appropriate
to deal with potential conflicts of interest arising from the fact that the same
individuals are trustees of the Trust and Worldwide Portfolios, up to and
including creating a new board of trustees for the Trust or Worldwide
Portfolios. Additional information concerning the trustees and the officers of
the Trust and Worldwide Portfolios is furnished in the Statement of Additional
Information under the heading "Management of the Fund."
THE ADVISOR -- GENERAL BUSINESS MANAGEMENT AND INVESTMENT OVERSIGHT
The investment advisor to the Portfolio is BBOI Worldwide LLC (the
"Advisor" or "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, such as coordinating certain matters relating to the operations of
the Portfolio and monitoring the Portfolio's compliance with all applicable
federal and state securities laws. Currently, the Advisor serves in this
capacity only to the Portfolio.
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The Advisor is a Delaware limited liability company formed in 1996.
Since the Advisor was only recently formed, it has no prior experience as an
investment advisor. However, Berger Associates, Inc. ("Berger Associates"),
which owns 100% of the Advisor has been in the investment advisory business for
over 20 years. Berger Associates serves as investment advisor or sub-advisor to
mutual funds, pension and profit-sharing plans, and institutional and private
investors, and has assets under management of more than $3.5 billion as of April
30, 1996. Kansas City Southern Industries, Inc. ("KCSI") owns approximately 80%
of the outstanding shares of Berger Associates. 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. Also, see below under "Pending Sale of Interest in
Advisor".
THE SUB-ADVISOR -- EXPERIENCED INTERNATIONAL INVESTMENT MANAGEMENT
Since its founding in 1966, Bank of Ireland's investment management
group has become recognized among international and global investment managers,
serving clients in Europe, the United States, Canada, Australia and South
Africa. Bank of Ireland Asset Management (U.S.) Limited ("BIAM"), the Sub-
Advisor to the Portfolio, is an indirect wholly-owned subsidiary of Bank of
Ireland. Bank of Ireland, founded in 1783, is 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 $16 billion as of April 30, 1996.
As permitted in its Investment Advisory Agreement with the Portfolio,
the Advisor has delegated day-to-day portfolio management responsibility to
BIAM, as the Sub-Advisor. 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 serves as investment advisor or sub-advisor to pension and
profit-sharing plans and other institutional investors and mutual funds. BIAM's
main offices are at 26 Fitzwilliam Place, Dublin 2, Ireland. BIAM maintains a
representative office at 2 Greenwich Plaza, Greenwich, CT 06830.
All investment decisions made for the Portfolio by the Sub-Advisor are
made by a team of BIAM investment personnel. No one individual is primarily
responsible for making the day-to-day investment decisions for the Portfolio.
Most of the investment professionals at BIAM have been with BIAM at least 10
years.
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
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in part with the proceeds of securities purchased by the Portfolio. Federal law
prohibits the Sub-Advisor, 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, the
Sub-Advisor 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.
The trustees of Worldwide Portfolios have authorized the Sub-Advisor
to consider sales of shares of the Fund by a broker-dealer or the
recommendations of a broker-dealer to its customers that they purchase Fund
shares as a factor in the selection of broker-dealers to execute securities
transactions for the Portfolio. In placing portfolio business with such broker-
dealers, the Sub-Advisor will seek the best execution of each transaction.
ADVISORY FEES
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. Until at
least April 30, 1998, the Advisor has agreed voluntarily to waive the investment
advisory fee paid by the Portfolio under the Investment Advisory Agreement to
the extent that the Portfolio's normal 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. Any reduction
in the advisory fee paid by the Portfolio will also reduce the pro rata share of
the advisory fee borne indirectly by the Fund.
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.
PENDING SALE OF INTEREST IN ADVISOR
As mentioned above, the Portfolio's Advisor, BBOI Worldwide, is a
limited liability company formed in 1996 and 100% owned by Berger Associates.
BBOI Worldwide was organized by Berger Associates in anticipation of forming a
joint venture with BIAM for the purpose of managing international and global
mutual funds. Pursuant to the Amended and Restated Operating Agreement of BBOI
Worldwide LLC, dated as of May 1, 1996, between Berger Associates and BIAM (the
"Joint Venture Agreement"), BIAM (or an affiliate) has agreed to acquire a 50%
interest in the Advisor and thereby enter into a joint venture with Berger
Associates to become effective upon receipt of all regulatory approvals. Berger
Associates' role in the joint venture will be to provide administration and
marketing, and BIAM's role will be to provide international and global
investment management expertise. Day-to-day portfolio management of the
Portfolio will continue to be provided by BIAM under the Sub-Advisory Agreement.
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The Joint Venture Agreement provides that Berger Associates and BIAM
will each own a 50% membership interest in the Advisor and each will have an
equal number of representatives on the Advisor's Board of Managers. Agreement
of representatives of both Berger Associates and BIAM will be required for all
significant management decisions.
BIAM's acquisition of an interest in the Advisor is subject to
approval of the Federal Reserve Board of the United States and the Central Bank
of Ireland. In the event the joint venture is not consummated, Berger
Associates anticipates continuing to provide the Fund with administrative
services, and BIAM has agreed to continue to serve as the Sub-Advisor to the
Portfolio for a period of not less than six months thereafter, on usual and
customary contractual terms.
Consummation of BIAM's acquisition of a membership interest in the
Advisor might be deemed to effect a change of control in the Advisor and thereby
an "assignment" (as defined in the Investment Company Act of 1940) and
termination of the Portfolio's Investment Advisory and Sub-Advisory Agreements.
However, the trustees of Worldwide Portfolios have considered the terms of the
joint venture and various factors related to the proposal, including that the
day-to-day management of the Portfolio by BIAM is not proposed to change. On
the basis of the factors considered, the trustees, including the Independent
Trustees of Worldwide Portfolios voting separately, have approved new Investment
Advisory and Sub-Advisory Agreements that will come into effect upon
consummation of the joint venture and any change of control in the Advisor that
may be deemed to result. The new Agreements have also been approved by the
Portfolio's initial investors. The new Agreements are identical in their terms
to the initial Agreements described in this Prospectus, except for commencement
date. No further trustee or shareholder vote is anticipated to approve the new
Agreements upon consummation of the joint venture. Accordingly, prospective
investors should consider BIAM's pending acquisition of an interest in the
Advisor at the time they consider their initial investment in the Fund.
7. EXPENSES OF THE FUND
The Fund is allocated and bears indirectly its pro rata share of the
aggregate annual operating expenses of the Portfolio, since all of the
investable assets of the Fund are invested in 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
Independent Trustees; 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,
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; the fees payable to the Advisor under the Investment
Advisory Agreement; and such other non-recurring and extraordinary items as may
arise from time to time.
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Until at least April 30, 1998, the Advisor has agreed voluntarily to
waive the investment advisory fee paid by the Portfolio under the Investment
Advisory Agreement to the extent that the Portfolio's normal 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.
Any reduction in the advisory fee paid by the Portfolio will also reduce the pro
rata share of the advisory fee borne indirectly by the Fund.
Expenses of the Fund include, among others, its pro rata share of the
expenses of the Trust, such as expenses of meetings of the shareholders of the
Trust. Expenses of the Fund also include, among others, taxes imposed on the
Fund; the fee payable to the Advisor under the Administrative Services
Agreement; and such other non-recurring and extraordinary items as may arise
from time to time.
SERVICE ARRANGEMENTS FOR THE FUND
Under the Administrative Services Agreement with the Fund, the Advisor
serves as the administrator of the Fund. In this capacity, it is responsible
for administering and managing all aspects of the Fund's day-to-day operations,
subject to the oversight of the trustees of the Trust. The Advisor is
responsible, at its expense, for furnishing (or procuring other parties to
furnish) all administrative services reasonably necessary for the operation of
the Fund, including recordkeeping and pricing services, custodian services,
transfer agency and dividend disbursing services, tax and audit services,
insurance, legal services, printing and mailing to shareholders of prospectuses
and other required communications, and certain other administrative and
recordkeeping services, such as coordinating matters relating to the operations
of the Fund, monitoring the Fund's status as a "regulated investment company"
under the Internal Revenue Code of 1986, registering sufficient Fund shares
under federal and state securities laws, and arranging for and supervising the
preparation of registration statements, tax returns, proxy materials, financial
statements and reports for filing with regulatory authorities and distribution
to shareholders of the Fund. Under the Administrative Services Agreement, the
Fund pays the Advisor a fee at an annual rate equal to the lesser of (i) 0.35%
of its average daily net assets, or (ii) the Advisor's annual cost to provide or
procure these services (including the fees of any services providers whose
services are procured by the Advisor), plus an additional 0.02% of the Fund's
average daily net assets. The trustees of the Trust regularly review amounts
paid to and expenditures incurred by the Advisor pursuant to the Administrative
Services Agreement. In addition, in the event that the Advisor's duties under
the Administrative Services Agreement are delegated to another party, the
Advisor may take into account, in calculating the cost of such services, only
the costs incurred by such other party in discharging the delegated duties.
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Arrangements may be entered into by the Advisor or its affiliates with
certain organizations (broker-dealers, recordkeepers and administrators) to
provide subtransfer agency, recordkeeping, shareholder communications,
subaccounting and/or other services to investors purchasing shares of the Fund
through investment programs or pension plans established or serviced by those
organizations. The Advisor or its affiliates may pay fees to these
organizations for their services. For purposes of determining the Advisor's
cost of providing or procuring transfer agency, dividend disbursing or other
services under the Administrative Services Agreement, the Advisor may take into
account only the fees that otherwise would be paid for by the Advisor if all the
investors who own Fund shares through the organization were instead direct
registered record holders of shares in the Fund.
Under a Sub-Administration Agreement between the Advisor and Berger
Associates, Berger Associates has been delegated the responsibility to perform
certain of the administrative and recordkeeping services required under the
Administrative Services Agreement and to procure, at the Advisor's expense,
third parties to provide the services not provided by Berger Associates. Under
the Sub-Administration Agreement, Berger Associates is paid a fee by the Advisor
of 0.25% of the Fund's average daily net assets for its services. During
certain periods, Berger Associates may voluntarily waive all or a portion of its
fee from the Advisor, which will not affect the fee paid by the Fund to the
Advisor under the Administrative Services Agreement. Investors Fiduciary Trust
Company ("IFTC") has been appointed to provide recordkeeping and pricing
services to the Fund, including calculating the daily net asset value of the
Fund, and to perform certain accounting and recordkeeping functions that it
requires. In addition, IFTC has been appointed to serve as the Fund's
custodian, transfer agent and dividend disbursing agent. IFTC has engaged DST
Systems, Inc. ("DST"), as sub-transfer agent to provide transfer agency and
dividend disbursing services for the Fund. The fees of Berger Associates, IFTC
and DST are all paid by the Advisor. Approximately 40% of the outstanding
shares of DST are owned by KCSI, which also owns approximately 80% of the
outstanding shares of Berger Associates.
SERVICE ARRANGEMENTS FOR THE PORTFOLIO
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 preparing investor communications, which have been
delegated to Berger Associates as part of the Sub-Administration Agreement
discussed above. 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
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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.
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.
DISTRIBUTOR
The distributor (principal underwriter) of the Fund's shares is First
Fund Distributors, Inc. (the "Distributor"), 4455 East Camelback Road, Suite
261-E, Phoenix, AZ 85018. The Distributor is compensated and reimbursed for its
costs in distributing Fund shares by Berger Associates.
8. PURCHASE OF SHARES IN THE FUND
The Fund is designed primarily for direct investment by institutional
investors such as pension and profit sharing plans, employee benefit trusts,
endowments, foundations and corporations, as well as high net worth individuals.
Shares of the Fund are also offered through certain financial intermediaries
that may charge their customers transaction or other fees with respect to the
customers' investment in the Fund.
Shares in the Fund may be purchased at the relevant net asset value
without a sales charge. The minimum initial investment for shares of the Fund
is $100,000. To purchase shares in the Fund, simply complete the application
form enclosed with this Prospectus and mail it to the Fund in care of DST
Systems, Inc., the Fund's transfer agent, as follows:
Berger Funds
c/o DST Systems, Inc.
P.O. Box 419958
Kansas City, MO 64141
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Additional investments may be made at any time by telephone or by mail
at the relevant net asset value by calling or writing the Fund.
A confirmation indicating the details of the transaction will be sent
promptly. Unless full shares only are specified, all purchases will be made in
full and fractional shares calculated to three decimal places.
All purchase orders are effected at the relevant net asset value per
share of the Fund next determined after receipt of the purchase order, completed
application and payment. A purchase order, together with payment in proper
form, received by the transfer agent, sub-transfer agent or any other authorized
agent of the Fund prior to the close of the New York Stock Exchange (the
"Exchange") on a day the Fund is open for business will be effected at that
day's net asset value. An order received after that time will be effected at
the net asset value determined on the next business day. See "Redemptions of
Fund Shares - Redemptions by Telephone" for the Fund's policies and procedures
on effecting transactions by telephone.
Payment for shares purchased may be made as follows:
BY WIRE OR ELECTRONIC FUNDS TRANSFER. Payment for shares purchased
may be made by wire or electronic funds transfer from the investor's bank to DST
Systems, Inc. Please call 1-800-[_________] for current wire or electronic
funds transfer instructions. The following information may be requested: name
of authorized person; shareholder name; shareholder account number; name of
Fund; amount being wired or transferred; and name of wiring or transferring
bank.
BY MAIL. Alternatively, payment for shares purchased may be made by
mail, so long as payment is accompanied or preceded by a completed account
application. Payment should be made by check or money order drawn on a United
States bank and made payable to the "Berger Funds". Checks not made payable to
the Berger Funds, the account registrant, transfer agent or retirement account
custodian will not be accepted. The Fund will not accept purchases by cash or
credit card or checks drawn on foreign banks unless provision is made for
payment through a U.S. bank in U.S. dollars.
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Fund shares may also be purchased through certain organizations
connected with pension and retirement plans. These organizations may charge
investors a transaction or other fee for their services, may require different
minimum initial and subsequent investments than the Fund and may impose other
charges or restrictions different from those applicable to shareholders who
invest in the Fund directly. Fees charged by these organizations will have the
effect of reducing a shareholder's total return on an investment in Fund shares.
No such charge will be paid by an investor who purchases the Fund shares
directly from the Fund as described above.
The Fund will, at its discretion, accept orders transmitted by these
organizations although not accompanied by payment for the shares being
purchased. Payment must be received by the Fund within three business days
after acceptance of the order. The price at which a purchase will be effected
is based on the next calculation of net asset value after the order is received
by the Fund's transfer agent, sub-transfer agent or any other authorized agent
of the Fund.
The Fund reserves the right in its sole discretion to withdraw all or
any part of the offering made by this Prospectus or to reject purchase orders,
when in the judgment of management, such withdrawal or rejection is in the best
interest of the Fund. The Fund also reserves the right at any time to waive the
minimum investment requirements applicable to initial investments or to increase
the minimums following notice. No application to purchase shares is binding on
the Fund until accepted in writing.
Investors may, subject to the approval of the Trust and Worldwide
Portfolios, purchase shares of the Fund with liquid securities that are eligible
for purchase by the Portfolio (consistent with the Fund's and the Portfolio's
investment policies and restrictions) and that have a value that is readily
ascertainable in accordance with the valuation policies of the Trust and
Worldwide Portfolios. These transactions will be effected only if the Sub-
Advisor intends to retain the securities in the Portfolio as an investment.
Assets so purchased will be valued in generally the same manner as they would be
valued for purposes of pricing the Fund's shares, if such assets were included
in the Portfolio's assets at the time of purchase. The Trust and Worldwide
Portfolios reserve the right to amend or terminate this practice at any time.
9. NET ASSET VALUE
The price of the Fund's shares is based on the net asset value of the
Fund, which is determined at the close of the regular trading session of the
Exchange (normally 4:00 p.m., New York time) each day that the Exchange is open.
The per share net asset value of the Fund is determined by dividing the total
value of its assets, less liabilities, by the total number of shares
outstanding. Since the Fund will invest all of its investable assets
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in the Portfolio, the value of the Fund's investable assets will be equal to the
value of its beneficial interest in the Portfolio.
The Portfolio's securities and other assets are valued as follows:
securities are valued at market value or, if market quotations are not readily
available, at their fair value determined in good faith pursuant to consistently
applied procedures established by the trustees. Money market instruments
maturing within 60 days are valued at amortized cost, 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. See the Statement of Additional Information for more detailed
information.
Generally, trading in foreign securities markets is substantially
completed each day at various times prior to the close of the Exchange. The
values of foreign securities used in computing the net asset value of the shares
of the Fund are determined as of the earlier of such market close or the closing
time of the Exchange. Occasionally, events affecting the value of such
securities may occur between the times at which they are determined and the
close of the Exchange, or when the foreign market on which such securities trade
is closed but the Exchange is open, which will not be reflected in the
computation of net asset value. If during such periods, events occur which
materially affect the value of such securities, the securities will be valued at
their fair market 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 customary U.S. holidays) and the Fund's net asset
value is not calculated. As a result, the net asset value of the Fund may be
significantly affected by such trading on days when shareholders cannot purchase
or redeem shares of the Fund.
Since the Fund does not impose any front end sales load or redemption
fee, both the purchase price and the redemption price of a Fund share are the
same and will be equal to the next calculated net asset value of a share of the
Fund.
10. OPEN ACCOUNT SYSTEM AND SHARE CERTIFICATES
Unless otherwise directed, all investor accounts are maintained on a
book-entry basis. Share certificates will not be issued unless requested by the
shareholder. Shares purchased by dividend reinvestment, and shares redeemed
under a Systematic Withdrawal Plan, will be confirmed after the end of each
calendar quarter. Following any other investment or redemption, the investor
will receive a printed confirmation indicating the dollar amount of the
transaction, the per share price of the transaction and the number of shares
purchased or redeemed.
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11. REDEMPTION OF FUND SHARES
(i) SHARE REDEMPTIONS BY MAIL. The Fund will redeem, at current net
asset value, all shares of the Fund offered for redemption. The redemption
price of shares tendered for redemption will be the net asset value next
determined after receipt of all required documents by the Fund's transfer agent,
sub-transfer agent or other authorized agent of the Fund. To receive the net
asset value for a specific day, a redemption request must be received before the
close of the Exchange on that day. Shareholders who purchased their shares
directly from the Fund may redeem all or part of their shares in the Fund by
sending a written request to the Fund, c/o DST Systems, Inc., P.O. Box 419958,
Kansas City, MO 64141. The written request for redemption must be signed by
each registered owner exactly as the shares are registered and must clearly
identify the account and the number of shares or the dollar amount to be
redeemed.
The signatures of the redeeming shareholders must be guaranteed by a
national or state bank, a member firm of a domestic stock exchange or the
National Association of Securities Dealers (NASD), a credit union, a federal
savings and loan association or another eligible guarantor institution if the
redemption: is being made payable other than exactly as registered; is being
mailed to an address which has been changed within 30 days of the redemption
request; or is being mailed to an address other than the one on record. A
notary public is not an acceptable guarantor. The Fund also reserves the right
to require a signature guarantee under other circumstances. The signature
guarantees must appear, together with the signatures of the registered owners,
(i) on the written request for redemption which clearly identifies the account
and the number of shares to be redeemed, (ii) on a separate instrument of
assignment ("stock power") which may be obtained from a bank or broker, or
(iii) on any share certificates tendered for redemption. The use of signature
guarantees is intended to protect the shareholder and the Fund from a possibly
fraudulent application for redemption.
(ii) REDEMPTIONS BY TELEPHONE. All shareholders have Telephone
Transaction Privileges to authorize purchases, exchanges or redemptions unless
they specifically decline this service on the account application or by writing
to the Fund, c/o DST Systems, Inc., P.O. Box 419958, Kansas City, MO 64141. The
telephone redemption option is not available for shares held in retirement
accounts sponsored by the Fund. Redemption requests may be made by telephoning
DST Systems, Inc., at 1-800-[_______]. To receive the net asset value for a
specific day, a redemption request must be received before the close of the
Exchange on that day. As discussed above, certain requests must be in writing
and the signature of a redeeming shareholder must be signature guaranteed, and
therefore shares may not be redeemed by telephone, if the redemption: is being
made payable other than exactly as registered; is being mailed to an address
which has been changed within 30 days of the redemption request; is being mailed
to an address other than the one on record; or the shares are represented by
share certificates issued to the shareholder.
All telephone transactions are recorded and written confirmations
indicating the details of all telephone transactions will promptly be sent to
the shareholder of record. Prior to accepting a telephone transaction,
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the shareholder placing the order may be required to provide certain identifying
information. A shareholder electing to communicate instructions by telephone
may be giving up some level of security that would otherwise be present were the
shareholder to request a transaction in writing. Neither the Fund nor its
transfer agent or Advisor assume responsibility for the authenticity of
instructions communicated by telephone which are reasonably believed to be
genuine and which comply with the foregoing procedures. The Fund, and/or its
transfer agent, may be liable for losses resulting from unauthorized or
fraudulent telephone instructions in the event these procedures are not
followed. All redemption requests initiated by telephone in excess of
$______________ must be confirmed in writing by an authorized party prior to
processing and transmission of proceeds.
In times of extreme economic or market conditions, redeeming shares by
telephone may be difficult. The Fund may terminate or modify the procedures
concerning the telephone redemption and wire transfer services at any time,
although shareholders of the Fund will be given at least 60 days' prior notice
of any termination or material modification. The Advisor may, at its own risk,
waive certain of the redemption requirements described in the preceding
paragraphs.
(iii) PAYMENT FOR REDEEMED SHARES. Payment for shares redeemed upon
written request will be made by check and generally will be mailed within three
business days after receipt by the transfer agent of the properly executed
redemption request and any outstanding certificates for the shares to be
redeemed. Payment for shares redeemed by telephone will be made by check
payable to the account name(s) and address exactly as registered, and generally
will be mailed within three business days following the date of the request for
redemption.
A shareholder may request that payment for redeemed shares of the Fund
be made by wire or electronic funds transfer. Shareholders may elect to use
these services on the account application or by providing the Fund with a
signature guaranteed letter requesting these services and designating the bank
to receive all wire or electronic funds transfers. A shareholder may change the
predesignated bank of record by providing the Fund with written, signature
guaranteed instructions. Redemption proceeds paid by wire transfer will be
transmitted to the shareholder's predesignated bank account on the next business
day after receipt of the shareholder's redemption request. Redemption proceeds
paid by electronic funds transfer will be electronically transmitted to the
shareholder's predesignated bank account on the second business day after
receipt of the shareholder's redemption request. There is no fee for wire or
electronic funds transfer of proceeds from the redemption of Fund shares.
Shareholders may encounter delays in redeeming shares purchased by
check (other than cashier's or certified checks) or electronic funds transfer if
the redemption request is made within 15 days after the date of purchase. In
those situations, the redemption check will be mailed within 15 days after the
transfer agent's receipt of the purchase instrument, provided that it has not
been dishonored or cancelled during that time. The foregoing policy is to
ensure that all payments for the shares being redeemed have been
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honored. In addition to the foregoing restrictions, no redemption payment can
be made for shares which have been purchased by telephone order until full
payment for the shares has been received. In any event, valid redemption
requests concerning shares for which full payment has been made will be priced
at the net asset value next determined after receipt of the request.
(iv) REDEMPTION IN KIND. The Fund intends to redeem its shares only
for cash, although it retains the right to redeem its shares in kind under
unusual circumstances, in order to protect the interests of the remaining
shareholders, by the delivery of securities selected from its assets at its
discretion. The Fund is, however, governed by Rule 18f-1 under the Investment
Company Act of 1940 pursuant to which the Fund is obligated to redeem shares
solely in cash up to the lesser of $250,000 or 1% of the net assets of the Fund
during any 90-day period for any one shareholder. Should redemptions by any
shareholder during any 90-day period exceed such limitation, the Fund will have
the option of redeeming the excess in cash or in kind. If shares are redeemed
in kind, the redeeming shareholder generally will incur brokerage costs in
converting the assets to cash.
(v) REDEMPTIONS BY THE FUND. As a means of reducing its expenses, the
Fund is authorized to redeem involuntarily all shares held in accounts with a
value of less than $100,000. Such redemptions will be permitted only when the
account is reduced below the minimum value by redemption, and not by declines in
per share net asset value. As a result, accounts established with the
applicable minimum investment might be subject to redemption after only a small
redemption has been made by the shareholder. At least 60 days' written notice
will be given to a shareholder before such an account is redeemed. During that
time, the shareholder may add sufficient funds to the account to meet or exceed
the minimum. If this condition is not met, the shares will be redeemed at the
per share net asset value next determined after the 60th day following the
notice. A check for the proceeds will be sent to the shareholder unless a share
certificate has been issued, in which case payment will be made upon surrender
of the certificate.
12. EXCHANGE PRIVILEGE
(i) EXCHANGES. By telephoning the Fund at 1-800-[_______], or writing
to the Fund, in care of DST at P.O. Box 419958, Kansas City, MO 64141, any
shareholder may exchange, without charge, any or all of his shares in the Fund,
subject to stated minimums, for shares of any of the publicly available Berger
Funds or Berger/BIAM Funds. Exchanges may be made only if the Berger Fund or
Berger/BIAM Fund into which a shareholder wishes to exchange shares is
registered in the shareholder's state of residence.
It is each investor's responsibility to obtain and read a prospectus
of the Berger Fund or Berger/BIAM Fund into which the investor is exchanging.
By giving exchange instructions, a shareholder will be deemed to have
acknowledged receipt of the prospectus for the Berger Fund or Berger/BIAM Fund
being purchased. Up to four exchanges out of the Fund are permitted during the
calendar year. This limit helps keep the Fund's net asset base stable and
reduces the Fund's administrative expenses. In times of extreme economic or
market conditions, exchanging Fund shares by telephone may be
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difficult. See "Redemption of Fund Shares - Redemptions by Telephone" for
procedures for telephone transactions.
Redemptions of shares in connection with exchanges into or out of the
Fund are made at the net asset value per share next determined after the
exchange request is received. To receive a specific day's price, a letter or
call must be received before that day's close of the Exchange. Each exchange
represents the sale of shares from one fund and the purchase of shares in
another, which may produce a gain or loss for U.S. Federal income tax purposes.
All exchanges out of the Fund are subject to the minimum and
subsequent investment requirements of the fund into which shares are being
exchanged. Exchanges will be accepted only if the registration of the two
accounts is identical. Neither the Fund, the Berger Funds, the Berger/BIAM
Funds, nor their transfer agents or advisors assume responsibility for the
authenticity of exchange instructions communicated by telephone or in writing
which are believed to be genuine. See "Redemption of Fund Shares - Redemptions
by Telephone" for procedures for telephone transactions. All shareholders have
Telephone Transaction Privileges to authorize exchanges unless they specifically
decline this service on the account application or by writing to the Fund,
c/o DST Systems, Inc., P.O. Box 419958, Kansas City, MO 64141.
13. PLANS AND PROGRAMS
The Fund offers several tax-qualified retirement plans for adoption by
individuals and employers. The Fund also offers both a profit-sharing plan and
a money purchase pension plan for employers and self-employed persons, an
Individual Retirement Account ("IRA") and a 403(b) Custodial Account.
In order to receive the necessary materials to create a profit-sharing
or money purchase pension plan account, an IRA account or a 403(b) Custodial
Account, please write to the Fund, c/o BBOI Worldwide, P.O. Box 5005, Denver, CO
80217, or call 1-800-[_________]. Trustees for existing 401(k) or other plans
interested in utilizing Fund shares as an investment or investment alternative
in their plans should contact the Fund at 1-800-[_________].
The Fund also offers a systematic withdrawal plan. Forms to open such
an account may be obtained by writing to the Fund, c/o DST Systems, Inc., P.O.
Box 419958, Kansas City, MO 64141, or call 1-800-[____________].
14. INCOME DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAX TREATMENT
The Fund intends to declare dividends representing the Fund's net
investment income annually, normally in December. It is also the present policy
of the Fund to distribute annually all of its net realized capital gains.
Dividends declared and payable to shareholders of record on a specified date in
December will be deemed to have been received by shareholders on December 31 for
tax purposes if paid during January the following year.
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The Fund is treated as a separate entity for tax purposes and intends
to elect and maintain qualification to be treated as a regulated investment
company under Subchapter M of the Internal Revenue Code of 1986, as amended.
The Fund's qualification as a regulated investment company will depend on the
Portfolio maintaining its status as a partnership for tax purposes. If the Fund
qualifies under Subchapter M and meets certain minimum distribution
requirements, the Fund generally will not be liable for U.S. Federal income tax
on the amount of its earnings that are timely distributed. If the Fund
distributes annually less than 98% of its income and gain, it may be subject to
a nondeductible excise tax equal to 4% of the shortfall.
All dividends and capital gains distributions paid by the Fund will be
automatically reinvested in shares of the Fund at the net asset value on the ex-
dividend date unless an investor specifically requests that either dividends or
distributions, or both, be paid in cash. The election to receive dividends or
distributions in cash or to reinvest them in Fund shares may be changed by
calling the Fund at 1-800-[_________] or by written request to the Fund, c/o DST
Systems, Inc., P.O. Box 419958, Kansas City, MO 64141, and must be received at
least ten days prior to the record date of any dividend or capital gains
distribution.
The Fund will inform its shareholders of the amount and nature of such
income or gains resulting from their investment in the Fund. Dividends paid by
the Fund from net investment income and distributions from net short-term
capital gains in excess of any net long-term capital losses, whether received in
cash or reinvested, generally will be taxable as ordinary income. Distributions
received from the Fund designated as long-term capital gains (net of capital
losses), whether received in cash or reinvested, will be taxable as long-term
capital gains without regard to the length of time a shareholder has owned
shares in the Fund. Any loss on the redemption or other sale or exchange of the
Fund's shares held for six months or less will be treated as a long-term capital
loss to the extent of any long-term capital gain distribution received on the
shares. If a shareholder is exempt from U.S. Federal income tax, the
shareholder will not generally be taxed on amounts distributed by the Fund.
Under the Internal Revenue Code, gains recognized by the Portfolio
upon a disposition of assets contributed in-kind to it by the Fund will be
specially allocated to the Fund and not to other investors in the Portfolio to
the extent of the unrealized appreciation in those assets at the time of their
transfer. As a result, shareholders of the Fund may receive distributions of a
greater amount of gains than if the Portfolio had purchased those assets in the
open market upon commencement of Fund operations or in a transaction that did
not involve contributions of assets in-kind.
Investment income received by the Fund, directly or through the
Portfolio, from sources within foreign countries may be subject to foreign
withholding and other taxes withheld at the source. The U.S. has entered into
tax treaties with many foreign countries that, in some circumstances, may
entitle the Fund or Portfolio to a reduced rate of tax or exemption from tax on
such income. It is impossible to determine the effective rate of foreign tax in
advance since the amount of the Portfolio's assets to be invested within various
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countries will fluctuate and the extent to which tax refunds will be recovered
is uncertain. If, directly or through the Portfolio, more than 50% in value of
the Fund's total assets at the close of its taxable year consists of securities
of foreign corporations, the Fund may elect to "pass-through" to its
shareholders the income taxes paid by the Fund to foreign governments during a
year. Under this election, each shareholder will be required to include the
shareholder's pro rata portion of these foreign taxes in gross income, but will
be able to deduct (as an itemized deduction for shareholders who itemize) or
claim a foreign tax credit for such amount (subject to various limitations). If
the election is not made, foreign taxes will be treated as an expense of the
Fund.
At certain levels of taxable income, the Internal Revenue Code
provides a preferential tax rate for long-term capital gains. Long-term capital
gains of taxpayers other than corporations are taxed at a 28% maximum rate,
whereas ordinary income is taxed at a 39.6% maximum rate. Capital losses
continue to be deductible only against capital gains plus (in the case of
taxpayers other than corporations) $3,000 of ordinary income annually ($1,500
for married individuals filing separately).
Some shareholders may be subject to 31% "backup withholding" on
dividends, capital gains distributions and redemption payments made by the Fund.
Backup withholding generally will apply to shareholders who fail to provide the
Fund with their correct taxpayer identification number or to make required
certifications. Backup withholding is not an additional tax. Any amounts
withheld may be credited against a shareholder's U.S. Federal income tax
liability.
The foregoing is only a brief summary of the U.S. Federal income tax
considerations affecting the Fund and its shareholders. See "Income Dividends,
Capital Gains Distributions and Tax Treatment" in the Statement of Additional
Information for more information regarding taxation. Potential investors should
consult their tax advisors with specific reference to their own tax situation.
15. ADDITIONAL INFORMATION
The Trust is a Delaware business trust organized on May 31, 1996. The
Fund was established on May 31, 1996, as a series or fund under the Trust.
Since the Trust and the Fund were only recently organized, they have no prior
operating history, although the Fund calculates its performance taking into
account the prior performance of a trust fund whose assets were transferred into
the Portfolio as described under "Performance" below. As of the date of this
Prospectus, all of the outstanding shares of the Fund were held by Berger
Associates, which provided the seed capital necessary to establish the Trust.
The Trust is authorized to issue an unlimited number of shares of
beneficial interest in series. The Trust is also authorized to establish
multiple classes of shares representing differing interests in an existing or
new series. As of the date of this Prospectus, the series comprising the
Berger/BIAM International Institutional Fund is one of three series established
under the Trust, although others may be added in the future. Shares of the Fund
are fully paid and nonassessable when issued. Each share has a par value
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of $.01. All shares issued by the Fund participate equally in dividends and
other distributions by the Fund, and in the residual assets of the Fund in the
event of its liquidation.
Shareholders of the Berger/BIAM International Institutional Fund and
the other funds or series of the Berger/BIAM Worldwide Funds Trust generally
vote separately on matters relating to those respective funds, although they
vote together and with the holders of any other series of the Trust issued in
the future in the election of trustees of the Trust and on all matters relating
to the Trust as a whole. Each full share of the Fund has one vote. Shares of
the Fund have noncumulative voting rights, which means that the holders of more
than 50% of the shares voting for the election of trustees can elect 100% of the
trustees if they choose to do so and, in such event, the holders of the
remaining less than 50% of the shares voting for the election of trustees will
not be able to elect any person or persons as trustees. The Fund is not
required to hold annual shareholder meetings unless required by the Investment
Company Act of 1940 or other applicable law or unless called by the trustees.
If shareholders owning at least 10% of the outstanding shares of the
Berger/BIAM Worldwide Funds Trust so request, a special shareholders' meeting
will be held for the purpose of considering the removal of a trustee of the
Trust. Special meetings will be held for other purposes if the holders of at
least 25% of the outstanding shares of the Trust so request. Subject to certain
limitations, the Trust will facilitate appropriate communications by
shareholders desiring to call a special meeting for the purpose of considering
the removal of a trustee.
The Fund invests all of its investable assets in the Portfolio, a
series of Worldwide Portfolios, which is also a Delaware business trust divided
into series. Investors in each series of Worldwide Portfolios will vote
separately or together in the same manner as shareholders of the Trust's series.
For more information on the Trust and Worldwide Portfolios, see "Additional
Information" in the Statement of Additional Information.
The Glass-Steagall Act prohibits a depository institution (such as a
bank) from underwriting or distributing most securities and from affiliating
with businesses engaged in certain similar activities. BIAM believes, based on
advice of its counsel, that it may perform the services for the Fund
contemplated by this Prospectus consistent with the Glass-Steagall Act and other
applicable banking laws and regulations. However, future changes in either
Federal or state statutes and regulations concerning the permissible activities
of banks and their affiliates, as well as future judicial or administrative
decisions or interpretations of present and future statutes and regulations,
might prevent BIAM from continuing to perform those services for the Fund.
State laws on this issue may differ from the interpretations of relevant Federal
law and banks and financial institutions may be required to register as dealers
pursuant to state securities law. If the circumstances described above should
change, the trustees of the Trust and Worldwide Portfolios would review the
relationships with BIAM and consider taking all actions appropriate under the
circumstances.
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<PAGE>
16. PERFORMANCE
From time to time in advertisements, the Fund may discuss its
performance ratings as published by recognized mutual fund statistical services,
such as Lipper Analytical Services, Inc., CDA Investment Technologies, Inc.,
Morningstar, Inc., or Value Line Investment Survey or by publications of general
interest such as THE WALL STREET JOURNAL, INVESTOR'S BUSINESS DAILY, BARRON'S,
FINANCIAL WORLD or KIPLINGER'S PERSONAL FINANCE MAGAZINE. In addition, the Fund
may compare its performance to that of recognized broad-based securities market
indices, including the Morgan Stanley Capital International EAFE (Europe,
Australasia, Far East) Index, the Dow Jones World Index, the Standard & Poor's
500 Stock Index, the Nasdaq Composite Index, or more narrowly-based indices
which reflect the market sectors in which the Fund invests.
The total return of the Fund is calculated for any specified period of
time by assuming the purchase of shares of the Fund at the net asset value at
the beginning of the period. Each dividend or other distribution paid by the
Fund is assumed to have been reinvested at the net asset value on the
reinvestment date. The total number of shares then owned as a result of this
process is valued at the net asset value at the end of the period. The
percentage increase is determined by subtracting the initial value of the
investment from the ending value and dividing the remainder by the initial
value.
The Fund's total return reflects the Fund's performance over a stated
period of time. An average annual total return reflects the hypothetical
annually compounded return that would have produced the same total return if the
Fund's performance had been constant over the entire period. Total return
figures are based on the overall change in value of a hypothetical investment in
the Fund. Because average annual total returns for more than one year tend to
smooth out variations in the Fund's return, investors should recognize that such
figures are not the same as actual year-by-year results.
Any performance figures for the Fund are based upon historical results
and do not assure future performance. The investment return and principal value
of an investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
The Portfolio commenced operations upon the transfer to the Portfolio
of assets held in a pooled trust (the "Pool") maintained by First NH Investment
Services Corp., for which BIAM has provided day-to-day portfolio management as
sub-advisor since the inception of the Pool. BIAM's bank holding company parent
indirectly owns a 23.5% interest in the parent of First NH Investment Services
Corp. The Pool had substantially the same investment objective, policies and
limitations of the Fund and the Portfolio. Assets from the Pool were
transferred to the Fund 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 (in which the Fund invests
all of its investable assets) were the same as the investment holdings in the
portfolio of
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<PAGE>
the Pool immediately prior to the transfer, except for the seed capital provided
by Berger Associates.
The Pool was not a registered investment company since it was exempt
from registration under the Investment Company Act of 1940 (the "1940 Act").
Since, in a practical sense, the Pool constitutes the "predecessor" of the
Portfolio, the Fund calculates its performance for periods commencing prior to
the transfer of the Pool's assets to the Portfolio by including the Pool's total
return, adjusted to reflect the deduction of fees and expenses applicable to the
Fund as stated in the Fee Table above in this Prospectus (that is, adjusted to
reflect estimated expenses, including the Fund's pro rata share of the aggregate
annual operating expenses, net of fee waivers, of the Portfolio in which all of
the investable assets of the Fund are invested).
The performance data set forth below includes the performance of the
Pool for periods before the Fund's and the Portfolio's registration statements
became effective. As noted above, the Pool was not registered under the 1940
Act and thus was not subject to certain investment restrictions that are imposed
by the 1940 Act. If the Pool had been registered under the 1940 Act, the Pool's
performance might have been adversely affected.
AVERAGE ANNUAL TOTAL RETURN
FOR PERIODS ENDED JUNE 30, 1996
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
BERGER/BIAM EAFE INDEX(2)
INTERNATIONAL
INSTITUTIONAL FUND(1)
- --------------------------------------------------------------------------------
1-YEAR 16.74% 13.62%
- --------------------------------------------------------------------------------
3-YEAR 12.33% 10.76%
- --------------------------------------------------------------------------------
5-YEAR 13.84% 10.33%
- --------------------------------------------------------------------------------
SINCE INCEPTION(3) 12.20% 4.26%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(1) Total return for the Fund has been adjusted to reflect estimated expenses
of the Fund, including the Fund's pro rata share of the aggregate annual
operating expenses, net of fee waivers, of the Portfolio in which all of the
investable assets of the Fund are invested.
(2) Source: Morgan Stanley Capital International (MSCI). The MSCI EAFE Index
is a market capitalization weighted index composed of companies representative
of the market structure of 30 developed market countries in Europe, Australasia
and the Far East.
(3) Covers the period since July 31, 1989.
All of the foregoing performance data were calculated in accordance
with methods prescribed by the Securities and Exchange Commission which are
discussed in more detail under the heading "Performance Information" in the
Statement of Additional Information.
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<PAGE>
Shareholders with questions should write to the Fund, c/o BBOI
Worldwide, P.O. Box 5005, Denver, CO 80217, or call 1-303-329-0200 or
1-800-[__________].
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<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any State.
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED AUGUST 19, 1996
PROSPECTUS
BERGER/BIAM INTERNATIONAL CORE FUND
The Berger/BIAM International CORE Fund (the "Fund") is a "no-load" mutual
fund, more technically referred to as an open-end management investment company,
organized as a diversified series of the Berger/BIAM Worldwide Funds Trust
("Trust"). The investment objective of the Fund is long-term capital
appreciation. The Fund seeks to achieve this objective by investing all of its
investable assets in the Berger/BIAM International Portfolio (the "Portfolio")
which, in turn, invests primarily in common stocks of well established companies
located outside the United States. The Portfolio intends to diversify its
holdings among several countries and to have, under normal market conditions, at
least 65% of the Portfolio's total assets invested in the securities of
companies located in at least five countries, not including the United States.
UNLIKE MANY OTHER MUTUAL FUNDS WHICH DIRECTLY ACQUIRE AND MANAGE THEIR OWN
PORTFOLIOS OF SECURITIES, THE FUND SEEKS ITS INVESTMENT OBJECTIVE BY INVESTING
ALL OF ITS INVESTABLE ASSETS IN THE PORTFOLIO, AS DESCRIBED ABOVE. Accordingly,
the investment performance of the Fund will derive from the investment
performance of the Portfolio. The Portfolio is an open-end management
investment company and a diversified series of a separate trust known as the
Berger/BIAM Worldwide Portfolios Trust ("Worldwide Portfolios"). The
Portfolio's investment objective and policies are identical to those of the
Fund. The Portfolio is advised by BBOI Worldwide LLC ("BBOI Worldwide" or the
"Advisor"), which has delegated daily portfolio management of the Portfolio to
Bank of Ireland Asset Management (U.S.) Limited ("BIAM" or the "Sub-Advisor").
For further information about the Fund's investment objective and structure, see
"Investment Objective and Policies and Risk Factors", "Introduction" and
"Additional Information About Master/Feeder Structure".
The Fund is designed primarily for direct investment by institutional
investors such as pension and profit sharing plans, employee benefit trusts,
endowments, foundations and corporations, as well as high net worth individuals.
Shares of the Fund are also offered through certain financial intermediaries
that may charge their customers transaction or other fees with respect to the
customers' investment in the Fund.
This Prospectus sets forth concisely the information about the Fund that a
prospective investor should consider before investing. Investors are advised to
retain this Prospectus for future reference. Additional information about the
Fund has been filed with the Securities and Exchange Commission. A copy of the
Statement of Additional Information, which is incorporated in its entirety by
reference, is available upon request without charge by writing to the Fund at
P.O. Box 5005, Denver, CO 80217, or by calling 1-800-[________]. Prospectuses
are also available upon request for the following funds advised by Berger
Associates, Inc.: the Berger 100 Fund, the Berger Growth and Income Fund, the
Berger Small Company Growth Fund and the Berger New Generation Fund.
INVESTMENTS IN THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK (INCLUDING BANK OF IRELAND). SHARES OF THE FUND ARE NOT
FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD, OR ANY OTHER GOVERNMENTAL AGENCY. AN INVESTMENT IN THE FUND IS
SUBJECT TO
<PAGE>
INVESTMENT RISK, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL AMOUNT INVESTED.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL SECURITIES IN ANY
STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH STATE.
The date of this Prospectus and the Statement of Additional Information
referred to above is _________________, 1996.
<PAGE>
Table of Contents
SECTION PAGE
1. Fee
Tables.................................................................. 1
2. Introduction............................................................ 2
3. Investment Objective and Policies and Risk
Factors................................................................. 3
4. Portfolio
Turnover................................................................ 11
5. Additional Information About Master/Feeder
Structure............................................................... 11
6. Management and Investment
Advice.................................................................. 12
7. Expenses of the
Fund.................................................................... 16
8. Purchase of Shares in the
Fund.................................................................... 18
9. Net Asset
Value................................................................... 20
10. Open Account System and Share
Certificates............................................................ 21
11. Redemption of Fund
Shares.................................................................. 21
12. Exchange
Privilege............................................................... 24
13. Plans and
Programs................................................................ 25
14. Income Dividends, Capital Gains Distributions and Tax
Treatment............................................................... 25
15. Additional
Information............................................................. 27
16. Performance............................................................ 28
<PAGE>
1. FEE TABLES
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases 0%
Maximum Sales Load Imposed on Reinvested Dividends 0%
Deferred Sales Load 0%
Redemption Fees 0%
Exchange Fee 0%
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)*
TOTAL
FUND
INVESTMENT OPERATING
ADVISORY EXPENSES
FEE OTHER (AFTER
(AFTER WAIVER) EXPENSES** WAIVER)
Berger/BIAM International 0.85%*** 0.25% 1.10%***
CORE Fund
* Annual Fund Operating Expenses include the Fund's pro rata portion of the
annual operating expenses of the Portfolio, which are borne indirectly by
the Fund.
** Other Expenses primarily include administrative services fees paid by the
Fund and custodian fees paid by the Portfolio and are based on estimated
expenses for the first year of operations of the Fund and the Portfolio.
*** Although the Fund does not pay an investment advisory fee directly to an
investment advisor, it bears indirectly, as an investor in the Portfolio,
its pro rata portion of the advisory fee paid by the Portfolio to the
Advisor. Until at least April 30, 1998, the Advisor has agreed voluntarily
to waive its investment advisory fee to the extent that the Portfolio's
normal 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. Absent the waiver, the
Investment Advisory Fee would be 0.90% and Total Fund Operating Expenses
would be estimated to be 1.15%.
EXAMPLES
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return, and (2) redemption at the end of each time period:
1 YEAR 3 YEARS
Berger/BIAM International CORE Fund $11* $35*
* Based on estimated expenses for the first year of operations of the Fund
and the Portfolio, after waiver.
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<PAGE>
THE EXPENSES SET FORTH IN THE PRECEDING TABLES SHOULD NOT BE CONSIDERED A
REPRESENTATION OF PAST OR FUTURE EXPENSES, AND ACTUAL EXPENSES MAY BE GREATER OR
LESS THAN THOSE SHOWN. THE ASSUMED 5% ANNUAL RETURN IS HYPOTHETICAL AND SHOULD
NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE ANNUAL RETURNS, WHICH MAY
BE GREATER OR LESS THAN THE ASSUMED AMOUNT.
Total Fund Operating Expenses include the Fund's pro rata share of the
aggregate annual operating expenses of the Portfolio, in which all of the
investable assets of the Fund are invested. The trustees of the Trust believe
that the investment in the Portfolio by investors in addition to the Fund may
enable the Portfolio to achieve economies of scale which could reduce expenses
and, accordingly, that the aggregate per share expenses of the Fund and the
Fund's pro rata share of the expenses of the Portfolio will be less than or
approximately equal to the expenses the Fund would incur if it retained the
services of an investment advisor and the assets of the Fund were invested
directly in the type of securities held by the Portfolio. While the investment
advisory fee for the Portfolio is higher than that paid by most other mutual
funds, it is comparable to the investment advisory fee paid by many other
international equity funds.
The purpose of the preceding tables is to assist the investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly or indirectly. The Fund's expenses are described in greater
detail under "Management and Investment Advice", and "Expenses of the Fund".
2. INTRODUCTION
The Berger/BIAM International CORE Fund is an open-end, diversified
management investment company commonly referred to as a "mutual fund". The Fund
is a "no-load" fund, meaning that a buyer pays no commissions or sales load when
buying shares of the Fund. This Prospectus describes the securities offered by
the Fund.
The Fund is a series of the Berger/BIAM Worldwide Funds Trust, a Delaware
business trust, and invests in the Portfolio that, in turn, invests in
securities in accordance with an investment objective, policies and limitations
that are identical to those of the Fund. This is sometimes called a
master/feeder fund structure, because the Fund and other investors who invest in
the Portfolio "feed" shareholders' investments into the Portfolio, a "master"
fund. The structure looks like this:
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<PAGE>
Shareholders
BUY SHARES IN [down arrow]
Fund
INVESTS IN [down arrow]
Portfolio
INVESTS IN [down arrow]
Stocks and
Other Securities
The trustees of the Trust believe that this structure may benefit
shareholders, since investment in the Portfolio by investors in addition to the
Fund may enable the Portfolio to achieve economies of scale which could reduce
expenses. For more information about this structure, see "Additional
Information About Master/Feeder Structure".
The Fund is designed primarily for direct investment by institutional
investors such as pension and profit sharing plans, employee benefit trusts,
endowments, foundations and corporations, as well as high net worth individuals.
Shares of the Fund are also offered through certain financial intermediaries
that may charge their customers transaction or other fees with respect to the
customers' investment in the Fund.
3. INVESTMENT OBJECTIVE AND POLICIES AND RISK FACTORS
The investment objective of the Fund is long-term capital appreciation.
The Fund seeks to achieve this objective by investing all of its investable
assets in the Portfolio which, in turn, invests primarily in common stocks of
well established companies located outside the United States. A company will be
considered 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. The Portfolio may also invest in securities other than common stock if
the Sub-Advisor believes these are likely to be the best suited at that time to
achieve the Portfolio's objective. These include equity-related securities
(such as preferred stocks and convertible securities), debt securities issued by
foreign governments or foreign corporations, U.S. or foreign short-term
investments or other securities described on the following pages. The Portfolio
intends to diversify its holdings among several countries and to have, under
normal market conditions, at least 65% of the Portfolio's total assets invested
in the securities of companies located in at least five countries, not including
the United States. Current income is not an investment objective of the Fund
and any income produced will be only of secondary importance as a by-product of
the investment selection process used to achieve the Fund's objective.
-3-
<PAGE>
INVESTMENT SELECTION
In selecting its portfolio securities, the Portfolio places primary
emphasis on fundamentally undervalued stocks as determined by a range of
characteristics, including relatively low price/earnings multiples, dividend
yield, consistency of earnings growth and cash flow, financial strength,
realizable asset value and liquidity. Securities of companies with medium to
large market capitalizations usually constitute the majority of the Portfolio's
investments. The Portfolio currently considers medium to large market
capitalizations to be those in excess of $1 billion. Market capitalization is
defined as total current market value of a company's outstanding common stock.
In addition, the Portfolio is presently anticipated to be weighted largely
toward companies located in Western Europe (for example, the United Kingdom,
Germany, France, Italy, Spain, Switzerland, the Netherlands, Sweden, Ireland and
Finland), Australia and the Far East (for example, Japan, Hong Kong, Singapore,
Malaysia, Thailand, Indonesia and the Philippines). However, the Portfolio is
free to invest in companies of any size and in companies located in other
foreign countries, including developing countries.
INVESTMENT DECISION MAKING PROCESS
The Sub-Advisor's investment approach is based on "bottom-up" fundamental
analysis of individual companies within a framework of dynamic economic and
business themes that are believed to provide the best opportunities for
effective stock selection. Stock selection decisions are guided by:
- - GLOBAL ECONOMIC AND BUSINESS THEMES. The Sub-Advisor identifies economic
and business themes and trends that have the potential to support the
long-term growth prospects of companies best positioned to take advantage
of them. These themes and trends may transcend political and geographic
boundaries and may be global or regional in nature. Current themes and
trends include, for example, worldwide growth in telecommunications and
multimedia, rapid economic development in the Pacific Basin, global
healthcare trends and unique consumer franchises.
- - FUNDAMENTAL ANALYSIS. The Sub-Advisor seeks to identify companies that it
believes are best positioned to benefit from the identified themes and
trends. It conducts an extensive "bottom-up" analysis seeking individual
quality companies with stocks that are fundamentally undervalued relative
to their long-term prospective earnings growth rate, their historic
valuation levels and their peer group. This process includes examining
financial statements, evaluating management and products, assessing
competitive position and strengths, as well as analyzing the economic
variables affecting the company's operating environment. This in-depth,
fundamental analysis is believed to be the most important step in
identifying stock selections for the Portfolio.
Actual country weightings are a by-product of the bottom-up stock selection
approach. Accordingly, the country in which a company is located is considered
by the Sub-
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<PAGE>
Advisor to be less important than the diversity of its sources of earnings and
earnings growth.
WHY INVEST IN THIS FUND?
The Advisor believes there is substantial opportunity for long-term capital
growth in foreign markets, as certain foreign economies may grow more rapidly
than the U.S. economy. In addition, boundaries and borders no longer define or
confine the operations of many of the world's business entities. Companies
raise capital, purchase raw materials, manufacture and distribute products on a
worldwide basis. Many profitable, successful companies benefit from global
economic growth, including companies in foreign markets. The Fund seeks to take
advantage of the investment opportunities created by an increasingly global
economy.
One reason for investing internationally is the opportunity to earn higher
investment returns. On a total return basis, foreign stocks represented by the
Morgan Stanley Capital International EAFE (Europe, Australasia, Far East) Index
outperformed U.S. stocks represented by the Standard & Poor's 500 Stock Index in
all but two rolling ten-year periods ended 1981 through 1995. Of course, during
this time there were shorter periods when U.S. stocks had higher returns, and
there have been periods when the EAFE Index produced negative returns.
Accordingly, investors in foreign equity securities should have a long-term
investment perspective, as international markets tend to be more volatile than
the U.S. market.
International investing also expands investment opportunities. The U.S.
percentage of the world's stock market capitalization has decreased over the
past 20 years. Today, more than half of the world's stock market capitalization
consists of non-U.S. stocks and companies. Since foreign stocks do not always
move in tandem with U.S. stocks and with each other, international investing
also has the potential to add diversification to an all-U.S. stock portfolio by
spreading investments across a number of markets.
Investors who wish to diversify their portfolio internationally can do so
by investing directly in foreign stocks, but they may find it difficult to make
purchases and sales, obtain reliable information, hold securities in safekeeping
and manage the conversion of the value of their international investments into
U.S. dollars. Investing in the Fund, however, eliminates these complications.
With a single investment, the investor owns a diversified international
investment portfolio that is actively managed by experienced professionals.
BIAM, the Portfolio's Sub-Advisor, has extensive experience in dealing with
foreign markets and with brokers and custodian banks around the world. BIAM
also has the benefit of an established information network and believes the Fund
offers a convenient and cost-effective means of investing internationally.
Of course, as an international fund, the Fund entails special risks as
described below. The Fund seeks to reduce these risks through diligent research
and diversification.
-5-
<PAGE>
SECURITIES, INVESTMENT PRACTICES AND RISK FACTORS
Since the shares of the Fund represent an investment in the Portfolio,
which in turn primarily represents an investment in common stocks, investors
should understand that the net asset value of the Fund will change as the market
value of the securities held in the Portfolio changes and that the value of a
Fund share will go up and down. Investors should also be aware that investment
in foreign securities carries additional risks not present when investing in
domestic securities. See "Foreign Securities" below.
The Fund is not intended as a complete or balanced investment vehicle, but
rather as an investment for persons who are in a financial position to assume
the risk and share price volatility associated with foreign investments. As a
result, the Fund should be considered as a long-term investment vehicle.
The investment objective of the Fund and the Portfolio is considered
fundamental, meaning that it cannot be changed without a vote of the
shareholders of the Fund and, as to the Portfolio's objective, of the investors
in the Portfolio. There can be no assurance that the Fund's or the Portfolio's
investment objective will be realized. Following is additional information
about some of the specific types of securities in which the Portfolio may
invest.
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 in the
Statement of Additional Information.
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
-6-
<PAGE>
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 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 currency would adversely
affect the value of the securities expressed in dollars. Foreign currency
exchange rates are determined by forces of supply and demand on the foreign
exchange markets, which are in turn affected by the international balance of
payments and other economic and financial conditions, government intervention,
speculation and other factors.
CONVERTIBLE SECURITIES. The Portfolio may purchase securities that 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 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 being rated below
investment grade by organizations such as Moody's Investors Service, Inc., and
Standard & Poor's Corporation, or being of similar creditworthiness in the
determination of 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 net
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
-7-
<PAGE>
action, if any, is appropriate in light of all relevant circumstances. For a
further discussion of debt security ratings, see Appendix A to the Statement of
Additional Information.
SECURITIES OF SMALLER COMPANIES. The Portfolio may invest in securities of
companies with small or medium 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 well 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 well established companies.
LENDING PORTFOLIO SECURITIES. The Portfolio may lend its securities to
qualified institutional investors such as brokers, dealers or other financial
organizations. This practice permits the Portfolio to earn income, which, in
turn, can be invested in additional securities to pursue its investment
objective. Loans of securities by the Portfolio will be collateralized by cash,
letters of credit, or securities issued or guaranteed by the U.S. Government or
its agencies. The collateral will equal at least 100% of the current market
value of the loaned securities, marked-to-market on a daily basis. 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
any security if, as a result of such loan, the aggregate value of securities
then on loan would exceed 33-1/3% of the market value of the Portfolio's total
assets.
HEDGING TRANSACTIONS. The Portfolio is authorized to make limited
commitments in certain 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. Forward contracts are obligations between two parties to exchange
particular goods or instruments (such as foreign currencies) at a set price on a
future date. The Portfolio currently intends that it will use forward contracts
only for hedging purposes and that it may enter into forward foreign currency
exchange contracts, provided the aggregate value of all outstanding contracts
does not exceed the value of the Portfolio's assets. Although a hedging
transaction may, for example, partially protect the Portfolio from a decline in
the foreign exchange price of a particular security or its portfolio generally,
hedging may also limit the potential return to the Portfolio due to positive
foreign exchange movements, and the cost of the transaction will reduce the
potential return on the security or the portfolio. In addition, forward foreign
currency exchange contracts do not
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eliminate fluctuations in the prices of the underlying securities the Portfolio
owns or intends to acquire.
The Portfolio will generally enter into forward foreign currency exchange
contracts either with respect to specific transactions or with respect to the
Portfolio's security positions. For example, the Portfolio may enter into a
forward contract in order to fix the price (in terms of a specified currency,
which may be U.S. dollars or a foreign currency) for securities it has agreed to
buy or sell or is considering buying or selling. Further, when the Sub-Advisor
believes that a particular foreign currency in which some or all of the
Portfolio's investments are denominated may decline compared to the U.S. dollar,
the Portfolio may enter into a forward contract to sell the currency that is
expected to decline (or another currency which acts as a proxy for that
currency). However, the Portfolio will be permitted to make such investments
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 securities
denominated in a specific foreign currency. To ensure that the Portfolio will
be able to meet its obligations under its forward foreign currency exchange
contracts, the Portfolio will be required to place liquid assets in a segregated
account with its custodian bank or to set aside securities to "cover" its
commitments in these contracts.
Forward foreign currency exchange contracts are privately negotiated
(i.e., over-the-counter) and the parties may agree to offset or terminate the
contract before its maturity or may hold the contract to maturity and
complete the contemplated delivery of the underlying foreign currency.
Transactions in forward foreign currency exchange contracts by the Portfolio
involve the potential for a loss that may exceed the amount of commitment the
Portfolio would be permitted to make in those contracts under its investment
limitations. The principal risks of the Portfolio's use of forward foreign
currency exchange contracts are: (a) losses resulting from currency market
movements not anticipated by the Portfolio; (b) possible imperfect
correlation between movements in the prices of forward contracts and
movements in the spot (i.e., cash) prices of the currencies hedged or used to
cover such positions; (c) lack of assurance that the Portfolio will be able
to enter into an offset or termination of the contract at any particular
time; (d) the need for additional information and skills beyond those
required for the management of a portfolio of traditional securities; and (e)
possible need to defer closing out certain forward contracts in order to
facilitate the Fund's qualification for beneficial tax treatment afforded
"regulated investment companies" under the Internal Revenue Code of 1986. 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 will fail to perform its obligations, in which
case the Portfolio could be worse off than if the contract had not been
entered into.
Although they currently have no intention of doing so, the trustees of
Worldwide Portfolios may, without shareholder approval, authorize the Portfolio
to invest in certain types of other instruments for hedging purposes, such as
financial futures and options. Appropriate notice to shareholders will be
provided of any intention to commence investing in such instruments. Additional
detail concerning the Portfolio's transactions in forwards,
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futures and options and the risks of such investments can be found in the
Statement of Additional Information.
ILLIQUID 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. 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. Certain restricted securities, such as Rule 144A
securities, may be treated as liquid under this restriction if a determination
is made that such securities are readily marketable. 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.
INVESTMENT RESTRICTIONS
In addition to its investment objective, the Portfolio has adopted a number
of restrictions on its investments and other activities that may not be changed
without shareholder approval. For example, the Portfolio may not borrow money,
except borrowing undertaken from banks for temporary or emergency purposes in
amounts not to exceed 25% of the market value of its total assets (including the
amount borrowed) and may not make loans (except that the Portfolio may lend
portfolio securities and enter into repurchase agreements in accordance with its
investment policies). The Portfolio may not invest in any one industry 25% or
more of the value of its total assets at the time of investment, nor invest in
commodities, except, only for the purpose of hedging, the Portfolio may invest
in forward foreign currency exchange contracts and other instruments as
specified in greater detail above and in the Statement of Additional
Information.
Further, with respect to 100% of its total assets, the Portfolio may not
purchase securities of any issuer (except U.S. Government securities) if,
immediately after and as a result of such purchase, the value of the Portfolio's
holdings in the securities of that issuer exceeds 5% of the value of its total
assets or it owns more than 10% of the outstanding voting securities or of any
class of securities of such issuer, although this restriction may be reduced to
apply to 75% or more of the Portfolio's total assets without a shareholder vote.
Also, 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 would be invested in such securities, although this
restriction may be changed without shareholder
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approval. For more detail about the Portfolio's investment restrictions, see
the Statement of Additional Information.
4. PORTFOLIO TURNOVER
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 shares of the Fund or interests in the
Portfolio due to economic, market or other factors that are not within the
control of management. Although the annual portfolio turnover rate of the
Portfolio will vary, it is normally expected to range from 25% to 75%.
5. ADDITIONAL INFORMATION ABOUT MASTER/FEEDER STRUCTURE
Unlike other mutual funds that directly acquire and manage their own
portfolios of securities, the Fund (referred to as a feeder fund) seeks to
achieve its investment objective by investing all of its investable assets in
the Portfolio (referred to as a master fund). This two-tier structure is known
as a master/feeder. The Fund has the same investment objective and policies as
the Portfolio. The Fund will invest only in the Portfolio, and the Fund's
shareholders will therefore acquire only an indirect interest in the investments
of the Portfolio.
In addition to selling a beneficial interest to the Fund, the Portfolio may
sell beneficial interests to other mutual funds or institutional investors (that
is, other feeder funds). Such investors will invest in the Portfolio on the
same terms and conditions and will pay their proportionate share of the
Portfolio's expenses. However, the other investors investing in the Portfolio
are not required to issue their shares at the same public offering price as the
Fund due to potential differences in expense structures. Accordingly, investors
in the Fund should be aware that these differences may result in differences in
returns experienced by investors in the different funds that invest in the
Portfolio. Such differences in returns are common in this type of mutual fund
structure and are also present in other mutual fund structures. Information
concerning other investors in the Portfolio (for example, other feeder funds) is
available from the Fund at 1-800-[_________].
The investment objective of the Fund may not be changed without the
approval of the Fund's shareholders. The investment objective of the Portfolio
may not be changed without the approval of the investors in the Portfolio,
including the Fund. If the objective of the Portfolio changes and the
shareholders of the Fund do not approve a parallel change in the Fund's
investment objective, the trustees of the Trust will consider other
alternatives, including seeking an alternative investment vehicle or directly
retaining the Fund's own investment advisor. Shareholders will be given at
least 30 days' written notice prior to any change in the investment objective of
the Fund or the Portfolio.
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Smaller funds investing in the Portfolio may be materially affected by the
actions of larger funds investing in the Portfolio. For example, if a larger
fund invests or withdraws from the Portfolio, the remaining funds may experience
lower or higher pro rata operating expenses. Lower returns could possibly
result from a large withdrawal. However, this possibility also exists for
traditionally structured funds which have large or institutional investors.
Also, a fund with a greater pro rata ownership in the Portfolio could have
effective voting control over the operations of the Portfolio.
Whenever the Fund is requested to vote as an investor in the Portfolio on
matters pertaining to the Portfolio (other than a vote by the Fund to continue
the operation of the Portfolio upon the withdrawal of another investor in the
Portfolio), the Fund will hold a meeting of its shareholders and will cast all
of its votes as an investor in the Portfolio in the same proportion as directed
by the votes of the Fund's shareholders. Fund shareholders who do not vote will
not affect the votes cast by the Fund at the meeting of the Portfolio investors.
The percentage of the votes representing the Fund's shareholders who do not vote
will be voted by the Fund in the same proportion as the Fund's shareholders who
do, in fact, vote.
The Fund may withdraw its investment in the Portfolio at any time, if the
trustees of the Trust determine that it is in the best interests of the Fund to
do so. Certain changes in the Portfolio's investment objective, policies and
limitations may require the Fund to withdraw its investment in the Portfolio.
Upon any such withdrawal, the trustees would consider what action might be
taken, including investing the Fund's assets in another pooled investment entity
having the same investment objective and policies as the Fund or retaining an
investment advisor to manage the Fund's assets in accordance with the investment
policies described above with respect to the Portfolio. Any such withdrawal
could result in a distribution in kind of portfolio securities (as opposed to a
cash distribution) from the Portfolio. If securities are distributed, the Fund
could incur brokerage, tax or other charges in converting the securities to
cash. In addition, a distribution in kind may adversely affect the liquidity of
the Fund.
This Prospectus and the Statement of Additional Information contain more
detailed information about this master/feeder organizational structure,
including information related to: (i) the investment objective, policies and
restrictions of the Fund and the Portfolio; (ii) the trustees and officers of
the Trust and Worldwide Portfolios, and the management of the Fund and the
Portfolio; (iii) portfolio transactions and brokerage commissions; (iv) the
Fund's shares, including the rights and liabilities of its shareholders; (v)
additional performance information, including the method used to calculate total
return; and (vi) the determination of the value of the shares of the Fund. The
master/feeder fund structure is still relatively new and lacks a substantial
history.
6. MANAGEMENT AND INVESTMENT ADVICE
The trustees of the Trust are responsible for major decisions relating to
the Fund's policies and objective. They also oversee the operation of the Fund
by its officers and review the investment performance of the Fund on a regular
basis. The trustees of
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Worldwide Portfolios have overall responsibility for operation of the
Portfolio. A majority of the trustees of the Trust and Worldwide Portfolios who
are not "interested persons" (as defined in the Investment Company Act of 1940)
of the Trust or Worldwide Portfolios ("Independent Trustees") have adopted
written procedures reasonably appropriate to deal with potential conflicts of
interest arising from the fact that the same individuals are trustees of the
Trust and Worldwide Portfolios, up to and including creating a new board of
trustees for the Trust or Worldwide Portfolios. Additional information
concerning the trustees and the officers of the Trust and Worldwide Portfolios
is furnished in the Statement of Additional Information under the heading
"Management of the Fund."
THE ADVISOR -- GENERAL BUSINESS MANAGEMENT AND INVESTMENT OVERSIGHT
The investment advisor to the Portfolio is BBOI Worldwide LLC (the
"Advisor" or "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, such as coordinating certain matters relating to the operations of
the Portfolio and monitoring the Portfolio's compliance with all applicable
federal and state securities laws. Currently, the Advisor serves in this
capacity only to the Portfolio.
The Advisor is a Delaware limited liability company formed in 1996. Since
the Advisor was only recently formed, it has no prior experience as an
investment advisor. However, Berger Associates, Inc. ("Berger Associates"),
which owns 100% of the Advisor has been in the investment advisory business for
over 20 years. Berger Associates serves as investment advisor or sub-advisor to
mutual funds, pension and profit-sharing plans, and institutional and private
investors, and has assets under management of more than $3.5 billion as of April
30, 1996. Kansas City Southern Industries, Inc. ("KCSI") owns approximately 80%
of the outstanding shares of Berger Associates. 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. Also, see below under "Pending Sale of Interest in
Advisor".
THE SUB-ADVISOR -- EXPERIENCED INTERNATIONAL INVESTMENT MANAGEMENT
Since its founding in 1966, Bank of Ireland's investment management
group has become recognized among international and global investment
managers, serving clients in Europe, the United States, Canada, Australia and
South Africa. Bank of Ireland Asset Management (U.S.) Limited ("BIAM"), the
Sub-Advisor to the Portfolio, is an indirect wholly-owned subsidiary of Bank
of Ireland. Bank of Ireland, founded in 1783, is 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 $16 billion as of April 30,
1996.
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As permitted in its Investment Advisory Agreement with the Portfolio,
the Advisor has delegated day-to-day portfolio management responsibility to
BIAM, as the Sub-Advisor. 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 serves as investment advisor or sub-advisor to pension and
profit-sharing plans and other institutional investors and mutual funds.
BIAM's main offices are at 26 Fitzwilliam Place, Dublin 2, Ireland. BIAM
maintains a representative office at 2 Greenwich Plaza, Greenwich, CT 06830.
All investment decisions made for the Portfolio by the Sub-Advisor are made
by a team of BIAM investment personnel. No one individual is primarily
responsible for making the day-to-day investment decisions for the Portfolio.
Most of the investment professionals at BIAM have been with BIAM at least 10
years.
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 the Sub-Advisor,
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, the Sub-Advisor 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.
The trustees of Worldwide Portfolios have authorized the Sub-Advisor to
consider sales of shares of the Fund by a broker-dealer or the
recommendations of a broker-dealer to its customers that they purchase Fund
shares as a factor in the selection of broker-dealers to execute securities
transactions for the Portfolio. In placing portfolio business with such
broker-dealers, the Sub-Advisor will seek the best execution of each
transaction.
ADVISORY FEES
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. Until at
least April 30, 1998, the Advisor has agreed voluntarily to waive the investment
advisory fee paid by the Portfolio under the Investment Advisory Agreement to
the extent that the Portfolio's normal 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. Any reduction
in the advisory fee paid by the Portfolio will also reduce the pro rata share of
the advisory fee borne indirectly by the Fund.
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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.
PENDING SALE OF INTEREST IN ADVISOR
As mentioned above, the Portfolio's Advisor, BBOI Worldwide, is a limited
liability company formed in 1996 and 100% owned by Berger Associates. BBOI
Worldwide was organized by Berger Associates in anticipation of forming a joint
venture with BIAM for the purpose of managing international and global mutual
funds. Pursuant to the Amended and Restated Operating Agreement of BBOI
Worldwide LLC, dated as of May 1, 1996, between Berger Associates and BIAM (the
"Joint Venture Agreement"), BIAM (or an affiliate) has agreed to acquire a 50%
interest in the Advisor and thereby enter into a joint venture with Berger
Associates to become effective upon receipt of all regulatory approvals. Berger
Associates' role in the joint venture will be to provide administration and
marketing, and BIAM's role will be to provide international and global
investment management expertise. Day-to-day portfolio management of the
Portfolio will continue to be provided by BIAM under the Sub-Advisory Agreement.
The Joint Venture Agreement provides that Berger Associates and BIAM will
each own a 50% membership interest in the Advisor and each will have an equal
number of representatives on the Advisor's Board of Managers. Agreement of
representatives of both Berger Associates and BIAM will be required for all
significant management decisions.
BIAM's acquisition of an interest in the Advisor is subject to approval of
the Federal Reserve Board of the United States and the Central Bank of Ireland.
In the event the joint venture is not consummated, Berger Associates anticipates
continuing to provide the Fund with administrative services, and BIAM has agreed
to continue to serve as the Sub-Advisor to the Portfolio for a period of not
less than six months thereafter, on usual and customary contractual terms.
Consummation of BIAM's acquisition of a membership interest in the
Advisor might be deemed to effect a change of control in the Advisor and
thereby an "assignment" (as defined in the Investment Company Act of 1940)
and termination of the Portfolio's Investment Advisory and Sub-Advisory
Agreements. However, the trustees of Worldwide Portfolios have considered
the terms of the joint venture and various factors related to the proposal,
including that the day-to-day management of the Portfolio by BIAM is not
proposed to change. On the basis of the factors considered, the trustees,
including the Independent Trustees of Worldwide Portfolios voting separately,
have approved new Investment Advisory and Sub-Advisory Agreements that will
come into effect upon consummation of the joint venture and any change of
control in the Advisor that may be deemed to result. The new Agreements have
also been approved by the Portfolio's initial investors. The new Agreements
are identical in their terms to the initial Agreements described in this
Prospectus, except for commencement date. No further trustee or
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shareholder vote is anticipated to approve the new Agreements upon consummation
of the joint venture. Accordingly, prospective investors should consider BIAM's
pending acquisition of an interest in the Advisor at the time they consider
their initial investment in the Fund.
7. EXPENSES OF THE FUND
The Fund is allocated and bears indirectly its pro rata share of the
aggregate annual operating expenses of the Portfolio, since all of the
investable assets of the Fund are invested in 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
Independent Trustees; 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,
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; the fees payable to the Advisor under the Investment
Advisory Agreement; and such other non-recurring and extraordinary items as may
arise from time to time.
Until at least April 30, 1998, the Advisor has agreed voluntarily to waive
the investment advisory fee paid by the Portfolio under the Investment Advisory
Agreement to the extent that the Portfolio's normal 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.
Any reduction in the advisory fee paid by the Portfolio will also reduce the pro
rata share of the advisory fee borne indirectly by the Fund.
Expenses of the Fund include, among others, its pro rata share of the
expenses of the Trust, such as expenses of meetings of the shareholders of the
Trust. Expenses of the Fund also include, among others, taxes imposed on the
Fund; the fee payable to the Advisor under the Administrative Services
Agreement; and such other non-recurring and extraordinary items as may arise
from time to time.
SERVICE ARRANGEMENTS FOR THE FUND
Under the Administrative Services Agreement with the Fund, the Advisor
serves as the administrator of the Fund. In this capacity, it is responsible
for administering and managing all aspects of the Fund's day-to-day operations,
subject to the oversight of the trustees of the Trust. The Advisor is
responsible, at its expense, for furnishing (or procuring other parties to
furnish) all administrative services reasonably necessary for the operation of
the Fund, including recordkeeping and pricing services, custodian services,
transfer agency and dividend disbursing services, tax and audit services,
insurance, legal services, printing and mailing to shareholders of prospectuses
and other required communications, and certain
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other administrative and recordkeeping services, such as coordinating matters
relating to the operations of the Fund, monitoring the Fund's status as a
"regulated investment company" under the Internal Revenue Code of 1986,
registering sufficient Fund shares under federal and state securities laws, and
arranging for and supervising the preparation of registration statements, tax
returns, proxy materials, financial statements and reports for filing with
regulatory authorities and distribution to shareholders of the Fund. Under the
Administrative Services Agreement, the Fund pays the Advisor a fee at an annual
rate equal to the lesser of (i) 0.10% of its average daily net assets, or (ii)
the Advisor's annual cost to provide or procure these services (including the
fees of any services providers whose services are procured by the Advisor), plus
an additional 0.01% of the Fund's average daily net assets. The trustees of the
Trust regularly review amounts paid to and expenditures incurred by the Advisor
pursuant to the Administrative Services Agreement. In addition, in the event
that the Advisor's duties under the Administrative Services Agreement are
delegated to another party, the Advisor may take into account, in calculating
the cost of such services, only the costs incurred by such other party in
discharging the delegated duties.
Under a Sub-Administration Agreement between the Advisor and Berger
Associates, Berger Associates has been delegated the responsibility to perform
certain of the administrative and recordkeeping services required under the
Administrative Services Agreement and to procure, at the Advisor's expense,
third parties to provide the services not provided by Berger Associates. Under
the Sub-Administration Agreement, Berger Associates is paid a fee by the Advisor
of 0.25% of the Fund's average daily net assets for its services. During
certain periods, Berger Associates may voluntarily waive all or a portion of its
fee from the Advisor, which will not affect the fee paid by the Fund to the
Advisor under the Administrative Services Agreement. Investors Fiduciary Trust
Company ("IFTC") has been appointed to provide recordkeeping and pricing
services to the Fund, including calculating the daily net asset value of the
Fund, and to perform certain accounting and recordkeeping functions that it
requires. In addition, IFTC has been appointed to serve as the Fund's
custodian, transfer agent and dividend disbursing agent. IFTC has engaged DST
Systems, Inc. ("DST"), as sub-transfer agent to provide transfer agency and
dividend disbursing services for the Fund. The fees of Berger Associates, IFTC
and DST are all paid by the Advisor. Approximately 40% of the outstanding
shares of DST are owned by KCSI, which also owns approximately 80% of the
outstanding shares of Berger Associates.
SERVICE ARRANGEMENTS FOR THE PORTFOLIO
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 preparing investor communications, which have been
delegated to Berger Associates as part of the Sub-Administration Agreement
discussed above. 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
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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.
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.
DISTRIBUTOR
The distributor (principal underwriter) of the Fund's shares is First Fund
Distributors, Inc. (the "Distributor"), 4455 East Camelback Road, Suite 261-E,
Phoenix, AZ 85018. The Distributor is compensated and reimbursed for its costs
in distributing Fund shares by Berger Associates.
8. PURCHASE OF SHARES IN THE FUND
The Fund is designed primarily for direct investment by institutional
investors such as pension and profit sharing plans, employee benefit trusts,
endowments, foundations and corporations, as well as high net worth individuals.
Shares of the Fund are also offered through certain financial intermediaries
that may charge their customers transaction or other fees with respect to the
customers' investment in the Fund.
Shares in the Fund may be purchased at the relevant net asset value without
a sales charge. The minimum initial investment for shares of the Fund is
$1,000,000. To purchase shares in the Fund, simply complete the application
form enclosed with this Prospectus and mail it to the Fund in care of DST
Systems, Inc., the Fund's transfer agent, as follows:
Berger Funds
c/o DST Systems, Inc.
P.O. Box 419958
Kansas City, MO 64141
Additional investments may be made at any time by telephone or by mail at
the relevant net asset value by calling or writing the Fund.
A confirmation indicating the details of the transaction will be sent
promptly. Unless full shares only are specified, all purchases will be made in
full and fractional shares calculated to three decimal places.
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All purchase orders are effected at the relevant net asset value per share
of the Fund next determined after receipt of the purchase order, completed
application and payment. A purchase order, together with payment in proper
form, received by the transfer agent, sub-transfer agent or any other authorized
agent of the Fund prior to the close of the New York Stock Exchange (the
"Exchange") on a day the Fund is open for business will be effected at that
day's net asset value. An order received after that time will be effected at
the net asset value determined on the next business day. See "Redemptions of
Fund Shares - Redemptions by Telephone" for the Fund's policies and procedures
on effecting transactions by telephone.
Payment for shares purchased may be made as follows:
BY WIRE OR ELECTRONIC FUNDS TRANSFER. Payment for shares purchased may be
made by wire or electronic funds transfer from the investor's bank to DST
Systems, Inc. Please call 1-800-[_________] for current wire or electronic
funds transfer instructions. The following information may be requested: name
of authorized person; shareholder name; shareholder account number; name of
Fund; amount being wired or transferred; and name of wiring or transferring
bank.
BY MAIL. Alternatively, payment for shares purchased may be made by mail,
so long as payment is accompanied or preceded by a completed account
application. Payment should be made by check or money order drawn on a United
States bank and made payable to the "Berger Funds". Checks not made payable to
the Berger Funds, the account registrant, transfer agent or retirement account
custodian will not be accepted. The Fund will not accept purchases by cash or
credit card or checks drawn on foreign banks unless provision is made for
payment through a U.S. bank in U.S. dollars.
Fund shares may also be purchased through certain organizations connected
with pension and retirement plans. These organizations may charge investors a
transaction or other fee for their services, may require different minimum
initial and subsequent investments than the Fund and may impose other charges or
restrictions different from those applicable to shareholders who invest in the
Fund directly. Fees charged by these organizations will have the effect of
reducing a shareholder's total return on an investment in Fund shares. No such
charge will be paid by an investor who purchases the Fund shares directly from
the Fund as described above.
The Fund will, at its discretion, accept orders transmitted by these
organizations although not accompanied by payment for the shares being
purchased. Payment must be received by the Fund within three business days
after acceptance of the order. The price at which a purchase will be effected
is based on the next calculation of net asset value after the order is received
by the Fund's transfer agent, sub-transfer agent or any other authorized agent
of the Fund.
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The Fund reserves the right in its sole discretion to withdraw all or any
part of the offering made by this Prospectus or to reject purchase orders, when
in the judgment of management, such withdrawal or rejection is in the best
interest of the Fund. The Fund also reserves the right at any time to waive the
minimum investment requirements applicable to initial investments or to increase
the minimums following notice. No application to purchase shares is binding on
the Fund until accepted in writing.
Investors may, subject to the approval of the Trust and Worldwide
Portfolios, purchase shares of the Fund with liquid securities that are
eligible for purchase by the Portfolio (consistent with the Fund's and the
Portfolio's investment policies and restrictions) and that have a value that
is readily ascertainable in accordance with the valuation policies of the
Trust and Worldwide Portfolios. These transactions will be effected only if
the Sub-Advisor intends to retain the securities in the Portfolio as an
investment. Assets so purchased will be valued in generally the same manner
as they would be valued for purposes of pricing the Fund's shares, if such
assets were included in the Portfolio's assets at the time of purchase. The
Trust and Worldwide Portfolios reserve the right to amend or terminate this
practice at any time.
9. NET ASSET VALUE
The price of the Fund's shares is based on the net asset value of the Fund,
which is determined at the close of the regular trading session of the Exchange
(normally 4:00 p.m., New York time) each day that the Exchange is open. The per
share net asset value of the Fund is determined by dividing the total value of
its assets, less liabilities, by the total number of shares outstanding. Since
the Fund will invest all of its investable assets in the Portfolio, the value of
the Fund's investable assets will be equal to the value of its beneficial
interest in the Portfolio.
The Portfolio's securities and other assets are valued as follows:
securities are valued at market value or, if market quotations are not readily
available, at their fair value determined in good faith pursuant to consistently
applied procedures established by the trustees. Money market instruments
maturing within 60 days are valued at amortized cost, 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. See the Statement of Additional Information for more detailed
information.
Generally, trading in foreign securities markets is substantially completed
each day at various times prior to the close of the Exchange. The values of
foreign securities used in computing the net asset value of the shares of the
Fund are determined as of the earlier of such market close or the closing time
of the Exchange. Occasionally, events affecting the value of such securities
may occur between the times at which they are determined and the close of the
Exchange, or when the foreign market on which such securities trade is closed
but the Exchange is open, which will not be reflected in the computation of net
asset value. If during such periods, events occur which materially affect the
value of such securities, the securities will be valued at their fair market
value as
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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 customary U.S. holidays) and the Fund's net asset value is not
calculated. As a result, the net asset value of the Fund may be significantly
affected by such trading on days when shareholders cannot purchase or redeem
shares of the Fund.
Since the Fund does not impose any front end sales load or redemption fee,
both the purchase price and the redemption price of a Fund share are the same
and will be equal to the next calculated net asset value of a share of the Fund.
10. OPEN ACCOUNT SYSTEM AND SHARE CERTIFICATES
Unless otherwise directed, all investor accounts are maintained on a
book-entry basis. Share certificates will not be issued unless requested by
the shareholder. Shares purchased by dividend reinvestment, and shares
redeemed under a Systematic Withdrawal Plan, will be confirmed after the end
of each calendar quarter. Following any other investment or redemption, the
investor will receive a printed confirmation indicating the dollar amount of
the transaction, the per share price of the transaction and the number of
shares purchased or redeemed.
11. REDEMPTION OF FUND SHARES
(i) SHARE REDEMPTIONS BY MAIL. The Fund will redeem, at current net asset
value, all shares of the Fund offered for redemption. The redemption price of
shares tendered for redemption will be the net asset value next determined after
receipt of all required documents by the Fund's transfer agent, sub-transfer
agent or other authorized agent of the Fund. To receive the net asset value for
a specific day, a redemption request must be received before the close of the
Exchange on that day. Shareholders who purchased their shares directly from the
Fund may redeem all or part of their shares in the Fund by sending a written
request to the Fund, c/o DST Systems, Inc., P.O. Box 419958, Kansas City, MO
64141. The written request for redemption must be signed by each registered
owner exactly as the shares are registered and must clearly identify the account
and the number of shares or the dollar amount to be redeemed.
The signatures of the redeeming shareholders must be guaranteed by a
national or state bank, a member firm of a domestic stock exchange or the
National Association of Securities Dealers (NASD), a credit union, a federal
savings and loan association or another eligible guarantor institution if the
redemption: is being made payable other than exactly as registered; is being
mailed to an address which has been changed within 30 days of the redemption
request; or is being mailed to an address other than the one on record. A
notary public is not an acceptable guarantor. The Fund also reserves the right
to require a signature guarantee under other circumstances. The signature
guarantees must appear, together with the signatures of the registered owners,
(i) on the written request for redemption which
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clearly identifies the account and the number of shares to be redeemed, (ii) on
a separate instrument of assignment ("stock power") which may be obtained from a
bank or broker, or (iii) on any share certificates tendered for redemption. The
use of signature guarantees is intended to protect the shareholder and the Fund
from a possibly fraudulent application for redemption.
(ii) REDEMPTIONS BY TELEPHONE. All shareholders have Telephone Transaction
Privileges to authorize purchases, exchanges or redemptions unless they
specifically decline this service on the account application or by writing to
the Fund, c/o DST Systems, Inc., P.O. Box 419958, Kansas City, MO 64141. The
telephone redemption option is not available for shares held in retirement
accounts sponsored by the Fund. Redemption requests may be made by telephoning
DST Systems, Inc., at 1-800-[_______]. To receive the net asset value for a
specific day, a redemption request must be received before the close of the
Exchange on that day. As discussed above, certain requests must be in writing
and the signature of a redeeming shareholder must be signature guaranteed, and
therefore shares may not be redeemed by telephone, if the redemption: is being
made payable other than exactly as registered; is being mailed to an address
which has been changed within 30 days of the redemption request; is being mailed
to an address other than the one on record; or the shares are represented by
share certificates issued to the shareholder.
All telephone transactions are recorded and written confirmations
indicating the details of all telephone transactions will promptly be sent to
the shareholder of record. Prior to accepting a telephone transaction, the
shareholder placing the order may be required to provide certain identifying
information. A shareholder electing to communicate instructions by telephone
may be giving up some level of security that would otherwise be present were the
shareholder to request a transaction in writing. Neither the Fund nor its
transfer agent or Advisor assume responsibility for the authenticity of
instructions communicated by telephone which are reasonably believed to be
genuine and which comply with the foregoing procedures. The Fund, and/or its
transfer agent, may be liable for losses resulting from unauthorized or
fraudulent telephone instructions in the event these procedures are not
followed. All redemption requests initiated by telephone in excess of
$______________ must be confirmed in writing by an authorized party prior to
processing and transmission of proceeds.
In times of extreme economic or market conditions, redeeming shares by
telephone may be difficult. The Fund may terminate or modify the procedures
concerning the telephone redemption and wire transfer services at any time,
although shareholders of the Fund will be given at least 60 days' prior notice
of any termination or material modification. The Advisor may, at its own risk,
waive certain of the redemption requirements described in the preceding
paragraphs.
(iii) PAYMENT FOR REDEEMED SHARES. Payment for shares redeemed upon
written request will be made by check and generally will be mailed within three
business days after receipt by the transfer agent of the properly executed
redemption request and any outstanding certificates for the shares to be
redeemed. Payment for shares redeemed by telephone will be made by check
payable to the account name(s) and address exactly as
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registered, and generally will be mailed within three business days following
the date of the request for redemption.
A shareholder may request that payment for redeemed shares of the Fund be
made by wire or electronic funds transfer. Shareholders may elect to use these
services on the account application or by providing the Fund with a signature
guaranteed letter requesting these services and designating the bank to receive
all wire or electronic funds transfers. A shareholder may change the
predesignated bank of record by providing the Fund with written, signature
guaranteed instructions. Redemption proceeds paid by wire transfer will be
transmitted to the shareholder's predesignated bank account on the next business
day after receipt of the shareholder's redemption request. Redemption proceeds
paid by electronic funds transfer will be electronically transmitted to the
shareholder's predesignated bank account on the second business day after
receipt of the shareholder's redemption request. There is no fee for wire or
electronic funds transfer of proceeds from the redemption of Fund shares.
Shareholders may encounter delays in redeeming shares purchased by check
(other than cashier's or certified checks) or electronic funds transfer if the
redemption request is made within 15 days after the date of purchase. In those
situations, the redemption check will be mailed within 15 days after the
transfer agent's receipt of the purchase instrument, provided that it has not
been dishonored or cancelled during that time. The foregoing policy is to
ensure that all payments for the shares being redeemed have been honored. In
addition to the foregoing restrictions, no redemption payment can be made for
shares which have been purchased by telephone order until full payment for the
shares has been received. In any event, valid redemption requests concerning
shares for which full payment has been made will be priced at the net asset
value next determined after receipt of the request.
(iv) REDEMPTION IN KIND. The Fund intends to redeem its shares only for
cash, although it retains the right to redeem its shares in kind under unusual
circumstances, in order to protect the interests of the remaining shareholders,
by the delivery of securities selected from its assets at its discretion. The
Fund is, however, governed by Rule 18f-1 under the Investment Company Act of
1940 pursuant to which the Fund is obligated to redeem shares solely in cash up
to the lesser of $250,000 or 1% of the net assets of the Fund during any 90-day
period for any one shareholder. Should redemptions by any shareholder during
any 90-day period exceed such limitation, the Fund will have the option of
redeeming the excess in cash or in kind. If shares are redeemed in kind, the
redeeming shareholder generally will incur brokerage costs in converting the
assets to cash.
(v) REDEMPTIONS BY THE FUND. As a means of reducing its expenses, the Fund
is authorized to redeem involuntarily all shares held in accounts with a value
of less than $1,000,000. Such redemptions will be permitted only when the
account is reduced below the minimum value by redemption, and not by declines in
per share net asset value. As a result, accounts established with the
applicable minimum investment might be subject to redemption after only a small
redemption has been made by the shareholder. At least 60 days' written notice
will be given to a shareholder before such an account is redeemed. During that
time,
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the shareholder may add sufficient funds to the account to meet or exceed the
minimum. If this condition is not met, the shares will be redeemed at the per
share net asset value next determined after the 60th day following the notice.
A check for the proceeds will be sent to the shareholder unless a share
certificate has been issued, in which case payment will be made upon surrender
of the certificate.
12. EXCHANGE PRIVILEGE
(i) EXCHANGES. By telephoning the Fund at 1-800-[_______], or writing to
the Fund, in care of DST at P.O. Box 419958, Kansas City, MO 64141, any
shareholder may exchange, without charge, any or all of his shares in the Fund,
subject to stated minimums, for shares of any of the publicly available Berger
Funds or Berger/BIAM Funds. Exchanges may be made only if the Berger Fund or
Berger/BIAM Fund into which a shareholder wishes to exchange shares is
registered in the shareholder's state of residence.
It is each investor's responsibility to obtain and read a prospectus of the
Berger Fund or Berger/BIAM Fund into which the investor is exchanging. By
giving exchange instructions, a shareholder will be deemed to have acknowledged
receipt of the prospectus for the Berger Fund or Berger/BIAM Fund being
purchased. Up to four exchanges out of the Fund are permitted during the
calendar year. This limit helps keep the Fund's net asset base stable and
reduces the Fund's administrative expenses. In times of extreme economic or
market conditions, exchanging Fund shares by telephone may be difficult. See
"Redemption of Fund Shares - Redemptions by Telephone" for procedures for
telephone transactions.
Redemptions of shares in connection with exchanges into or out of the Fund
are made at the net asset value per share next determined after the exchange
request is received. To receive a specific day's price, a letter or call must
be received before that day's close of the Exchange. Each exchange represents
the sale of shares from one fund and the purchase of shares in another, which
may produce a gain or loss for U.S. Federal income tax purposes.
All exchanges out of the Fund are subject to the minimum and subsequent
investment requirements of the fund into which shares are being exchanged.
Exchanges will be accepted only if the registration of the two accounts is
identical. Neither the Fund, the Berger Funds, the Berger/BIAM Funds, nor their
transfer agents or advisors assume responsibility for the authenticity of
exchange instructions communicated by telephone or in writing which are believed
to be genuine. See "Redemption of Fund Shares - Redemptions by Telephone" for
procedures for telephone transactions. All shareholders have Telephone
Transaction Privileges to authorize exchanges unless they specifically decline
this service on the account application or by writing to the Fund, c/o DST
Systems, Inc., P.O. Box 419958, Kansas City, MO 64141.
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13. PLANS AND PROGRAMS
The Fund offers several tax-qualified retirement plans for adoption by
individuals and employers. The Fund also offers both a profit-sharing plan and
a money purchase pension plan for employers and self-employed persons, an
Individual Retirement Account ("IRA") and a 403(b) Custodial Account.
In order to receive the necessary materials to create a profit-sharing or
money purchase pension plan account, an IRA account or a 403(b) Custodial
Account, please write to the Fund, c/o BBOI Worldwide, P.O. Box 5005, Denver, CO
80217, or call 1-800-[_________]. Trustees for existing 401(k) or other plans
interested in utilizing Fund shares as an investment or investment alternative
in their plans should contact the Fund at 1-800-[_________].
The Fund also offers a systematic withdrawal plan. Forms to open such an
account may be obtained by writing to the Fund, c/o DST Systems, Inc., P.O. Box
419958, Kansas City, MO 64141, or call 1-800-[____________].
14. INCOME DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAX TREATMENT
The Fund intends to declare dividends representing the Fund's net
investment income annually, normally in December. It is also the present policy
of the Fund to distribute annually all of its net realized capital gains.
Dividends declared and payable to shareholders of record on a specified date in
December will be deemed to have been received by shareholders on December 31 for
tax purposes if paid during January the following year.
The Fund is treated as a separate entity for tax purposes and intends to
elect and maintain qualification to be treated as a regulated investment company
under Subchapter M of the Internal Revenue Code of 1986, as amended. The Fund's
qualification as a regulated investment company will depend on the Portfolio
maintaining its status as a partnership for tax purposes. If the Fund qualifies
under Subchapter M and meets certain minimum distribution requirements, the Fund
generally will not be liable for U.S. Federal income tax on the amount of its
earnings that are timely distributed. If the Fund distributes annually less
than 98% of its income and gain, it may be subject to a nondeductible excise tax
equal to 4% of the shortfall.
All dividends and capital gains distributions paid by the Fund will be
automatically reinvested in shares of the Fund at the net asset value on the
ex-dividend date unless an investor specifically requests that either
dividends or distributions, or both, be paid in cash. The election to
receive dividends or distributions in cash or to reinvest them in Fund shares
may be changed by calling the Fund at 1-800-[_________] or by written request
to the Fund, c/o DST Systems, Inc., P.O. Box 419958, Kansas City, MO 64141,
and must be received at least ten days prior to the record date of any
dividend or capital gains distribution.
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The Fund will inform its shareholders of the amount and nature of such
income or gains resulting from their investment in the Fund. Dividends paid by
the Fund from net investment income and distributions from net short-term
capital gains in excess of any net long-term capital losses, whether received in
cash or reinvested, generally will be taxable as ordinary income. Distributions
received from the Fund designated as long-term capital gains (net of capital
losses), whether received in cash or reinvested, will be taxable as long-term
capital gains without regard to the length of time a shareholder has owned
shares in the Fund. Any loss on the redemption or other sale or exchange of the
Fund's shares held for six months or less will be treated as a long-term capital
loss to the extent of any long-term capital gain distribution received on the
shares. If a shareholder is exempt from U.S. Federal income tax, the
shareholder will not generally be taxed on amounts distributed by the Fund.
Under the Internal Revenue Code, gains recognized by the Portfolio upon a
disposition of assets contributed in-kind to it by the Fund will be specially
allocated to the Fund and not to other investors in the Portfolio to the extent
of the unrealized appreciation in those assets at the time of their transfer.
As a result, shareholders of the Fund may receive distributions of a greater
amount of gains than if the Portfolio had purchased those assets in the open
market upon commencement of Fund operations or in a transaction that did not
involve contributions of assets in-kind.
Investment income received by the Fund, directly or through the Portfolio,
from sources within foreign countries may be subject to foreign withholding and
other taxes withheld at the source. The U.S. has entered into tax treaties with
many foreign countries that, in some circumstances, may entitle the Fund or
Portfolio to a reduced rate of tax or exemption from tax on such income. It is
impossible to determine the effective rate of foreign tax in advance since the
amount of the Portfolio's assets to be invested within various countries will
fluctuate and the extent to which tax refunds will be recovered is uncertain.
If, directly or through the Portfolio, more than 50% in value of the Fund's
total assets at the close of its taxable year consists of securities of foreign
corporations, the Fund may elect to "pass-through" to its shareholders the
income taxes paid by the Fund to foreign governments during a year. Under this
election, each shareholder will be required to include the shareholder's pro
rata portion of these foreign taxes in gross income, but will be able to deduct
(as an itemized deduction for shareholders who itemize) or claim a foreign tax
credit for such amount (subject to various limitations). If the election is not
made, foreign taxes will be treated as an expense of the Fund.
At certain levels of taxable income, the Internal Revenue Code provides a
preferential tax rate for long-term capital gains. Long-term capital gains of
taxpayers other than corporations are taxed at a 28% maximum rate, whereas
ordinary income is taxed at a 39.6% maximum rate. Capital losses continue to be
deductible only against capital gains plus (in the case of taxpayers other than
corporations) $3,000 of ordinary income annually ($1,500 for married individuals
filing separately).
Some shareholders may be subject to 31% "backup withholding" on dividends,
capital gains distributions and redemption payments made by the Fund. Backup
withholding
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generally will apply to shareholders who fail to provide the Fund with their
correct taxpayer identification number or to make required certifications.
Backup withholding is not an additional tax. Any amounts withheld may be
credited against a shareholder's U.S. Federal income tax liability.
The foregoing is only a brief summary of the U.S. Federal income tax
considerations affecting the Fund and its shareholders. See "Income Dividends,
Capital Gains Distributions and Tax Treatment" in the Statement of Additional
Information for more information regarding taxation. Potential investors should
consult their tax advisors with specific reference to their own tax situation.
15. ADDITIONAL INFORMATION
The Trust is a Delaware business trust organized on May 31, 1996. The Fund
was established on May 31, 1996, as a series or fund under the Trust. Since the
Trust and the Fund were only recently organized, they have no prior operating
history, although the Fund calculates its performance taking into account the
prior performance of a trust fund whose assets were transferred into the
Portfolio as described under "Performance" below. As of the date of this
Prospectus, all of the outstanding shares of the Fund were held by Berger
Associates, which provided the seed capital necessary to establish the Trust.
The Trust is authorized to issue an unlimited number of shares of
beneficial interest in series. The Trust is also authorized to establish
multiple classes of shares representing differing interests in an existing or
new series. As of the date of this Prospectus, the series comprising the
Berger/BIAM International CORE Fund is one of three series established under the
Trust, although others may be added in the future. Shares of the Fund are fully
paid and nonassessable when issued. Each share has a par value of $.01. All
shares issued by the Fund participate equally in dividends and other
distributions by the Fund, and in the residual assets of the Fund in the event
of its liquidation.
Shareholders of the Berger/BIAM International CORE Fund and the other funds
or series of the Berger/BIAM Worldwide Funds Trust generally vote separately on
matters relating to those respective funds, although they vote together and with
the holders of any other series of the Trust issued in the future in the
election of trustees of the Trust and on all matters relating to the Trust as a
whole. Each full share of the Fund has one vote. Shares of the Fund have
noncumulative voting rights, which means that the holders of more than 50% of
the shares voting for the election of trustees can elect 100% of the trustees if
they choose to do so and, in such event, the holders of the remaining less than
50% of the shares voting for the election of trustees will not be able to elect
any person or persons as trustees. The Fund is not required to hold annual
shareholder meetings unless required by the Investment Company Act of 1940 or
other applicable law or unless called by the trustees.
If shareholders owning at least 10% of the outstanding shares of the
Berger/BIAM Worldwide Funds Trust so request, a special shareholders' meeting
will be held for the purpose of considering the removal of a trustee of the
Trust. Special meetings will be held for other purposes if the holders of at
least 25% of the outstanding shares of the
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Trust so request. Subject to certain limitations, the Trust will facilitate
appropriate communications by shareholders desiring to call a special meeting
for the purpose of considering the removal of a trustee.
The Fund invests all of its investable assets in the Portfolio, a series of
Worldwide Portfolios, which is also a Delaware business trust divided into
series. Investors in each series of Worldwide Portfolios will vote separately
or together in the same manner as shareholders of the Trust's series. For more
information on the Trust and Worldwide Portfolios, see "Additional Information"
in the Statement of Additional Information.
The Glass-Steagall Act prohibits a depository institution (such as a bank)
from underwriting or distributing most securities and from affiliating with
businesses engaged in certain similar activities. BIAM believes, based on
advice of its counsel, that it may perform the services for the Fund
contemplated by this Prospectus consistent with the Glass-Steagall Act and other
applicable banking laws and regulations. However, future changes in either
Federal or state statutes and regulations concerning the permissible activities
of banks and their affiliates, as well as future judicial or administrative
decisions or interpretations of present and future statutes and regulations,
might prevent BIAM from continuing to perform those services for the Fund.
State laws on this issue may differ from the interpretations of relevant Federal
law and banks and financial institutions may be required to register as dealers
pursuant to state securities law. If the circumstances described above should
change, the trustees of the Trust and Worldwide Portfolios would review the
relationships with BIAM and consider taking all actions appropriate under the
circumstances.
16. PERFORMANCE
From time to time in advertisements, the Fund may discuss its performance
ratings as published by recognized mutual fund statistical services, such as
Lipper Analytical Services, Inc., CDA Investment Technologies, Inc.,
Morningstar, Inc., or Value Line Investment Survey or by publications of general
interest such as THE WALL STREET JOURNAL, INVESTOR'S BUSINESS DAILY, BARRON'S,
FINANCIAL WORLD or KIPLINGER'S PERSONAL FINANCE MAGAZINE. In addition, the Fund
may compare its performance to that of recognized broad-based securities market
indices, including the Morgan Stanley Capital International EAFE (Europe,
Australasia, Far East) Index, the Dow Jones World Index, the Standard & Poor's
500 Stock Index, the Nasdaq Composite Index, or more narrowly-based indices
which reflect the market sectors in which the Fund invests.
The total return of the Fund is calculated for any specified period of time
by assuming the purchase of shares of the Fund at the net asset value at the
beginning of the period. Each dividend or other distribution paid by the Fund
is assumed to have been reinvested at the net asset value on the reinvestment
date. The total number of shares then owned as a result of this process is
valued at the net asset value at the end of the period. The percentage increase
is determined by subtracting the initial value of the investment from the ending
value and dividing the remainder by the initial value.
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The Fund's total return reflects the Fund's performance over a stated
period of time. An average annual total return reflects the hypothetical
annually compounded return that would have produced the same total return if the
Fund's performance had been constant over the entire period. Total return
figures are based on the overall change in value of a hypothetical investment in
the Fund. Because average annual total returns for more than one year tend to
smooth out variations in the Fund's return, investors should recognize that such
figures are not the same as actual year-by-year results.
Any performance figures for the Fund are based upon historical results and
do not assure future performance. The investment return and principal value of
an investment will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost.
The Portfolio commenced operations upon the transfer to the Portfolio of
assets held in a pooled trust (the "Pool") maintained by First NH Investment
Services Corp., for which BIAM has provided day-to-day portfolio management as
sub-advisor since the inception of the Pool. BIAM's bank holding company parent
indirectly owns a 23.5% interest in the parent of First NH Investment Services
Corp. The Pool had substantially the same investment objective, policies and
limitations of the Fund and the Portfolio. Assets from the Pool were
transferred to the Fund 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 (in which the Fund invests
all of its investable assets) 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 Berger Associates.
The Pool was not a registered investment company since it was exempt from
registration under the Investment Company Act of 1940 (the "1940 Act"). Since,
in a practical sense, the Pool constitutes the "predecessor" of the Portfolio,
the Fund calculates its performance for periods commencing prior to the transfer
of the Pool's assets to the Portfolio by including the Pool's total return,
adjusted to reflect the deduction of fees and expenses applicable to the Fund as
stated in the Fee Table above in this Prospectus (that is, adjusted to reflect
estimated expenses, including the Fund's pro rata share of the aggregate annual
operating expenses, net of fee waivers, of the Portfolio in which all of the
investable assets of the Fund are invested).
The performance data set forth below includes the performance of the Pool
for periods before the Fund's and the Portfolio's registration statements became
effective. As noted above, the Pool was not registered under the 1940 Act and
thus was not subject to certain investment restrictions that are imposed by the
1940 Act. If the Pool had been registered under the 1940 Act, the Pool's
performance might have been adversely affected.
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AVERAGE ANNUAL TOTAL RETURN
FOR PERIODS ENDED JUNE 30, 1996
BERGER/BIAM EAFE INDEX(2)
INTERNATIONAL
CORE FUND(1)
1-YEAR 16.74% 13.62%
3-YEAR 12.36% 10.76%
5-YEAR 13.93% 10.33%
SINCE INCEPTION(3) 12.28% 4.26%
1 Total return for the Fund has been adjusted to reflect estimated expenses of
the Fund, including the Fund's pro rata share of the aggregate annual operating
expenses, net of fee waivers, of the Portfolio in which all of the investable
assets of the Fund are invested.
2 Source: Morgan Stanley Capital International (MSCI). The MSCI EAFE Index is
a market capitalization weighted index composed of companies representative of
the market structure of 30 developed market countries in Europe, Australasia and
the Far East.
3 Covers the period since July 31, 1989.
All of the foregoing performance data were calculated in accordance with
methods prescribed by the Securities and Exchange Commission which are discussed
in more detail under the heading "Performance Information" in the Statement of
Additional Information.
Shareholders with questions should write to the Fund, c/o BBOI Worldwide,
P.O. Box 5005, Denver, CO 80217, or call 1-303-329-0200 or 1-800-[__________].
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SUBJECT TO COMPLETION
PRELIMINARY STATEMENT OF ADDITIONAL INFORMATION
DATED AUGUST 19, 1996
BERGER/BIAM INTERNATIONAL FUND
STATEMENT OF ADDITIONAL INFORMATION
SHAREHOLDER SERVICES: 1-800-551-5849
This Statement of Additional Information about the Berger/BIAM
International Fund (the "Fund"), a series of the Berger/BIAM Worldwide Funds
Trust (the "Trust"), is not a prospectus. It should be read in conjunction with
the Prospectus describing the Fund, dated ______________, 1996, which may be
obtained by writing the Fund at P.O. Box 5005, Denver, Colorado 80217, or
calling 1-800-333-1001. The Fund is a no-load mutual fund.
The investment objective of the Fund is long-term capital appreciation.
The Fund seeks to achieve this objective by investing all of its investable
assets in the Berger/BIAM International Portfolio (the "Portfolio") which, in
turn, invests primarily in common stocks of well established companies located
outside the United States. A company will be considered 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. The Portfolio intends
to diversify its holdings among several countries and to have, under normal
market conditions, at least 65% of the Portfolio's total assets invested in the
securities of companies located in at least five countries, not including the
United States.
The Fund is an open-end management investment company organized as a
diversified series of the Trust. UNLIKE MANY OTHER MUTUAL FUNDS WHICH DIRECTLY
ACQUIRE AND MANAGE THEIR OWN PORTFOLIOS OF SECURITIES, THE FUND SEEKS ITS
INVESTMENT OBJECTIVE BY INVESTING ALL OF ITS INVESTABLE ASSETS IN THE PORTFOLIO,
AS DESCRIBED ABOVE. Accordingly, the investment performance of the Fund will
derive from the investment performance of the Portfolio. The Portfolio is an
open-end management investment company and a diversified series of a separate
trust known as the Berger/BIAM Worldwide Portfolios Trust ("Worldwide
Portfolios"). The Portfolio's investment objective and policies are identical
to those of the Fund. The Portfolio is advised by BBOI Worldwide LLC ("BBOI" or
the "Advisor"), which has delegated daily portfolio management of the Portfolio
to Bank of Ireland Asset Management (U.S.) Limited ("BIAM" or the "Sub-
Advisor").
_____________________, 1996
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This Statement of Additional Information does not constitute a
prospectus.
<PAGE>
TABLE OF CONTENTS
&
CROSS-REFERENCES TO PROSPECTUS
CROSS-REFERENCES TO
RELATED DISCLOSURES
TABLE OF CONTENTS IN PROSPECTUS
Introduction Section 2
1. Investment Policies Section 2, 3, 4
2. Investment Restrictions Section 3
3. Management of the Fund Section 6
4. Investment Advisor and Sub-Advisor Section 6
5. Expenses of the Fund Section 6, 7
6. Brokerage Policy Section 6, 7
7. How to Purchase Shares in Section 9
the Fund
8. How the Net Asset Value is Section 10
Determined
9. Income Dividends, Capital Gains Section 15
Distributions and Tax Treatment
10. Suspension of Redemption Rights Section 12
11. Tax-Sheltered Retirement Plans Section 14
12. Special Purchase and Exchange Plans Section 13
13. Performance Information Section 17
14. Additional Information Section 16
Financial Statements
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INTRODUCTION
The Berger/BIAM International Fund is a mutual fund, or open-end,
diversified management investment company. The investment objective of the Fund
is long-term capital appreciation. This is also the investment objective of the
Portfolio in which the Fund invests all of its investable assets. Current
income is not an investment objective of the Fund and any income produced will
be only of secondary importance as a by-product of the investment selection
process used to achieve the Fund's objective.
1. INVESTMENT POLICIES
The Prospectus discusses the investment objective of the Fund and the
Portfolio and the policies to be employed to achieve that objective. This
section contains supplemental information concerning the types of securities and
other instruments in which the Portfolio may invest, the investment policies and
portfolio strategies that the Portfolio may utilize and certain risks attendant
to those investments, policies and strategies.
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
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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
(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 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.
The use of repurchase agreements involves certain risks. For example,
if the other party to the agreement defaults on its obligation to repurchase the
underlying security at a time
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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.
Finally, 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. Although these risks are acknowledged, it is
expected that they can be controlled through careful monitoring procedures.
UNSEASONED ISSUERS. The Portfolio may invest to a limited degree in
securities of unseasoned issuers. Unseasoned issuers are companies with a
record of less than three years' continuous operation, even including the
operations of any predecessors and parents. Unseasoned issuers 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 growth
companies. In addition, many unseasoned issuers may also be small companies and
involve the risks and price volatility associated with smaller companies. The
Portfolio may invest up to 5% of its total assets in securities of unseasoned
issuers.
PASSIVE FOREIGN INVESTMENT COMPANIES (PFICS). The Portfolio may
purchase the securities of certain foreign investment funds or trusts considered
Passive Foreign Investment Companies (PFICs) under U.S. tax laws. In addition
to bearing their proportionate share of the Portfolio's expenses (management
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<PAGE>
fees and operating expenses), shareholders will also indirectly bear similar
expenses of such PFIC. PFIC investments also may be subject to less favorable
U.S. tax treatment, as discussed in Section 9 below.
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 on a comparable security
available 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.
LENDING OF SECURITIES. As discussed in the Prospectus, 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
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<PAGE>
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 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.
HEDGING TRANSACTIONS. As described in the Prospectus, the Portfolio
is authorized to make limited commitments in certain 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. A hedging transaction may partially
protect the Portfolio from a decline in the value of a particular security or
its portfolio generally, although 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.
Any utilization of forwards or any other hedging technique (investing,
for example, in futures or options) is
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<PAGE>
subject to policies and procedures which may be established and changed by the
trustees from time to time without shareholder vote. Currently, the Portfolio
is authorized to invest only in forward contracts for hedging purposes and is
not permitted to invest in futures or options. If the trustees ever authorize
the 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 the Prospectus.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS. A forward contract is an
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 enter into are forward foreign currency exchange
contracts and that it may enter into 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). 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
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<PAGE>
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 ("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
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<PAGE>
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.
PORTFOLIO TURNOVER. Although the annual portfolio turnover rate of
the Portfolio will vary, it is normally expected to range from 25% to 75%. 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 shares of the Portfolio due to economic, market or
other factors that are not within the control of management.
2. INVESTMENT RESTRICTIONS
The Fund has adopted the investment policy that it may,
notwithstanding any other fundamental or non-fundamental investment policy or
restriction, invest all of its investable assets in the securities of another
open-end investment company or series thereof with substantially the same
investment objective, policies and limitations as the Fund.
All other fundamental and non-fundamental investment policies and
restrictions of the Fund and the Portfolio are identical. Therefore, although
the following investment restrictions refer to the Portfolio and the trustees of
Worldwide Portfolios, they apply equally to the Fund and the trustees of the
Trust.
The Portfolio has adopted certain fundamental restrictions on its
investments and other activities, and none of these restrictions may be changed
without the approval of (i) 67% or more of the voting securities of the
Portfolio present at a meeting of shareholders thereof if the holders of more
than 50% of the outstanding voting securities are present or represented by
proxy, or (ii) more than 50% of the outstanding voting securities of the
Portfolio. Whenever the Fund is requested to vote on a change in the investment
restrictions of the Portfolio, the Fund will hold a meeting of its shareholders
and will cast its votes as instructed by the shareholders.
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<PAGE>
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.
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
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<PAGE>
be changed by the trustees without a shareholder vote. 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 of any company which,
including its predecessors and parents, has a record of less than three years'
continuous operation, if such purchase would cause the Portfolio's investments
in all such companies taken at cost to exceed 5% of the value of the Portfolio's
total assets.
3. 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.
4. 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).
5. The Portfolio may not invest in companies for the purposes of
exercising control of management.
6. 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.
7. 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.
8. 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.
9. The Portfolio may not purchase or sell any interest in an oil,
gas or mineral development or exploration
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program, including investments in oil, gas or other mineral leases, rights or
royalty contracts (except that the Portfolio may invest in the securities of
issuers engaged in the foregoing activities).
10. The Portfolio may not invest more than 5% of its net assets in
warrants. Included in that amount, but not to exceed 2% of net assets, are
warrants whose underlying securities are not traded on principal domestic or
foreign exchanges. Warrants acquired by the Portfolio in units or attached to
securities are not subject to these limits.
The Trust has undertaken to the State of Ohio that the Fund will
prohibit the purchase or retention by the Fund of the securities of any issuer
if the officers, directors or trustees of the Fund, its advisors, or managers
owning beneficially more than 1/2 of 1% of the securities of an issuer together
own beneficially more than 5% of the securities of that issuer.
3. MANAGEMENT OF THE FUND
The trustees and executive officers of the Trust are listed below,
together with information which includes their principal occupations during the
past five years and other principal business affiliations. The trustees and
executive officers of the Trust also serve in the same capacities as trustees
and officers of Worldwide Portfolios.
* GERARD M. LAVIN, 210 University Boulevard, Suite 900, Denver, CO 80206, age
53. President and a trustee of Berger/BIAM Worldwide Portfolios Trust
and Berger/BIAM Worldwide Funds Trust since their inception in May 1996.
President and a trustee of Berger Institutional Products Trust since its
inception in October 1995. President and a director since April 1995 of
Berger Associates, Inc. A Vice President of DST Systems, Inc. (data
processing) since July 1995. Director of First of Michigan Capital Corp.
(holding company) and First of Michigan Corp. (broker-dealer) since
March 1995. Formerly President and Chief Executive Officer of Investors
Fiduciary Trust Company (banking) from February 1992 to March 1995 and
Chief Operating Officer of SUNAMERICA Asset Management Co. (money
management) from January 1990 to February 1992.
DENNIS E. BALDWIN, 3481 South Race Street, Englewood, CO 80110, age 67.
President, Baldwin Financial Counseling. Formerly (1978-1990), Vice
President and Denver Office Manager of Merrill Lynch Capital Markets.
Director of Berger 100 Fund and Berger Growth and Income Fund. Trustee
of Berger Investment Portfolio Trust, Berger Institutional Products
Trust, Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide
Portfolios Trust.
* WILLIAM M. B. BERGER, 210 University Boulevard, Suite 900, Denver, CO
80206, age 70. Director and, formerly,
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President (1974-1994) of Berger 100 Fund and Berger Growth and Income
Fund. Trustee of Berger Investment Portfolio Trust since its inception
in August 1993 (Chairman of the Trustees through November 1994).
Trustee of Berger Institutional Products Trust since its inception in
October 1995. Trustee of Berger/BIAM Worldwide Funds Trust and
Berger/BIAM Worldwide Portfolios Trust since their inception in May
1996. Chairman (since 1994) and a Director (since 1973) and, formerly,
President (1973-1994) of Berger Associates, Inc.
LOUIS R. BINDNER, 1075 South Fox, Denver, CO 80223, age 70. President,
Climate Engineering, Inc. (building environmental systems). Director of
Berger 100 Fund and Berger Growth and Income Fund. Trustee of Berger
Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios
Trust.
KATHERINE A. CATTANACH, 384 South Ogden, Denver, CO 80209, age 51.
President, Cattanach & Associates, Ltd. (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 100 Fund and Berger Growth and Income Fund. Trustee of Berger
Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios
Trust.
LUCY BLACK CREIGHTON, 1917 Leyden Street, Denver, CO 80220, age 68.
Associate, University College, University of Denver. Formerly,
President of the Colorado State Board of Land Commissioners (1989-1995),
and Vice President and Economist (1983-1988) and Consulting Economist
(1989) for First Interstate Bank of Denver. Ph.D. in Economics (Harvard
University). Director of Berger 100 Fund and Berger Growth and Income
Fund. Trustee of Berger Investment Portfolio Trust, Berger
Institutional Products Trust, Berger/BIAM Worldwide Funds Trust and
Berger/BIAM Worldwide Portfolios Trust.
PAUL R. KNAPP, 33 North LaSalle Street, Suite 1920, Chicago, IL 60602, age
50. Since 1991, Director, Chairman, President and Chief Executive
Officer of Catalyst Institute (international public policy research
organization focused primarily on financial markets and institutions)
and Catalyst Consulting (international financial institutions business
consulting firm). Formerly (1988-1991), Director, President and Chief
Executive Officer of Kessler Asher Group (brokerage, clearing and
trading firm). Director of Berger 100 Fund and Berger Growth and Income
Fund. Trustee of Berger Investment Portfolio Trust, Berger
Institutional Products Trust, Berger/BIAM Worldwide Funds Trust and
Berger/BIAM Worldwide Portfolios Trust.
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HARRY T. LEWIS, JR., 370 17th Street, Suite 3560, Denver, CO 80202, age 63.
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 Berger 100 Fund
and Berger Growth and Income Fund. Trustee of Berger Investment
Portfolio Trust, Berger Institutional Products Trust, Berger/BIAM
Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
MICHAEL OWEN, 412 Reid Hall, Montana State University, Bozeman, MT 59717,
age 59. Since 1994, Dean, and since 1989, a member of the Finance
faculty, of the College of Business, Montana State University. Self-
employed as a financial and management consultant, and in real estate
development. Formerly (1976-1989), Chairman and Chief Executive Officer
of Royal Gold, Inc. (mining). Chairman of the Board of Berger 100 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 and Berger/BIAM Worldwide Portfolios
Trust.
WILLIAM SINCLAIRE, 3049 S. Perry Park Road, Sedalia, CO 80135, age 67.
President, Sinclaire Cattle Co., and private investor. Director of
Berger 100 Fund and Berger Growth and Income Fund. Trustee of Berger
Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios
Trust.
* CRAIG D. CLOYED, 210 University Boulevard, Suite 900, Denver, CO 80206, age
50. Vice President of Berger/BIAM Worldwide Funds Trust and Berger/BIAM
Worldwide Portfolios Trust since their inception in May 1996. Also,
Vice President and Chief Marketing Officer of Berger Associates, Inc.,
since August 1995, and President, CEO and a director of Berger
Distributors, Inc., since its inception in May 1996. Formerly
(September 1989 to August 1995), Senior Vice President of INVESCO Funds
Group (mutual funds).
* KEVIN R. FAY, 210 University Boulevard, Suite 900, Denver, CO 80206, age
40. Vice President, Secretary and Treasurer of Berger 100 Fund and
Berger Growth and Income Fund since October 1991, of Berger Investment
Portfolio Trust since its inception in August 1993, of Berger
Institutional Products Trust since its inception in October 1995 and of
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios
Trust since their inception in May 1996. Also, Vice President-Finance
and Administration, Secretary and Treasurer of Berger Associates, Inc.,
since September 1991, and a director of Berger Distributors, Inc., since
its inception in May 1996. Formerly, Financial Consultant (registered
representative) with Neidiger Tucker Bruner, Inc. (broker-dealer)
(October 1989 to September 1991) and
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Financial Consultant with Merrill Lynch, Pierce, Fenner & Smith, Inc.
(October 1985 to October 1989).
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* Interested person (as defined in the Investment Company Act of 1940) of the
Fund and of the Portfolio's Advisor or Sub-Advisor.
TRUSTEE COMPENSATION
Officers of the Trust receive no compensation from the Trust.
However, trustees of the Trust who are not interested persons of the Portfolio's
Advisor or Sub-Advisor, who are also trustees of Worldwide Portfolios, are
compensated for their services according to a fee schedule, allocated among the
Berger and Berger/BIAM Funds, which includes an annual fee component and a per
meeting fee component. Neither the officers of the Trust nor the trustees
receive any form of pension or retirement benefit compensation from the Trust.
Set forth below is information regarding compensation (including
reimbursement of expenses) estimated to be paid or accrued during the current
fiscal year ended July 31, 1997, for each trustee of the Trust and of the other
funds in the Berger Fund and Berger/BIAM Fund complex.
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NAME AND POSITION WITH AGGREGATE AGGREGATE
BERGER AND BERGER/BIAM COMPENSATION COMPENSATION
FUNDS FROM FROM
THE FUND(1) ALL BERGER
AND
BERGER/BIAM
FUNDS(2)
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Dennis E. Baldwin(3) $ 830 $41,083
- --------------------------------------------------------------------------------
William M.B. Berger(3),(5) $ 0 $ 0
- --------------------------------------------------------------------------------
Louis R. Bindner(3) $ 706 $34,965
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Katherine A. Cattanach(3) $ 801 $39,657
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Lucy Black Creighton(3) $ 679 $33,602
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Paul R. Knapp(3) $ 907 $44,919
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Gerard M. Lavin(4),(5) $ 0 $ 0
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Harry T. Lewis(3) $ 775 $38,357
- --------------------------------------------------------------------------------
Michael Owen(3) $1,025 $50,720
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William Sinclaire(3) $ 681 $33,697
- --------------------------------------------------------------------------------
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(1) Comprised of the portion of the estimated trustee compensation to be paid
by Worldwide Portfolios to its trustees and allocated to the Fund.
(2) Consisting of Berger 100 Fund, Berger Growth and Income Fund, Berger
Investment Portfolio Trust, Berger Institutional Products Trust, Berger/BIAM
Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
(3) Director of Berger 100 Fund and Berger Growth and Income Fund. Trustee of
Berger Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
(4) Trustee of Berger Institutional Products Trust, Berger/BIAM Worldwide Funds
Trust and Berger/BIAM Worldwide Portfolios Trust.
(5) Interested person of the Berger/BIAM Worldwide Funds Trust and/or the
Portfolio's Advisor or Sub-Advisor.
Trustees may elect to defer receipt of all or a portion of their fees
pursuant to a fee deferral plan adopted by the Berger/BIAM Worldwide Portfolios
Trust. Under the plan, deferred fees are credited to an account and adjusted
thereafter to reflect the investment experience of whichever of the Berger or
Berger/BIAM 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
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fees under the plan is a general obligation of Worldwide Portfolios.
As of the date of this Statement of Additional Information, the
officers and trustees of the Trust as a group owned of record or beneficially no
shares of the Berger/BIAM International Fund.
4. INVESTMENT ADVISOR AND SUB-ADVISOR
INVESTMENT ADVISOR
The investment advisor to the Portfolio is BBOI Worldwide LLC (the
"Advisor" or "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 limited liability company formed in 1996. Since the
Advisor was only recently formed, it has no prior experience as an investment
advisor. However, Berger Associates, Inc. ("Berger Associates"), which owns
100% of the Advisor, has been in the investment advisory business for over 20
years. Kansas City Southern Industries, Inc. ("KCSI") owns approximately 80% of
the outstanding shares of Berger Associates. 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. Also, see in the Prospectus under "Pending Sale of Interest in
Advisor" for more information concerning ownership of the Advisor.
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 (the "Sub-Advisor" or "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 2 Greenwich
Plaza, 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.
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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 furnishes 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 Fund bears a pro rata
portion of the fee paid by the Portfolio to the Advisor.
Until at least April 30, 1998, the Advisor has agreed voluntarily to
waive the investment advisory fee paid by the Portfolio under the Investment
Advisory Agreement to the extent that the Portfolio's normal 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.
Any reduction in the advisory fee paid by the Portfolio will also reduce the pro
rata share of the advisory fee borne indirectly by the Fund.
The Investment Advisory Agreement will continue in effect until April
1998, and thereafter from year to year if such continuation is specifically
approved at least annually by the trustees or by vote of a majority of the
outstanding shares of the 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 will continue in effect until April 1998,
and thereafter from year to year if such
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continuation is specifically approved at least annually by the trustees or by
vote of a majority of the outstanding shares 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 investments 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. 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 Associates, 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 Associates, permits its covered persons to purchase and
sell securities for their own accounts in accordance with provisions governing
personal investing. The Code requires all covered persons to conduct their
personal securities transactions in a manner which does not operate adversely to
the interests of the Fund or the Portfolio or the Advisor's other advisory
clients. Board members and officers of the Advisor (including those who also
serve as trustees of the Trust or of Worldwide Portfolios), investment
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<PAGE>
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 Code. Requests for
authority to trade will be denied pre-clearance when, among other reasons, the
proposed personal transaction would be contrary to the provisions of the Code 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 Fund or 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 Advisor's Code. Those covered persons (as well
as board members, officers, employees and other access persons of the Advisor
covered by an approved Code of Ethics of an affiliated investment advisor) also
may be required under certain circumstances to forfeit their profits made from
personal trading. The Code is administered by the Advisor and the provisions of
the Code 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
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 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.
5. EXPENSES OF THE FUND
The Fund is allocated and bears indirectly its pro rata share of the
aggregate annual operating expenses of the Portfolio, since all of the
investable assets of the Fund are invested in 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
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<PAGE>
Independent Trustees; 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,
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; the fees payable to the Advisor under the Investment
Advisory Agreement; and such other non-recurring and extraordinary items as may
arise from time to time.
Until at least April 30, 1998, the Advisor has agreed voluntarily to
waive the investment advisory fee paid by the Portfolio under the Investment
Advisory Agreement to the extent that the Portfolio's normal 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.
Any reduction in the advisory fee paid by the Portfolio will also reduce the pro
rata share of the advisory fee borne indirectly by the Fund.
Expenses of the Fund include, among others, its pro rata share of the
expenses of the Trust, such as: expenses of registering the Trust with
securities authorities; expenses of meetings of the shareholders of the Trust;
and legal fees. Expenses of the Fund also include, among others, registration
and filing fees incurred in registering shares of the Fund with securities
authorities; 12b-1 fees; taxes imposed on the Fund; the fee payable to the
Advisor under the Administrative Services Agreement; and such other non-
recurring and extraordinary items as may arise from time to time.
SERVICE ARRANGEMENTS FOR THE FUND
Under the Administrative Services Agreement with the Fund, the Advisor
serves as the administrator of the Fund. In this capacity, it is responsible
for administering and managing all aspects of the Fund's day-to-day operations,
subject to the oversight of the trustees of the Trust. The Advisor is
responsible, at its expense, for furnishing (or procuring other parties to
furnish) all administrative services reasonably necessary for the operation of
the Fund, including recordkeeping and pricing services, custodian services,
transfer agency and dividend disbursing services, tax and audit services,
insurance, printing and mailing to shareholders of prospectuses and other
required communications,
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<PAGE>
and certain other administrative and recordkeeping services, such as
coordinating matters relating to the operations of the Fund, monitoring the
Fund's status as a "regulated investment company" under the Internal Revenue
Code, coordinating registration of sufficient Fund shares under federal and
state securities laws, arranging for and supervising the preparation of
registration statements, tax returns, proxy materials, financial statements and
reports for filing with regulatory authorities and distribution to shareholders
of the Fund. Under the Administrative Services Agreement, the Fund pays the
Advisor a fee at an annual rate equal to the lesser of (i) 0.45% of its average
daily net assets, or (ii) the Advisor's annual cost to provide or procure these
services (including the fees of any services providers whose services are
procured by the Advisor), plus an additional 0.02% of the Fund's average daily
net assets. The trustees of the Trust regularly review amounts paid to and
expenditures incurred by the Advisor pursuant to the Administrative Services
Agreement. In addition, in the event that the Advisor's duties under the
Administrative Services Agreement are delegated to another party, the Advisor
may take into account, in calculating the cost of such services, only the costs
incurred by such other party in discharging the delegated duties.
Arrangements may be entered into by the Advisor or its affiliates with
certain organizations (broker-dealers, recordkeepers and administrators) to
provide subtransfer agency, recordkeeping, shareholder communications,
subaccounting and/or other services to investors purchasing shares of the Fund
through investment programs or pension plans established or serviced by those
organizations. The Advisor or its affiliates may pay fees to these
organizations for their services. For purposes of determining the Advisor's
cost of providing or procuring transfer agency, dividend disbursing or other
services under the Administrative Services Agreement, the Advisor may take into
account only the fees that otherwise would be paid for by the Advisor if all the
investors who own Fund shares through the organization were instead direct
registered record holders of shares in the Fund.
Under a Sub-Administration Agreement between the Advisor and Berger
Associates, Berger Associates has been delegated the responsibility to perform
certain of the administrative and recordkeeping services required under the
Administrative Services Agreement and to procure, at the Advisor's expense,
third parties to provide the services not provided by Berger Associates. Under
the Sub-Administration Agreement, Berger Associates is paid a fee by the Advisor
of 0.25% of the Fund's average daily net assets for its services. During
certain periods, Berger Associates may voluntarily waive all or a portion of its
fee from the Advisor, which will not affect the fee paid by the Fund to the
Advisor under the Administrative Services Agreement.
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<PAGE>
Investors Fiduciary Trust Company ("IFTC"), 127 W. 10th Street, Kansas City, MO
64105, has been appointed to provide recordkeeping and pricing services to the
Fund, including calculating the daily net asset value of the Fund, and to
perform certain accounting and recordkeeping functions that it requires. In
addition, IFTC has been appointed to serve as the Fund's custodian, transfer
agent and dividend disbursing agent. IFTC has engaged DST Systems, Inc.
("DST"), P.O. Box 419958, Kansas City, MO 64141, as sub-transfer agent to
provide transfer agency and dividend disbursing services for the Fund. The fees
of Berger Associates, IFTC and DST are all paid by the Advisor. Approximately
40% of the outstanding shares of DST are owned by KCSI, which also owns
approximately 80% of the outstanding shares of Berger Associates.
SERVICE ARRANGEMENTS FOR THE PORTFOLIO
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 preparing investor communications, which have been
delegated to Berger Associates as part of the Sub-Administration Agreement
discussed above. 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"), P.O. Box 351,
Boston, MA 02101, 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.
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.
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DISTRIBUTOR
The distributor (principal underwriter) of the Fund's shares is First
Fund Distributors, Inc. (the "Distributor"), 4455 East Camelback Road, Suite
261-E, Phoenix, AZ 85018. The Distributor is compensated and reimbursed for its
costs in distributing Fund shares by Berger Associates.
The Fund has adopted a Rule 12b-1 plan (the "Plan") pursuant to
Rule 12b-1 under the Investment Company Act of 1940, which provides for the
payment to Berger Associates of a 12b-1 fee of 0.25% per annum of the Fund's
average daily net assets to finance activities primarily intended to result in
the sale of Fund shares. The expenses paid by Berger Associates may include
payments made to the Fund's Distributor in connection with the distribution of
the Fund's shares, the costs of preparing, printing and mailing prospectuses to
other than existing shareholders, as well as promotional expenses directed at
increasing the sale of Fund shares. The Rule 12b-1 Plan for the Fund came into
effect at the inception of the Fund. A further discussion of the Plan is
contained in Section 8 of the Prospectus.
6. BROKERAGE POLICY
Although the Portfolio retains full control over its own investment
policies, the Sub-Advisor is authorized to place the portfolio transactions of
the Portfolio. The Sub-Advisor is required to report on the placement of
brokerage business to the trustees of Worldwide Portfolios every quarter,
indicating the brokers with whom portfolio business was placed and the basis for
such placement.
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.
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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 research services would typically
consist of studies made by investment analysts or economists relating either to
the past record of and future outlook for companies and the industries in which
they operate, or to national and worldwide economic conditions, monetary
conditions and trends in investors' sentiment, and the relationship of these
factors to the securities market. In addition, such analysts may be available
for regular consultation so that the Sub-Advisor may be apprised of current
developments in the above-mentioned factors.
The research services received 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.
The 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 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 research services from brokers.
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.
7. HOW TO PURCHASE SHARES IN THE FUND
Minimum Initial Investment $2,000.00
Minimum Subsequent Investment $ 50.00
To purchase shares in the Fund, simply complete the application form
enclosed with the Prospectus. Then mail it with a check payable to "Berger
Funds" to the Fund in care of DST Systems, Inc., the Fund's sub-transfer agent,
as follows:
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Berger Funds
c/o DST Systems, Inc.
P.O. Box 419958
Kansas City, MO 64141
If a shareholder is adding to an existing account, shares may also be
purchased by placing an order by telephone call to the Fund at 1-800-551-5849 or
via personal computer through online service providers or other online access
points approved by the Fund, and remitting payment to DST Systems, Inc. In
order to make sure that payment for telephone purchases is received on time,
shareholders are encouraged to remit payment by wire or electronic funds
transfer, or by overnight delivery.
In addition, Fund shares may be purchased through certain broker-
dealers that have established mutual fund programs and certain other
organizations connected with pension and retirement plans. These broker-dealers
and other organizations may charge investors a transaction or other fee for
their services, may require different minimum initial and subsequent investments
than the Fund and may impose other charges or restrictions different from those
applicable to shareholders who invest in the Fund directly. Fees charged by
these organizations will have the effect of reducing a shareholder's total
return on an investment in Fund shares. No such charge will be paid by an
investor who purchases the Fund shares directly from the Fund as described
above.
8. HOW THE NET ASSET VALUE IS DETERMINED
The net asset value of the Fund is determined once daily, at the close
of the regular trading session of the New York Stock Exchange (the "Exchange")
(normally 4:00 p.m., New York time, Monday through Friday) each day that the
Exchange is open. The Exchange is closed and the net asset value of the Fund is
not determined on weekends and on New Year's Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day
each year. The per share net asset value of the Fund is determined by dividing
the total value of its assets, less liabilities, by the total number of shares
outstanding. Since the Fund invests all of its investable assets in the
Portfolio, the value of the Fund's investable assets will be equal to the value
of its beneficial interest in the Portfolio.
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
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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 are valued at fair values
determined in good faith pursuant to consistently applied procedures established
by the trustees.
Generally, trading in foreign securities markets is substantially
completed each day at various times prior to the close of the Exchange. The
values of foreign securities used in computing the net asset value of the shares
of 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 will be valued at
their fair market 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 Fund's
net asset value is not calculated. As a result, the net asset value of the Fund
may be significantly affected by such trading on days when shareholders cannot
purchase or redeem shares of the Fund.
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9. INCOME DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAX TREATMENT
TAX STATUS OF THE FUND AND THE PORTFOLIO
The Fund intends to meet the requirements of Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code") and to distribute to its
investors all or substantially all of its taxable income as defined in the Code.
If the Fund meets the Subchapter M requirements, it generally is not liable for
U.S. Federal income taxes to the extent its earnings are timely distributed.
Qualification as a regulated investment company ("RIC") under the Code does not,
however, involve any federal supervision of management or of the investment
practices or policies of the Fund. If the Fund distributes annually less than
98% of its income and gain, it may be subject to a nondeductible excise tax
equal to 4% of the shortfall.
The Trust anticipates that (1) the Portfolio will be treated for U.S.
Federal income tax purposes as a partnership, and (2) for purposes of
determining whether the Fund satisfies the income and diversification
requirements to maintain its status as a RIC, the Fund, as an investor in the
Portfolio, will be deemed to own a proportionate 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 has advised the Fund that it intends to conduct
its operations so as to enable its investors, including the Fund, to satisfy
those requirements.
TAXATION OF FUND DISTRIBUTIONS
Advice as to the tax status of each year's dividends and distributions
will be mailed annually to the shareholders of the Fund. Dividends paid by the
Fund from net investment income and distributions from the Fund's net short-term
capital gains in excess of any net long-term capital losses, whether received in
cash or reinvested, generally will be taxable as ordinary income. Distributions
received from the Fund designated as long-term capital gains (net of capital
losses), whether received in cash or reinvested, will be taxable as long-term
capital gains without regard to the length of time a shareholder has owned
shares in the Fund. Any loss on the redemption or other sale or exchange of the
Fund's shares held for six months or less will be treated as a long-term capital
loss to the extent of any long-term capital gain distribution received on the
shares. A portion of the dividends (but not capital gains distributions) paid
by the Fund may be eligible for the dividends received deduction for corporate
shareholders to the extent that the Fund's income consists of dividends paid by
United States corporations. If a shareholder is exempt from U.S. Federal income
tax, the shareholder will not generally be taxed on amounts distributed by the
Fund.
If the amount of the Fund's distributions for a taxable year exceeds
the Fund's tax earnings and profits available for
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distribution, all or portion or the distributions may be treated as a return of
capital or as capital gains. In the event a distribution is treated as a return
of capital, the shareholder's basis in his or her Fund shares will be reduced to
the extent the distribution is so treated.
At certain levels of taxable income, the Code provides a preferential
tax rate for long-term capital gains. Long-term capital gains of taxpayers
other than corporations are taxed at a 28% maximum rate, whereas ordinary income
is taxed at a 39.6% maximum rate. Capital losses continue to be deductible only
against capital gains plus (in the case of taxpayers other than corporations)
$3,000 of ordinary income annually ($1,500 for married individuals filing
separately).
FOREIGN SOURCE INCOME
Income received by the Fund, directly or through the Portfolio, from
sources within foreign countries may be subject to withholding and other income
or similar taxes imposed by such countries. The U.S. has entered into tax
treaties with many foreign countries that, in some circumstances, may entitle
the Fund or the Portfolio to a reduced rate of tax or exemption from tax on such
income. If, directly or through the Portfolio, more than 50% in value of the
Fund's total assets at the close of its taxable year consists of securities of
foreign corporations, the Fund may elect to "pass-through" to its shareholders
the amount of foreign income taxes paid by the Fund and the foreign-source
character of the income received by the Fund. Under this election, each
shareholder will be required to include the shareholder's pro rata portion of
these foreign taxes in gross income, but will be able to deduct (as an itemized
deduction) or claim a foreign tax credit for such amount (subject to various
limitations).
Depending upon their particular tax circumstances, shareholders may be
unable to claim a full credit for their proportionate share of the foreign
income taxes passed through by the Fund. Further limitations as to the credit
or deduction of the foreign income taxes may apply for purposes of the
alternative minimum tax. If the election to pass through foreign income taxes
is not made, foreign taxes will be treated as an expense of the Fund, reducing
its investment company taxable income, and the distributions by the Fund will be
treated as United States source income.
OTHER TAX CONSIDERATIONS
The amount, timing and character of Fund income taxed to Fund
shareholders may be affected by certain special U.S. tax rules that may apply to
various investments of the Fund and the Portfolio, including the following:
CURRENCY TRANSACTIONS. On the disposition of foreign currency,
foreign currency denominated debt
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securities and certain financial contracts, forward contracts and
options, gains or losses attributable to currency fluctuations are
treated as ordinary gain or loss. These gains or losses, termed
"section 988" gains or losses, may increase, decrease or eliminate the
amount to be distributed to shareholders as ordinary income. If
section 988 losses exceed other net investment income during a taxable
year the Fund generally would not be able to make ordinary dividend
distributions, or distributions made before the losses were realized
would be recharacterized as return of capital to shareholders for U.S.
Federal income tax purposes (reducing each shareholder's basis in his
or her Fund shares) or as a capital gain. To minimize the risk of
such distributions, the Fund may adjust its dividends (if any) to take
currency fluctuations into account.
HEDGING TRANSACTIONS. On the disposition of certain contracts,
such as options, futures contracts and forward contracts (termed
"section 1256 contracts"), the resulting gains or losses generally are
considered 60% long-term and 40% short-term capital gains or losses,
regardless of the time the Fund or the Portfolio has held the
contract. However, foreign currency gains or losses (as discussed
above) arising from certain section 1256 contracts may be treated as
ordinary income or loss. In addition, section 1256 contracts held by
the Fund, directly or through the Portfolio, at the end of each
taxable year and on certain other dates prescribed by the tax laws are
"marked-to-market" such that unrealized gains or losses are treated as
though they were realized. Further, requirements relating to the
Fund's tax status as a regulated investment company may limit the
extent to which the Fund and the Portfolio will be able to engage in
transactions in such contracts.
Hedging transactions undertaken by the Fund and the Portfolio may
result in "straddles" for U.S. Federal income tax purposes, affecting
the character of gains (or losses) realized by the Fund. In addition,
losses realized by the Fund on straddle positions may be deferred.
PASSIVE FOREIGN INVESTMENT COMPANIES. The Portfolio may invest
in foreign entities that are classified as passive foreign investment
companies ("PFICs") for U.S. tax purposes. If the Fund or the
Portfolio receives an "excess distribution" with respect to PFIC
stock, the Portfolio or the Fund itself may be subject to tax on a
portion of the excess distribution, whether or not the corresponding
income is distributed by the Fund to shareholders. However,
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the Fund or the Portfolio may be eligible to elect one of two
alternative tax treatments with respect to PFIC shares which would
avoid the foregoing "excess distribution" taxes, 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 shareholders of the Fund may differ substantially as compared to a
fund that did not invest in PFIC shares.
FOREIGN SHAREHOLDERS
Foreign shareholders of the Fund generally will be subject to a 30%
U.S. withholding tax on ordinary income dividends paid by the Fund. This
withholding may be reduced by an applicable tax treaty. Foreign shareholders
are urged to consult with their own tax advisors with respect to this
withholding tax and the other particular U.S. and foreign tax consequences to
them of an investment in the Fund.
The foregoing discussion relates only to U.S. Federal income tax law.
Ordinary income and capital gains dividends also may be subject to state and
local taxes, which may differ from the U.S. Federal treatment. Shareholders are
urged to consult with their tax advisors with respect to the particular tax
consequences to them of an investment in the Fund, including the application and
effect of state and local taxes.
10. SUSPENSION OF REDEMPTION RIGHTS
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
shareholders of the Fund.
The Fund intends to redeem its shares only for cash, although it
retains the right to redeem its shares in kind under unusual circumstances, in
order to protect the interests of the remaining shareholders, by the delivery of
securities selected from its assets at its discretion. The Fund is, however,
governed by Rule 18f-1 under the Investment Company Act of 1940 pursuant to
which the Fund is obligated to redeem shares solely in cash up to the lesser of
$250,000 or 1% of the net assets of the Fund during any 90-day period for any
one shareholder. For purposes of this threshold, each underlying account holder
whose shares are held of record in certain omnibus accounts is treated as one
shareholder. Should redemptions by any shareholder during any 90-day period
exceed such limitation, the Fund will have the option of redeeming the excess in
cash or in kind. If shares are redeemed in kind, the redeeming shareholder
generally will
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incur brokerage costs in converting the assets to cash. The method of valuing
securities used to make redemption in kind will be the same as the method of
valuing portfolio securities described under Section 8. Shareholders have the
ability to request in writing a review of the valuation of in-kind redemptions,
which will be considered by the trustees of the Trust within 90 days of such
written request.
11. TAX-SHELTERED RETIREMENT PLANS
The Fund offers a Profit-Sharing Plan, a Money Purchase Pension Plan,
an Individual Retirement Account and a 403(b) Custodial Account for adoption by
employers and individuals who wish to participate in such Plans by accumulating
shares of the Fund with tax-deductible dollars.
PROFIT-SHARING AND MONEY PURCHASE PENSION PLANS
Employers, self-employed individuals and partnerships may make tax-
deductible contributions to the tax-qualified retirement plans offered by the
Fund. All income and capital gains in the Plans are tax free until withdrawn.
The amounts that are deductible depend upon the type of Plan or Plans adopted.
If you, as an employer, self-employed person or partnership, adopt the
Profit-Sharing Plan, you may vary the amount of your contributions from year to
year and may elect to make no contribution at all for some years. If you adopt
the Money Purchase Pension Plan, you must commit yourself to make a contribution
each year according to a formula in the Plan that is based upon your and your
employees' compensation or earned income. By adopting both the Profit-Sharing
and the Money Purchase Pension Plan, you can increase the amount of
contributions that you may deduct in any one year.
If you wish to purchase shares of the Fund in conjunction with one or
both of these tax-qualified plans, you may use an Internal Revenue Service
approved prototype Trust Agreement and Retirement Plan available from the Fund.
IFTC serves as trustee of the Plan, for which it charges an annual trustee's fee
of $12 for each Berger or Berger/BIAM Fund or Cash Account Trust Money Market
Portfolio (discussed below) in which the participant's account is invested.
Contributions under the Plans are invested exclusively in shares of the Berger
and Berger/BIAM Funds or the Cash Account Trust Money Market Portfolios, which
are then held by the trustee under the terms of the Plans to create a retirement
fund in accordance with the tax code.
Distributions from the Profit-Sharing and Money Purchase Pension Plans
generally may not be made without penalty until the participant reaches age 59
1/2 and must begin no later than April 1 of the calendar year following the year
in which the participant attains age 70 1/2. Except for required distributions
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after age 70 1/2, periodic distributions over more than 10 years and the
distribution of any after-tax contributions, distributions are subject to 20%
U.S. Federal income tax withholding unless those distributions are rolled
directly to another qualified plan or an individual retirement account (IRA).
Participants may not be able to receive distributions immediately upon request
because of certain requirements under U.S. Federal tax law. Since distributions
which do not satisfy these requirements can result in adverse tax consequences,
consultation with an attorney or tax advisor regarding the Plans is recommended.
In order to receive the necessary materials to create a Profit-Sharing
or Money Purchase Pension Plan, please write to the Fund, c/o BBOI Worldwide,
P.O. Box 5005, Denver, Colorado 80217, or call 1-800-333-1001. Trustees for
401(k) or other existing plans interested in utilizing Fund shares as an
investment or investment alternative in their plans should contact the Fund at
1-800-333-1001.
INDIVIDUAL RETIREMENT ACCOUNT (IRA)
If you are an individual with compensation or earned income, whether
or not you are actively participating in an existing qualified retirement plan,
you can provide for your own retirement by adopting an IRA. Under an IRA, you
can contribute each year up to the lesser of 100% of your compensation or
$2,000. If you have a nonemployed spouse (or if your spouse elects to be
treated as having no compensation), you may make contributions totaling up to
$2,250 to two IRAs. If neither you nor your spouse are covered by an existing
qualified retirement plan, or if your income does not exceed certain amounts,
the amounts contributed to your IRA can be deducted for U.S. Federal income tax
purposes whether or not your deductions are itemized. If you or your spouse are
covered by an existing qualified retirement plan, and your income exceeds the
applicable amounts, your IRA contributions are not deductible for U.S. Federal
income tax purposes. However, whether your contributions are deductible or not,
the income and capital gains on your IRA are not taxed until the account is
distributed.
If you wish to create an IRA to invest in shares of the Fund, you may
use the Fund's IRA custodial agreement form which is an adaptation of the form
provided by the Internal Revenue Service. Under the IRA custodial agreement,
IFTC will serve as custodian, for which it will charge an annual custodian fee
of $12 per Berger or Berger/BIAM Fund or Cash Account Trust Money Market
Portfolio in which the IRA is invested.
Distributions from an IRA generally may not be made without penalty
until you reach age 59 1/2 and must begin no later than April 1 of the calendar
year following the year in which you attain age 70 1/2. Since distributions
which do not satisfy these requirements can result in adverse tax consequences,
consultation with an attorney or tax advisor is recommended.
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In order to receive the necessary materials to create an IRA account,
please write to the Fund, c/o BBOI Worldwide, P.O. Box 5005, Denver, Colorado
80217, or call 1-800-333-1001.
403(b) CUSTODIAL ACCOUNTS
If you are employed by a public school system or certain tax-exempt
organizations such as private schools, colleges, universities, hospitals,
religious and charitable or other nonprofit organizations, you may establish a
403(b) Custodial Account. Your employer must participate in the establishment
of the account.
Your employer will automatically deduct the amount you designate from
your gross salary and contribute it to your 403(b) Custodial Account. The
amount which you may contribute annually under a salary reduction agreement is
generally the lesser of $9,500 or your exclusion allowance, which is based upon
a specified formula. There is a $50 minimum investment in the 403(b) Custodial
Account. Contributions made to the account reduce the amount of your current
income subject to U.S. Federal income tax. U.S. Federal income tax is not paid
on your contribution until you begin making withdrawals. In addition, all
income and capital gains in the account are tax-free until withdrawn.
Withdrawals from your 403(b) Custodial Agreement may begin as soon as
you reach age 59-1/2 and must begin no later than April 1 of the year following
the calendar year in which you attain age 70 1/2. Except for required
distributions after age 70 1/2 and periodic distributions over more than 10
years, distributions are subject to 20% U.S. Federal income tax withholding
unless those distributions are rolled directly to another 403(b) account or
annuity or an individual retirement account (IRA). You may not be able to
receive distributions immediately upon request because of certain notice
requirements under U.S. Federal tax law. Since distributions which do not
satisfy these requirements can result in adverse tax consequences, consultation
with an attorney or tax advisor regarding the 403(b) Custodial Account is
recommended.
Individuals who wish to purchase shares of the Fund in conjunction
with a 403(b) Custodial Account may use a Custodian Account Agreement and
related forms available from the Fund. IFTC serves as custodian of the 403(b)
Custodial Account, for which it charges an annual custodian fee of $12 per
Berger and Berger/BIAM Fund in which the participant's account is invested.
In order to receive the necessary materials to create a 403(b)
Custodial Account, please write to the Fund, c/o BBOI Worldwide, P.O. Box 5005,
Denver, Colorado 80217, or call 1-800-333-1001.
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12. EXCHANGE PRIVILEGE AND SYSTEMATIC WITHDRAWAL PLAN
A shareholder who owns shares of the Fund worth at least $5,000 at the
current net asset value may establish a Systematic Withdrawal account from which
a fixed sum will be paid to the shareholder at regular intervals by the Fund.
To establish a Systematic Withdrawal account, the shareholder deposits
Fund shares with the Fund and appoints the Fund as agent to redeem shares in the
shareholder's account in order to make monthly, quarterly, semi-annual or annual
withdrawal payments to the shareholder of a fixed amount. The minimum
withdrawal payment is $50.00. These payments generally will be made on the 25th
day of each month.
Withdrawal payments are not yield or income on the shareholder's
investment, since portions of each payment will normally consist of a return of
the shareholder's investment. Depending on the size of the disbursements
requested and the fluctuation in value of the Fund, redemptions for the purpose
of making such disbursements may reduce or even exhaust the shareholder's
account.
The shareholder may vary the amount or frequency of withdrawal
payments, temporarily discontinue them, or change the designated payee or
payee's address, by notifying the Fund. The shareholder may, of course, make
additional deposits of Fund shares in the shareholder's account at any time.
Since redemption of shares to make withdrawal payments is a taxable
event, each investor should consult a tax advisor concerning proper tax
treatment of the redemption.
Any shareholder may exchange any or all of the shareholder's shares in
the Fund, subject to stated minimums, for shares of any of the publicly
available Berger Funds or Berger/BIAM Funds or for shares of the Money Market
Portfolio, the Government Securities Portfolio or the Tax-Exempt Portfolio of
the Cash Account Trust ("CAT Portfolios"), separately managed, unaffiliated
money market funds, without charge, after receiving a current prospectus of the
other Berger Fund, Berger/BIAM Fund or CAT Portfolio. The exchange privilege
with the CAT Portfolios does not constitute an offering or recommendation of the
shares of any such CAT Portfolio by the Fund or the Advisor or Sub-Advisor.
Exchanges into or out of the Fund are made at the net asset value per share next
determined after the exchange request is received. Each exchange represents the
sale of shares from one fund and the purchase of shares in another, which may
produce a gain or loss for U.S. Federal income tax purposes. An exchange of
shares may be made by written request directed to the Fund, in care of DST
Systems, Inc., via a personal computer through online service providers or other
online access points approved by the Fund, or simply by telephoning the Fund at
1-800-551-5849. This privilege is revocable by the Fund, and is not available
in any state in which the shares of the Berger or Berger/BIAM Fund or
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CAT Portfolio being acquired in the exchange are not registered for sale.
Shareholders automatically have telephone and online privileges to authorize
exchanges unless they specifically decline this service in the account
application or in writing.
13. PERFORMANCE INFORMATION
The Prospectus contains a brief description of how total return is
calculated.
Quotations of average annual total return for the Fund will be
expressed in terms of the average annual compounded rate of return of a
hypothetical investment in the Fund over periods of 1, 5 and 10 years, or for
the life of the Fund, if shorter. These are the rates of return that would
equate the initial amount invested to the ending redeemable value. These rates
of return are calculated pursuant to the following formula: P(1 + T)n = ERV
(where P = a hypothetical initial payment of $1,000, T = the average annual
total return, n = the number of years and ERV = the ending redeemable value of a
hypothetical $1,000 payment made at the beginning of the period). All total
return figures reflect the deduction of a proportional share of Fund expenses on
an annual basis, and assume that all dividends and distributions are reinvested
when paid.
14. ADDITIONAL INFORMATION
BERGER/BIAM WORLDWIDE FUNDS TRUST AND THE FUND
The Trust is a Delaware business trust organized on May 31, 1996. The
Fund was established on May 31, 1996, as a series of the Trust. The Trust is
authorized to issue an unlimited number of shares of beneficial interest in
series or portfolios. Currently, the series comprising the Fund is one of three
series established under the Trust, although others may be added in the future.
The Trust is also authorized to establish multiple classes of shares
representing differing interests in an existing or new series.
Under Delaware law, shareholders of the Trust will enjoy the same
limitations on personal liability as extended to stockholders of a Delaware
corporation. Further, the Trust Instrument of the Trust provides that no
shareholder shall be personally liable for the debts, liabilities, obligations
and expenses incurred by, contracted for or otherwise existing with respect to,
the Trust or any particular series (fund) of the Trust. However, the principles
of law governing the limitations of liability of beneficiaries of a business
trust have not been authoritatively established as to business trusts organized
under the laws of one jurisdiction but operating or owning property in other
jurisdictions. In states that have adopted legislation containing provisions
comparable to the Delaware Business Trust
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Act, it is believed that the limitation of liability of beneficial owners
provided by Delaware law should be respected. In those jurisdictions that have
not adopted similar legislative provisions, it is possible that a court might
hold that the shareholders of the Trust are not entitled to the limitations of
liability set forth in Delaware law or the Trust Instrument and, accordingly,
that they may be personally liable for the obligations of the Trust.
In order to protect shareholders from such potential liability, the
Trust Instrument requires that every written obligation of the Trust or any
series thereof contain a statement to the effect that such obligation may only
be enforced against the assets of the Trust or such series. The Trust
Instrument also provides for indemnification from the assets of the relevant
series for all losses and expenses incurred by any shareholder by reason of
being or having been a shareholder, and that the Trust shall, upon request,
assume the defense of any such claim made against such shareholder for any act
or obligation of the relevant series and satisfy any judgment thereon from the
assets of that series.
As a result, the risk of a Berger/BIAM International Fund shareholder
incurring financial loss on account of shareholder liability is limited to
circumstances in which the Fund itself would be unable to meet its obligations.
The Trust believes that, in view of the above, the risk of personal liability to
shareholders of the Fund is remote. The trustees intend to conduct the
operations of the Trust and the Fund so as to avoid, to the extent possible,
liability of shareholders for liabilities of the Trust or the Fund.
Shares of the Fund have no preemptive rights, and since the Fund has
only one class of securities there are no sinking funds or arrearage provisions
which may affect the rights of the Fund shares. Fund shares have no conversion
or subscription rights.
As of the date of this Statement of Additional Information, all of the
outstanding shares of the Fund were held by Berger Associates, Inc., a Delaware
corporation and controlling person of the Advisor, which provided the seed
capital necessary to establish the Trust.
BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST AND THE PORTFOLIO
Worldwide Portfolios is also 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 "Performance" in the
Prospectus for additional information on the asset transfer.
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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. The Delaware law information set forth above with respect to the
Trust also applies to Worldwide Portfolios and investors in the Portfolio.
Each investor in the Portfolio, including the Fund, is entitled to a
vote in proportion to the amount of its investment in the Portfolio. Whenever
the Fund is requested to vote as an investor in the Portfolio on matters
pertaining to the Portfolio (other than a vote by the Fund to continue the
operation of the Portfolio upon the withdrawal of another investor in the
Portfolio), the Fund will hold a meeting of its shareholders and will cast all
of its votes as an investor in the Portfolio in the same proportion as directed
by the votes of the Fund's shareholders. Fund shareholders who do not vote will
not affect the votes cast by the Fund at the meeting of the Portfolio investors.
The percentage of the votes representing the Fund's shareholders who do not vote
will be voted by the Fund in the same proportion as the Fund's shareholders who
do, in fact, vote.
DISTRIBUTION
The Distributor is the principal underwriter of the Fund's shares.
The Distributor is a registered broker-dealer under the Securities Exchange Act
of 1934 and is a member of the National Association of Securities Dealers, Inc.
The Distributor acts as the agent of the Fund in connection with the sale of its
shares in all states in which the shares are registered and in which the
Distributor is qualified as a broker-dealer.
The Trust, on behalf of the Fund, and the Distributor are parties to a
Distribution Agreement that continues for two years from its date of execution
and thereafter from year to year if such continuation is specifically approved
at least annually by the trustees or by vote of a majority of the outstanding
shares of the Fund and in either case by vote of a majority of the trustees of
the Trust who are not "interested persons" (as that term is defined in the
Investment Company Act of 1940) of the Trust or the Distributor. The
Distribution Agreement is subject to termination by the Fund or the Distributor
on not more than 60 days' nor less than 30 days' prior written notice, and
terminates automatically in the event of its assignment. Under the Distribution
Agreement, the Distributor continuously offers the Fund's shares and solicits
orders to purchase Fund shares at net asset value.
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OTHER INFORMATION
Davis, Graham & Stubbs LLP, 370 Seventeenth Street, Denver, Colorado,
has acted as counsel for the Trust and the Fund. Dechert Price & Rhoads, 1500 K
Street, N.W., Washington, DC, has acted as special counsel for the Trust and the
Fund.
Price Waterhouse LLP, 950 Seventeenth Street, Denver, Colorado, has
been appointed to act as independent accountants for the Fund and the Portfolio
for the fiscal year ended July 31, 1997.
The Berger/BIAM Worldwide Funds Trust has filed with the Commission,
Washington, D.C., a Registration Statement under the Securities Act of 1933, as
amended, with respect to the securities of the Berger/BIAM International Fund,
of which this Statement of Additional Information is a part. If further
information is desired with respect to the Fund or its securities, reference is
made to the Registration Statement and the exhibits filed as a part thereof.
FINANCIAL STATEMENTS
The following financial statements appear attached to the end of this
Statement of Additional Information:
For Berger/BIAM Worldwide Funds Trust:
Report of the Independent Accountants, dated ____________, 1996
Statement of Assets and Liabilities of the Berger/BIAM International Fund,
as of ____________, 1996
Notes to Statement of Assets and Liabilities, dated _________________, 1996
For Berger/BIAM Worldwide Portfolios Trust:
Report of the Independent Accountants, dated ____________, 1996
Statement of Assets and Liabilities of the Berger/BIAM International
Portfolio, as of ____________, 1996
Notes to Statement of Assets and Liabilities, dated _________________, 1996
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APPENDIX A
HIGH-YIELD/HIGH RISK CONVERTIBLE BONDS
The Portfolio may purchase securities which are convertible into common
stock when the Portfolio's Sub-Advisor believes they offer the potential for a
higher total return than nonconvertible securities. While fixed income
securities generally have a priority claim on a corporation's assets over that
of common stock, some of the convertible securities which the 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.
Specifically, corporate debt securities which are below investment grade
(securities rated Ba or lower by Moody's or BB or lower by Standard & Poor's)
and unrated securities which the Portfolio may purchase and hold are subject to
a higher risk of non-payment of principal or interest, or both, than higher
grade debt securities. Generally speaking, the lower the quality of a debt
security (which may be reflected in its Moody's and/or Standard & Poor's
ratings), the higher the yield it will provide, but the greater the risk that
interest or principal payments will not be made when due. Thus, the lower the
grade of a security, the more speculative characteristics it generally has.
Information about the ratings of Moody's and Standard & Poor's, and the
investment risks associated with the various ratings, is set forth below.
The market prices of these lower grade convertible 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.
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.
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<PAGE>
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-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.
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<PAGE>
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.
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.
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<PAGE>
SUBJECT TO COMPLETION
PRELIMINARY STATEMENT OF ADDITIONAL INFORMATION
DATED AUGUST 19, 1996
BERGER/BIAM INTERNATIONAL INSTITUTIONAL FUND
STATEMENT OF ADDITIONAL INFORMATION
SHAREHOLDER SERVICES: 1-800-
This Statement of Additional Information about the Berger/BIAM
International Institutional Fund (the "Fund"), a series of the Berger/BIAM
Worldwide Funds Trust (the "Trust"), is not a prospectus. It should be read in
conjunction with the Prospectus describing the Fund, dated , 1996,
which may be obtained by writing the Fund at P.O. Box 5005, Denver, Colorado
80217, or calling 1-800-[ ]. The Fund is a no-load mutual fund.
The investment objective of the Fund is long-term capital
appreciation. The Fund seeks to achieve this objective by investing all of its
investable assets in the Berger/BIAM International Portfolio (the "Portfolio")
which, in turn, invests primarily in common stocks of well established companies
located outside the United States. A company will be considered 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. The Portfolio
intends to diversify its holdings among several countries and to have, under
normal market conditions, at least 65% of the Portfolio's total assets invested
in the securities of companies located in at least five countries, not including
the United States.
The Fund is an open-end management investment company organized as a
diversified series of the Trust. UNLIKE MANY OTHER MUTUAL FUNDS WHICH DIRECTLY
ACQUIRE AND MANAGE THEIR OWN PORTFOLIOS OF SECURITIES, THE FUND SEEKS ITS
INVESTMENT OBJECTIVE BY INVESTING ALL OF ITS INVESTABLE ASSETS IN THE PORTFOLIO,
AS DESCRIBED ABOVE. Accordingly, the investment performance of the Fund will
derive from the investment performance of the Portfolio. The Portfolio is an
open-end management investment company and a diversified series of a separate
trust known as the Berger/BIAM Worldwide Portfolios Trust ("Worldwide
Portfolios"). The Portfolio's investment objective and policies are identical
to those of the Fund. The Portfolio is advised by BBOI Worldwide LLC ("BBOI" or
the "Advisor"), which has delegated daily portfolio management of the Portfolio
to Bank of Ireland Asset Management (U.S.) Limited ("BIAM" or the "Sub-
Advisor").
, 1996
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This Statement of Additional Information does not constitute a
prospectus.
<PAGE>
TABLE OF CONTENTS
&
CROSS-REFERENCES TO PROSPECTUS
Cross-References to
Related Disclosures
TABLE OF CONTENTS in Prospectus
----------------- --------------------
Introduction Section 2
1. Investment Policies Section 2, 3, 4
2. Investment Restrictions Section 3
3. Management of the Fund Section 6
4. Investment Advisor and Sub-Advisor Section 6
5. Expenses of the Fund Section 6, 7
6. Brokerage Policy Section 6, 7
7. Purchase of Shares Section 8
8. Net Asset Value Section 9
9. Income Dividends, Capital Gains Section 14
Distributions and Tax Treatment
10. Suspension of Redemption Rights Section 11
11. Tax-Sheltered Retirement Plans Section 13
12. Special Purchase and Exchange Plans Section 12, 13
13. Performance Information Section 16
14. Additional Information Section 15
Financial Statements
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INTRODUCTION
The Berger/BIAM International Institutional Fund is a mutual fund, or
open-end, diversified management investment company. The investment objective
of the Fund is long-term capital appreciation. This is also the investment
objective of the Portfolio in which the Fund invests all of its investable
assets. Current income is not an investment objective of the Fund and any
income produced will be only of secondary importance as a by-product of the
investment selection process used to achieve the Fund's objective.
1. INVESTMENT POLICIES
The Prospectus discusses the investment objective of the Fund and the
Portfolio and the policies to be employed to achieve that objective. This
section contains supplemental information concerning the types of securities and
other instruments in which the Portfolio may invest, the investment policies and
portfolio strategies that the Portfolio may utilize and certain risks attendant
to those investments, policies and strategies.
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
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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
(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 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.
The use of repurchase agreements involves certain risks. For example,
if the other party to the agreement defaults on its obligation to repurchase the
underlying security at a time
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<PAGE>
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.
Finally, 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. Although these risks are acknowledged, it is
expected that they can be controlled through careful monitoring procedures.
UNSEASONED ISSUERS. The Portfolio may invest to a limited degree in
securities of unseasoned issuers. Unseasoned issuers are companies with a
record of less than three years' continuous operation, even including the
operations of any predecessors and parents. Unseasoned issuers 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 growth
companies. In addition, many unseasoned issuers may also be small companies and
involve the risks and price volatility associated with smaller companies. The
Portfolio may invest up to 5% of its total assets in securities of unseasoned
issuers.
PASSIVE FOREIGN INVESTMENT COMPANIES (PFICS). The Portfolio may
purchase the securities of certain foreign investment funds or trusts considered
Passive Foreign Investment Companies (PFICs) under U.S. tax laws. In addition
to bearing their proportionate share of the Portfolio's expenses (management
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<PAGE>
fees and operating expenses), shareholders will also indirectly bear similar
expenses of such PFIC. PFIC investments also may be subject to less favorable
U.S. tax treatment, as discussed in Section 9 below.
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 on a comparable security
available 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.
LENDING OF SECURITIES. As discussed in the Prospectus, 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
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<PAGE>
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 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.
HEDGING TRANSACTIONS. As described in the Prospectus, the Portfolio
is authorized to make limited commitments in certain 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. A hedging transaction may partially
protect the Portfolio from a decline in the value of a particular security or
its portfolio generally, although 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.
Any utilization of forwards or any other hedging technique (investing,
for example, in futures or options) is
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<PAGE>
subject to policies and procedures which may be established and changed by the
trustees from time to time without shareholder vote. Currently, the Portfolio
is authorized to invest only in forward contracts for hedging purposes and is
not permitted to invest in futures or options. If the trustees ever authorize
the 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 the Prospectus.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS. A forward contract is an
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 enter into are forward foreign currency exchange
contracts and that it may enter into 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). 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
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<PAGE>
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 ("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
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<PAGE>
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.
PORTFOLIO TURNOVER. Although the annual portfolio turnover rate of
the Portfolio will vary, it is normally expected to range from 25% to 75%. 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 shares of the Portfolio due to economic, market or
other factors that are not within the control of management.
2. INVESTMENT RESTRICTIONS
The Fund has adopted the investment policy that it may,
notwithstanding any other fundamental or non-fundamental investment policy or
restriction, invest all of its investable assets in the securities of another
open-end investment company or series thereof with substantially the same
investment objective, policies and limitations as the Fund.
All other fundamental and non-fundamental investment policies and
restrictions of the Fund and the Portfolio are identical. Therefore, although
the following investment restrictions refer to the Portfolio and the trustees of
Worldwide Portfolios, they apply equally to the Fund and the trustees of the
Trust.
The Portfolio has adopted certain fundamental restrictions on its
investments and other activities, and none of these restrictions may be changed
without the approval of (i) 67% or more of the voting securities of the
Portfolio present at a meeting of shareholders thereof if the holders of more
than 50% of the outstanding voting securities are present or represented by
proxy, or (ii) more than 50% of the outstanding voting securities of the
Portfolio. Whenever the Fund is requested to vote on a change in the investment
restrictions of the Portfolio, the Fund will hold a meeting of its shareholders
and will cast its votes as instructed by the shareholders.
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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.
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
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be changed by the trustees without a shareholder vote. 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 of any company which,
including its predecessors and parents, has a record of less than three years'
continuous operation, if such purchase would cause the Portfolio's investments
in all such companies taken at cost to exceed 5% of the value of the Portfolio's
total assets.
3. 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.
4. 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).
5. The Portfolio may not invest in companies for the purposes of
exercising control of management.
6. 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.
7. 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.
8. 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.
9. The Portfolio may not purchase or sell any interest in an oil,
gas or mineral development or exploration
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<PAGE>
program, including investments in oil, gas or other mineral leases, rights or
royalty contracts (except that the Portfolio may invest in the securities of
issuers engaged in the foregoing activities).
10. The Portfolio may not invest more than 5% of its net assets in
warrants. Included in that amount, but not to exceed 2% of net assets, are
warrants whose underlying securities are not traded on principal domestic or
foreign exchanges. Warrants acquired by the Portfolio in units or attached to
securities are not subject to these limits.
The Trust has undertaken to the State of Ohio that the Fund will
prohibit the purchase or retention by the Fund of the securities of any issuer
if the officers, directors or trustees of the Fund, its advisors, or managers
owning beneficially more than 1/2 of 1% of the securities of an issuer together
own beneficially more than 5% of the securities of that issuer.
3. MANAGEMENT OF THE FUND
The trustees and executive officers of the Trust are listed below,
together with information which includes their principal occupations during the
past five years and other principal business affiliations. The trustees and
executive officers of the Trust also serve in the same capacities as trustees
and officers of Worldwide Portfolios.
* GERARD M. LAVIN, 210 University Boulevard, Suite 900, Denver, CO 80206,
age 53. President and a trustee of Berger/BIAM Worldwide Portfolios
Trust and Berger/BIAM Worldwide Funds Trust since their inception in
May 1996. President and a trustee of Berger Institutional Products
Trust since its inception in October 1995. President and a director
since April 1995 of Berger Associates, Inc. A Vice President of DST
Systems, Inc. (data processing) since July 1995. Director of First of
Michigan Capital Corp. (holding company) and First of Michigan Corp.
(broker-dealer) since March 1995. Formerly President and Chief
Executive Officer of Investors Fiduciary Trust Company (banking) from
February 1992 to March 1995 and Chief Operating Officer of SUNAMERICA
Asset Management Co. (money management) from January 1990 to February
1992.
DENNIS E. BALDWIN, 3481 South Race Street, Englewood, CO 80110, age 67.
President, Baldwin Financial Counseling. Formerly (1978-1990), Vice
President and Denver Office Manager of Merrill Lynch Capital Markets.
Director of Berger 100 Fund and Berger Growth and Income Fund.
Trustee of Berger Investment Portfolio Trust, Berger Institutional
Products Trust, Berger/BIAM Worldwide Funds Trust and Berger/BIAM
Worldwide Portfolios Trust.
* WILLIAM M. B. BERGER, 210 University Boulevard, Suite 900, Denver, CO
80206, age 70. Director and, formerly,
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President (1974-1994) of Berger 100 Fund and Berger Growth and
Income Fund. Trustee of Berger Investment Portfolio Trust since
its inception in August 1993 (Chairman of the Trustees through
November 1994). Trustee of Berger Institutional Products Trust
since its inception in October 1995. Trustee of Berger/BIAM
Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios
Trust since their inception in May 1996. Chairman (since 1994)
and a Director (since 1973) and, formerly, President (1973-1994)
of Berger Associates, Inc.
LOUIS R. BINDNER, 1075 South Fox, Denver, CO 80223, age 70. President,
Climate Engineering, Inc. (building environmental systems). Director
of Berger 100 Fund and Berger Growth and Income Fund. Trustee of
Berger Investment Portfolio Trust, Berger Institutional Products
Trust, Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide
Portfolios Trust.
KATHERINE A. CATTANACH, 384 South Ogden, Denver, CO 80209, age 51.
President, Cattanach & Associates, Ltd. (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 100 Fund and Berger Growth and Income Fund.
Trustee of Berger Investment Portfolio Trust, Berger Institutional
Products Trust, Berger/BIAM Worldwide Funds Trust and Berger/BIAM
Worldwide Portfolios Trust.
LUCY BLACK CREIGHTON, 1917 Leyden Street, Denver, CO 80220, age 68.
Associate, University College, University of Denver. Formerly,
President of the Colorado State Board of Land Commissioners (1989-
1995), and Vice President and Economist (1983-1988) and Consulting
Economist (1989) for First Interstate Bank of Denver. Ph.D. in
Economics (Harvard University). Director of Berger 100 Fund and
Berger Growth and Income Fund. Trustee of Berger Investment Portfolio
Trust, Berger Institutional Products Trust, Berger/BIAM Worldwide
Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
PAUL R. KNAPP, 33 North LaSalle Street, Suite 1920, Chicago, IL 60602, age
50. Since 1991, Director, Chairman, President and Chief Executive
Officer of Catalyst Institute (international public policy research
organization focused primarily on financial markets and institutions)
and Catalyst Consulting (international financial institutions business
consulting firm). Formerly (1988-1991), Director, President and Chief
Executive Officer of Kessler Asher Group (brokerage, clearing and
trading firm). Director of Berger 100 Fund and Berger Growth and
Income Fund. Trustee of Berger Investment Portfolio Trust, Berger
Institutional Products Trust, Berger/BIAM Worldwide Funds Trust and
Berger/BIAM Worldwide Portfolios Trust.
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HARRY T. LEWIS, JR., 370 17th Street, Suite 3560, Denver, CO 80202, age
63. 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 Berger 100 Fund and Berger Growth and Income Fund. Trustee of
Berger Investment Portfolio Trust, Berger Institutional Products
Trust, Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide
Portfolios Trust.
MICHAEL OWEN, 412 Reid Hall, Montana State University, Bozeman, MT 59717,
age 59. Since 1994, Dean, and since 1989, a member of the Finance
faculty, of the College of Business, Montana State University. Self-
employed as a financial and management consultant, and in real estate
development. Formerly (1976-1989), Chairman and Chief Executive
Officer of Royal Gold, Inc. (mining). Chairman of the Board of Berger
100 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 and Berger/BIAM Worldwide
Portfolios Trust.
WILLIAM SINCLAIRE, 3049 S. Perry Park Road, Sedalia, CO 80135, age 67.
President, Sinclaire Cattle Co., and private investor. Director of
Berger 100 Fund and Berger Growth and Income Fund. Trustee of Berger
Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios
Trust.
* CRAIG D. CLOYED, 210 University Boulevard, Suite 900, Denver, CO 80206, age
50. Vice President of Berger/BIAM Worldwide Funds Trust and
Berger/BIAM Worldwide Portfolios Trust since their inception in May
1996. Also, Vice President and Chief Marketing Officer of Berger
Associates, Inc., since August 1995, and President, CEO and a director
of Berger Distributors, Inc., since its inception in May 1996.
Formerly (September 1989 to August 1995), Senior Vice President of
INVESCO Funds Group (mutual funds).
* KEVIN R. FAY, 210 University Boulevard, Suite 900, Denver, CO 80206, age
40. Vice President, Secretary and Treasurer of Berger 100 Fund and
Berger Growth and Income Fund since October 1991, of Berger Investment
Portfolio Trust since its inception in August 1993, of Berger
Institutional Products Trust since its inception in October 1995 and
of Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide
Portfolios Trust since their inception in May 1996. Also, Vice
President-Finance and Administration, Secretary and Treasurer of
Berger Associates, Inc., since September 1991, and a director of
Berger Distributors, Inc., since its inception in May 1996. Formerly,
Financial Consultant (registered representative) with Neidiger Tucker
Bruner, Inc. (broker-dealer) (October 1989 to September 1991) and
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Financial Consultant with Merrill Lynch, Pierce, Fenner & Smith, Inc.
(October 1985 to October 1989).
- ---------------
* Interested person (as defined in the Investment Company Act of 1940) of the
Fund and of the Portfolio's Advisor or Sub-Advisor.
TRUSTEE COMPENSATION
Officers of the Trust receive no compensation from the Trust.
However, trustees of the Trust who are not interested persons of the Portfolio's
Advisor or Sub-Advisor, who are also trustees of Worldwide Portfolios, are
compensated for their services according to a fee schedule, allocated among the
Berger and Berger/BIAM Funds, which includes an annual fee component and a per
meeting fee component. Neither the officers of the Trust nor the trustees
receive any form of pension or retirement benefit compensation from the Trust.
Set forth below is information regarding compensation (including
reimbursement of expenses) estimated to be paid or accrued during the current
fiscal year ended July 31, 1997, for each trustee of the Trust and of the other
funds in the Berger Fund and Berger/BIAM Fund complex.
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<PAGE>
NAME AND POSITION WITH AGGREGATE AGGREGATE
BERGER AND BERGER/BIAM COMPENSATION COMPENSATION
FUNDS FROM FROM
THE FUND(1) ALL BERGER
AND
BERGER/BIAM
FUNDS(2)
- ----------------------------------------------------------------------
Dennis E. Baldwin(3) $82 $41,083
William M.B. Berger(3),(5) $0 $0
Louis R. Bindner(3) $70 $34,965
Katherine A. Cattanach(3) $79 $39,657
Lucy Black Creighton(3) $67 $33,602
Paul R. Knapp(3) $90 $44,919
Gerard M. Lavin(4),(5) $0 $0
Harry T. Lewis(3) $77 $38,357
Michael Owen(3) $101 $50,720
William Sinclaire(3) $67 $33,697
(1) Comprised of the portion of the estimated trustee compensation to be paid
by Worldwide Portfolios to its trustees and allocated to the Fund.
(2) Consisting of Berger 100 Fund, Berger Growth and Income Fund, Berger
Investment Portfolio Trust, Berger Institutional Products Trust, Berger/BIAM
Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
(3) Director of Berger 100 Fund and Berger Growth and Income Fund. Trustee of
Berger Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
(4) Trustee of Berger Institutional Products Trust, Berger/BIAM Worldwide Funds
Trust and Berger/BIAM Worldwide Portfolios Trust.
(5) Interested person of the Berger/BIAM Worldwide Funds Trust and/or the
Portfolio's Advisor or Sub-Advisor.
Trustees may elect to defer receipt of all or a portion of their fees
pursuant to a fee deferral plan adopted by the Berger/BIAM Worldwide Portfolios
Trust. Under the plan, deferred fees are credited to an account and adjusted
thereafter to reflect the investment experience of whichever of the Berger or
Berger/BIAM 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
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fees under the plan is a general obligation of Worldwide Portfolios.
As of the date of this Statement of Additional Information, the
officers and trustees of the Trust as a group owned of record or beneficially no
shares of the Berger/BIAM International Institutional Fund.
4. INVESTMENT ADVISOR AND SUB-ADVISOR
INVESTMENT ADVISOR
The investment advisor to the Portfolio is BBOI Worldwide LLC (the
"Advisor" or "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 limited liability company formed in 1996. Since the
Advisor was only recently formed, it has no prior experience as an investment
advisor. However, Berger Associates, Inc. ("Berger Associates"), which owns
100% of the Advisor, has been in the investment advisory business for over 20
years. Kansas City Southern Industries, Inc. ("KCSI") owns approximately 80% of
the outstanding shares of Berger Associates. 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. Also, see in the Prospectus under "Pending Sale of Interest in
Advisor" for more information concerning ownership of the Advisor.
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 (the "Sub-Advisor" or "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 2 Greenwich
Plaza, 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.
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<PAGE>
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 furnishes 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 Fund bears a pro rata
portion of the fee paid by the Portfolio to the Advisor.
Until at least April 30, 1998, the Advisor has agreed voluntarily to
waive the investment advisory fee paid by the Portfolio under the Investment
Advisory Agreement to the extent that the Portfolio's normal 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.
Any reduction in the advisory fee paid by the Portfolio will also reduce the pro
rata share of the advisory fee borne indirectly by the Fund.
The Investment Advisory Agreement will continue in effect until April
1998, and thereafter from year to year if such continuation is specifically
approved at least annually by the trustees or by vote of a majority of the
outstanding shares of the 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 will continue in effect until April 1998,
and thereafter from year to year if such
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<PAGE>
continuation is specifically approved at least annually by the trustees or by
vote of a majority of the outstanding shares 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 investments 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. 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 Associates, 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 Associates, permits its covered persons to purchase and
sell securities for their own accounts in accordance with provisions governing
personal investing. The Code requires all covered persons to conduct their
personal securities transactions in a manner which does not operate adversely to
the interests of the Fund or the Portfolio or the Advisor's other advisory
clients. Board members and officers of the Advisor (including those who also
serve as trustees of the Trust or of Worldwide Portfolios), investment
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<PAGE>
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 Code. Requests for
authority to trade will be denied pre-clearance when, among other reasons, the
proposed personal transaction would be contrary to the provisions of the Code 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 Fund or 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 Advisor's Code. Those covered persons (as well
as board members, officers, employees and other access persons of the Advisor
covered by an approved Code of Ethics of an affiliated investment advisor) also
may be required under certain circumstances to forfeit their profits made from
personal trading. The Code is administered by the Advisor and the provisions of
the Code 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
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 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.
5. EXPENSES OF THE FUND
The Fund is allocated and bears indirectly its pro rata share of the
aggregate annual operating expenses of the Portfolio, since all of the
investable assets of the Fund are invested in 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
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<PAGE>
Independent Trustees; 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,
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; the fees payable to the Advisor under the Investment
Advisory Agreement; and such other non-recurring and extraordinary items as may
arise from time to time.
Until at least April 30, 1998, the Advisor has agreed voluntarily to
waive the investment advisory fee paid by the Portfolio under the Investment
Advisory Agreement to the extent that the Portfolio's normal 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.
Any reduction in the advisory fee paid by the Portfolio will also reduce the pro
rata share of the advisory fee borne indirectly by the Fund.
Expenses of the Fund include, among others, its pro rata share of the
expenses of the Trust, such as expenses of meetings of the shareholders of the
Trust. Expenses of the Fund also include, among others, taxes imposed on the
Fund; the fee payable to the Advisor under the Administrative Services
Agreement; and such other non-recurring and extraordinary items as may arise
from time to time.
SERVICE ARRANGEMENTS FOR THE FUND
Under the Administrative Services Agreement with the Fund, the Advisor
serves as the administrator of the Fund. In this capacity, it is responsible
for administering and managing all aspects of the Fund's day-to-day operations,
subject to the oversight of the trustees of the Trust. The Advisor is
responsible, at its expense, for furnishing (or procuring other parties to
furnish) all administrative services reasonably necessary for the operation of
the Fund, including recordkeeping and pricing services, custodian services,
transfer agency and dividend disbursing services, tax and audit services,
insurance, legal services, printing and mailing to shareholders of prospectuses
and other required
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<PAGE>
communications, and certain other administrative and recordkeeping services,
such as coordinating matters relating to the operations of the Fund, monitoring
the Fund's status as a "regulated investment company" under the Internal Revenue
Code of 1986, registering sufficient Fund shares under federal and state
securities laws, arranging for and supervising the preparation of registration
statements, tax returns, proxy materials, financial statements and reports for
filing with regulatory authorities and distribution to shareholders of the Fund.
Under the Administrative Services Agreement, the Fund pays the Advisor a fee at
an annual rate equal to the lesser of (i) 0.35% of its average daily net assets,
or (ii) the Advisor's annual cost to provide or procure these services
(including the fees of any services providers whose services are procured by the
Advisor), plus an additional 0.02% of the Fund's average daily net assets. The
trustees of the Trust regularly review amounts paid to and expenditures incurred
by the Advisor pursuant to the Administrative Services Agreement. In addition,
in the event that the Advisor's duties under the Administrative Services
Agreement are delegated to another party, the Advisor may take into account, in
calculating the cost of such services, only the costs incurred by such other
party in discharging the delegated duties.
Arrangements may be entered into by the Advisor or its affiliates with
certain organizations (broker-dealers, recordkeepers and administrators) to
provide subtransfer agency, recordkeeping, shareholder communications,
subaccounting and/or other services to investors purchasing shares of the Fund
through investment programs or pension plans established or serviced by those
organizations. The Advisor or its affiliates may pay fees to these
organizations for their services. For purposes of determining the Advisor's
cost of providing or procuring transfer agency, dividend disbursing or other
services under the Administrative Services Agreement, the Advisor may take into
account only the fees that otherwise would be paid for by the Advisor if all the
investors who own Fund shares through the organization were instead direct
registered record holders of shares in the Fund.
Under a Sub-Administration Agreement between the Advisor and Berger
Associates, Berger Associates has been delegated the responsibility to perform
certain of the administrative and recordkeeping services required under the
Administrative Services Agreement and to procure, at the Advisor's expense,
third parties to provide the services not provided by Berger Associates. Under
the Sub-Administration Agreement, Berger Associates is paid a fee by the Advisor
of 0.25% of the Fund's average daily net assets for its services. During
certain periods, Berger Associates may voluntarily waive all or a portion of its
fee from the Advisor, which will not affect the fee paid by the Fund to
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the Advisor under the Administrative Services Agreement. Investors Fiduciary
Trust Company ("IFTC"), 127 W. 10th Street, Kansas City, MO 64105, has been
appointed to provide recordkeeping and pricing services to the Fund, including
calculating the daily net asset value of the Fund, and to perform certain
accounting and recordkeeping functions that it requires. In addition, IFTC has
been appointed to serve as the Fund's custodian, transfer agent and dividend
disbursing agent. IFTC has engaged DST Systems, Inc. ("DST"), P.O. Box 419958,
Kansas City, MO 64141, as sub-transfer agent to provide transfer agency and
dividend disbursing services for the Fund. The fees of Berger Associates, IFTC
and DST are all paid by the Advisor. Approximately 40% of the outstanding
shares of DST are owned by KCSI, which also owns approximately 80% of the
outstanding shares of Berger Associates.
SERVICE ARRANGEMENTS FOR THE PORTFOLIO
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 preparing investor communications, which have been
delegated to Berger Associates as part of the Sub-Administration Agreement
discussed above. 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"), P.O. Box 351,
Boston, MA 02101, 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.
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
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otherwise be obligated to pay. No portion of the commission is retained by
DSTS.
DISTRIBUTOR
The distributor (principal underwriter) of the Fund's shares is First
Fund Distributors, Inc. (the "Distributor"), 4455 East Camelback Road, Suite
261-E, Phoenix, AZ 85018. The Distributor is compensated and reimbursed for its
costs in distributing Fund shares by Berger Associates.
6. BROKERAGE POLICY
Although the Portfolio retains full control over its own investment
policies, the Sub-Advisor is authorized to place the portfolio transactions of
the Portfolio. The Sub-Advisor is required to report on the placement of
brokerage business to the trustees of Worldwide Portfolios every quarter,
indicating the brokers with whom portfolio business was placed and the basis for
such placement.
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 research services would typically
consist of studies made by investment analysts or economists relating either to
the past record of and future outlook for companies and the industries in which
they operate, or to national and worldwide economic conditions, monetary
conditions and trends in investors' sentiment, and the relationship of these
factors to the securities market. In addition, such analysts may be available
for regular consultation so that the Sub-Advisor may be apprised of current
developments in the above-mentioned factors.
The research services received from brokers could be helpful to the
Sub-Advisor in performing its investment advisory
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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. The 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 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 research services from brokers.
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.
7. PURCHASE OF SHARES
Minimum Initial Investment $100,000.00
Shares in the Fund may be purchased at the relevant net asset value
without a sales charge. The minimum initial investment for shares of the Fund
is $100,000. To purchase shares in the Fund, simply complete the application
form enclosed with the Prospectus and mail it to the Fund in care of DST
Systems, Inc., the Fund's transfer agent, as follows:
Berger Funds
c/o DST Systems, Inc.
P.O. Box 419958
Kansas City, MO 64141
Payment for shares purchased may be made by wire, electronic funds
transfer or mail. All purchase orders are effected at the relevant net asset
value per share of the Fund next determined after receipt of the purchase order,
completed application and payment. A purchase order, together with payment in
proper form, received by the transfer agent, subtransfer agent or any other
authorized agent of the Fund prior to the close of the New York Stock Exchange
(the "Exchange") on a day the Fund is open for business will be effected at that
day's net asset value. An order received after that time will be
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effected at the net asset value determined on the next business day.
Additional investments may be made at any time by telephone or by mail
at the relevant net asset value by calling or writing the Fund and making
payment by wire or electronic funds transfer as outlined above.
In addition, Fund shares may be purchased certain organizations
connected with pension and retirement plans. These organizations may charge
investors a transaction or other fee for their services, may require different
minimum initial and subsequent investments than the Fund and may impose other
charges or restrictions different from those applicable to shareholders who
invest in the Fund directly. Fees charged by these organizations will have the
effect of reducing a shareholder's total return on an investment in Fund shares.
No such charge will be paid by an investor who purchases the Fund shares
directly from the Fund as described above.
8. NET ASSET VALUE
The net asset value of the Fund 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 Fund is not determined on weekends and
on New Year's Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day each year. The per share net
asset value of the Fund is determined by dividing the total value of its assets,
less liabilities, by the total number of shares outstanding. Since the Fund
invests all of its investable assets in the Portfolio, the value of the Fund's
investable assets will be equal to the value of its beneficial interest in the
Portfolio.
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
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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 are valued at fair values determined in good faith pursuant to
consistently applied procedures established by the trustees.
Generally, trading in foreign securities markets is substantially
completed each day at various times prior to the close of the Exchange. The
values of foreign securities used in computing the net asset value of the shares
of 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 will be valued at
their fair market 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 Fund's
net asset value is not calculated. As a result, the net asset value of the Fund
may be significantly affected by such trading on days when shareholders cannot
purchase or redeem shares of the Fund.
9. INCOME DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAX TREATMENT
TAX STATUS OF THE FUND AND THE PORTFOLIO
The Fund intends to meet the requirements of Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code") and to distribute to its
investors all or substantially all of its taxable income as defined in the Code.
If the Fund meets the Subchapter M requirements, it generally is not liable for
U.S. Federal income taxes to the extent its earnings are timely distributed.
Qualification as a regulated investment company
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("RIC") under the Code does not, however, involve any federal supervision of
management or of the investment practices or policies of the Fund. If the Fund
distributes annually less than 98% of its income and gain, it may be subject to
a nondeductible excise tax equal to 4% of the shortfall.
The Trust anticipates that (1) the Portfolio will be treated for U.S.
Federal income tax purposes as a partnership, and (2) for purposes of
determining whether the Fund satisfies the income and diversification
requirements to maintain its status as a RIC, the Fund, as an investor in the
Portfolio, will be deemed to own a proportionate 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 has advised the Fund that it intends to conduct
its operations so as to enable its investors, including the Fund, to satisfy
those requirements.
TAXATION OF FUND DISTRIBUTIONS
Advice as to the tax status of each year's dividends and distributions
will be mailed annually to the shareholders of the Fund. Dividends paid by the
Fund from net investment income and distributions from the Fund's net short-term
capital gains in excess of any net long-term capital losses, whether received in
cash or reinvested, generally will be taxable as ordinary income. Distributions
received from the Fund designated as long-term capital gains (net of capital
losses), whether received in cash or reinvested, will be taxable as long-term
capital gains without regard to the length of time a shareholder has owned
shares in the Fund. Any loss on the redemption or other sale or exchange of the
Fund's shares held for six months or less will be treated as a long-term capital
loss to the extent of any long-term capital gain distribution received on the
shares. A portion of the dividends (but not capital gains distributions) paid
by the Fund may be eligible for the dividends received deduction for corporate
shareholders to the extent that the Fund's income consists of dividends paid by
United States corporations. If a shareholder is exempt from U.S. Federal income
tax, the shareholder will not generally be taxed on amounts distributed by the
Fund.
Under the Internal Revenue Code, gains recognized by the Portfolio
upon a disposition of assets contributed in-kind to it by the Fund will be
specially allocated to the Fund and not to other investors in the Portfolio to
the extent of the unrealized appreciation in those assets at the time of their
transfer. As a result, shareholders of the Fund may receive distributions of a
greater amount of gains than if the Portfolio had purchased those assets in the
open market upon commencement of Fund operations or in a transaction that did
not involve contributions of assets in-kind.
If the amount of the Fund's distributions for a taxable year exceeds
the Fund's tax earnings and profits available for distribution, all or portion
or the distributions may be treated
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as a return of capital or as capital gains. In the event a distribution is
treated as a return of capital, the shareholder's basis in his or her Fund
shares will be reduced to the extent the distribution is so treated.
At certain levels of taxable income, the Code provides a preferential
tax rate for long-term capital gains. Long-term capital gains of taxpayers
other than corporations are taxed at a 28% maximum rate, whereas ordinary income
is taxed at a 39.6% maximum rate. Capital losses continue to be deductible only
against capital gains plus (in the case of taxpayers other than corporations)
$3,000 of ordinary income annually ($1,500 for married individuals filing
separately).
FOREIGN SOURCE INCOME
Income received by the Fund, directly or through the Portfolio, from
sources within foreign countries may be subject to withholding and other income
or similar taxes imposed by such countries. The U.S. has entered into tax
treaties with many foreign countries that, in some circumstances, may entitle
the Fund or the Portfolio to a reduced rate of tax or exemption from tax on such
income. If, directly or through the Portfolio, more than 50% in value of the
Fund's total assets at the close of its taxable year consists of securities of
foreign corporations, the Fund may elect to "pass-through" to its shareholders
the amount of foreign income taxes paid by the Fund and the foreign-source
character of the income received by the Fund. Under this election, each
shareholder will be required to include the shareholder's pro rata portion of
these foreign taxes in gross income, but will be able to deduct (as an itemized
deduction) or claim a foreign tax credit for such amount (subject to various
limitations).
Depending upon their particular tax circumstances, shareholders may be
unable to claim a full credit for their proportionate share of the foreign
income taxes passed through by the Fund. Further limitations as to the credit
or deduction of the foreign income taxes may apply for purposes of the
alternative minimum tax. If the election to pass through foreign income taxes
is not made, foreign taxes will be treated as an expense of the Fund, reducing
its investment company taxable income, and the distributions by the Fund will be
treated as United States source income.
OTHER TAX CONSIDERATIONS
The amount, timing and character of Fund income taxed to Fund
shareholders may be affected by certain special U.S. tax rules that may apply to
various investments of the Fund and the Portfolio, including the following:
CURRENCY TRANSACTIONS. On the disposition of foreign currency,
foreign currency denominated debt securities and certain financial
contracts, forward
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contracts and options, gains or losses attributable to currency
fluctuations are treated as ordinary gain or loss. These gains or
losses, termed "section 988" gains or losses, may increase, decrease
or eliminate the amount to be distributed to shareholders as ordinary
income. If section 988 losses exceed other net investment income
during a taxable year the Fund generally would not be able to make
ordinary dividend distributions, or distributions made before the
losses were realized would be recharacterized as return of capital to
shareholders for U.S. Federal income tax purposes (reducing each
shareholder's basis in his or her Fund shares) or as a capital gain.
To minimize the risk of such distributions, the Fund may adjust its
dividends (if any) to take currency fluctuations into account.
HEDGING TRANSACTIONS. On the disposition of certain contracts,
such as options, futures contracts and forward contracts (termed
"section 1256 contracts"), the resulting gains or losses generally are
considered 60% long-term and 40% short-term capital gains or losses,
regardless of the time the Fund or the Portfolio has held the
contract. However, foreign currency gains or losses (as discussed
above) arising from certain section 1256 contracts may be treated as
ordinary income or loss. In addition, section 1256 contracts held by
the Fund, directly or through the Portfolio, at the end of each
taxable year and on certain other dates prescribed by the tax laws are
"marked-to-market" such that unrealized gains or losses are treated as
though they were realized. Further, requirements relating to the
Fund's tax status as a regulated investment company may limit the
extent to which the Fund and the Portfolio will be able to engage in
transactions in such contracts.
Hedging transactions undertaken by the Fund and the Portfolio may
result in "straddles" for U.S. Federal income tax purposes, affecting
the character of gains (or losses) realized by the Fund. In addition,
losses realized by the Fund on straddle positions may be deferred.
PASSIVE FOREIGN INVESTMENT COMPANIES. The Portfolio may invest
in foreign entities that are classified as passive foreign investment
companies ("PFICs") for U.S. tax purposes. If the Fund or the
Portfolio receives an "excess distribution" with respect to PFIC
stock, the Portfolio or the Fund itself may be subject to tax on a
portion of the excess distribution, whether or not the corresponding
income is distributed by the Fund to shareholders. However, the Fund
or the Portfolio may be eligible to elect one
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of two alternative tax treatments with respect to PFIC shares which
would avoid the foregoing "excess distribution" taxes, 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 shareholders of the Fund may differ substantially as
compared to a fund that did not invest in PFIC shares.
FOREIGN SHAREHOLDERS
Foreign shareholders of the Fund generally will be subject to a 30%
U.S. withholding tax on ordinary income dividends paid by the Fund. This
withholding may be reduced by an applicable tax treaty. Foreign shareholders
are urged to consult with their own tax advisors with respect to this
withholding tax and the other particular U.S. and foreign tax consequences to
them of an investment in the Fund.
The foregoing discussion relates only to U.S. Federal income tax law.
Ordinary income and capital gains dividends also may be subject to state and
local taxes, which may differ from the U.S. Federal treatment. Shareholders are
urged to consult with their tax advisors with respect to the particular tax
consequences to them of an investment in the Fund, including the application and
effect of state and local taxes.
10. SUSPENSION OF REDEMPTION RIGHTS
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
shareholders of the Fund.
The Fund intends to redeem its shares only for cash, although it
retains the right to redeem its shares in kind under unusual circumstances, in
order to protect the interests of the remaining shareholders, by the delivery of
securities selected from its assets at its discretion. The Fund is, however,
governed by Rule 18f-1 under the Investment Company Act of 1940 pursuant to
which the Fund is obligated to redeem shares solely in cash up to the lesser of
$250,000 or 1% of the net assets of the Fund during any 90-day period for any
one shareholder. For purposes of this threshold, each underlying account holder
whose shares are held of record in certain omnibus accounts is treated as one
shareholder. Should redemptions by any shareholder during any 90-day period
exceed such limitation, the Fund will have the option of redeeming the excess in
cash or in kind. If shares are redeemed in kind, the redeeming shareholder
generally will incur brokerage costs in converting the assets to cash. The
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method of valuing securities used to make redemption in kind will be the same as
the method of valuing portfolio securities described under Section 8.
Shareholders have the ability to request in writing a review of the valuation of
in-kind redemptions, which will be considered by the trustees of the Trust
within 90 days of such written request.
11. PLANS AND PROGRAMS
The Fund offers several tax-qualified retirement plans for adoption by
individuals and employers. The Fund also offers both a profit-sharing plan and
a money purchase pension plan for employers and self-employed persons, an
Individual Retirement Account ("IRA") and a 403(b) Custodial Account.
In order to receive the necessary materials to create a profit-sharing
or money purchase pension plan account, an IRA account or a 403(b) Custodial
Account, please write to the Fund, c/o BBOI Worldwide, P.O. Box 5005, Denver, CO
80217, or call 1-800-[ ]. Trustees for 401(k) or other existing plans
interested in utilizing Fund shares as an investment or investment alternative
in their plans should contact the Fund at 1-800-[ ].
The Fund also offers a systematic withdrawal plan. Forms to open such
an account may be obtained by writing to the Fund, c/o DST Systems, Inc., P.O.
Box 419958, Kansas City, MO 64141, or call 1-800-[ ].
12. EXCHANGE PRIVILEGE
Any shareholder may exchange any or all of the shareholder's shares in
the Fund, subject to stated minimums, for shares of any of the publicly
available Berger Funds or Berger/BIAM Funds, without charge, after receiving a
current prospectus of the other Berger Fund or Berger/BIAM Fund. Exchanges into
or out of the Fund are made at the net asset value per share next determined
after the exchange request is received. Each exchange represents the sale of
shares from one fund and the purchase of shares in another, which may produce a
gain or loss for U.S. Federal income tax purposes. An exchange of shares may be
made by written request directed to the Fund, in care of DST Systems, Inc., or
simply by telephoning the Fund at 1-800-[ ]. This privilege is
revocable by the Fund, and is not available in any state in which the shares of
the Berger or Berger/BIAM Fund being acquired in the exchange are not registered
for sale. Shareholders automatically have telephone privileges to authorize
exchanges unless they specifically decline this service in the account
application or in writing.
13. PERFORMANCE INFORMATION
The Prospectus contains a brief description of how total return is
calculated.
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Quotations of average annual total return for the Fund will be
expressed in terms of the average annual compounded rate of return of a
hypothetical investment in the Fund over periods of 1, 5 and 10 years, or for
the life of the Fund, if shorter. These are the rates of return that would
equate the initial amount invested to the ending redeemable value. These rates
of return are calculated pursuant to the following formula: P(1 + T)n = ERV
(where P = a hypothetical initial payment of $1,000, T = the average annual
total return, n = the number of years and ERV = the ending redeemable value of a
hypothetical $1,000 payment made at the beginning of the period). All total
return figures reflect the deduction of a proportional share of Fund expenses on
an annual basis, and assume that all dividends and distributions are reinvested
when paid.
14. ADDITIONAL INFORMATION
BERGER/BIAM WORLDWIDE FUNDS TRUST AND THE FUND
The Trust is a Delaware business trust organized on May 31, 1996. The
Fund was established on May 31, 1996, as a series of the Trust. The Trust is
authorized to issue an unlimited number of shares of beneficial interest in
series or portfolios. Currently, the series comprising the Fund is one of three
series established under the Trust, although others may be added in the future.
The Trust is also authorized to establish multiple classes of shares
representing differing interests in an existing or new series.
Under Delaware law, shareholders of the Trust will enjoy the same
limitations on personal liability as extended to stockholders of a Delaware
corporation. Further, the Trust Instrument of the Trust provides that no
shareholder shall be personally liable for the debts, liabilities, obligations
and expenses incurred by, contracted for or otherwise existing with respect to,
the Trust or any particular series (fund) of the Trust. However, the principles
of law governing the limitations of liability of beneficiaries of a business
trust have not been authoritatively established as to business trusts organized
under the laws of one jurisdiction but operating or owning property in other
jurisdictions. In states that have adopted legislation containing provisions
comparable to the Delaware Business Trust Act, it is believed that the
limitation of liability of beneficial owners provided by Delaware law should be
respected. In those jurisdictions that have not adopted similar legislative
provisions, it is possible that a court might hold that the shareholders of the
Trust are not entitled to the limitations of liability set forth in Delaware law
or the Trust Instrument and, accordingly, that they may be personally liable for
the obligations of the Trust.
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In order to protect shareholders from such potential liability, the
Trust Instrument requires that every written obligation of the Trust or any
series thereof contain a statement to the effect that such obligation may only
be enforced against the assets of the Trust or such series. The Trust
Instrument also provides for indemnification from the assets of the relevant
series for all losses and expenses incurred by any shareholder by reason of
being or having been a shareholder, and that the Trust shall, upon request,
assume the defense of any such claim made against such shareholder for any act
or obligation of the relevant series and satisfy any judgment thereon from the
assets of that series.
As a result, the risk of a Berger/BIAM International Institutional
Fund shareholder incurring financial loss on account of shareholder liability is
limited to circumstances in which the Fund itself would be unable to meet its
obligations. The Trust believes that, in view of the above, the risk of
personal liability to shareholders of the Fund is remote. The trustees intend
to conduct the operations of the Trust and the Fund so as to avoid, to the
extent possible, liability of shareholders for liabilities of the Trust or the
Fund.
Shares of the Fund have no preemptive rights, and since the Fund has
only one class of securities there are no sinking funds or arrearage provisions
which may affect the rights of the Fund shares. Fund shares have no conversion
or subscription rights.
As of the date of this Statement of Additional Information, all of the
outstanding shares of the Fund were held by Berger Associates, Inc., a Delaware
corporation and controlling person of the Advisor, which provided the seed
capital necessary to establish the Trust.
BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST AND THE PORTFOLIO
Worldwide Portfolios is also 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 "Performance" in the
Prospectus 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. The Delaware law information set forth above with respect to the
Trust also applies to Worldwide Portfolios and investors in the Portfolio.
Each investor in the Portfolio, including the Fund, is entitled to a
vote in proportion to the amount of its investment
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in the Portfolio. Whenever the Fund is requested to vote as an investor in the
Portfolio on matters pertaining to the Portfolio (other than a vote by the Fund
to continue the operation of the Portfolio upon the withdrawal of another
investor in the Portfolio), the Fund will hold a meeting of its shareholders and
will cast all of its votes as an investor in the Portfolio in the same
proportion as directed by the votes of the Fund's shareholders. Fund
shareholders who do not vote will not affect the votes cast by the Fund at the
meeting of the Portfolio investors. The percentage of the votes representing
the Fund's shareholders who do not vote will be voted by the Fund in the same
proportion as the Fund's shareholders who do, in fact, vote.
DISTRIBUTION
The Distributor is the principal underwriter of the Fund's shares.
The Distributor is a registered broker-dealer under the Securities Exchange Act
of 1934 and is a member of the National Association of Securities Dealers, Inc.
The Distributor acts as the agent of the Fund in connection with the sale of its
shares in all states in which the shares are registered and in which the
Distributor is qualified as a broker-dealer.
The Trust, on behalf of the Fund, and the Distributor are parties to a
Distribution Agreement that continues for two years from its date of execution
and thereafter from year to year if such continuation is specifically approved
at least annually by the trustees or by vote of a majority of the outstanding
shares of the Fund and in either case by vote of a majority of the trustees of
the Trust who are not "interested persons" (as that term is defined in the
Investment Company Act of 1940) of the Trust or the Distributor. The
Distribution Agreement is subject to termination by the Fund or the Distributor
on not more than 60 days' nor less than 30 days' prior written notice, and
terminates automatically in the event of its assignment. Under the Distribution
Agreement, the Distributor continuously offers the Fund's shares and solicits
orders to purchase Fund shares at net asset value.
OTHER INFORMATION
Davis, Graham & Stubbs LLP, 370 Seventeenth Street, Denver, Colorado,
has acted as counsel for the Trust and the Fund. Dechert Price & Rhoads, 1500 K
Street, N.W., Washington, DC, has acted as special counsel for the Trust and the
Fund.
Price Waterhouse LLP, 950 Seventeenth Street, Denver, Colorado, has
been appointed to act as independent accountants for the Fund and the Portfolio
for the fiscal year ended July 31, 1997.
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The Berger/BIAM Worldwide Funds Trust has filed with the Commission,
Washington, D.C., a Registration Statement under the Securities Act of 1933, as
amended, with respect to the securities of the Berger/BIAM International
Institutional Fund, of which this Statement of Additional Information is a part.
If further information is desired with respect to the Fund or its securities,
reference is made to the Registration Statement and the exhibits filed as a part
thereof.
FINANCIAL STATEMENTS
The following financial statements appear attached to the end of this
Statement of Additional Information:
For Berger/BIAM Worldwide Funds Trust:
Report of the Independent Accountants, dated , 1996
Statement of Assets and Liabilities of the Berger/BIAM International
Institutional Fund, as of , 1996
Notes to Statement of Assets and Liabilities, dated , 1996
For Berger/BIAM Worldwide Portfolios Trust:
Report of the Independent Accountants, dated , 1996
Statement of Assets and Liabilities of the Berger/BIAM International
Portfolio, as of , 1996
Notes to Statement of Assets and Liabilities, dated , 1996
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APPENDIX A
HIGH-YIELD/HIGH RISK CONVERTIBLE BONDS
The Portfolio may purchase securities which are convertible into
common stock when the Portfolio's Sub-Advisor believes they offer the potential
for a higher total return than nonconvertible securities. While fixed income
securities generally have a priority claim on a corporation's assets over that
of common stock, some of the convertible securities which the 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.
Specifically, corporate debt securities which are below investment
grade (securities rated Ba or lower by Moody's or BB or lower by Standard &
Poor's) and unrated securities which the Portfolio may purchase and hold are
subject to a higher risk of non-payment of principal or interest, or both, than
higher grade debt securities. Generally speaking, the lower the quality of a
debt security (which may be reflected in its Moody's and/or Standard & Poor's
ratings), the higher the yield it will provide, but the greater the risk that
interest or principal payments will not be made when due. Thus, the lower the
grade of a security, the more speculative characteristics it generally has.
Information about the ratings of Moody's and Standard & Poor's, and the
investment risks associated with the various ratings, is set forth below.
The market prices of these lower grade convertible 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.
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.
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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-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.
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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.
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.
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SUBJECT TO COMPLETION
PRELIMINARY STATEMENT OF ADDITIONAL INFORMATION
DATED AUGUST 19, 1996
BERGER/BIAM INTERNATIONAL CORE FUND
STATEMENT OF ADDITIONAL INFORMATION
SHAREHOLDER SERVICES: 1-800-___________
This Statement of Additional Information about the Berger/BIAM
International CORE Fund (the "Fund"), a series of the Berger/BIAM Worldwide
Funds Trust (the "Trust"), is not a prospectus. It should be read in
conjunction with the Prospectus describing the Fund, dated ______________, 1996,
which may be obtained by writing the Fund at P.O. Box 5005, Denver, Colorado
80217, or calling 1-800-[_________]. The Fund is a no-load mutual fund.
The investment objective of the Fund is long-term capital appreciation.
The Fund seeks to achieve this objective by investing all of its investable
assets in the Berger/BIAM International Portfolio (the "Portfolio") which, in
turn, invests primarily in common stocks of well established companies located
outside the United States. A company will be considered 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. The Portfolio intends
to diversify its holdings among several countries and to have, under normal
market conditions, at least 65% of the Portfolio's total assets invested in the
securities of companies located in at least five countries, not including the
United States.
The Fund is an open-end management investment company organized as a
diversified series of the Trust. UNLIKE MANY OTHER MUTUAL FUNDS WHICH DIRECTLY
ACQUIRE AND MANAGE THEIR OWN PORTFOLIOS OF SECURITIES, THE FUND SEEKS ITS
INVESTMENT OBJECTIVE BY INVESTING ALL OF ITS INVESTABLE ASSETS IN THE PORTFOLIO,
AS DESCRIBED ABOVE. Accordingly, the investment performance of the Fund will
derive from the investment performance of the Portfolio. The Portfolio is an
open-end management investment company and a diversified series of a separate
trust known as the Berger/BIAM Worldwide Portfolios Trust ("Worldwide
Portfolios"). The Portfolio's investment objective and policies are identical
to those of the Fund. The Portfolio is advised by BBOI Worldwide LLC ("BBOI" or
the "Advisor"), which has delegated daily portfolio management of the Portfolio
to Bank of Ireland Asset Management (U.S.) Limited ("BIAM" or the "Sub-
Advisor").
_____________________, 1996
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This Statement of Additional Information does not constitute a
prospectus.
<PAGE>
TABLE OF CONTENTS
&
CROSS-REFERENCES TO PROSPECTUS
Cross-References to
Related Disclosures
Table of Contents in Prospectus
----------------- -------------------
Introduction Section 2
1. Investment Policies Section 2, 3, 4
2. Investment Restrictions Section 3
3. Management of the Fund Section 6
4. Investment Advisor and Sub-Advisor Section 6
5. Expenses of the Fund Section 6, 7
6. Brokerage Policy Section 6, 7
7. Purchase of Shares Section 8
8. Net Asset Value Section 9
9. Income Dividends, Capital Gains Section 14
Distributions and Tax Treatment
10. Suspension of Redemption Rights Section 11
11. Tax-Sheltered Retirement Plans Section 13
12. Special Purchase and Exchange Plans Section 12, 13
13. Performance Information Section 16
14. Additional Information Section 15
Financial Statements
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INTRODUCTION
The Berger/BIAM International CORE Fund is a mutual fund, or open-end,
diversified management investment company. The investment objective of the Fund
is long-term capital appreciation. This is also the investment objective of the
Portfolio in which the Fund invests all of its investable assets. Current
income is not an investment objective of the Fund and any income produced will
be only of secondary importance as a by-product of the investment selection
process used to achieve the Fund's objective.
1. INVESTMENT POLICIES
The Prospectus discusses the investment objective of the Fund and the
Portfolio and the policies to be employed to achieve that objective. This
section contains supplemental information concerning the types of securities and
other instruments in which the Portfolio may invest, the investment policies and
portfolio strategies that the Portfolio may utilize and certain risks attendant
to those investments, policies and strategies.
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
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sell the security and the number of other potential purchasers; (3) dealer
undertakings to make a market in the security; and (4) the nature of the
security and the marketplace trades (e.g., the time needed to dispose of the
security, the method of soliciting offers, and the mechanics of the transfer).
The liquidity of 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 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.
The use of repurchase agreements involves certain risks. 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. Finally, 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. Although these risks
are acknowledged, it is expected that they can be controlled through careful
monitoring procedures.
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UNSEASONED ISSUERS. The Portfolio may invest to a limited degree in
securities of unseasoned issuers. Unseasoned issuers are companies with a
record of less than three years' continuous operation, even including the
operations of any predecessors and parents. Unseasoned issuers 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 growth
companies. In addition, many unseasoned issuers may also be small companies and
involve the risks and price volatility associated with smaller companies. The
Portfolio may invest up to 5% of its total assets in securities of unseasoned
issuers.
PASSIVE FOREIGN INVESTMENT COMPANIES (PFICS). The Portfolio may
purchase the securities of certain foreign investment funds or trusts considered
Passive Foreign Investment Companies (PFICs) under U.S. tax laws. In addition
to bearing their proportionate share of the Portfolio's expenses (management
fees and operating expenses), shareholders will also indirectly bear similar
expenses of such PFIC. PFIC investments also may be subject to less favorable
U.S. tax treatment, as discussed in Section 9 below.
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 on a comparable security
available 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
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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.
LENDING OF SECURITIES. As discussed in the Prospectus, 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 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
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<PAGE>
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.
HEDGING TRANSACTIONS. As described in the Prospectus, the Portfolio
is authorized to make limited commitments in certain 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. A hedging transaction may partially
protect the Portfolio from a decline in the value of a particular security or
its portfolio generally, although 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.
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
shareholder vote. Currently, the Portfolio is authorized to invest only in
forward contracts for hedging purposes and is not permitted to invest in futures
or options. If the trustees ever authorize the 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 the Prospectus.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS. A forward contract is an
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 enter into are forward foreign currency exchange
contracts and that it may enter into 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
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<PAGE>
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). 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 ("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
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<PAGE>
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.
PORTFOLIO TURNOVER. Although the annual portfolio turnover rate of
the Portfolio will vary, it is normally expected to range from 25% to 75%. 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 shares of the Portfolio due to economic, market or
other factors that are not within the control of management.
2. INVESTMENT RESTRICTIONS
The Fund has adopted the investment policy that it may,
notwithstanding any other fundamental or non-fundamental investment policy or
restriction, invest all of its investable assets in the securities of another
open-end investment company or series thereof with substantially the same
investment objective, policies and limitations as the Fund.
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All other fundamental and non-fundamental investment policies and
restrictions of the Fund and the Portfolio are identical. Therefore, although
the following investment restrictions refer to the Portfolio and the trustees of
Worldwide Portfolios, they apply equally to the Fund and the trustees of the
Trust.
The Portfolio has adopted certain fundamental restrictions on its
investments and other activities, and none of these restrictions may be changed
without the approval of (i) 67% or more of the voting securities of the
Portfolio present at a meeting of shareholders thereof if the holders of more
than 50% of the outstanding voting securities are present or represented by
proxy, or (ii) more than 50% of the outstanding voting securities of the
Portfolio. Whenever the Fund is requested to vote on a change in the investment
restrictions of the Portfolio, the Fund will hold a meeting of its shareholders
and will cast its votes as instructed by the shareholders.
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.
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
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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 shareholder vote. 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 of any company which,
including its predecessors and parents, has a record of less than three years'
continuous operation, if such purchase would cause the Portfolio's investments
in all such companies taken at cost to exceed 5% of the value of the Portfolio's
total assets.
3. 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.
4. 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).
5. The Portfolio may not invest in companies for the purposes of
exercising control of management.
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6. 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.
7. 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.
8. 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.
9. The Portfolio may not purchase or sell any interest in an oil,
gas or mineral development or exploration program, including investments in oil,
gas or other mineral leases, rights or royalty contracts (except that the
Portfolio may invest in the securities of issuers engaged in the foregoing
activities).
10. The Portfolio may not invest more than 5% of its net assets in
warrants. Included in that amount, but not to exceed 2% of net assets, are
warrants whose underlying securities are not traded on principal domestic or
foreign exchanges. Warrants acquired by the Portfolio in units or attached to
securities are not subject to these limits.
The Trust has undertaken to the State of Ohio that the Fund will
prohibit the purchase or retention by the Fund of the securities of any issuer
if the officers, directors or trustees of the Fund, its advisors, or managers
owning beneficially more than 1/2 of 1% of the securities of an issuer together
own beneficially more than 5% of the securities of that issuer.
3. MANAGEMENT OF THE FUND
The trustees and executive officers of the Trust are listed below,
together with information which includes their principal occupations during the
past five years and other principal business affiliations. The trustees and
executive officers of the Trust also serve in the same capacities as trustees
and officers of Worldwide Portfolios.
*GERARD M. LAVIN, 210 University Boulevard, Suite 900, Denver, CO 80206, age
53. President and a trustee of Berger/BIAM Worldwide Portfolios Trust and
Berger/BIAM Worldwide Funds Trust since their inception in May 1996.
President and a trustee of Berger Institutional Products Trust since its
inception in October 1995. President and a director since April 1995 of
Berger Associates, Inc. A Vice President of DST Systems, Inc. (data
processing) since July 1995.
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Director of First of Michigan Capital Corp. (holding company) and First of
Michigan Corp. (broker-dealer) since March 1995. Formerly President and
Chief Executive Officer of Investors Fiduciary Trust Company (banking) from
February 1992 to March 1995 and Chief Operating Officer of SUNAMERICA Asset
Management Co. (money management) from January 1990 to February 1992.
DENNIS E. BALDWIN, 3481 South Race Street, Englewood, CO 80110, age 67.
President, Baldwin Financial Counseling. Formerly (1978-1990), Vice
President and Denver Office Manager of Merrill Lynch Capital Markets.
Director of Berger 100 Fund and Berger Growth and Income Fund. Trustee of
Berger Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios
Trust.
* WILLIAM M. B. BERGER, 210 University Boulevard, Suite 900, Denver, CO 80206,
age 70. Director and, formerly, President (1974-1994) of Berger 100 Fund
and Berger Growth and Income Fund. Trustee of Berger Investment Portfolio
Trust since its inception in August 1993 (Chairman of the Trustees through
November 1994). Trustee of Berger Institutional Products Trust since its
inception in October 1995. Trustee of Berger/BIAM Worldwide Funds Trust
and Berger/BIAM Worldwide Portfolios Trust since their inception in May
1996. Chairman (since 1994) and a Director (since 1973) and, formerly,
President (1973-1994) of Berger Associates, Inc.
LOUIS R. BINDNER, 1075 South Fox, Denver, CO 80223, age 70. President, Climate
Engineering, Inc. (building environmental systems). Director of Berger 100
Fund and Berger Growth and Income Fund. Trustee of Berger Investment
Portfolio Trust, Berger Institutional Products Trust, Berger/BIAM Worldwide
Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
KATHERINE A. CATTANACH, 384 South Ogden, Denver, CO 80209, age 51. President,
Cattanach & Associates, Ltd. (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 100
Fund and Berger Growth and Income Fund. Trustee of Berger Investment
Portfolio Trust, Berger Institutional Products Trust, Berger/BIAM Worldwide
Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
LUCY BLACK CREIGHTON, 1917 Leyden Street, Denver, CO 80220, age 68. Associate,
University College, University of Denver. Formerly, President of the
Colorado State Board of Land Commissioners (1989-1995), and Vice President
and Economist (1983-1988) and Consulting Economist (1989) for First
Interstate Bank of Denver. Ph.D. in Economics
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(Harvard University). Director of Berger 100 Fund and Berger Growth and
Income Fund. Trustee of Berger Investment Portfolio Trust, Berger
Institutional Products Trust, Berger/BIAM Worldwide Funds Trust and
Berger/BIAM Worldwide Portfolios Trust.
PAUL R. KNAPP, 33 North LaSalle Street, Suite 1920, Chicago, IL 60602, age 50.
Since 1991, Director, Chairman, President and Chief Executive Officer of
Catalyst Institute (international public policy research organization
focused primarily on financial markets and institutions) and Catalyst
Consulting (international financial institutions business consulting firm).
Formerly (1988-1991), Director, President and Chief Executive Officer of
Kessler Asher Group (brokerage, clearing and trading firm). Director of
Berger 100 Fund and Berger Growth and Income Fund. Trustee of Berger
Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios
Trust.
HARRY T. LEWIS, JR., 370 17th Street, Suite 3560, Denver, CO 80202, age 63.
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 Berger 100 Fund and
Berger Growth and Income Fund. Trustee of Berger Investment Portfolio
Trust, Berger Institutional Products Trust, Berger/BIAM Worldwide Funds
Trust and Berger/BIAM Worldwide Portfolios Trust.
MICHAEL OWEN, 412 Reid Hall, Montana State University, Bozeman, MT 59717, age
59. Since 1994, Dean, and since 1989, a member of the Finance faculty, of
the College of Business, Montana State University. Self-employed as a
financial and management consultant, and in real estate development.
Formerly (1976-1989), Chairman and Chief Executive Officer of Royal Gold,
Inc. (mining). Chairman of the Board of Berger 100 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 and Berger/BIAM Worldwide Portfolios Trust.
WILLIAM SINCLAIRE, 3049 S. Perry Park Road, Sedalia, CO 80135, age 67.
President, Sinclaire Cattle Co., and private investor. Director of Berger
100 Fund and Berger Growth and Income Fund. Trustee of Berger Investment
Portfolio Trust, Berger Institutional Products Trust, Berger/BIAM Worldwide
Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
* CRAIG D. CLOYED, 210 University Boulevard, Suite 900, Denver, CO 80206, age
50. Vice President of Berger/BIAM Worldwide Funds Trust and Berger/BIAM
Worldwide Portfolios Trust since their inception in May 1996. Also, Vice
President
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and Chief Marketing Officer of Berger Associates, Inc., since August 1995,
and President, CEO and a director of Berger Distributors, Inc., since its
inception in May 1996. Formerly (September 1989 to August 1995), Senior
Vice President of INVESCO Funds Group (mutual funds).
* KEVIN R. FAY, 210 University Boulevard, Suite 900, Denver, CO 80206, age 40.
Vice President, Secretary and Treasurer of Berger 100 Fund and Berger
Growth and Income Fund since October 1991, of Berger Investment Portfolio
Trust since its inception in August 1993, of Berger Institutional Products
Trust since its inception in October 1995 and of Berger/BIAM Worldwide
Funds Trust and Berger/BIAM Worldwide Portfolios Trust since their
inception in May 1996. Also, Vice President-Finance and Administration,
Secretary and Treasurer of Berger Associates, Inc., since September 1991,
and a director of Berger Distributors, Inc., since its inception in May
1996. Formerly, Financial Consultant (registered representative) with
Neidiger Tucker Bruner, Inc. (broker-dealer) (October 1989 to September
1991) and Financial Consultant with Merrill Lynch, Pierce, Fenner & Smith,
Inc. (October 1985 to October 1989).
________________
* Interested person (as defined in the Investment Company Act of 1940) of the
Fund and of the Portfolio's Advisor or Sub-Advisor.
TRUSTEE COMPENSATION
Officers of the Trust receive no compensation from the Trust.
However, trustees of the Trust who are not interested persons of the Portfolio's
Advisor or Sub-Advisor, who are also trustees of Worldwide Portfolios, are
compensated for their services according to a fee schedule, allocated among the
Berger and Berger/BIAM Funds, which includes an annual fee component and a per
meeting fee component. Neither the officers of the Trust nor the trustees
receive any form of pension or retirement benefit compensation from the Trust.
Set forth below is information regarding compensation (including
reimbursement of expenses) estimated to be paid or accrued during the current
fiscal year ended July 31, 1997, for each trustee of the Trust and of the other
funds in the Berger Fund and Berger/BIAM Fund complex.
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NAME AND POSITION WITH AGGREGATE AGGREGATE
BERGER AND BERGER/BIAM COMPENSATION COMPENSATION
FUNDS FROM FROM
THE FUND(1) ALL BERGER
AND
BERGER/BIAM
FUNDS(2)
- --------------------------------------------------------------------------------
Dennis E. Baldwin(3) $333 $41,083
William M.B. Berger(3),(5) $0 $0
Louis R. Bindner(3) $283 $34,965
Katherine A. Cattanach(3) $321 $39,657
Lucy Black Creighton(3) $272 $33,602
Paul R. Knapp(3) $364 $44,919
Gerard M. Lavin(4),(5) $0 $0
Harry T. Lewis(3) $311 $38,357
Michael Owen(3) $411 $50,720
William Sinclaire(3) $273 $33,697
- --------------------------------------------------------------------------------
(1) Comprised of the portion of the estimated trustee compensation to be paid
by Worldwide Portfolios to its trustees and allocated to the Fund.
(2) Consisting of Berger 100 Fund, Berger Growth and Income Fund, Berger
Investment Portfolio Trust, Berger Institutional Products Trust, Berger/BIAM
Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
(3) Director of Berger 100 Fund and Berger Growth and Income Fund. Trustee of
Berger Investment Portfolio Trust, Berger Institutional Products Trust,
Berger/BIAM Worldwide Funds Trust and Berger/BIAM Worldwide Portfolios Trust.
(4) Trustee of Berger Institutional Products Trust, Berger/BIAM Worldwide Funds
Trust and Berger/BIAM Worldwide Portfolios Trust.
(5) Interested person of the Berger/BIAM Worldwide Funds Trust and/or the
Portfolio's Advisor or Sub-Advisor.
Trustees may elect to defer receipt of all or a portion of their fees
pursuant to a fee deferral plan adopted by the Berger/BIAM Worldwide Portfolios
Trust. Under the plan, deferred fees are credited to an account and adjusted
thereafter to reflect the investment experience of whichever of the Berger or
Berger/BIAM 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.
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As of the date of this Statement of Additional Information, the
officers and trustees of the Trust as a group owned of record or beneficially no
shares of the Berger/BIAM International CORE Fund.
4. INVESTMENT ADVISOR AND SUB-ADVISOR
INVESTMENT ADVISOR
The investment advisor to the Portfolio is BBOI Worldwide LLC (the
"Advisor" or "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 limited liability company formed in 1996. Since the
Advisor was only recently formed, it has no prior experience as an investment
advisor. However, Berger Associates, Inc. ("Berger Associates"), which owns
100% of the Advisor, has been in the investment advisory business for over 20
years. Kansas City Southern Industries, Inc. ("KCSI") owns approximately 80% of
the outstanding shares of Berger Associates. 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. Also, see in the Prospectus under "Pending Sale of Interest in
Advisor" for more information concerning ownership of the Advisor.
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 (the "Sub-Advisor" or "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 2 Greenwich
Plaza, 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.
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 furnishes general business
management and administrative services to the Portfolio. Under the Investment
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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 Fund bears a pro rata
portion of the fee paid by the Portfolio to the Advisor.
Until at least April 30, 1998, the Advisor has agreed voluntarily to
waive the investment advisory fee paid by the Portfolio under the Investment
Advisory Agreement to the extent that the Portfolio's normal 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.
Any reduction in the advisory fee paid by the Portfolio will also reduce the pro
rata share of the advisory fee borne indirectly by the Fund.
The Investment Advisory Agreement will continue in effect until April
1998, and thereafter from year to year if such continuation is specifically
approved at least annually by the trustees or by vote of a majority of the
outstanding shares of the 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 will continue in effect until April 1998,
and thereafter from year to year if such continuation is specifically approved
at least annually by the trustees or by vote of a majority of the outstanding
shares of the 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
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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 investments 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. 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 Associates, 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 Associates, permits its covered persons to purchase and
sell securities for their own accounts in accordance with provisions governing
personal investing. The Code requires all covered persons to conduct their
personal securities transactions in a manner which does not operate adversely to
the interests of the Fund or the Portfolio or the Advisor's other advisory
clients. Board members and officers of the Advisor (including those who also
serve as trustees of the Trust or of Worldwide Portfolios), 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 Code. Requests for authority to trade
will be denied pre-clearance when, among other reasons, the proposed personal
transaction would be contrary to the provisions of the Code 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 Fund or
the Portfolio.
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<PAGE>
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 Advisor's Code. Those covered persons (as well
as board members, officers, employees and other access persons of the Advisor
covered by an approved Code of Ethics of an affiliated investment advisor) also
may be required under certain circumstances to forfeit their profits made from
personal trading. The Code is administered by the Advisor and the provisions of
the Code 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
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 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.
5. EXPENSES OF THE FUND
The Fund is allocated and bears indirectly its pro rata share of the
aggregate annual operating expenses of the Portfolio, since all of the
investable assets of the Fund are invested in 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
Independent Trustees; 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,
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; the fees payable to the Advisor under the Investment
Advisory Agreement; and such other non-recurring and extraordinary items as may
arise from time to time.
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Until at least April 30, 1998, the Advisor has agreed voluntarily to
waive the investment advisory fee paid by the Portfolio under the Investment
Advisory Agreement to the extent that the Portfolio's normal 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.
Any reduction in the advisory fee paid by the Portfolio will also reduce the pro
rata share of the advisory fee borne indirectly by the Fund.
Expenses of the Fund include, among others, its pro rata share of the
expenses of the Trust, such as expenses of meetings of the shareholders of the
Trust. Expenses of the Fund also include, among others, taxes imposed on the
Fund; the fee payable to the Advisor under the Administrative Services
Agreement; and such other non-recurring and extraordinary items as may arise
from time to time.
SERVICE ARRANGEMENTS FOR THE FUND
Under the Administrative Services Agreement with the Fund, the Advisor
serves as the administrator of the Fund. In this capacity, it is responsible
for administering and managing all aspects of the Fund's day-to-day operations,
subject to the oversight of the trustees of the Trust. The Advisor is
responsible, at its expense, for furnishing (or procuring other parties to
furnish) all administrative services reasonably necessary for the operation of
the Fund, including recordkeeping and pricing services, custodian services,
transfer agency and dividend disbursing services, tax and audit services,
insurance, legal services, printing and mailing to shareholders of prospectuses
and other required communications, and certain other administrative and
recordkeeping services, such as coordinating matters relating to the operations
of the Fund, monitoring the Fund's status as a "regulated investment company"
under the Internal Revenue Code of 1986, registering sufficient Fund shares
under federal and state securities laws, arranging for and supervising the
preparation of registration statements, tax returns, proxy materials, financial
statements and reports for filing with regulatory authorities and distribution
to shareholders of the Fund. Under the Administrative Services Agreement, the
Fund pays the Advisor a fee at an annual rate equal to the lesser of (i) 0.10%
of its average daily net assets, or (ii) the Advisor's annual cost to provide or
procure these services (including the fees of any services providers whose
services are procured by the Advisor), plus an additional 0.01% of the Fund's
average daily net assets. The trustees of the Trust regularly review amounts
paid to and expenditures incurred by the Advisor pursuant to the Administrative
Services Agreement. In addition, in the event that the Advisor's duties under
the Administrative Services Agreement are delegated to another party, the
Advisor may take into account, in calculating the cost of such services, only
the costs incurred by such other party in discharging the delegated duties.
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Under a Sub-Administration Agreement between the Advisor and Berger
Associates, Berger Associates has been delegated the responsibility to perform
certain of the administrative and recordkeeping services required under the
Administrative Services Agreement and to procure, at the Advisor's expense,
third parties to provide the services not provided by Berger Associates. Under
the Sub-Administration Agreement, Berger Associates is paid a fee by the Advisor
of 0.25% of the Fund's average daily net assets for its services. During
certain periods, Berger Associates may voluntarily waive all or a portion of its
fee from the Advisor, which will not affect the fee paid by the Fund to the
Advisor under the Administrative Services Agreement. Investors Fiduciary Trust
Company ("IFTC"), 127 W. 10th Street, Kansas City, MO 64105, has been appointed
to provide recordkeeping and pricing services to the Fund, including calculating
the daily net asset value of the Fund, and to perform certain accounting and
recordkeeping functions that it requires. In addition, IFTC has been appointed
to serve as the Fund's custodian, transfer agent and dividend disbursing agent.
IFTC has engaged DST Systems, Inc. ("DST"), P.O. Box 419958, Kansas City, MO
64141, as sub-transfer agent to provide transfer agency and dividend disbursing
services for the Fund. The fees of Berger Associates, IFTC and DST are all paid
by the Advisor. Approximately 40% of the outstanding shares of DST are owned by
KCSI, which also owns approximately 80% of the outstanding shares of Berger
Associates.
SERVICE ARRANGEMENTS FOR THE PORTFOLIO
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 preparing investor communications, which have
been delegated to Berger Associates as part of the Sub-Administration
Agreement discussed above. 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"), P.O. Box 351, Boston, MA 02101, 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.
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
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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.
DISTRIBUTOR
The distributor (principal underwriter) of the Fund's shares is First
Fund Distributors, Inc. (the "Distributor"), 4455 East Camelback Road, Suite
261-E, Phoenix, AZ 85018. The Distributor is compensated and reimbursed for its
costs in distributing Fund shares by Berger Associates.
6. BROKERAGE POLICY
Although the Portfolio retains full control over its own investment
policies, the Sub-Advisor is authorized to place the portfolio transactions of
the Portfolio. The Sub-Advisor is required to report on the placement of
brokerage business to the trustees of Worldwide Portfolios every quarter,
indicating the brokers with whom portfolio business was placed and the basis for
such placement.
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 research services would typically
consist of studies made by investment analysts or economists relating either to
the past record of and future outlook for companies and the industries in which
they operate, or to national and worldwide economic conditions, monetary
conditions and trends in investors' sentiment, and the relationship of these
factors to the securities market. In addition, such analysts may be available
for regular consultation so that the Sub-Advisor may be apprised of current
developments in the above-mentioned factors.
The research services received from brokers could be helpful to the
Sub-Advisor in performing its investment advisory
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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. The 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 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 research services from brokers.
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.
7. PURCHASE OF SHARES
Minimum Initial Investment $1,000,000.00
Shares in the Fund may be purchased at the relevant net asset value
without a sales charge. The minimum initial investment for shares of the Fund
is $1,000,000. To purchase shares in the Fund, simply complete the application
form enclosed with the Prospectus and mail it to the Fund in care of DST
Systems, Inc., the Fund's transfer agent, as follows:
Berger Funds
c/o DST Systems, Inc.
P.O. Box 419958
Kansas City, MO 64141
Payment for shares purchased may be made by wire, electronic funds
transfer or mail. All purchase orders are effected at the relevant net asset
value per share of the Fund next determined after receipt of the purchase
order, completed application and payment. A purchase order, together with
payment in proper form, received by the transfer agent, subtransfer agent or
any other authorized agent of the Fund prior to the close of the New York
Stock Exchange (the "Exchange") on a day the Fund is open for business will
be effected at that day's net asset value. An order received after that time
will be effected at the net asset value determined on the next business day.
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Additional investments may be made at any time by telephone or by mail
at the relevant net asset value by calling or writing the Fund and making
payment by wire or electronic funds transfer as outlined above.
In addition, Fund shares may be purchased through certain
organizations connected with pension and retirement plans. These organizations
may charge investors a transaction or other fee for their services, may require
different minimum initial and subsequent investments than the Fund and may
impose other charges or restrictions different from those applicable to
shareholders who invest in the Fund directly. Fees charged by these
organizations will have the effect of reducing a shareholder's total return on
an investment in Fund shares. No such charge will be paid by an investor who
purchases the Fund shares directly from the Fund as described above.
8. NET ASSET VALUE
The net asset value of the Fund 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 Fund is not determined on weekends and
on New Year's Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day each year. The per share net
asset value of the Fund is determined by dividing the total value of its assets,
less liabilities, by the total number of shares outstanding. Since the Fund
invests all of its investable assets in the Portfolio, the value of the Fund's
investable assets will be equal to the value of its beneficial interest in the
Portfolio.
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 are valued at fair values
determined in good faith pursuant to consistently applied procedures established
by the trustees.
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Generally, trading in foreign securities markets is substantially
completed each day at various times prior to the close of the Exchange. The
values of foreign securities used in computing the net asset value of the shares
of 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 will be valued at
their fair market 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 Fund's
net asset value is not calculated. As a result, the net asset value of the Fund
may be significantly affected by such trading on days when shareholders cannot
purchase or redeem shares of the Fund.
9. INCOME DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAX TREATMENT
TAX STATUS OF THE FUND AND THE PORTFOLIO
The Fund intends to meet the requirements of Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code") and to distribute to its
investors all or substantially all of its taxable income as defined in the Code.
If the Fund meets the Subchapter M requirements, it generally is not liable for
U.S. Federal income taxes to the extent its earnings are timely distributed.
Qualification as a regulated investment company ("RIC") under the Code does not,
however, involve any federal supervision of management or of the investment
practices or policies of the Fund. If the Fund distributes annually less than
98% of its income and gain, it may be subject to a nondeductible excise tax
equal to 4% of the shortfall.
The Trust anticipates that (1) the Portfolio will be treated for U.S.
Federal income tax purposes as a partnership, and (2) for purposes of
determining whether the Fund satisfies the income and diversification
requirements to maintain its status as a RIC, the Fund, as an investor in the
Portfolio, will be deemed to own a proportionate 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 has advised the Fund that it intends to conduct
its operations so as to enable its investors, including the Fund, to satisfy
those requirements.
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TAXATION OF FUND DISTRIBUTIONS
Advice as to the tax status of each year's dividends and distributions
will be mailed annually to the shareholders of the Fund. Dividends paid by the
Fund from net investment income and distributions from the Fund's net short-term
capital gains in excess of any net long-term capital losses, whether received in
cash or reinvested, generally will be taxable as ordinary income. Distributions
received from the Fund designated as long-term capital gains (net of capital
losses), whether received in cash or reinvested, will be taxable as long-term
capital gains without regard to the length of time a shareholder has owned
shares in the Fund. Any loss on the redemption or other sale or exchange of the
Fund's shares held for six months or less will be treated as a long-term capital
loss to the extent of any long-term capital gain distribution received on the
shares. A portion of the dividends (but not capital gains distributions) paid
by the Fund may be eligible for the dividends received deduction for corporate
shareholders to the extent that the Fund's income consists of dividends paid by
United States corporations. If a shareholder is exempt from U.S. Federal income
tax, the shareholder will not generally be taxed on amounts distributed by the
Fund.
Under the Internal Revenue Code, gains recognized by the Portfolio
upon a disposition of assets contributed in-kind to it by the Fund will be
specially allocated to the Fund and not to other investors in the Portfolio to
the extent of the unrealized appreciation in those assets at the time of their
transfer. As a result, shareholders of the Fund may receive distributions of a
greater amount of gains than if the Portfolio had purchased those assets in the
open market upon commencement of Fund operations or in a transaction that did
not involve contributions of assets in-kind.
If the amount of the Fund's distributions for a taxable year exceeds
the Fund's tax earnings and profits available for distribution, all or portion
or the distributions may be treated as a return of capital or as capital gains.
In the event a distribution is treated as a return of capital, the shareholder's
basis in his or her Fund shares will be reduced to the extent the distribution
is so treated.
At certain levels of taxable income, the Code provides a preferential
tax rate for long-term capital gains. Long-term capital gains of taxpayers
other than corporations are taxed at a 28% maximum rate, whereas ordinary income
is taxed at a 39.6% maximum rate. Capital losses continue to be deductible only
against capital gains plus (in the case of taxpayers other than corporations)
$3,000 of ordinary income annually ($1,500 for married individuals filing
separately).
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FOREIGN SOURCE INCOME
Income received by the Fund, directly or through the Portfolio, from
sources within foreign countries may be subject to withholding and other income
or similar taxes imposed by such countries. The U.S. has entered into tax
treaties with many foreign countries that, in some circumstances, may entitle
the Fund or the Portfolio to a reduced rate of tax or exemption from tax on such
income. If, directly or through the Portfolio, more than 50% in value of the
Fund's total assets at the close of its taxable year consists of securities of
foreign corporations, the Fund may elect to "pass-through" to its shareholders
the amount of foreign income taxes paid by the Fund and the foreign-source
character of the income received by the Fund. Under this election, each
shareholder will be required to include the shareholder's pro rata portion of
these foreign taxes in gross income, but will be able to deduct (as an itemized
deduction) or claim a foreign tax credit for such amount (subject to various
limitations).
Depending upon their particular tax circumstances, shareholders may be
unable to claim a full credit for their proportionate share of the foreign
income taxes passed through by the Fund. Further limitations as to the credit
or deduction of the foreign income taxes may apply for purposes of the
alternative minimum tax. If the election to pass through foreign income taxes
is not made, foreign taxes will be treated as an expense of the Fund, reducing
its investment company taxable income, and the distributions by the Fund will be
treated as United States source income.
OTHER TAX CONSIDERATIONS
The amount, timing and character of Fund income taxed to Fund
shareholders may be affected by certain special U.S. tax rules that may apply to
various investments of the Fund and the Portfolio, including the following:
CURRENCY TRANSACTIONS. On the disposition of foreign currency,
foreign currency denominated debt securities and certain financial
contracts, forward contracts and options, gains or losses attributable
to currency fluctuations are treated as ordinary gain or loss. These
gains or losses, termed "section 988" gains or losses, may increase,
decrease or eliminate the amount to be distributed to shareholders as
ordinary income. If section 988 losses exceed other net investment
income during a taxable year the Fund generally would not be able to
make ordinary dividend distributions, or distributions made before the
losses were realized would be recharacterized as return of capital to
shareholders for U.S. Federal income tax purposes (reducing each
shareholder's basis in his or her Fund shares) or as a capital gain.
To minimize the risk of such distributions, the Fund may adjust its
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dividends (if any) to take currency fluctuations into account.
HEDGING TRANSACTIONS. On the disposition of certain contracts,
such as options, futures contracts and forward contracts (termed
"section 1256 contracts"), the resulting gains or losses generally are
considered 60% long-term and 40% short-term capital gains or losses,
regardless of the time the Fund or the Portfolio has held the
contract. However, foreign currency gains or losses (as discussed
above) arising from certain section 1256 contracts may be treated as
ordinary income or loss. In addition, section 1256 contracts held by
the Fund, directly or through the Portfolio, at the end of each
taxable year and on certain other dates prescribed by the tax laws are
"marked-to-market" such that unrealized gains or losses are treated as
though they were realized. Further, requirements relating to the
Fund's tax status as a regulated investment company may limit the
extent to which the Fund and the Portfolio will be able to engage in
transactions in such contracts.
Hedging transactions undertaken by the Fund and the Portfolio may
result in "straddles" for U.S. Federal income tax purposes, affecting
the character of gains (or losses) realized by the Fund. In addition,
losses realized by the Fund on straddle positions may be deferred.
PASSIVE FOREIGN INVESTMENT COMPANIES. The Portfolio may invest
in foreign entities that are classified as passive foreign investment
companies ("PFICs") for U.S. tax purposes. If the Fund or the
Portfolio receives an "excess distribution" with respect to PFIC
stock, the Portfolio or the Fund itself may be subject to tax on a
portion of the excess distribution, whether or not the corresponding
income is distributed by the Fund to shareholders. However, the Fund
or the Portfolio may be eligible to elect one of two alternative tax
treatments with respect to PFIC shares which would avoid the foregoing
"excess distribution" taxes, 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 shareholders of
the Fund may differ substantially as compared to a fund that did not
invest in PFIC shares.
FOREIGN SHAREHOLDERS
Foreign shareholders of the Fund generally will be subject to a 30%
U.S. withholding tax on ordinary income dividends paid by the Fund. This
withholding may be reduced by
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an applicable tax treaty. Foreign shareholders are urged to consult with their
own tax advisors with respect to this withholding tax and the other particular
U.S. and foreign tax consequences to them of an investment in the Fund.
The foregoing discussion relates only to U.S. Federal income tax law.
Ordinary income and capital gains dividends also may be subject to state and
local taxes, which may differ from the U.S. Federal treatment. Shareholders are
urged to consult with their tax advisors with respect to the particular tax
consequences to them of an investment in the Fund, including the application and
effect of state and local taxes.
10. SUSPENSION OF REDEMPTION RIGHTS
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
shareholders of the Fund.
The Fund intends to redeem its shares only for cash, although it
retains the right to redeem its shares in kind under unusual circumstances, in
order to protect the interests of the remaining shareholders, by the delivery of
securities selected from its assets at its discretion. The Fund is, however,
governed by Rule 18f-1 under the Investment Company Act of 1940 pursuant to
which the Fund is obligated to redeem shares solely in cash up to the lesser of
$250,000 or 1% of the net assets of the Fund during any 90-day period for any
one shareholder. For purposes of this threshold, each underlying account holder
whose shares are held of record in certain omnibus accounts is treated as one
shareholder. Should redemptions by any shareholder during any 90-day period
exceed such limitation, the Fund will have the option of redeeming the excess in
cash or in kind. If shares are redeemed in kind, the redeeming shareholder
generally will incur brokerage costs in converting the assets to cash. The
method of valuing securities used to make redemption in kind will be the same as
the method of valuing portfolio securities described under Section 8.
Shareholders have the ability to request in writing a review of the valuation of
in-kind redemptions, which will be considered by the trustees of the Trust
within 90 days of such written request.
11. PLANS AND PROGRAMS
The Fund offers several tax-qualified retirement plans for adoption by
individuals and employers. The Fund also offers both a profit-sharing plan and
a money purchase pension plan for employers and self-employed persons, an
Individual Retirement Account ("IRA") and a 403(b) Custodial Account.
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In order to receive the necessary materials to create a profit-sharing
or money purchase pension plan account, an IRA account or a 403(b) Custodial
Account, please write to the Fund, c/o BBOI Worldwide, P.O. Box 5005, Denver, CO
80217, or call 1-800-[ ]. Trustees for 401(k) or other existing plans
interested in utilizing Fund shares as an investment or investment alternative
in their plans should contact the Fund at 1-800-[ ].
The Fund also offers a systematic withdrawal plan. Forms to open such
an account may be obtained by writing to the Fund, c/o DST Systems, Inc., P.O.
Box 419958, Kansas City, MO 64141, or call 1-800-[ ].
12. EXCHANGE PRIVILEGE
Any shareholder may exchange any or all of the shareholder's shares in
the Fund, subject to stated minimums, for shares of any of the publicly
available Berger Funds or Berger/BIAM Funds, without charge, after receiving a
current prospectus of the other Berger Fund or Berger/BIAM Fund. Exchanges into
or out of the Fund are made at the net asset value per share next determined
after the exchange request is received. Each exchange represents the sale of
shares from one fund and the purchase of shares in another, which may produce a
gain or loss for U.S. Federal income tax purposes. An exchange of shares may be
made by written request directed to the Fund, in care of DST Systems, Inc., or
simply by telephoning the Fund at 1-800-[ ]. This privilege is
revocable by the Fund, and is not available in any state in which the shares of
the Berger or Berger/BIAM Fund being acquired in the exchange are not registered
for sale. Shareholders automatically have telephone privileges to authorize
exchanges unless they specifically decline this service in the account
application or in writing.
13. PERFORMANCE INFORMATION
The Prospectus contains a brief description of how total return is
calculated.
Quotations of average annual total return for the Fund will be
expressed in terms of the average annual compounded rate of return of a
hypothetical investment in the Fund over periods of 1, 5 and 10 years, or for
the life of the Fund, if shorter. These are the rates of return that would
equate the initial amount invested to the ending redeemable value. These rates
of return are calculated pursuant to the following formula: P(1 + T)(n) = ERV
(where P = a hypothetical initial payment of $1,000, T = the average annual
total return, n = the number of years and ERV = the ending redeemable value of a
hypothetical $1,000 payment made at the beginning of the period). All total
return figures reflect the deduction of a proportional share of Fund expenses on
an annual basis, and assume that all dividends and distributions are reinvested
when paid.
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14. ADDITIONAL INFORMATION
BERGER/BIAM WORLDWIDE FUNDS TRUST AND THE FUND
The Trust is a Delaware business trust organized on May 31, 1996. The
Fund was established on May 31, 1996, as a series of the Trust. The Trust is
authorized to issue an unlimited number of shares of beneficial interest in
series or portfolios. Currently, the series comprising the Fund is one of three
series established under the Trust, although others may be added in the future.
The Trust is also authorized to establish multiple classes of shares
representing differing interests in an existing or new series.
Under Delaware law, shareholders of the Trust will enjoy the same
limitations on personal liability as extended to stockholders of a Delaware
corporation. Further, the Trust Instrument of the Trust provides that no
shareholder shall be personally liable for the debts, liabilities, obligations
and expenses incurred by, contracted for or otherwise existing with respect to,
the Trust or any particular series (fund) of the Trust. However, the principles
of law governing the limitations of liability of beneficiaries of a business
trust have not been authoritatively established as to business trusts organized
under the laws of one jurisdiction but operating or owning property in other
jurisdictions. In states that have adopted legislation containing provisions
comparable to the Delaware Business Trust Act, it is believed that the
limitation of liability of beneficial owners provided by Delaware law should be
respected. In those jurisdictions that have not adopted similar legislative
provisions, it is possible that a court might hold that the shareholders of the
Trust are not entitled to the limitations of liability set forth in Delaware law
or the Trust Instrument and, accordingly, that they may be personally liable for
the obligations of the Trust.
In order to protect shareholders from such potential liability, the
Trust Instrument requires that every written obligation of the Trust or any
series thereof contain a statement to the effect that such obligation may only
be enforced against the assets of the Trust or such series. The Trust
Instrument also provides for indemnification from the assets of the relevant
series for all losses and expenses incurred by any shareholder by reason of
being or having been a shareholder, and that the Trust shall, upon request,
assume the defense of any such claim made against such shareholder for any act
or obligation of the relevant series and satisfy any judgment thereon from the
assets of that series.
As a result, the risk of a Berger/BIAM International CORE Fund
shareholder incurring financial loss on account of shareholder liability is
limited to circumstances in which the Fund itself would be unable to meet its
obligations. The Trust believes that, in view of the above, the risk of
personal liability to shareholders of the Fund is remote. The trustees
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intend to conduct the operations of the Trust and the Fund so as to avoid, to
the extent possible, liability of shareholders for liabilities of the Trust or
the Fund.
Shares of the Fund have no preemptive rights, and since the Fund has
only one class of securities there are no sinking funds or arrearage provisions
which may affect the rights of the Fund shares. Fund shares have no conversion
or subscription rights.
As of the date of this Statement of Additional Information, all of the
outstanding shares of the Fund were held by Berger Associates, Inc., a Delaware
corporation and controlling person of the Advisor, which provided the seed
capital necessary to establish the Trust.
BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST AND THE PORTFOLIO
Worldwide Portfolios is also 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 "Performance" in the
Prospectus 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. The Delaware law information set forth above with respect to the
Trust also applies to Worldwide Portfolios and investors in the Portfolio.
Each investor in the Portfolio, including the Fund, is entitled to a
vote in proportion to the amount of its investment in the Portfolio. Whenever
the Fund is requested to vote as an investor in the Portfolio on matters
pertaining to the Portfolio (other than a vote by the Fund to continue the
operation of the Portfolio upon the withdrawal of another investor in the
Portfolio), the Fund will hold a meeting of its shareholders and will cast all
of its votes as an investor in the Portfolio in the same proportion as directed
by the votes of the Fund's shareholders. Fund shareholders who do not vote will
not affect the votes cast by the Fund at the meeting of the Portfolio investors.
The percentage of the votes representing the Fund's shareholders who do not vote
will be voted by the Fund in the same proportion as the Fund's shareholders who
do, in fact, vote.
DISTRIBUTION
The Distributor is the principal underwriter of the Fund's shares.
The Distributor is a registered broker-dealer under the Securities Exchange Act
of 1934 and is a member of the National Association of Securities Dealers, Inc.
The Distributor acts as the agent of the Fund in connection with the sale of its
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shares in all states in which the shares are registered and in which the
Distributor is qualified as a broker-dealer.
The Trust, on behalf of the Fund, and the Distributor are parties to a
Distribution Agreement that continues for two years from its date of execution
and thereafter from year to year if such continuation is specifically approved
at least annually by the trustees or by vote of a majority of the outstanding
shares of the Fund and in either case by vote of a majority of the trustees of
the Trust who are not "interested persons" (as that term is defined in the
Investment Company Act of 1940) of the Trust or the Distributor. The
Distribution Agreement is subject to termination by the Fund or the Distributor
on not more than 60 days' nor less than 30 days' prior written notice, and
terminates automatically in the event of its assignment. Under the Distribution
Agreement, the Distributor continuously offers the Fund's shares and solicits
orders to purchase Fund shares at net asset value.
OTHER INFORMATION
Davis, Graham & Stubbs LLP, 370 Seventeenth Street, Denver, Colorado,
has acted as counsel for the Trust and the Fund. Dechert Price & Rhoads, 1500 K
Street, N.W., Washington, DC, has acted as special counsel for the Trust and the
Fund.
Price Waterhouse LLP, 950 Seventeenth Street, Denver, Colorado, has
been appointed to act as independent accountants for the Fund and the Portfolio
for the fiscal year ended July 31, 1997.
The Berger/BIAM Worldwide Funds Trust has filed with the Commission,
Washington, D.C., a Registration Statement under the Securities Act of 1933, as
amended, with respect to the securities of the Berger/BIAM International CORE
Fund, of which this Statement of Additional Information is a part. If further
information is desired with respect to the Fund or its securities, reference is
made to the Registration Statement and the exhibits filed as a part thereof.
FINANCIAL STATEMENTS
The following financial statements appear attached to the end of this
Statement of Additional Information:
For Berger/BIAM Worldwide Funds Trust:
Report of the Independent Accountants, dated , 1996
Statement of Assets and Liabilities of the Berger/BIAM International
CORE Fund, as of , 1996
Notes to Statement of Assets and Liabilities, dated ,
1996
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For Berger/BIAM Worldwide Portfolios Trust:
Report of the Independent Accountants, dated , 1996
Statement of Assets and Liabilities of the Berger/BIAM International
Portfolio, as of , 1996
Notes to Statement of Assets and Liabilities, dated ,
1996
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APPENDIX A
HIGH-YIELD/HIGH RISK CONVERTIBLE BONDS
The Portfolio may purchase securities which are convertible into
common stock when the Portfolio's Sub-Advisor believes they offer the potential
for a higher total return than nonconvertible securities. While fixed income
securities generally have a priority claim on a corporation's assets over that
of common stock, some of the convertible securities which the 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.
Specifically, corporate debt securities which are below investment
grade (securities rated Ba or lower by Moody's or BB or lower by Standard &
Poor's) and unrated securities which the Portfolio may purchase and hold are
subject to a higher risk of non-payment of principal or interest, or both, than
higher grade debt securities. Generally speaking, the lower the quality of a
debt security (which may be reflected in its Moody's and/or Standard & Poor's
ratings), the higher the yield it will provide, but the greater the risk that
interest or principal payments will not be made when due. Thus, the lower the
grade of a security, the more speculative characteristics it generally has.
Information about the ratings of Moody's and Standard & Poor's, and the
investment risks associated with the various ratings, is set forth below.
The market prices of these lower grade convertible 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.
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.
-34-
<PAGE>
KEY TO MOODY'S CORPORATE RATINGS
Aaa-Bbonds 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-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.
-35-
<PAGE>
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.
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.
-36-
<PAGE>
PART C. OTHER INFORMATION
Item 24. FINANCIAL STATEMENTS AND EXHIBITS:
(a) FINANCIAL STATEMENTS.
In Part A of the Registration Statement (Prospectus):
None.
To be included in Part B of the Registration Statement (Statement of
Additional Information) in a Pre-Effective Amendment to this
Registration Statement:
BERGER/BIAM WORLDWIDE FUNDS TRUST
1. Report of Independent Accountants, dated ________, 1996
2. Statement of Assets and Liabilities of the Berger/BIAM
International Fund, as of __________, 1996 (in the Statement of
Additional Information for the Berger/BIAM International Fund)
Statement of Assets and Liabilities of the Berger/BIAM
International Institutional Fund, as of __________, 1996 (in the
Statement of Additional Information for the Berger/BIAM
International Institutional Fund)
Statement of Assets and Liabilities of the Berger/BIAM
International CORE Fund, as of __________, 1996 (in the Statement
of Additional Information for the Berger/BIAM International CORE
Fund)
3. Notes to Statements of Assets and Liabilities, dated
_______________, 1996
BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST
1. Report of Independent Accountants, dated ________, 1996
2. Statements of Assets and Liabilities of the Berger/BIAM
International Portfolio, as of __________, 1996
3. Notes to Statements of Assets and Liabilities, dated
____________, 1996
In Part C of the Registration Statement:
None.
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<PAGE>
(b) EXHIBITS.
The Exhibit Index following the signature pages below is incorporated
herein by reference.
Item 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
On the date that this Registration Statement is declared effective, Berger
Associates, Inc. ("Berger Associates"), a Delaware corporation and controlling
person of BBOI Worldwide LLC ("BBOI Worldwide"), will own all of the outstanding
shares of the Registrant, having provided all the initial seed capital to
establish the Registrant. Consequently, Berger Associates will be a control
person of the Registrant. Berger Associates will continue to be a control
person of the Registrant so long as it holds more than 25% of the Registrant's
outstanding shares, as the term "control" is defined in the Investment Company
Act of 1940. So long as the Registrant is controlled by Berger Associates, it
will also be under the control of the corporate parent of Berger Associates,
Kansas City Southern Industries, Inc. ("KCSI"). See "Management and Investment
Advice" in the Prospectus and "Investment Advisor" in the Statement of
Additional Information for more information on KCSI and its affiliates.
Item 26. NUMBER OF HOLDERS OF SECURITIES
The number of record holders of shares of beneficial interest in the
Registrant as of the effective date of this Registration Statement, was as
follows:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SERIES OR FUND NUMBER OF HOLDERS
OF SHARES
- --------------------------------------------------------------------------------
Berger/BIAM International Fund 1
- --------------------------------------------------------------------------------
Berger/BIAM International 1
Institutional Fund
- --------------------------------------------------------------------------------
Berger/BIAM International CORE Fund 1
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Item 27. INDEMNIFICATION
Article IX, Section 2 of the Trust Instrument for Berger/BIAM
Worldwide Funds Trust (the "Trust") provides for indemnification of certain
persons acting on behalf of the Trust to the fullest extent permitted by the
law. In general, trustees, officers, employees 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
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<PAGE>
their duties, or unless it has been determined that they have not acted in good
faith in the reasonable belief that their actions were in or not opposed to the
best interests of the Trust. The Trust also may advance money for these
expenses, provided that the trustees, officers, employees or agents undertake to
repay the Trust if their conduct is later determined to preclude
indemnification. The Trust has the power to purchase insurance on behalf of its
trustees, officers, employees and agents, whether or not it would be permitted
or required to indemnify them for any such liability under the Trust Instrument
or applicable law, and the Trust has purchased and maintains an insurance policy
covering such persons against certain liabilities incurred in their official
capacities.
Item 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISOR
The business of BBOI Worldwide, the investment advisor of the
Portfolio, and Berger Associates, the sole owner of BBOI Worldwide, are
described in the Prospectus in Section 6 and in the Statement of Additional
Information in Section 4 which are included in this Registration Statement.
The business of BIAM, the sub-advisor to the Berger/BIAM International
Portfolio, is also described in Section 6 of the Prospectus and in Section 4 of
the Statement of Additional Information. Information relating to the business
and other connections of the officers and directors of BIAM (current and for the
past two years) is listed in Schedules A and D of BIAM's Form ADV as filed with
the Securities and Exchange Commission (File No. 801-29606, dated June 28,
1996), which information from such schedules is incorporated herein by
reference.
Item 29. PRINCIPAL UNDERWRITERS
Not applicable.
Item 30. LOCATION OF ACCOUNTS AND RECORDS
The accounts, books and other documents required to be maintained by
Section 31(a) of the 1940 Act and the rules promulgated thereunder are
maintained as follows:
(a) Shareholder records are maintained by the Registrant's sub-
transfer agent, DST Systems, Inc., P.O. Box 419958, Kansas City,
MO 64141;
(b) Accounting records relating to cash and other money balances;
asset, liability, reserve, capital, income and expense accounts;
portfolio securities; purchases and sales; and brokerage
commissions are maintained by the Registrant's Recordkeeping and
Pricing Agent, Investors Fiduciary Trust Company ("IFTC"),
127 West 10th
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<PAGE>
Street, Kansas City, Missouri 64105. Other records of the
Registrant relating to purchases and sales; the Trust Instrument,
minute books and other trust records; brokerage orders;
performance information and other records are maintained at the
offices of the Registrant at 210 University Boulevard, Suite 900,
Denver, Colorado 80206.
(c) Certain records relating to day-to-day portfolio management of
the Berger/BIAM 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, 2 Greenwich Plaza, Greenwich, Connecticut 06830.
Item 31. MANAGEMENT SERVICES
The Registrant has no management-related service contract which is not
discussed in Parts A and B of this form. See Section 7 of the Prospectus and
Section 5 of the Statement of Additional Information for a discussion of the
Recordkeeping and Pricing Agent Agreement entered into between the Registrant
and IFTC and the Administrative Services Agreements entered into between the
Registrant and BBOI Worldwide, investment advisor to the Registrant.
Item 32. UNDERTAKINGS
(a) Registrant hereby undertakes to file a post-effective amendment,
containing reasonably current financial statements relating to each of the
Berger/BIAM International Fund, the Berger/BIAM International Institutional Fund
and the Berger/BIAM International CORE Fund (which need not be certified) within
four to six months of the later of the effective date of this Registration
Statement or commencement of operations of each such Fund respectively.
(b) The Registrant undertakes to furnish each person to whom a
prospectus is delivered with a copy of Registrant's latest annual report to
shareholders, upon request and without charge.
(c) Registrant undertakes to comply with the following policy with
respect to calling meetings of shareholders for the purpose of voting upon the
removal of any trustee of the Registrant and facilitating shareholder
communications related to such meetings:
1. The trustees will promptly call a meeting of shareholders for the
purpose of voting upon the removal of any trustee of the Registrant when
requested in writing to do so by the record holders of at least 10% of the
outstanding shares of the Registrant.
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<PAGE>
2. Whenever ten or more shareholders of record who have been
shareholders of the Registrant for at least six months, and who hold in the
aggregate either shares having a net asset value of at least $25,000 or at least
1% of the outstanding shares of the Registrant, whichever is less, apply to the
trustees in writing stating that they wish to communicate with other
shareholders with a view to obtaining signatures to request such a meeting, and
deliver to the trustees a form of communication and request which they wish to
transmit, the trustees within 5 business days after receipt of such application
either will (i) give such applicants access to a list of the names and addresses
of all shareholders of record of the Registrant, or (ii) inform such applicants
of the approximate number of shareholders of record and the approximate cost of
mailing the proposed communication and form of request.
3. If the trustees elect to follow the course specified in clause
(ii), above, the trustees, upon the written request of such applicants
accompanied by tender of the material to be mailed and the reasonable expenses
of the mailing, will, with reasonable promptness, mail such material to all
shareholders of record, unless within 5 business days after such tender the
trustees shall mail to such applicants and file with the Securities and Exchange
Commission (the "Commission"), together with a copy of the material requested to
be mailed, a written statement signed by at least a majority of the trustees to
the effect that in their opinion either such material contains untrue statements
of fact or omits to state facts necessary to make the statements contained
therein not misleading, or would be in violation of applicable law, and
specifying the basis of such opinion.
4. If the Commission enters an order either refusing to sustain any
of the trustees' objections or declaring that any objections previously
sustained by the Commission have been resolved by the applicants, the trustees
will cause the Registrant to mail copies of such material to all shareholders of
record with reasonable promptness after the entry of such order and the renewal
of such tender.
(d) Insofar as indemnification for liability arising under the
Securities Act of 1933 may be permitted to trustees, officers and controlling
persons of the Registrant pursuant to the provisions set forth above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liability (other than the payment by the
Registrant of expense incurred or paid by a trustee, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate
C-5
<PAGE>
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
C-6
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant, Berger/BIAM Worldwide Funds
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 16th day of August, 1996.
BERGER/BIAM WORLDWIDE FUNDS TRUST
(Registrant)
By /s/ Gerard M. Lavin
---------------------------------------
Name: Gerard M. Lavin
----------------------------------
Title: President
---------------------------------
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the Registration Statement has been signed below by the following
persons in the capacities indicated for Berger/BIAM Worldwide Funds Trust and on
the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Gerard M. Lavin President (Principal August 16, 1996
- --------------------------- Executive Officer)
Gerard M. Lavin and Trustee
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<PAGE>
/s/ Kevin R. Fay Vice President, August 16, 1996
- --------------------------- Secretary and Treasurer
Kevin R. Fay (Principal Financial
and Accounting Officer)
/s/ Dennis E. Baldwin* Trustee August 16, 1996
- ---------------------------
Dennis E. Baldwin
/s/ William M.B. Berger* Trustee August 16, 1996
- ---------------------------
William M.B. Berger
/s/ Louis R. Bindner* Trustee August 16, 1996
- ---------------------------
Louis R. Bindner
/s/ Katherine A. Cattanach* Trustee August 16, 1996
- ---------------------------
Katherine A. Cattanach
/s/ Lucy Black Creighton* Trustee August 16, 1996
- ---------------------------
Lucy Black Creighton
/s/ Paul R. Knapp* Trustee August 16, 1996
- ---------------------------
Paul R. Knapp
/s/ Harry T. Lewis, Jr.* Trustee August 16, 1996
- ---------------------------
Harry T. Lewis, Jr.
/s/ Michael Owen* Trustee August 16, 1996
- ---------------------------
Michael Owen
/s/ William Sinclaire* Trustee August 16, 1996
- ---------------------------
William Sinclaire
/s/ Gerard M. Lavin
- ---------------------------
*By: Gerard M. Lavin
Attorney-in-Fact
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<PAGE>
SIGNATURES
Berger/BIAM Worldwide Portfolios Trust has duly caused this amendment
to the Registration Statement on Form N-1A of Berger/BIAM Worldwide Funds Trust
to be signed under the Securities Act of 1933 on its behalf by the undersigned,
thereunto duly authorized, in the City and County of Denver, and State of
Colorado, on the 16th day of August, 1996.
BERGER/BIAM WORLDWIDE PORTFOLIOS TRUST
(Registrant)
By /s/ Gerard M. Lavin
---------------------------------------
Name: Gerard M. Lavin
----------------------------------
Title: President
---------------------------------
This amendment to the Registration Statement of Berger/BIAM Worldwide
Funds Trust has been signed below under the Securities Act of 1933 by the
following persons in the capacities indicated for Berger/BIAM Worldwide
Portfolios Trust and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Gerard M. Lavin President (Principal August 16, 1996
- --------------------------- Executive Officer)
Gerard M. Lavin and Trustee
/s/ Kevin R. Fay Vice President, August 16, 1996
- --------------------------- Secretary and Treasurer
Kevin R. Fay (Principal Financial
and Accounting Officer)
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<PAGE>
/s/ Dennis E. Baldwin* Trustee August 16, 1996
- ---------------------------
Dennis E. Baldwin
/s/ William M.B. Berger* Trustee August 16, 1996
- ---------------------------
William M.B. Berger
/s/ Louis R. Bindner* Trustee August 16, 1996
- ---------------------------
Louis R. Bindner
/s/ Katherine A. Cattanach* Trustee August 16, 1996
- ---------------------------
Katherine A. Cattanach
/s/ Lucy Black Creighton* Trustee August 16, 1996
- ---------------------------
Lucy Black Creighton
/s/ Paul R. Knapp* Trustee August 16, 1996
- ---------------------------
Paul R. Knapp
/s/ Harry T. Lewis, Jr.* Trustee August 16, 1996
- ---------------------------
Harry T. Lewis, Jr.
/s/ Michael Owen* Trustee August 16, 1996
- ---------------------------
Michael Owen
/s/ William Sinclaire* Trustee August 16, 1996
- ---------------------------
William Sinclaire
/s/ Gerard M. Lavin
- ---------------------------
*By: Gerard M. Lavin
Attorney-in-Fact
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<PAGE>
EXHIBIT INDEX
N-1A EDGAR
Exhibit Exhibit
No. No. Name of Exhibit
- ------ -------- -----------------
* Exhibit 1 EX-99.B1 Trust Instrument
* Exhibit 2 EX-99.B2 Bylaws
Exhibit 3 Not applicable
Exhibit 4 Not applicable
Exhibit 5 Not applicable
* Exhibit 6 EX-99.B6 Distribution Agreement between Berger/BIAM
Worldwide Funds Trust and First Fund
Distributors, Inc.
Exhibit 7 Not applicable
* Exhibit 8 EX-99.B8 Custody Agreement between IFTC and
Berger/BIAM Worldwide Funds Trust
** Exhibit 9.1.1 EX-99.B9.1.1 New Account Application
** Exhibit 9.1.2 EX-99.B9.1.2 New Account Application for Berger/BIAM
International Institutional Fund
** Exhibit 9.1.3 EX-99.B9.1.3 New Account Application for Berger/BIAM
International CORE Fund
* Exhibit 9.2.1 EX-99.B9.2.1 Form of Administrative Services Agreement
for Berger/BIAM International Fund
* Exhibit 9.2.2 EX-99.B9.2.2 Form of Administrative Services Agreement
for Berger/BIAM International
Institutional Fund
* Exhibit 9.2.3 EX-99.B9.2.3 Form of Administrative Services Agreement
for Berger/BIAM International CORE Fund
* Exhibit 9.2.4 EX-99.B9.2.4 Form of Sub-Administration Agreement
between BBOI Worldwide LLC and Berger
Associates, Inc.
* Exhibit 9.3 EX-99.B9.3 Form of Recordkeeping and Pricing Agent
Agreement
* Exhibit 9.4 EX-99.B9.4 Form of Agency Agreement
** Exhibit 10 EX-99.B10 Opinion and consent of Davis, Graham &
Stubbs LLP
** Exhibit 11 EX-99.B11 Consent of Price Waterhouse LLP
Exhibit 12 Not applicable
** Exhibit 13 EX-99.B13 Investment Letter from Initial Stockholder
** Exhibit 14.1 EX-99.B14.1 Form 5305-A Individual Retirement
Custodial Account and Related Documents
** Exhibit 14.2 EX-99.B14.2 Investment Company Institute Prototype
Money Purchase Pension and Profit Sharing
Plan Basic Document #01 and Related
Documents
** Exhibit 14.3 EX-99.B14.3 403(b)(7) Plan Custodial Account Agreement
and Related Documents
* Exhibit 15 EX-99.B15 Rule 12b-1 Plan for Berger/BIAM
International Fund
<PAGE>
** Exhibit 16 EX-99.B16 Schedule for Computation of Performance
Data
*** Exhibit 17.1 Financial Data Schedule for Berger/BIAM
International Fund
*** Exhibit 17.2 Financial Data Schedule for Berger/BIAM
International Institutional Fund
*** Exhibit 17.3 Financial Data Schedule for Berger/BIAM
International CORE Fund
Exhibit 18 Not Applicable
- ---------------------------
* Filed herewith.
** To be filed by amendment.
*** Not required to be filed until financial statements for Fund are required.
<PAGE>
EXHIBIT 1
BERGER/BIAM WORLDWIDE FUNDS TRUST
(A Delaware Business Trust)
TRUST INSTRUMENT
Dated May 31, 1996
<PAGE>
<TABLE>
TABLE OF CONTENTS
Page
----
<S> <C> <C>
ARTICLE I DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II THE TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1. Management of the Trust . . . . . . . . . . . . . . . . . . . . 2
Section 2. Initial Trustees and Number of Trustees . . . . . . . . . . . . 2
Section 3. Term of Office of Trustees. . . . . . . . . . . . . . . . . . . 2
Section 4. Vacancies; Appointment of Trustees. . . . . . . . . . . . . . . 3
Section 5. Temporary Vacancy or Absence. . . . . . . . . . . . . . . . . . 3
Section 6. Chairman. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 7. Action by the Trustees. . . . . . . . . . . . . . . . . . . . . 3
Section 8. Ownership of Trust Property . . . . . . . . . . . . . . . . . . 4
Section 9. Effect of Trustees Not Serving. . . . . . . . . . . . . . . . . 4
Section 10. Trustees, Etc. as Shareholders. . . . . . . . . . . . . . . . . 4
ARTICLE III POWERS OF THE TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1. Powers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2. Certain Transactions. . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE IV SERIES; CLASSES; SHARES. . . . . . . . . . . . . . . . . . . . . . . 8
Section 1. Establishment of Series or Classes. . . . . . . . . . . . . . . 8
Section 2. Shares of Beneficial Interest . . . . . . . . . . . . . . . . . 9
Section 3. Investment in the Trust . . . . . . . . . . . . . . . . . . . 10
Section 4. Assets and Liabilities of Series. . . . . . . . . . . . . . . 10
Section 5. Ownership and Transfer of Shares. . . . . . . . . . . . . . . . 11
Section 6. Status of Shares: Limitation of Shareholder Liability. . . . . 11
ARTICLE V DISTRIBUTIONS AND REDEMPTIONS. . . . . . . . . . . . . . . . . . . . 12
Section 1. Distributions . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 2. Redemptions . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 3. Determination of Net Asset Value. . . . . . . . . . . . . . . . 13
Section 4. Suspension of Right of Redemption . . . . . . . . . . . . . . . 13
Section 5. Redemptions Necessary for Qualification as Regulated
Investment Company. . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE VI SHAREHOLDERS' VOTING POWERS AND MEETINGS . . . . . . . . . . . . . . 14
Section 1. Voting Powers . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 2. Meetings of Shareholders. . . . . . . . . . . . . . . . . . . . 14
Section 3. Quorum; Required Vote . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE VII CONTRACTS WITH SERVICE PROVIDERS . . . . . . . . . . . . . . . . . . 15
Section 1. Investment Adviser. . . . . . . . . . . . . . . . . . . . . . . 15
Section 2. Principal Underwriter . . . . . . . . . . . . . . . . . . . . . 15
</TABLE>
i
<PAGE>
<TABLE>
Page
----
<S> <C> <C>
Section 3. Transfer Agency, Shareholder Services and Administration
Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 4. Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 5. Parties to Contracts with Service Providers . . . . . . . . . . 16
ARTICLE VIII EXPENSES OF THE TRUST AND SERIES . . . . . . . . . . . . . . . . . . 17
ARTICLE IX LIMITATION OF LIABILITY AND INDEMNIFICATION. . . . . . . . . . . . . 17
Section 1. Limitation of Liability . . . . . . . . . . . . . . . . . . . . 17
Section 2. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 3. Indemnification of Shareholders . . . . . . . . . . . . . . . . 20
ARTICLE X MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 1. Trust Not a Partnership . . . . . . . . . . . . . . . . . . . . 20
Section 2. Trustee Action; Expert Advice; No Bond or Surety. . . . . . . . 20
Section 3. Record Dates. . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 4. Termination of the Trust. . . . . . . . . . . . . . . . . . . . 21
Section 5. Reorganization; Merger; Consolidation . . . . . . . . . . . . . 22
Section 6. Trust Instrument. . . . . . . . . . . . . . . . . . . . . . . . 22
Section 7. Applicable Law. . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 8. Amendments. . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 9. Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 10. Severability. . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 11. Use of the Names "Berger" and "BIAM". . . . . . . . . . . . . . 24
</TABLE>
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<PAGE>
BERGER/BIAM WORLDWIDE FUNDS TRUST
TRUST INSTRUMENT
This TRUST INSTRUMENT is made on May 31, 1996, by the Trustees, to
establish a business trust under the law of Delaware for the investment and
reinvestment of funds contributed to the Trust by investors. The Trustees
declare that all money and property contributed to the Trust shall be held and
managed in trust pursuant to this Trust Instrument. The name of the Trust
created by this Trust Instrument is Berger/BIAM Worldwide Funds Trust.
ARTICLE I
DEFINITIONS
Unless otherwise provided or required by the context:
(a) "Bylaws" means the Bylaws of the Trust adopted by the Trustees, which
Bylaws are incorporated by reference herein in their entirety, as amended from
time to time;
(b) "Class" means any class of Shares of a Series established pursuant to
Article IV;
(c) "Commission," "Interested Person," and "Principal Underwriter" have
the meanings provided in the 1940 Act;
(d) "Covered Person" means a person so defined in Article IX, Section 2;
(e) "Delaware Act" means the Delaware Business Trust Act, 12 Del.C.
Section 3801 ET SEQ., as amended from time to time;
(f) "Majority Shareholder Vote" means "the vote of a majority of the
outstanding voting securities" as defined in the 1940 Act;
(g) "Net Asset Value" means the net asset value per share of each Series
or Class of the Trust, determined as provided in Article V, Section 3;
(h) "Outstanding Shares" means Shares shown in the books of the Trust or
its transfer agent as then issued and outstanding, but does not include Shares
which have been repurchased or redeemed by the Trust and which are held in the
treasury of the Trust;
(i) "Series" means a series of Shares established pursuant to Article IV;
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(j) "Shareholder" means a record owner of Outstanding Shares;
(k) "Shares" means the equal proportionate transferable units of interest
into which the beneficial interest of each Series or Class is divided from time
to time (including whole Shares and fractions of Shares);
(l) "Trust" means Berger/BIAM Worldwide Funds Trust established hereby,
and reference to the Trust, when applicable to one or more Series, refers to
that Series;
(m) "Trustees" means the persons who have signed this Trust Instrument, so
long as they shall continue in office in accordance with the terms hereof, and
all other persons who may from time to time be duly qualified and serving as
Trustees in accordance with Article II, in all cases in their capacities as
Trustees hereunder;
(n) "Trust Property" means any and all property, real or personal,
tangible or intangible, which is owned or held by or for the Trust or any Series
or the Trustees on behalf of the Trust or any Series;
(o) The "1940 Act" means the Investment Company Act of 1940, as amended
from time to time.
ARTICLE II
THE TRUSTEES
SECTION 1. MANAGEMENT OF THE TRUST. The business and affairs of the Trust
shall be managed by or under the direction of the Trustees, and they shall have
all powers necessary or desirable to carry out that responsibility. The
Trustees may execute all instruments and take all action they deem necessary or
desirable to promote the interests of the Trust. Any determination made by the
Trustees in good faith as to what is in the interests of the Trust shall be
conclusive.
SECTION 2. INITIAL TRUSTEES AND NUMBER OF TRUSTEES. The initial Trustees
shall be the persons signing this Trust Instrument. The exact number of
Trustees (other than the initial Trustees) shall be fixed from time to time by a
majority of the Trustees, provided, that there shall be at least two (2)
Trustees. Other than the initial Trustees and Trustees appointed to fill
vacancies pursuant to Section 4 of this Article, the Shareholders shall elect
the Trustees by a plurality vote on such dates as the Trustees may fix from time
to time.
SECTION 3. TERM OF OFFICE OF TRUSTEES. Each Trustee shall hold office for
life or until his successor is elected and qualified or the Trust terminates;
except that (a) any Trustee may
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resign by delivering to the other Trustees or to any Trust officer a written
resignation effective upon such delivery or a later date specified therein;
(b) any Trustee who requests to be retired, or who has become physically or
mentally incapacitated or is otherwise unable to serve, may be retired by a
written instrument signed by a majority of the other Trustees, specifying the
effective date of retirement; (c) any Trustee shall be retired or removed
with or without cause at any time upon the unanimous written request of the
remaining Trustees; and (d) any Trustee may be removed at any meeting of the
Shareholders by a vote of at least two-thirds of the Outstanding Shares.
SECTION 4. VACANCIES; APPOINTMENT OF TRUSTEES. Whenever a vacancy shall
exist, regardless of the reason for such vacancy, the remaining Trustees shall
appoint any person as they determine in their sole discretion to fill that
vacancy, consistent with the limitations under the 1940 Act. Such appointment
shall be made by a written instrument signed by a majority of the Trustees or by
a resolution of the Trustees, duly adopted and recorded in the records of the
Trust, specifying the effective date of the appointment. The Trustees may
appoint a new Trustee as provided above in anticipation of a vacancy expected to
occur because of the retirement, resignation or removal of a Trustee, or an
increase in number of Trustees, provided that such appointment shall become
effective only at or after the expected vacancy occurs. As soon as any such
Trustee has accepted his or her appointment in writing, the Trust estate shall
vest in the new Trustee, together with the continuing Trustees, without any
further act or conveyance, and he or she shall be deemed a Trustee hereunder.
SECTION 5. TEMPORARY VACANCY OR ABSENCE. Whenever a vacancy in the
Trustees shall occur, until such vacancy is filled, or while any Trustee is
absent from his domicile (unless that Trustee has made arrangements to be
informed about, and to participate in, the affairs of the Trust during such
absence), or is physically or mentally incapacitated, the remaining Trustees
shall have all the powers hereunder and their certificate as to such vacancy,
absence or incapacity shall be conclusive. Any Trustee may, by power of
attorney, delegate his powers as Trustee for a period not to exceed six (6)
months, unless otherwise extended for one or more additional consecutive six (6)
month periods, to any other Trustee or Trustees.
SECTION 6. CHAIRMAN. The Trustees may appoint one of their number to be a
non-officer Chairman of the Trustees. In such event, the Chairman shall preside
at all meetings of the Trustees.
SECTION 7. ACTION BY THE TRUSTEES. The Trustees shall act by majority
vote at a meeting duly called (including at a telephonic meeting at which all
participants can hear one another, unless the 1940 Act requires that a
particular action be taken only at a meeting of the Trustees in person) at which
a quorum is present or by written consent of a majority of Trustees (or such
greater number as may be required by applicable law) without a
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meeting. A majority of the Trustees shall constitute a quorum at any
meeting. Meetings of the Trustees may be called orally or in writing by the
Chairman of the Trustees or by any two other Trustees. Notice of the time,
date and place of all Trustees meetings shall be given to each Trustee by
telephone, facsimile or other electronic mechanism sent to his home or
business address at least twenty-four hours in advance of the meeting or by
written notice mailed to his home or business address at least seventy-two
hours in advance of the meeting. Notice need not be given to any Trustee who
attends the meeting without objecting to the lack of notice or who signs a
waiver of notice either before, at or after the meeting. Subject to the
requirements of the 1940 Act, the Trustees by majority vote may delegate to
any Trustee or Trustees authority to approve particular matters or take
particular actions on behalf of the Trust. Any written consent or waiver may
be provided and delivered to the Trust by facsimile or other similar
electronic mechanism.
SECTION 8. OWNERSHIP OF TRUST PROPERTY. The Trust Property of the Trust
and of each Series shall be held separate and apart from any assets now or
hereafter held in any capacity other than as Trustee hereunder by the Trustees
or any successor Trustees. All of the Trust Property and legal title thereto
shall at all times be considered as vested in the Trust, provided that the
Trustees may cause legal title to any Trust Property to be held by or in the
name of the Trustees acting on behalf of the Trust, or in the name of any person
as nominee. No Shareholder shall be deemed to have a severable ownership in any
individual asset of the Trust or of any Series or any right of partition or
possession thereof, but each Shareholder shall have, as provided in Article IV,
a proportionate undivided beneficial interest in the Trust or Series represented
by Shares. The Trust or the Trustees on behalf of the Trust shall be deemed to
hold legal and beneficial ownership of any income earned on securities held by
the Trust issued by any business entity formed, organized or existing under the
laws of any jurisdiction other than a state, commonwealth, possession or colony
of the United States or the laws of the United States.
SECTION 9. EFFECT OF TRUSTEES NOT SERVING. The death, resignation,
retirement, removal, incapacity or inability or refusal to serve of the
Trustees, or any one of them, shall not operate to annul the Trust or to revoke
any existing agency created pursuant to the terms of this Trust Instrument.
SECTION 10. TRUSTEES, ETC. AS SHAREHOLDERS. Subject to any restrictions
in the Bylaws, any Trustee, officer, agent or independent contractor of the
Trust may acquire, own and dispose of Shares to the same extent as any other
Shareholder, and the Trustees may issue and sell Shares to and buy Shares from
any such person or any firm or company in which such person is interested,
subject only to any general limitations herein.
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ARTICLE III
POWERS OF THE TRUSTEES
SECTION 1. POWERS. The Trustees in all instances shall act as principals,
free of the control of the Shareholders. The Trustees shall have full power and
authority to take or refrain from taking any action and to execute any contracts
and instruments that they may consider necessary or desirable in the management
of the Trust. The Trustees shall not in any way be bound or limited by current
or future laws or customs applicable to trust investments, but shall have full
power and authority to make any investments which they, in their sole
discretion, deem proper to accomplish the purposes of the Trust. The Trustees
may exercise all of their powers without recourse to any court or other
authority. Subject to any applicable limitation herein or in the Bylaws or
resolutions of the Trust, the Trustees shall have power and authority, without
limitation:
(a) To invest and reinvest cash and other property, and to hold cash
or other property uninvested, without in any event being bound or limited by any
current or future law or custom concerning investments by trustees, and to sell,
exchange, lend, pledge, mortgage, hypothecate, write options on and lease any or
all of the Trust Property; to invest in obligations, securities and assets of
any kind, and without regard to whether they may mature before or after the
possible termination of the Trust; and without limitation to invest all or any
part of its cash and other assets and property in securities issued by any
investment company or series thereof;
(b) To operate as and carry on the business of an investment company,
and exercise all the powers necessary and proper to conduct such a business;
(c) To adopt Bylaws not inconsistent with this Trust Instrument
providing for the conduct of the business of the Trust and to amend and repeal
them to the extent such right is not reserved to the Shareholders;
(d) To elect and remove such officers and appoint and terminate such
agents, independent contractors and delegatees as they deem appropriate;
(e) To employ an investment adviser (subject to such general or
specific instruments as the Trustees may from time to time adopt) to effect
purchases, sales, loans or exchanges of Trust Property on behalf of the Trustees
or may authorize any officer, employee or Trustee to effect such purchases,
sales, loans or exchanges pursuant to recommendations of any such investment
adviser;
(f) To employ as custodian of any Trust Property, subject to any
provisions herein or in the Bylaws, one or more
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banks, trust companies or companies that are members of a national securities
exchange, or other entities permitted by the Commission to serve as such;
(g) To retain one or more transfer agents, dividend disbursing
agents, placement agents, administrators, or Shareholder servicing agents, or
both;
(h) To provide for the distribution of Shares, either through a
Principal Underwriter or distributor as provided herein, or by the Trust itself,
or both, or pursuant to a distribution plan of any kind;
(i) To set record dates in the manner provided for herein or in the
Bylaws;
(j) To delegate such authority as they consider desirable to any
officers of the Trust and to any agent, subagent, independent contractor,
delegatee, manager, investment adviser, custodian or underwriter;
(k) To sell or exchange any or all of the Trust Property, subject to
Article X, Section 4;
(l) To vote or give assent, or exercise any rights of ownership, with
respect to securities or other property; and to execute and deliver powers of
attorney delegating such power to other persons;
(m) To exercise powers and rights of subscription or otherwise which
in any manner arise out of ownership of securities;
(n) To hold any security or other Trust Property (i) in a form not
indicating any trust, whether in bearer, book entry, unregistered or other
negotiable form, or (ii) either in the Trust's or Trustees' own name or in the
name of a custodian or a nominee or nominees, subject to safeguards according to
the usual practice of business trusts or investment companies;
(o) To establish separate and distinct Series with separately defined
investment objectives and policies and distinct investment purposes, and with
separate Shares representing beneficial interests in such Series, and to
establish separate Classes, all in accordance with the provisions of Article IV;
(p) To the full extent permitted by Section 3804 of the Delaware Act,
to allocate assets, liabilities and expenses of the Trust to a particular Series
and assets, liabilities and expenses to a particular Class or to apportion the
same between or among two or more Series or Classes, provided that any
liabilities or expenses incurred by a particular Series or Class shall be
payable solely out of the assets belonging to that Series or Class as provided
for in Article IV, Section 4;
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(q) To consent to or participate in any plan for the liquidation,
reorganization, consolidation or merger of any corporation or concern whose
securities are held by the Trust; to consent to any contract, lease, mortgage,
purchase or sale of property by such corporation or concern; and to pay calls or
subscriptions with respect to any security held by the Trust;
(r) To compromise, arbitrate or otherwise adjust claims in favor of
or against the Trust or any matter in controversy including, but not limited to,
claims for taxes;
(s) To make distributions of income and of capital gains to
Shareholders in the manner provided for in this Trust Instrument or in the
Bylaws;
(t) To borrow money and in connection therewith to issue notes or
other evidences of indebtedness and to pledge or grant security interests in
Trust Property as security therefor;
(u) To establish committees for such purposes, with such membership,
and with such responsibilities as the Trustees may consider proper;
(v) To issue, sell, repurchase, redeem, cancel, retire, acquire,
hold, resell, reissue, dispose of and otherwise deal in Shares; to establish
terms and conditions regarding the issuance, sale, repurchase, exchange,
redemption, cancellation, retirement, acquisition, holding, resale, reissuance,
disposition of or dealing in Shares; and, subject to Articles IV and V, to apply
to any such repurchase, redemption, retirement, cancellation or acquisition of
Shares any funds or property of the Trust or of the particular Series with
respect to which such Shares are issued;
(w) To enter into joint ventures, general or limited partnerships and
any other combinations or associations;
(x) To endorse or guarantee the payment of any notes or other
obligations of any person or to make contracts of guaranty or suretyship, or
otherwise assume liability for payment thereof;
(y) To adopt, establish and carry out pension, profit-sharing, share
bonus, share purchase, savings, thrift and other retirement, incentive and
benefit plans, trusts and provisions, including the purchasing of life insurance
and annuity contracts as a means of providing such retirement and other
benefits, for any or all of the Trustees, officers, employees and agents of the
Trust;
(z) To join with other security holders in acting through a
committee, depository, voting trustee or otherwise, and in that connection to
deposit any security with, or transfer any security to, any such committee,
depository or trustee, and to delegate to them such power and authority with
relation to any
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security (whether or not so deposited or transferred) as the Trustees shall
deem proper, and to agree to pay, and to pay, such portion of the expenses
and compensation of such committee, depository or trustee as the Trustees
shall deem proper;
(aa) To either (i) invest all or a portion of the Trust Property, or
(ii) sell all or a portion of the Trust Property and invest the proceeds
thereof, in another investment company that is registered under the 1940 Act, in
the Trustees' sole discretion, without the vote or approval of any Shareholder
or Shareholders, notwithstanding any other provision of this Trust Instrument or
the Bylaws to the contrary; and
(bb) To carry on any other business in connection with or incidental
to any of the foregoing powers, to do everything necessary or desirable to
accomplish any purpose or to further any of the foregoing powers, and to take
every other action incidental to the foregoing business or purposes, objects or
powers.
The clauses above shall be construed as objects and powers, and the
enumeration of specific powers shall not limit in any way the general powers of
the Trustees. Any action by one or more of the Trustees in their capacity as
such hereunder shall be deemed an action on behalf of the Trust or the
applicable Series, and not an action in an individual capacity. No one dealing
with the Trustees shall be under any obligation to make any inquiry concerning
the authority of the Trustees, or to see to the application of any payments made
or property transferred to the Trustees or upon their order. In construing this
Trust Instrument, the presumption shall be in favor of a grant of power to the
Trustees.
SECTION 2. CERTAIN TRANSACTIONS. Except as prohibited by applicable law,
the Trustees may, on behalf of the Trust, buy any securities from or sell any
securities to, or lend any assets of the Trust to, any Trustee or officer of the
Trust or any firm of which any such Trustee or officer is a member acting as
principal, or have any such dealings with any investment adviser, administrator,
distributor or transfer agent for the Trust or with any Interested Person of
such person. The Trust may employ any such person or entity in which such
person is an Interested Person, as broker, legal counsel, registrar, investment
adviser, administrator, distributor, transfer agent, dividend disbursing agent,
custodian or in any other capacity upon customary terms.
ARTICLE IV
SERIES; CLASSES; SHARES
SECTION 1. ESTABLISHMENT OF SERIES OR CLASSES. The Trust shall consist of
one or more Series. The Trustees hereby establish the Series listed in Schedule
A attached hereto and made a part hereof. Each additional Series shall be
established by the
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adoption of a resolution of the Trustees. The Trustees may divide the Shares
of any Series into Classes. In such case each Class of a Series shall
represent interests in the assets of that Series. The Trustees by resolution
may designate the relative rights and preferences of the Shares of each
Series or Class. The Trust shall maintain separate and distinct records for
each Series and hold and account for the assets thereof separately from the
other assets of the Trust or of any other Series. A Series may issue any
number of Shares and need not issue Shares. Each Share of a Series shall
represent an equal beneficial interest in the net assets of such Series.
Each holder of Shares of a Series or Class shall be entitled to receive his
pro rata share of all distributions made with respect to such Series or
Class. Upon redemption of his Shares, such Shareholder shall be paid solely
out of the funds and property of such Series. The Trustees may change the
name of any Series or Class. At any time that there are no Shares
outstanding of any particular Series (or Class) previously established and
designated, the Trustees may by a majority vote abolish that Series (or
Class) and rescind the establishment and designation thereof.
SECTION 2. SHARES OF BENEFICIAL INTEREST. The beneficial interest in the
Trust shall be divided into Shares of one or more separate and distinct Series
or Classes established by the Trustees. The number of Shares of each Series and
Class is unlimited and each Share shall have a par value, or be without par
value, as determined by resolution of the Trustees. All Shares issued hereunder
shall be fully paid and nonassessable. Shareholders shall have no preemptive or
other right to subscribe to any additional Shares or other securities issued by
the Trust or any Series. The Trustees shall have full power and authority, in
their sole discretion and without obtaining Shareholder approval: to issue
original or additional Shares at such times and for the amount and type of
consideration and on such terms and conditions as they deem appropriate; to
issue fractional Shares and Shares held in the treasury; to establish and to
change in any manner Shares of any Series or Classes with such preferences,
terms of conversion, voting powers, rights and privileges as the Trustees may
determine (but without a vote of a majority of the Outstanding Shares of the
Series or Class, as the case may be, voting as a class, the Trustees may not
change Outstanding Shares in a manner materially adverse to the Shareholders of
such Shares); to divide or combine the Shares of any Series or Classes into a
greater or lesser number; to classify or reclassify any Shares of any Series or
Classes into one or more Series or Classes of Shares; to abolish any one or more
Series or Classes of Shares; to issue Shares to acquire other assets (including
assets subject to, and in connection with, the assumption of liabilities) and
businesses; and to take such other action with respect to the Shares as the
Trustees may deem desirable. Shares held in the treasury shall not confer any
voting rights on the Trustees and shall not be entitled to any dividends or
other distributions declared with respect to the Shares.
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SECTION 3. INVESTMENT IN THE TRUST. The Trustees shall accept investments
in any Series from such persons and on such terms as they may from time to time
authorize. At the Trustees' discretion, such investments, subject to applicable
law, may be in the form of cash or securities in which that Series is authorized
to invest, valued as provided in Article V, Section 3. Investments in a Series
shall be credited to each Shareholder's account in the form of full or
fractional Shares at the Net Asset Value per Share next determined after the
investment is received or accepted as may be determined by the Trustees;
provided, however, that the Trustees may, in their sole discretion, (a) impose a
sales charge upon investments in any Series or Class or (b) determine the Net
Asset Value per Share of the initial capital contribution. The Trustees shall
have the right to refuse to accept investments in any Series at any time without
any cause or reason therefor whatsoever.
SECTION 4. ASSETS AND LIABILITIES OF SERIES. All consideration received
by the Trust for the issue or sale of Shares of a particular Series, together
with all assets in which such consideration is invested or reinvested, all
income, earnings, profits and proceeds thereof (including any proceeds derived
from the sale, exchange or liquidation of such assets, and any funds or payments
derived from any reinvestment of such proceeds in whatever form the same may
be), shall be held and accounted for separately from the other assets of the
Trust and every other Series and are referred to as "assets belonging to" that
Series. The assets belonging to a particular Series shall belong only to that
Series for all purposes, and to no other Series, subject only to the rights of
creditors of that particular Series. Any assets, income, earnings, profits and
proceeds thereof, funds, or payments which are not readily identifiable as
belonging to any particular Series shall be allocated by the Trustees between
and among one or more Series as the Trustees deem fair and equitable. Each such
allocation shall be conclusive and binding upon the Shareholders of all Series
for all purposes, and such assets, earnings, income, profits or funds, or
payments and proceeds thereof shall be referred to as assets belonging to that
Series. The assets belonging to a Series shall be so recorded upon the books of
the Trust, and shall be held by the Trustees in trust for the benefit of the
Shareholders of that Series. The assets belonging to a Series shall be charged
with the liabilities of that Series and all expenses, costs, charges and
reserves attributable to that Series, except that liabilities and expenses
allocated solely to a particular Class shall be borne by that Class. Any
general liabilities, expenses, costs, charges or reserves of the Trust which are
not readily identifiable as belonging to any particular Series or Class shall be
allocated and charged by the Trustees between or among any one or more of the
Series or Classes or, if appropriate, between or among any one or more of the
Series or Classes and any other investment company advised by the same
investment adviser, in each case in such manner as the Trustees deem fair and
equitable. Each such allocation shall be conclusive and binding upon the
Shareholders of all Series or Classes for all purposes.
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Without limiting the foregoing, but subject to the right of the Trustees to
allocate general liabilities, expenses, costs, charges or reserves as herein
provided, the debts, liabilities, obligations and expenses incurred, contracted
for or otherwise existing with respect to a particular Series shall be
enforceable against the assets of such Series only, and not against the assets
of the Trust generally or of any other Series. Notice of this contractual
limitation on liabilities among Series may, in the Trustees' discretion, be set
forth in the certificate of trust of the Trust (whether originally or by
amendment) as filed or to be filed in the Office of the Secretary of State of
the State of Delaware pursuant to the Delaware Act, and upon the giving of such
notice in the certificate of trust, the statutory provisions of Section 3804 of
the Delaware Act relating to limitations on liabilities among Series (and the
statutory effect under Section 3804 of setting forth such notice in the
certificate of trust) shall become applicable to the Trust and each Series. Any
person extending credit to, contracting with or having any claim against any
Series may look only to the assets of that Series to satisfy or enforce any
debt, liability, obligation or expense incurred, contracted for or otherwise
existing with respect to that Series. No Shareholder or former Shareholder of
any Series shall have a claim on or any right to any assets allocated or
belonging to any other Series. No Shareholder or former Shareholder of any
particular Series shall have any claim or right to institute suit against or in
the right of the Trust or any Series with respect to any matter that does not
directly affect that particular Series.
SECTION 5. OWNERSHIP AND TRANSFER OF SHARES. The Trust shall maintain a
register containing the names and addresses of the Shareholders of each Series
and Class thereof, the number of Shares of each Series and Class held by such
Shareholders, and a record of all Share transfers. The register shall be
conclusive as to the identity of Shareholders of record and the number of Shares
held by them from time to time. The Trustees may authorize the issuance of
certificates representing Shares and adopt rules governing their use. The
Trustees may make rules governing the transfer of Shares, whether or not
represented by certificates.
SECTION 6. STATUS OF SHARES: LIMITATION OF SHAREHOLDER LIABILITY. Shares
shall be deemed to be personal property giving Shareholders only the rights
provided in this Trust Instrument. Every Shareholder, by virtue of having
acquired a Share, shall be held expressly to have assented to and agreed to be
bound by the terms of this Trust Instrument. No Shareholder shall be personally
liable for the debts, liabilities, obligations and expenses incurred by,
contracted for, or otherwise existing with respect to, the Trust or any Series.
The death of a Shareholder during the existence of the Trust shall not operate
to terminate the Trust, nor entitle the representative of any deceased
Shareholder to an accounting or to take any action in court or elsewhere against
the Trust or the Trustees, but entitles such representative only to the rights
of said deceased Shareholder under the Trust. Neither the Trust nor the
Trustees shall have any power to bind any Shareholder
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personally or to demand payment from any Shareholder for anything, other than
as agreed by the Shareholder. Shareholders shall have the same limitation of
personal liability as is extended to shareholders of a private corporation
for profit incorporated in the State of Delaware. Every written obligation
of the Trust or any Series shall contain a statement to the effect that such
obligation may only be enforced against the assets of the Trust or such
Series; however, the omission of such statement shall not operate to bind or
create personal liability for any Shareholder or Trustee.
ARTICLE V
DISTRIBUTIONS AND REDEMPTIONS
SECTION 1. DISTRIBUTIONS. The Trustees may declare and pay dividends and
other distributions from the assets belonging to each Series. The amount and
payment of dividends or distributions and their form, whether they are in cash,
Shares or other Trust Property, shall be determined by the Trustees. Dividends
and other distributions may be paid pursuant to a standing resolution adopted
once or more often as the Trustees determine. All dividends and other
distributions on Shares of a particular Series shall be distributed pro rata to
the Shareholders of that Series in proportion to the number of Shares of that
Series they held on the record date established for such payment, except that
such dividends and distributions shall appropriately reflect expenses allocated
to a particular Class of such Series. The Trustees may adopt and offer to
Shareholders such dividend reinvestment plans, cash dividend payout plans or
similar plans as the Trustees deem appropriate.
SECTION 2. REDEMPTIONS. Each Shareholder of a Series shall have the right
at such times as may be permitted by the Trustees to require the Series to
redeem all or any part of his Shares at a redemption price per Share equal to
the Net Asset Value per Share. In the absence of such resolution, the
redemption price per Share shall be the Net Asset Value next determined after
receipt by the Series of a request for redemption in proper form less such
charges as are determined by the Trustees and described in any required
disclosure document. The Trustees may specify conditions, prices and places of
redemption, and may specify binding requirements for the proper form or forms of
requests for redemption. Payment of the redemption price may be wholly or
partly in securities or other assets at the value of such securities or assets
used in such determination of Net Asset Value, or may be in cash. Following
redemption, Shares may be reissued from time to time. The Trustees may require
Shareholders to redeem Shares for any reason under terms set by the Trustees,
including the failure of a Shareholder to supply a personal identification
number if required to do so, or to have the minimum investment required, or to
pay when due for the purchase of Shares issued to him. To the extent permitted
by law, the Trustees may retain the
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proceeds of any redemption of Shares required by them for payment of amounts
due and owing by a Shareholder to the Trust or any Series or Class.
Notwithstanding the foregoing, the Trustees may postpone payment of the
redemption price and may suspend the right of the Shareholders to require any
Series or Class to redeem Shares during any period of time when and to the
extent permissible under the 1940 Act.
SECTION 3. DETERMINATION OF NET ASSET VALUE. The Trustees shall cause the
Net Asset Value of Shares of each Series or Class to be determined from time to
time in a manner consistent with applicable laws and regulations. The Trustees
may delegate the power and duty to determine Net Asset Value per Share to one or
more Trustees or officers of the Trust or to a custodian, depository or other
agent appointed for such purpose. The Net Asset Value of Shares shall be
determined separately for each Series or Class at such times as may be
prescribed by the Trustees or, in the absence of action by the Trustees, as of
the close of the regular trading session on the New York Stock Exchange on each
day for all or part of which such Exchange is open for unrestricted trading.
SECTION 4. SUSPENSION OF RIGHT OF REDEMPTION. If, as referred to in
Section 2 of this Article, the Trustees postpone payment of the redemption price
and suspend the right of Shareholders to redeem their Shares, such suspension
shall take effect at the time the Trustees shall specify, but not later than the
close of business on the business day next following the declaration of
suspension. Thereafter Shareholders shall have no right of redemption or
payment until the Trustees declare the end of the suspension. If the right of
redemption is suspended, a Shareholder may either withdraw his request for
redemption or receive payment based on the Net Asset Value per Share next
determined after the suspension terminates.
SECTION 5. REDEMPTIONS NECESSARY FOR QUALIFICATION AS REGULATED INVESTMENT
COMPANY. If the Trustees shall determine that direct or indirect ownership of
Shares of any Series has or may become concentrated in any person to an extent
which would disqualify any Series as a regulated investment company under the
Internal Revenue Code, then the Trustees shall have the power (but not the
obligation) by lot or other means they deem equitable to (a) call for redemption
by any such person of a number, or principal amount, of Shares sufficient to
maintain or bring the direct or indirect ownership of Shares into conformity
with the requirements for such qualification and (b) refuse to transfer or issue
Shares to any person whose acquisition of Shares in question would, in the
Trustees' judgment, result in such disqualification. Any such redemption shall
be effected at the redemption price and in the manner provided in this Article.
Shareholders shall upon demand disclose to the Trustees in writing such
information concerning direct and indirect ownership of Shares as the Trustees
deem necessary to comply with the requirements of any taxing authority.
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ARTICLE VI
SHAREHOLDERS' VOTING POWERS AND MEETINGS
SECTION 1. VOTING POWERS. The Shareholders shall have power to vote only
with respect to (a) the election of Trustees; (b) the removal of Trustees; (c)
any investment advisory contract; (d) any termination of the Trust as provided
in Article X, Section 4; (e) the amendment of this Trust Instrument to the
extent and as provided in Article X, Section 8; and (f) such additional matters
relating to the Trust as may be required by law, this Trust Instrument, or the
Bylaws or any registration of the Trust with the Commission or any State, or as
the Trustees may consider desirable.
On any matter submitted to a vote of the Shareholders, all Shares shall be
voted by individual Series or Class, except (a) when required by the 1940 Act,
Shares shall be voted in the aggregate and not by individual Series or Class,
and (b) when the Trustees have determined that the matter affects the interests
of more than one Series or Class, then the Shareholders of all such affected
Series or Classes shall be entitled to vote thereon. Each whole Share shall be
entitled to one vote as to any matter on which it is entitled to vote, and each
fractional Share shall be entitled to a proportionate fractional vote. There
shall be no cumulative voting in the election of Trustees. Shares may be voted
in person or by proxy or in any manner provided for in the Bylaws. The Bylaws
may provide that proxies may be given by any electronic or telecommunications
device or in any other manner, but if a proposal by anyone other than the
officers or Trustees is submitted to a vote of the Shareholders of the Trust or
of any Series or Class, or if there is a proxy contest or proxy solicitation or
proposal in opposition to any proposal by the officers or Trustees, Shares may
be voted only in person or by written proxy. Until Shares of a Series are
issued, as to that Series the Trustees may exercise all rights of Shareholders
and may take any action required or permitted to be taken by Shareholders by
law, this Trust Instrument or the Bylaws.
SECTION 2. MEETINGS OF SHAREHOLDERS. Special meetings of the Shareholders
of any Series or Class may be called by the Trustees and shall be called by the
Trustees upon the written request of Shareholders owning at least twenty-five
percent (25%) of the Outstanding Shares of such Series or Class entitled to
vote. Shareholders shall be entitled to at least fifteen days notice of any
meeting, given as determined by the Trustees.
SECTION 3. QUORUM; REQUIRED VOTE. One-third of the Outstanding Shares of
each Series or Class, or one-third of the Outstanding Shares of the Trust,
entitled to vote in person or by proxy shall be a quorum for the transaction of
business at a Shareholders meeting with respect to such Series or Class, or with
respect to the entire Trust, respectively. Except when a larger vote is
required by law, this Trust Instrument or the Bylaws, at
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any meeting at which a quorum is present, a majority of the Shares voted in
person or by proxy shall decide any matters to be voted upon with respect to
the entire Trust and a plurality of such Shares shall elect a Trustee;
provided, that if this Trust Instrument or applicable law permits or requires
that Shares be voted on any matter by individual Series or Classes, then a
majority of the Shares of that Series or Class (or, if required by law, a
Majority Shareholder Vote of that Series or Class) voted in person or by
proxy on the matter shall decide that matter insofar as that Series or Class
is concerned.
Shareholders may act as to the Trust or any Series or Class by the written
consent of a majority (or such greater amount as may be required by applicable
law) of the Outstanding Shares of the Trust or of such Series or Class, as the
case may be. If the consents of all Shareholders entitled to vote have not been
solicited in writing and if the unanimous written consent of all such
Shareholders shall not have been received, the Secretary shall give prompt
notice of the action approved by the Shareholders without a meeting.
Notwithstanding any other provision herein or in the Bylaws, any meeting of
Shareholders, whether or not a quorum is present, may be adjourned from time to
time by the vote of the majority of the Shares represented at that meeting,
either in person or by proxy. Any adjourned session of a meeting of
Shareholders may be held within a reasonable time without further notice.
ARTICLE VII
CONTRACTS WITH SERVICE PROVIDERS
SECTION 1. INVESTMENT ADVISER. Subject to a Majority Shareholder Vote,
the Trustees may enter into one or more investment advisory contracts on behalf
of the Trust or any Series, providing for investment advisory services,
statistical and research facilities and services, and other facilities and
services to be furnished to the Trust or Series on terms and conditions
acceptable to the Trustees. Any such contract may provide for the investment
adviser to effect purchases, sales or exchanges of portfolio securities or other
Trust Property on behalf of the Trustees or may authorize any officer or agent
of the Trust to effect such purchases, sales or exchanges pursuant to
recommendations of the investment adviser. The Trustees may authorize the
investment adviser to employ one or more sub-advisers. Any reference in this
Trust Instrument to the investment adviser shall be deemed to include such
sub-advisers, unless the context otherwise requires.
SECTION 2. PRINCIPAL UNDERWRITER. The Trustees may enter into contracts
with another party on behalf of the Trust or any Series or Class, providing for
the distribution and sale of
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Shares by such other party, either directly or as sales agent, on terms and
conditions acceptable to the Trustees. The Trustees may adopt a plan or
plans of distribution with respect to Shares of any Series or Class and enter
into any related agreements, whereby the Series or Class finances directly or
indirectly any activity that is primarily intended to result in sales of its
Shares, subject to the requirements of Section 12 of the 1940 Act, Rule 12b-1
thereunder, and other applicable rules and regulations.
SECTION 3. TRANSFER AGENCY, SHAREHOLDER SERVICES AND ADMINISTRATION
AGREEMENTS. The Trustees, on behalf of the Trust or any Series or Class, may
enter into transfer agency agreements, Shareholder service agreements and
administration and management agreements with any party or parties on terms and
conditions acceptable to the Trustees.
SECTION 4. CUSTODIAN. The Trustees shall at all times place and maintain
the securities and similar investments of the Trust and of each Series in
custody meeting the requirements of Section 17(f) of the 1940 Act and the rules
thereunder. The Trustees, on behalf of the Trust or any Series, may enter into
an agreement with a custodian on terms and conditions acceptable to the
Trustees, providing for the custodian, among other things, to (a) hold the
securities owned by the Trust or any Series and deliver the same upon written
order or oral order confirmed in writing, (b) receive and receipt for any moneys
due to the Trust or any Series and deposit the same in its own banking
department or elsewhere, (c) disburse such funds upon orders or vouchers, and
(d) employ one or more sub-custodians.
SECTION 5. PARTIES TO CONTRACTS WITH SERVICE PROVIDERS. The Trustees may
enter into any contract referred to in this Article with any entity, although
one or more of the Trustees or officers of the Trust may be an officer,
director, trustee, partner, shareholder or member of such entity, and no such
contract shall be invalidated or rendered void or voidable because of such
relationship. No person having such a relationship shall be disqualified from
voting on or executing a contract in his capacity as Trustee and/or Shareholder,
or be liable merely by reason of such relationship for any loss or expense to
the Trust with respect to such a contract or accountable for any profit realized
directly or indirectly therefrom.
Any contract referred to in Sections 1 and 2 of this Article shall be
consistent with and subject to the applicable requirements of Section 15 of the
1940 Act and the rules and orders thereunder with respect to its continuance in
effect, its termination and the method of authorization and approval of such
contract or renewal. No amendment to a contract referred to in Section 1 of
this Article shall be effective unless assented to in a manner consistent with
the requirements of Section 15 of the 1940 Act, and the rules and orders
thereunder.
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ARTICLE VIII
EXPENSES OF THE TRUST AND SERIES
Subject to Article IV, Section 4, the Trust or a particular Series shall
pay, or shall reimburse the Trustees from the Trust estate or the assets
belonging to the particular Series, for their expenses and disbursements,
including, but not limited to, interest charges, taxes, brokerage fees and
commissions; expenses of pricing Trust portfolio securities; expenses of issue,
repurchase and redemption of Shares; certain insurance premiums; applicable
fees, interest charges and expenses of third parties, including the Trust's
investment advisers, managers, administrators, distributors, custodians,
transfer agents and fund accountants; fees of pricing, interest, dividend,
credit and other reporting services; costs of membership in trade associations;
telecommunications expenses; funds transmission expenses; auditing, legal and
compliance expenses; costs of forming the Trust and its Series and maintaining
its existence; costs of preparing and printing the prospectuses of the Trust and
each Series, statements of additional information and Shareholder reports and
delivering them to Shareholders; expenses of meetings of Shareholders and proxy
solicitations therefor; costs of maintaining books and accounts; costs of
reproduction, stationery and supplies; fees and expenses of the Trustees;
compensation of the Trust's officers and employees and costs of other personnel
performing services for the Trust or any Series; costs of Trustee meetings;
Commission registration fees and related expenses; state or foreign securities
laws registration fees and related expenses; and for such non-recurring items as
may arise, including litigation to which the Trust or a Series (or a Trustee or
officer of the Trust acting as such) is a party, and for all losses and
liabilities by them incurred in administering the Trust. The Trustees shall
have a lien on the assets belonging to the appropriate Series, or in the case of
an expense allocable to more than one Series, on the assets of each such Series,
prior to any rights or interests of the Shareholders thereto, for the
reimbursement to them of such expenses, disbursements, losses and liabilities.
This Article shall not preclude the Trust from directly paying any of the
aforementioned fees and expenses.
ARTICLE IX
LIMITATION OF LIABILITY AND INDEMNIFICATION
SECTION 1. LIMITATION OF LIABILITY. All persons contracting with or
having any claim against the Trust or a particular Series shall look only to the
assets of the Trust or such Series for payment under such contract or claim; and
neither the Trustees nor any of the Trust's officers, employees or agents,
whether past, present or future, shall be personally liable therefor. Every
written instrument or obligation on behalf of the Trust or any Series shall
contain a statement to the foregoing effect, but the absence of such statement
shall not operate to make
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any Trustee or officer of the Trust liable thereunder. Provided they have
exercised reasonable care and have acted under the reasonable belief that
their actions are in the best interest of the Trust, the Trustees, officers,
employees and managers of the Trust shall not be responsible or liable for
any act or omission or for neglect or wrongdoing of them or any officer,
agent, employee, manager, investment adviser, delegatee or independent
contractor of the trust, but nothing contained in this trust instrument or in
the delaware act shall protect any trustee, officer, employee or manager of
the trust against liability to the trust or to shareholders to which he would
otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office.
SECTION 2. INDEMNIFICATION.
(a) Subject to the exceptions and limitations contained in subsection
(b) below:
(i) every person who is, or has been, a Trustee, officer,
employee, manager or agent of the Trust (including persons who serve at the
Trust's request as directors, trustees, officers or agents of another
organization in which the Trust has any interest as a shareholder, creditor or
otherwise) ("Covered Person") shall be indemnified by the Trust or the
appropriate Series to the fullest extent permitted by law against liability and
against all expenses reasonably incurred or paid by such person in connection
with any claim, action, suit or proceeding in which such person becomes involved
as a party or otherwise by virtue of being or having been a Covered Person and
against amounts paid or incurred by such person in the settlement thereof,
whether or not such person is a Covered Person at the time such expenses are
incurred;
(ii) as used herein, the words "claim," "action," "suit," or
"proceeding" shall apply to all claims, actions, suits or proceedings (civil,
criminal or other, including appeals), actual or threatened while in office or
thereafter, and the words "liability" and "expenses" shall include, without
limitation, attorney's fees, costs, judgments, amounts paid in settlement,
fines, penalties and other liabilities.
(b) No indemnification shall be provided hereunder to a Covered
Person:
(i) Who shall have been adjudicated by a court or body
before which the proceeding was brought (A) to be liable to the Trust or its
Shareholders by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office, or (B)
not to have acted in good faith in the reasonable belief that his action was in
or not opposed to the best interests of the Trust; or
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(ii) In the event of a settlement, unless there has been a
determination that such Covered Person did not engage in willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of his office: (A) by the court or other body approving the settlement;
(B) by at least a majority of those Trustees who are neither Interested Persons
of the Trust nor are parties to the matter based upon a review of readily
available facts (as opposed to a full trial-type inquiry); or (C) by written
opinion of independent legal counsel based upon a review of readily available
facts (as opposed to a full trial-type inquiry).
(c) To the maximum extent permitted by applicable law, expenses in
connection with the preparation and presentation of a defense to any claim,
action, suit or proceeding of the character described in subsection (a) of this
Section may be paid by the Trust or applicable Series from time to time prior to
final disposition thereof upon receipt of an undertaking by or on behalf of such
Covered Person that such amount will be paid over by such person to the Trust or
applicable Series if it is ultimately determined that such person is not
entitled to indemnification under this Section; provided, however, that either
(i) such Covered Person shall have provided appropriate security for such
undertaking, (ii) the Trust is insured against losses arising out of any such
advance payments or (iii) either a majority of the Trustees who are neither
Interested Persons of the Trust nor parties to the matter, or independent legal
counsel in a written opinion, shall have determined, based upon a review of
readily available facts (as opposed to a full trial-type inquiry) that there is
reason to believe that such Covered Person will not be disqualified from
indemnification under this Section.
(d) The rights of indemnification herein provided shall be severable,
shall not be exclusive of or affect any other rights to which any Covered Person
may now or hereafter be entitled, and shall inure to the benefit of the heirs,
executors and administrators of a Covered Person.
(e) By action of the Trustees, and notwithstanding any interest of
the Trustees in the action, the Trust shall have power to purchase and maintain
insurance, in such amounts as the Trustees deem appropriate, on behalf of any
Covered Person, whether or not such person is indemnified against such liability
or expense under the provisions of this Article IX and whether or not the Trust
would have the power or would be required to indemnify such person against such
liability under the provisions of this Article IX or of the Delaware Act or by
any other applicable law, subject only to any limitations imposed by the 1940
Act.
(f) Any repeal or modification of this Article IX by the Shareholders
of the Trust, or adoption or modification of any other provision of the Trust
Instrument or Bylaws inconsistent with this Article, shall be prospective only,
to the extent that such repeal or modification would, if applied
retrospectively,
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adversely affect any limitation on the liability of any Covered Person or
indemnification available to any Covered Person with respect to any act or
omission which occurred prior to such repeal, modification or adoption.
SECTION 3. INDEMNIFICATION OF SHAREHOLDERS. If any Shareholder or former
Shareholder of any Series shall be held personally liable solely by reason of
being or having been a Shareholder and not because of acts or omissions or for
some other reason, the Shareholder or former Shareholder (or such person's
heirs, executors, administrators or other legal representatives or in the case
of any entity, its general successor) shall be entitled out of the assets
belonging to the applicable Series to be held harmless from and indemnified
against all loss and expense arising from such liability. The Trust, on behalf
of the affected Series, shall, upon request by such Shareholder, assume the
defense of any such claim made against such Shareholder for any act or
obligation of the Series and satisfy any judgment thereon from the assets of the
Series.
ARTICLE X
MISCELLANEOUS
SECTION 1. TRUST NOT A PARTNERSHIP. This Trust Instrument creates a trust
and not a partnership. No Trustee shall have any power to bind personally
either the Trust's officers or any Shareholder.
SECTION 2. TRUSTEE ACTION; EXPERT ADVICE; NO BOND OR SURETY. The exercise
by the Trustees of their powers and discretion hereunder in good faith and with
reasonable care under the circumstances then prevailing shall be binding upon
everyone interested. Subject to the provisions of Article IX, the Trustees
shall not be liable for errors of judgment or mistakes of fact or law. The
Trustees may take advice of counsel or other experts with respect to the meaning
and operation of this Trust Instrument, and subject to the provisions of Article
IX, shall not be liable for any act or omission in accordance with such advice
or for failing to follow such advice. The Trustees shall not be required to
give any bond as such, nor any surety if a bond is obtained.
SECTION 3. RECORD DATES. The Trustees may fix in advance a date up to
sixty (60) days before the date of any Shareholders meeting, or the date for the
payment of any dividends or other distributions, or the date for the allotment
of rights, or the date when any change or conversion or exchange of Shares shall
go into effect as a record date for the determination of the Shareholders
entitled to notice of, and to vote at, any such meeting, or entitled to receive
payment of such dividend or other distribution, or to receive any such allotment
of rights, or to exercise such rights in respect of any such change, conversion
or exchange of Shares. Any Shareholder who was a Shareholder at the
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date and time so fixed shall be entitled to vote at such meeting or any
adjournment thereof.
SECTION 4. TERMINATION OF THE TRUST.
(a) This Trust shall have perpetual existence. Subject to a Majority
Shareholder Vote of the Trust or of each Series to be affected, the Trustees
may:
(i) Sell and convey all or substantially all of the assets
of the Trust or any affected Series to another Series or to another entity which
is an open-end investment company as defined in the 1940 Act, or is a series
thereof, for adequate consideration, which may include the assumption of all
outstanding obligations, taxes and other liabilities, accrued or contingent, of
the Trust or any affected Series, and which may include shares of or interests
in such Series, entity or series thereof; or
(ii) At any time sell and convert into money all or
substantially all of the assets of the Trust or any affected Series.
Upon making reasonable provision for the payment of all known liabilities
of the Trust or any affected Series in either (i) or (ii), by such assumption or
otherwise, the Trustees shall distribute the remaining proceeds or assets (as
the case may be) ratably among the Shareholders of the Trust or any affected
Series; however, the payment to any particular Class of such Series may be
reduced by any fees, expenses or charges allocated to that Class or Series.
(b) The Trustees may take any of the actions specified in subsection
(a)(i) and (ii) above without obtaining a Majority Shareholder Vote of the Trust
or any Series if a majority of the Trustees determines that the continuation of
the Trust or Series is not in the best interests of the Trust, such Series, or
their respective Shareholders as a result of factors or events adversely
affecting the ability of the Trust or such Series to conduct its business and
operations in an economically viable manner. Such factors and events may
include the inability of the Trust or a Series to maintain its assets at an
appropriate size, changes in laws or regulations governing the Trust or the
Series or affecting assets of the type in which the Trust or Series invests, or
economic developments or trends having a significant adverse impact on the
business or operations of the Trust or such Series.
(c) Upon completion of the distribution of the remaining proceeds or
assets pursuant to subsection (a), the Trust or affected Series shall terminate
and the Trustees and the Trust shall be discharged of any and all further
liabilities and duties hereunder with respect thereto and the right, title and
interest of all parties therein shall be canceled and discharged. Upon
termination of the Trust, following completion of winding up of its business,
the Trustees shall cause a certificate of cancellation of
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the Trust's certificate of trust to be filed in accordance with the Delaware
Act, which certificate of cancellation may be signed by any one Trustee.
SECTION 5. REORGANIZATION; MERGER; CONSOLIDATION.
(a) Notwithstanding anything else herein, to change the Trust's form
of organization the Trustees may, without Shareholder approval, (i) cause the
Trust to merge or consolidate with or into one or more entities, if the
surviving or resulting entity is the Trust or another open-end management
investment company under the 1940 Act, or a series thereof, that will succeed to
or assume the Trust's registration under the 1940 Act, (ii) cause the Shares to
be exchanged under or pursuant to any state or federal statute to the extent
permitted by law, or (iii) cause the Trust to incorporate under the laws of
Delaware. Any agreement of merger or consolidation or certificate of merger may
be signed by a majority of Trustees and facsimile signatures conveyed by
electronic or telecommunication means shall be valid.
(b) Any merger, consolidation or incorporation of the Trust other
than those described in Section 5(a) hereof may be approved by the affirmative
vote of both a majority of the Trustees voting at a duly constituted meeting of
Trustees at which a quorum is present and the holders of one-half (1/2) of the
Outstanding Shares of the Trust entitled to vote thereon.
(c) Pursuant to and in accordance with the provisions of Section
3815(f) of the Delaware Act, an agreement of merger or consolidation approved in
accordance with this Section 5 may effect any amendment to the governing
instrument of the Trust or effect the adoption of a new trust instrument of the
Trust if it is the surviving or resulting trust in the merger or consolidation.
SECTION 6. TRUST INSTRUMENT. The original or a copy of this Trust
Instrument and of each amendment hereto or Trust Instrument supplemental shall
be kept at the office of the Trust where it may be inspected by any Shareholder.
Anyone dealing with the Trust may rely on a certificate by a Trustee or an
officer of the Trust as to the authenticity of the Trust Instrument or any such
amendments or supplements and as to any matters in connection with the Trust.
The masculine gender herein shall include the feminine and neuter genders.
Headings herein are for convenience only and shall not affect the construction
of this Trust Instrument. This Trust Instrument may be executed in any number
of counterparts, each of which shall be deemed an original.
SECTION 7. APPLICABLE LAW. This Trust Instrument and the Trust created
hereunder are governed by and construed and administered according to the
Delaware Act and the applicable laws of the State of Delaware; provided,
however, that there shall not be applicable to the Trust, the Trustees or this
Trust Instrument (a) the provisions of Section 3540 of Title 12 of the Delaware
Code, or (b) any provisions of the laws (statutory or common) of
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the State of Delaware (other than the Delaware Act) pertaining to trusts
which relate to or regulate (i) the filing with any court or governmental
body or agency of trustee accounts or schedules of trustee fees and charges,
(ii) affirmative requirements to post bonds for trustees, officers, agents or
employees of a trust, (iii) the necessity for obtaining court or other
governmental approval concerning the acquisition, holding or disposition of
real or personal property, (iv) fees or other sums payable to trustees,
officers, agents or employees of a trust, (v) the allocation of receipts and
expenditures to income or principal, (vi) restrictions or limitations on the
permissible nature, amount or concentration of trust investments or
requirements relating to the titling, storage or other manner of holding of
trust assets, or (vii) the establishment of fiduciary or other standards of
responsibility or limitations on the acts or powers of trustees, which are
inconsistent with the limitations on liabilities or authority and powers of
the Trustees set forth or referenced in this Trust Instrument. The Trust
shall be of the type commonly called a Delaware business trust, and, without
limiting the provisions hereof, the Trust may exercise all powers which are
ordinarily exercised by such a trust under Delaware law. The Trust
specifically reserves the right to exercise any of the powers or privileges
afforded to trusts or actions that may be engaged in by trusts under the
Delaware Act, and the absence of a specific reference herein to any such
power, privilege or action shall not imply that the Trust may not exercise
such power or privilege or take such actions.
SECTION 8. AMENDMENTS. The Trustees may, without any Shareholder vote,
amend or otherwise supplement this Trust Instrument by making an amendment, a
Trust Instrument supplemental hereto or an amended and restated trust
instrument; provided, that Shareholders shall have the right to vote on any
amendment (a) which would affect the voting rights of Shareholders granted in
Article VI, Section 1, (b) to this Section 8, (c) required to be approved by
Shareholders by law or by the Trust's registration statement(s) filed with the
Commission, and (d) submitted to them by the Trustees in their discretion. Any
amendment submitted to Shareholders which the Trustees determine would affect
the Shareholders of any Series shall be authorized by vote of the Shareholders
of such Series and no vote shall be required of Shareholders of a Series not
affected.
Notwithstanding anything else herein, any amendment to Article IX which
would have the effect of reducing the indemnification and other rights provided
thereby to Trustees, officers, employees and agents of the Trust or to
Shareholders or former Shareholders, and any repeal or amendment of this
sentence, shall each require the affirmative vote of the holders of two-thirds
(2/3) of the Outstanding Shares of the Trust entitled to vote thereon.
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SECTION 9. FISCAL YEAR. The fiscal year of the Trust shall end on the
date set in the manner specified in the Bylaws. The Trustees may change the
fiscal year of the Trust without Shareholder approval.
SECTION 10. SEVERABILITY. The provisions of this Trust Instrument are
severable. If the Trustees determine, with the advice of counsel, that any
provision hereof conflicts with the 1940 Act, the regulated investment company
provisions of the Internal Revenue Code or with other applicable laws and
regulations, the conflicting provision shall be deemed never to have constituted
a part of this Trust Instrument; provided, however, that such determination
shall not affect any of the remaining provisions of this Trust Instrument or
render invalid or improper any action taken or omitted prior to such
determination. If any provision hereof shall be held invalid or unenforceable
in any jurisdiction, such invalidity or unenforceability shall attach only to
such provision only in such jurisdiction and shall not affect any other
provision of this Trust Instrument.
SECTION 11. USE OF THE NAMES "BERGER" AND "BIAM".
(a) Berger Associates, Inc. ("Berger") has consented to and granted a
non-exclusive license for the use by the Trust and by each Series thereof to the
identifying word "Berger" in the name of the Trust and of each Series. Such
consent is conditioned upon the Trust's employment of Berger or its affiliate as
investment adviser to the Trust and to each Series. As between Berger and the
Trust, Berger shall control the use of such name insofar as such name contains
the identifying word "Berger." Berger may from time to time use the identifying
word "Berger" in other connections and for other purposes, including without
limitation in the names of other investment companies, corporations or
businesses that it may manage, advise, sponsor or own or in which it may have a
financial interest. Berger may require the Trust or any Series to cease using
the identifying word "Berger" in the name of the Trust or any Series if the
Trust or Series ceases to employ Berger or affiliate thereof as investment
adviser.
(b) Bank of Ireland Asset Management (U.S.) Limited ("BIAM") has
consented to and granted a non-exclusive license for the use by the Trust and by
each Series thereof to the identifying words "Bank of Ireland Asset Management"
or the initials thereof in the name of the Trust and of each Series. Such
consent is conditioned upon the Trust's employment of BIAM or its affiliate as
investment adviser to the Trust and to each Series. As between BIAM and the
Trust, BIAM shall control the use of such name insofar as such name contains the
identifying words "Bank of Ireland Asset Management" or the initials thereof.
BIAM may from time to time use the identifying words "Bank of Ireland Asset
Management" or the initials thereof in other connections and for other purposes,
including without limitation in the names of other investment companies,
corporations or businesses that it may manage, advise, sponsor or own or in
which it may have a financial interest. BIAM
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may require the Trust or any Series to cease using the identifying words
"Bank of Ireland Asset Management" or the initials thereof in the name of the
Trust or any Series if the Trust or Series ceases to employ BIAM or affiliate
thereof as investment adviser.
[the balance of this page left intentionally blank]
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IN WITNESS WHEREOF, the undersigned, being all of the initial Trustees,
have executed this Trust Instrument as of the date first above written.
/s/ MICHAEL OWEN
-------------------------------------
Michael Owen, as
Trustee and not individually
/s/ DENNIS E. BALDWIN
-------------------------------------
Dennis E. Baldwin, as
Trustee and not individually
-------------------------------------
William M.B. Berger, as
Trustee and not individually
/s/ LOUIS R. BINDNER
-------------------------------------
Louis R. Bindner, as
Trustee and not individually
/s/ KATHERINE A. CATTANACH
-------------------------------------
Katherine A. Cattanach, as
Trustee and not individually
/s/ LUCY BLACK CREIGHTON
-------------------------------------
Lucy Black Creighton, as
Trustee and not individually
/s/ PAUL R. KNAPP
-------------------------------------
Paul R. Knapp, as
Trustee and not individually
/s/ GERARD M. LAVIN
-------------------------------------
Gerard M. Lavin, as
Trustee and not individually
<PAGE>
/s/ HARRY T. LEWIS, JR.
-------------------------------------
Harry T. Lewis, Jr., as
Trustee and not individually
/s/ WILLIAM SINCLAIRE
-------------------------------------
William Sinclaire, as
Trustee and not individually
<PAGE>
IN WITNESS WHEREOF, the undersigned, being all of the initial Trustees,
have executed this Trust Instrument as of the date first above written.
-------------------------------------
Michael Owen, as
Trustee and not individually
-------------------------------------
Dennis E. Baldwin, as
Trustee and not individually
/s/ WILLIAM M.B. BERGER
-------------------------------------
William M.B. Berger, as
Trustee and not individually
-------------------------------------
Louis R. Bindner, as
Trustee and not individually
-------------------------------------
Katherine A. Cattanach, as
Trustee and not individually
-------------------------------------
Lucy Black Creighton, as
Trustee and not individually
-------------------------------------
Paul R. Knapp, as
Trustee and not individually
<PAGE>
SCHEDULE A
SERIES OF THE TRUST
Berger/BIAM International Fund
Berger/BIAM International Institutional Fund
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<PAGE>
EXHIBIT 2
BERGER/BIAM WORLDWIDE FUNDS TRUST
(A Delaware Business Trust)
BYLAWS
May 31, 1996
<PAGE>
TABLE OF CONTENTS
<TABLE>
Page
----
<S> <C> <C>
ARTICLE I NAME OF TRUST, PRINCIPAL OFFICE AND SEAL . . . . . . . . . . . . . . 1
Section 1. Principal Office. . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. Delaware Office . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 3. Seal. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II MEETINGS OF TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1. Meetings. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. Action Without a Meeting. . . . . . . . . . . . . . . . . . . . 2
Section 3. Compensation of Trustees. . . . . . . . . . . . . . . . . . . . 2
ARTICLE III COMMITTEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1. Organization. . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 2. Executive Committee . . . . . . . . . . . . . . . . . . . . . . 2
Section 3. Nominating Committee. . . . . . . . . . . . . . . . . . . . . . 2
Section 4. Audit Committee . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 5. Other Committees. . . . . . . . . . . . . . . . . . . . . . . . 3
Section 6. Proceedings and Quorum. . . . . . . . . . . . . . . . . . . . . 3
Section 7. Compensation of Committee Members . . . . . . . . . . . . . . . 3
ARTICLE IV OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2. Election, Tenure and Qualifications of Officers . . . . . . . . 3
Section 3. Vacancies and Newly Created Offices . . . . . . . . . . . . . . 3
Section 4. Removal and Resignation . . . . . . . . . . . . . . . . . . . . 4
Section 5. Chairman. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 6. President . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 7. Vice President. . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 8. Treasurer and Assistant Treasurers. . . . . . . . . . . . . . . 5
Section 9. Secretary and Assistant Secretaries . . . . . . . . . . . . . . 5
Section 10. Subordinate Officers. . . . . . . . . . . . . . . . . . . . . . 5
Section 11. Compensation of Officers. . . . . . . . . . . . . . . . . . . . 6
Section 12. Surety Bond . . . . . . . . . . . . . . . . . . . . . . . . . . 6
ARTICLE V MEETINGS OF SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . 6
Section 1. Annual Meetings . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2. Special Meetings. . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3. Notice of Meetings. . . . . . . . . . . . . . . . . . . . . . . 6
Section 4. Validity of Proxies . . . . . . . . . . . . . . . . . . . . . . 7
Section 5. Place of Meeting. . . . . . . . . . . . . . . . . . . . . . . . 8
Section 6. Action Without a Meeting. . . . . . . . . . . . . . . . . . . . 8
</TABLE>
(i)
<PAGE>
<TABLE>
Page
----
<S> <C> <C>
ARTICLE VI SHARES OF BENEFICIAL INTEREST. . . . . . . . . . . . . . . . . . . . 8
Section 1. Share Certificates. . . . . . . . . . . . . . . . . . . . . . . 8
Section 2. Transfer of Shares. . . . . . . . . . . . . . . . . . . . . . . 9
Section 3. Lost, Stolen or Destroyed Certificates. . . . . . . . . . . . . 9
ARTICLE VII CUSTODY OF SECURITIES. . . . . . . . . . . . . . . . . . . . . . . . 9
Section 1. Employment of a Custodian . . . . . . . . . . . . . . . . . . . 9
Section 2. Termination of Custodian Agreement. . . . . . . . . . . . . . . 10
Section 3. Other Arrangements. . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE VIII FISCAL YEAR AND ACCOUNTANT . . . . . . . . . . . . . . . . . . . . . 10
Section 1. Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 2. Accountant. . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE IX AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE X NET ASSET VALUE. . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 1. Determination of Net Asset Value. . . . . . . . . . . . . . . . 10
ARTICLE XI MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 1. Inspection of Books . . . . . . . . . . . . . . . . . . . . . . 11
Section 2. Severability. . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3. Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
</TABLE>
(ii)
<PAGE>
BYLAWS
OF
BERGER/BIAM WORLDWIDE FUNDS TRUST
(A Delaware Business Trust)
These Bylaws of Berger/BIAM Worldwide Funds Trust (the "Trust"), a Delaware
business trust, are subject to the Trust Instrument of the Trust dated May 31,
1996, as from time to time amended, supplemented or restated (the "Trust
Instrument"). Capitalized terms used herein have the same meaning as in the
Trust Instrument.
ARTICLE I
NAME OF TRUST, PRINCIPAL OFFICE AND SEAL
SECTION 1. PRINCIPAL OFFICE. The principal office of the Trust shall be
located in Denver, Colorado, or such other location as the Trustees may from
time to time determine. The Trust may establish and maintain other offices and
places of business as the Trustees may from time to time determine.
SECTION 2. DELAWARE OFFICE. The Trustees shall establish a registered
office in the State of Delaware and shall appoint as the Trust's registered
agent for service of process in the State of Delaware an individual resident of
the State of Delaware or a Delaware corporation or a corporation authorized to
transact business in the State of Delaware and in any case the business office
of such registered agent for service of process shall be identical with the
registered Delaware office of the Trust.
SECTION 3. SEAL. The Trustees may adopt a seal which shall be in such
form and have such inscription as the Trustees may from time to time determine.
Any Trustee or officer of the Trust shall have authority to affix the seal to
any document, provided that the failure to affix the seal shall not affect the
validity or effectiveness of any document.
ARTICLE II
MEETINGS OF TRUSTEES
SECTION 1. MEETINGS. Meetings of the Trustees may be held at such places
and such times as the Trustees may from time to time determine. Such meetings
may be called orally or in writing by the Chairman of the Trustees or by any two
other Trustees. Each
<PAGE>
Trustee shall be given notice of any meeting as provided in Article II,
Section 7, of the Trust Instrument.
SECTION 2. ACTION WITHOUT A MEETING. Actions may be taken by the Trustees
without a meeting or by a telephone meeting, as provided in Article II,
Section 7, of the Trust Instrument.
SECTION 3. COMPENSATION OF TRUSTEES. Each Trustee may receive such
compensation from the Trust for his or her services and reimbursement for his or
her expenses as may be fixed from time to time by the Trustees.
ARTICLE III
COMMITTEES
SECTION 1. ORGANIZATION. The Trustees may designate one or more
committees of the Trustees. The Chairmen of such committees shall be elected by
the Trustees. The number composing such committees and the powers conferred
upon the same shall be determined by the vote of a majority of the Trustees.
All members of such committees shall hold office at the pleasure of the
Trustees. The Trustees may abolish any such committee at any time in their sole
discretion. Any committee to which the Trustees delegate any of their powers
shall maintain records of its meetings and shall report its actions to the
Trustees. The Trustees shall have the power to rescind any action of any
committee, but no such rescission shall have retroactive effect. The Trustees
shall have the power at any time to fill vacancies in the committees. The
Trustees may delegate to these committees any of its powers, except the power to
declare a dividend or distribution on Shares, authorize the issuance of Shares,
recommend to Shareholders any action requiring Shareholders' approval, amend
these Bylaws, approve any merger or Share exchange, approve or terminate any
contract with an investment adviser, transfer agent, custodian or principal
underwriter, or to take any other action required by applicable law to be taken
by the Trustees or to be approved by Shareholders.
SECTION 2. EXECUTIVE COMMITTEE. The Trustees may elect from their own
number an Executive Committee which shall have any or all the powers of the
Trustees when the Trustees are not in session.
SECTION 3. NOMINATING COMMITTEE. The Trustees may elect from their own
number a Nominating Committee which shall have the power to select and nominate
Trustees who are not Interested Persons, and shall have such other powers and
perform such other duties as may be assigned to it from time to time by the
Trustees.
SECTION 4. AUDIT COMMITTEE. The Trustees may elect from their own number
an Audit Committee which shall have the power to review and evaluate the audit
function, including recommending
-2-
<PAGE>
independent certified public accountants, and shall have such other powers
and perform such other duties as may be assigned to it from time to time by
the Trustees.
SECTION 5. OTHER COMMITTEES. The Trustees may appoint other committees
whose members need not be Trustees. Each such committee shall have such powers
and perform such duties as may be assigned to it from time to time by the
Trustees, but shall not exercise any power which may lawfully be exercised only
by the Trustees or a committee thereof.
SECTION 6. PROCEEDINGS AND QUORUM. In the absence of an appropriate
resolution of the Trustees, each committee may adopt such rules and regulations
governing its proceedings, quorum and manner of acting as it shall deem proper
and desirable. In the event any member of any committee is absent from any
meeting, the members present at the meeting, whether or not they constitute a
quorum, may appoint a member of the Trustees to act in the place of such absent
member.
SECTION 7. COMPENSATION OF COMMITTEE MEMBERS. Each committee member may
receive such compensation from the Trust for his or her services and
reimbursement for his or her expenses as may be fixed from time to time by the
Trustees.
ARTICLE IV
OFFICERS
SECTION 1. GENERAL. The officers of the Trust shall be a President, a
Treasurer, a Secretary, and may include a Chairman of the Trustees, one or more
Vice Presidents, Assistant Treasurers or Assistant Secretaries, and such other
officers as the Trustees may from time to time elect. It shall not be necessary
for any Trustee or other officer to be a Shareholder of the Trust.
SECTION 2. ELECTION, TENURE AND QUALIFICATIONS OF OFFICERS. The officers
of the Trust, except those appointed as provided in Section 10 of this Article,
shall be elected by the Trustees. Each officer elected by the Trustees shall
hold office until his or her successor shall have been elected and qualified or
until his or her earlier resignation. Any person may hold one or more offices
of the Trust except that no one person may serve concurrently as both President
and Secretary. A person who holds more than one office in the Trust may not act
in more than one capacity to execute, acknowledge or verify an instrument
required by law to be executed, acknowledged or verified by more than one
officer. No officer need be a Trustee.
SECTION 3. VACANCIES AND NEWLY CREATED OFFICES. Whenever a vacancy shall
occur in any office, regardless of the reason for such vacancy, or if any new
office shall be created, such vacancies or newly created offices may be filled
by the
-3-
<PAGE>
Trustees or, in the case of any office created pursuant to Section 10 of this
Article, by any officer upon whom such power shall have been conferred by the
Trustees.
SECTION 4. REMOVAL AND RESIGNATION. Any officer may be removed from
office at any time, with or without cause, by the Trustees. In addition, any
officer or agent appointed in accordance with the provisions of Section 10 of
this Article may be removed, with or without cause, by any officer upon whom
such power of removal shall have been conferred by the Trustees. Any officer
may resign from office at any time by delivering a written resignation to the
Trustees, the President, the Secretary, or any Assistant Secretary. Unless
otherwise specified therein, such resignation shall take effect upon delivery.
SECTION 5. CHAIRMAN. The Chairman of the Trustees, if such an officer is
elected by the Trustees, shall preside at all meetings of the Trustees and at
all meetings of the Shareholders, and shall exercise and perform such other
powers and duties as may be from time to time assigned to the Chairman by the
Trustees or prescribed by these Bylaws.
SECTION 6. PRESIDENT. The President shall be the chief executive officer
of the Trust. The President must be a Trustee. Subject to the direction of the
Trustees, the President shall have general charge of the business affairs,
policies and property of the Trust and general supervision over its officers,
employees and agents. In the absence of the Chairman of the Trustees or if no
Chairman of the Trustees has been elected, the President shall preside at all
Shareholders' meetings and at all meetings of the Trustees and shall in general
exercise the powers and perform the duties of the Chairman of the Trustees.
Except as the Trustees may otherwise order, the President shall have the power
to grant, issue, execute or sign such powers of attorney, proxies, agreements or
other documents as may be deemed advisable or necessary in the furtherance of
the interests of the Trust or any Series or Class thereof. The President also
shall have the power to employ attorneys, accountants and other advisers and
agents for the Trust. The President shall exercise such other powers and
perform such other duties as the Trustees may from time to time assign to the
President.
SECTION 7. VICE PRESIDENT. The Trustees may from time to time elect one
or more Vice Presidents who shall have such powers and perform such duties as
may from time to time be assigned to them by the Trustees or the President. At
the request or in the absence or disability of the President, the Vice President
(or, if there are two or more Vice Presidents, then the first appointed of the
Vice Presidents present and able to act) may perform all the duties of the
President and, when so acting, shall have all the powers of and be subject to
all the restrictions upon the President.
-4-
<PAGE>
SECTION 8. TREASURER AND ASSISTANT TREASURERS. The Treasurer shall be the
principal financial and accounting officer of the Trust and shall have general
charge of the finances and books of the Trust. The Treasurer shall deliver all
funds and securities of the Trust to such company as the Trustees shall retain
as custodian in accordance with the Trust Instrument, these Bylaws, and
applicable law. The Treasurer shall make annual reports regarding the business
and financial condition of the Trust as soon as possible after the close of the
Trust's fiscal year. The Treasurer also shall furnish such other reports
concerning the business and financial condition of the Trust as the Trustees may
from time to time require. The Treasurer shall perform all acts incidental to
the office of Treasurer, subject to the supervision of the Trustees, and shall
perform such additional duties as the Trustees may from time to time designate.
Any Assistant Treasurer may perform such duties of the Treasurer as the
Trustees or the Treasurer may assign, and, in the absence of the Treasurer, may
perform all the duties of the Treasurer.
SECTION 9. SECRETARY AND ASSISTANT SECRETARIES. The Secretary shall
record all votes and proceedings of the meetings of Trustees and Shareholders in
books to be kept for that purpose. The Secretary shall be responsible for
giving and serving of all notices of the Trust. The Secretary shall have
custody of any seal of the Trust. The Secretary shall be responsible for the
records of the Trust, including the Share register and such other books and
papers as the Trustees may direct and such books, reports, certificates and
other documents required by law. All of such records and documents shall at all
reasonable times be kept open by the Secretary for inspection by any Trustee for
any proper Trust purpose. The Secretary shall perform all acts incidental to
the office of Secretary, subject to the supervision of the Trustees, and shall
perform such additional duties as the Trustees may from time to time designate.
Any Assistant Secretary may perform such duties of the Secretary as the
Trustees or the Secretary may assign, and, in the absence of the Secretary, may
perform all the duties of the Secretary.
SECTION 10. SUBORDINATE OFFICERS. The Trustees may appoint from time to
time such other officers and agents as they may deem advisable, each of whom
shall have such title, hold office for such period, have such authority and
perform such duties as the Trustees may determine. The Trustees may delegate
from time to time to one or more officers or committees of Trustees the power to
appoint any such subordinate officers or agents and to prescribe their
respective rights, terms of office, authorities and duties. Any officer or
agent appointed in accordance with the provisions of this Section 10 may be
removed, either with or without cause, by any officer upon whom such power of
removal shall have been conferred by the Trustees.
-5-
<PAGE>
SECTION 11. COMPENSATION OF OFFICERS. Each officer may receive such
compensation from the Trust for services and reimbursement for expenses as may
be fixed from time to time by the Trustees.
SECTION 12. SURETY BOND. The Trustees may require any officer or agent of
the Trust to execute a bond (including, without limitation, any bond required by
the Investment Company Act of 1940 and the rules and regulations of the
Securities and Exchange Commission) to the Trust in such sum and with such
surety or sureties as the Trustees may determine, conditioned upon the faithful
performance of his or her duties to the Trust, including responsibility for
negligence and for the accounting of any of the Trust's property, funds or
securities that may come into his or her hands.
ARTICLE V
MEETINGS OF SHAREHOLDERS
SECTION 1. ANNUAL MEETINGS. There shall be no annual Shareholders'
meetings except as required by law or as hereinafter provided.
SECTION 2. SPECIAL MEETINGS. Special meetings of Shareholders of the
Trust or of any Series or Class shall be called by the President, Vice President
or Secretary whenever ordered by the Trustees, and shall be held at such time
and place as may be stated in the notice of the meeting.
Special meetings of the Shareholders of the Trust or of any Series or Class
shall be called by the Secretary upon the written request of Shareholders owning
at least twenty-five percent (25%) of the Outstanding Shares entitled to vote at
such meeting, provided that (1) such request shall state the purposes of such
meeting and the matters proposed to be acted on, and (2) the Shareholders
requesting such meeting shall have paid to the Trust the reasonably estimated
cost of preparing and mailing the notice thereof, which the Secretary shall
determine and specify to such Shareholders.
If the Secretary fails for more than thirty days to call a special meeting,
the Trustees or the Shareholders requesting such a meeting may, in the name of
the Secretary, call the meeting by giving the required notice. If the meeting
is a meeting of Shareholders of any Series or Class, but not a meeting of all
Shareholders of the Trust, then only a special meeting of Shareholders of such
Series or Class need be called and, in such case, only Shareholders of such
Series or Class shall be entitled to notice of and to vote at such meeting.
SECTION 3. NOTICE OF MEETINGS. Except as provided in Section 2 of this
Article, the Secretary shall cause written notice
-6-
<PAGE>
of the place, date and time, and, in the case of a special meeting, the
purpose or purposes for which the meeting is called. Notice shall be given
as determined by the Trustees at least fifteen days before the date of the
meeting. The written notice of any meeting may be delivered or mailed,
postage prepaid, to each Shareholder entitled to vote at such meeting. If
mailed, notice shall be deemed to be given when deposited in the United
States mail directed to the Shareholder at his or her address as it appears
on the records of the Trust. Notice of any Shareholders' meeting need not be
given to any Shareholder if a written waiver of notice, executed before, at
or after such meeting, is filed with the record of such meeting, or to any
Shareholder who is present at such meeting in person or by proxy unless the
Shareholder is present solely for the purpose of objecting to the call of the
meeting. Notice of adjournment of a Shareholders' meeting to another time or
place need not be given, if such time and place are announced at the meeting
at which the adjournment is taken and the adjourned meeting is held within a
reasonable time after the date set for the original meeting. At the
adjourned meeting the Trust may transact any business which might have been
transacted at the original meeting. If after the adjournment a new record
date is fixed for the adjourned meeting, a notice of the adjourned meeting
shall be given to Shareholders of record entitled to vote at such meeting.
Any irregularities in the notice of any meeting or the nonreceipt of any such
notice by any of the Shareholders shall not invalidate any action otherwise
properly taken at any such meeting.
SECTION 4. VALIDITY OF PROXIES. Subject to the provisions of the Trust
Instrument, Shareholders entitled to vote may vote either in person or by proxy,
provided that either (1) a written instrument authorizing such proxy to act has
been signed and dated by the Shareholder or by his or her duly authorized
attorney, or (2) the Trustees adopt by resolution an electronic, telephonic,
computerized or other alternative to execution of a written instrument
authorizing the proxy to act, but if a proposal by anyone other than the
officers or Trustees is submitted to a vote of the Shareholders of the Trust or
of any Series or Class, or if there is a proxy contest or proxy solicitation or
proposal in opposition to any proposal by the officers or Trustees, Shares may
be voted only in person or by written proxy. Unless the proxy provides
otherwise, it shall not be valid if executed more than eleven months before the
date of the meeting. All proxies shall be delivered to the Secretary or other
person responsible for recording the proceedings before being voted. A proxy
with respect to Shares held in the name of two or more persons shall be valid if
executed by one of them unless at or prior to exercise of such proxy the Trust
receives a specific written notice to the contrary from any one of them. Unless
otherwise specifically limited by their terms, proxies shall entitle the
Shareholder to vote at any adjournment of a Shareholders meeting. At every
meeting of Shareholders, unless the voting is conducted by inspectors, all
questions concerning the qualifications of voters, the validity of proxies, and
the acceptance or rejection of votes, shall be decided by the chairman of the
meeting. Subject to the provisions of the
-7-
<PAGE>
Trust Instrument or these Bylaws, all matters concerning the giving, voting
or validity of proxies shall be governed by the General Corporation Law of
the State of Delaware relating to proxies, and judicial interpretations
thereunder, as if the Trust were a Delaware corporation and the Shareholders
were shareholders of a Delaware corporation.
SECTION 5. PLACE OF MEETING. All special meetings of Shareholders shall
be held at the principal place of business of the Trust or at such other place
as the Trustees may from time to time designate.
SECTION 6. ACTION WITHOUT A MEETING. Any action to be taken by
Shareholders may be taken without a meeting if a majority (or such other amount
as may be required by law) of the Outstanding Shares entitled to vote on the
matter consent to the action in writing and such written consents are filed with
the records of the Shareholders' meetings. Such written consent shall be
treated for all purposes as a vote at a meeting of the Shareholders held at the
principal place of business of the Trust. If the unanimous written consent of
all Shareholders entitled to vote shall not have been received, the Secretary
shall give prompt notice of the action approved by the Shareholders without a
meeting.
ARTICLE VI
SHARES OF BENEFICIAL INTEREST
SECTION 1. SHARE CERTIFICATES. No certificates certifying the ownership
of Shares shall be issued except as the Trustees may otherwise authorize from
time to time. The Trustees may issue certificates to a Shareholder of any
Series or Class for any purpose and the issuance of a certificate to one or more
Shareholders shall not require the issuance of certificates to all Shareholders.
If the Trustees authorize the issuance of Share certificates, then such
certificates shall be in the form prescribed from time to time by the Trustees
and shall be signed by the President or a Vice President and by the Treasurer,
Assistant Treasurer, Secretary or Assistant Secretary of the Trust. Such
signatures may be facsimiles if the certificate is signed by a transfer agent or
Shareholder servicing agent or by a registrar, other than a Trustee, officer or
employee of the Trust. If any officer who has signed any such certificate or
whose facsimile signature has been placed thereon shall have ceased to be such
an officer before the certificate is issued, then such certificate may be issued
by the Trust with the same effect as if he or she were such an officer at the
date of issue. The Trustees may at any time discontinue the issuance of Share
certificates and may, by written notice to each Shareholder, require the
surrender of Share certificates to the Trust for cancellation. Such surrender
and cancellation shall not affect the ownership of Shares in the Trust.
-8-
<PAGE>
In lieu of issuing certificates of Shares, the Trustees or the transfer
agent or Shareholder servicing agent may either issue receipts or may keep
accounts upon the books of the Trust for record holders of such Shares. In
either case, the record holders shall be deemed, for all purposes, to be holders
of certificates for such Shares as if they accepted such certificates and shall
be held to have expressly consented to the terms thereof.
SECTION 2. TRANSFER OF SHARES. The Shares of the Trust shall be
transferable only by a transfer recorded on the books of the Trust by the
Shareholder of record in person or by his or her duly authorized attorney or
legal representative. The Shares of the Trust may be freely transferred, and
the Trustees may, from time to time, adopt rules and regulations regarding the
method of transfer of such Shares. The Trust shall be entitled to treat the
holder of record of any Share or Shares as the absolute owner for all purposes,
and shall not be bound to recognize any legal, equitable or other claim or
interest in such Share or Shares on the part of any other person except as
otherwise expressly provided by law.
Shares of any portfolio of the Trust that are repurchased or redeemed by
the Trust will be held in the treasury. Shares which are held in the treasury
may be reissued and sold by the Trust.
SECTION 3. LOST, STOLEN OR DESTROYED CERTIFICATES. If any Share
certificate should become lost, stolen or destroyed, a duplicate Share
certificate may be issued in place thereof, upon such terms and conditions as
the Trustees may prescribe, including, but not limited to, requiring the owner
of the lost, stolen or destroyed certificate to give the Trust a bond or other
indemnity, in such form and in such amount as the Trustees may direct and with
such surety or sureties as may be satisfactory to the Trustees sufficient to
indemnify the Trust against any claim that may be made against it on account of
the alleged loss, theft or destruction of any such certificate or the issuance
of such new certificate.
ARTICLE VII
CUSTODY OF SECURITIES
SECTION 1. EMPLOYMENT OF A CUSTODIAN. The Trust shall at all times place
and maintain all funds, securities and similar investments of the Trust and of
each Series in the custody of a Custodian, including any sub-custodian for the
Custodian (the "Custodian"). The Custodian shall be one or more banks or trust
companies of good standing having an aggregate capital surplus, and undivided
profits of not less than two million dollars ($2,000,000), or such other
financial institutions or other entities as shall be permitted by rule or order
of the Securities
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and Exchange Commission. The Custodian shall be appointed from time to time
by the Trustees, who shall determine its remuneration.
SECTION 2. TERMINATION OF CUSTODIAN AGREEMENT. Upon termination of the
Custodian Agreement or inability of the Custodian to continue to serve, the
Trustees shall promptly appoint a successor Custodian, but in the event that no
successor Custodian can be found who has the required qualifications and is
willing to serve, the Trustees shall promptly call a special meeting of the
Shareholders to determine whether the Trust shall function without a Custodian
or shall be liquidated. If so directed by resolution of the Trustees or by vote
of a majority of Outstanding Shares of the Trust, the Custodian shall deliver
and pay over all property of the Trust or any Series held by it as specified in
such vote.
SECTION 3. OTHER ARRANGEMENTS. The Trust may make such other arrangements
for the custody of its assets (including deposit arrangements) as may be
required by any applicable law, rule or regulation.
ARTICLE VIII
FISCAL YEAR AND ACCOUNTANT
SECTION 1. FISCAL YEAR. The fiscal year of the Trust shall be as
determined by the Trustees.
SECTION 2. ACCOUNTANT. The Trust shall employ independent certified
public accountants as its accountant ("Accountant") to examine the accounts of
the Trust and to sign and certify financial statements filed by the Trust. The
Accountant's certificates and reports shall be addressed both to the Trustees
and to the Shareholders.
ARTICLE IX
AMENDMENTS
SECTION 1. GENERAL. All Bylaws of the Trust shall be subject to
amendment, alteration or repeal, and new Bylaws may be made by the affirmative
vote of a majority of either: (1) the Outstanding Shares of the Trust entitled
to vote at any meeting; or (2) the Trustees at any meeting.
ARTICLE X
NET ASSET VALUE
SECTION 1. DETERMINATION OF NET ASSET VALUE. The term "Net Asset Value"
of any Series shall mean that amount by which the assets belonging to that
Series exceed its liabilities, all as
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determined by or under the direction of the Trustees. Such value per Share
shall be determined separately for each Series and shall be determined on
such days and at such times as the Trustees may determine. Such
determination shall be made with respect to securities for which market
quotations are readily available, at the market value of such securities; and
with respect to other securities and assets, at the fair value as determined
in good faith by the Trustees, provided, however, that the Trustees, without
Shareholder approval, may alter the method of appraising portfolio securities
insofar as permitted under the Investment Company Act of 1940 and the rules,
regulations and interpretations thereof promulgated or issued by the
Securities and Exchange Commission or insofar as permitted by any order of
the Securities and Exchange Commission applicable to the Series. The
Trustees may delegate any of their powers and duties under this Section 1
with respect to appraisal of assets and liabilities. At any time the
Trustees may cause the Net Asset Value per Share last determined to be
determined again in a similar manner and may fix the time when such
redetermined values shall become effective. The Net Asset Value of any
Series may vary by Class within the Series, reflecting such differences among
Classes as may have been designated by the Trustees in establishing such
Classes.
ARTICLE XI
MISCELLANEOUS
SECTION 1. INSPECTION OF BOOKS. The Trustees shall from time to time
determine whether and to what extent, and at what times and places, and under
what conditions the accounts and books of the Trust or any Series or Class shall
be open to the inspection of Shareholders. No Shareholder shall have any right
to inspect any account or book or document of the Trust except as conferred by
law or otherwise by the Trustees.
SECTION 2. SEVERABILITY. The provisions of these Bylaws are severable.
If the Trustees determine, with the advice of counsel, that any provision hereof
conflicts with the Trust Instrument, the Investment Company Act of 1940, the
regulated investment company provisions of the Internal Revenue Code or with
other applicable laws and regulations the conflicting provision shall be deemed
never to have constituted a part of these Bylaws; provided, however, that such
determination shall not affect any of the remaining provisions of these Bylaws
or render invalid or improper any action taken or omitted prior to such
determination. If any provision hereof shall be held invalid or unenforceable
in any jurisdiction, such invalidity or unenforceability shall attach only to
such provision only in such jurisdiction and shall not affect any other
provision of these Bylaws.
SECTION 3. HEADINGS. Headings are placed in these Bylaws for convenience
of reference only and in case of any
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conflict, the text of these Bylaws rather than the headings shall control.
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EXHIBIT 6
DISTRIBUTION AGREEMENT
This Agreement, made as of the day of , 1996 between
Berger/BIAM Worldwide Funds Trust, a Delaware Business Trust,(the "Trust")
and FIRST FUND DISTRIBUTORS, INC., a Delaware corporation (the "Distributor").
WITNESSETH:
WHEREAS, the Trust is engaged in business as an open-end management
investment company and registered as such under the Investment Company Act of
l940 (the "1940 Act"), and it is in the interest of the Trust to offer its
shares of Berger/BIAM International Fund, Berger/BIAM International
Institutional Fund and Berger/BIAM International CORE Fund (the "Funds") for
sale continuously; and
WHEREAS, the Distributor is registered as a broker-dealer under the
Securities Exchange Act of l934 (the "1934 Act") and is a member in good
standing of the National Association of Securities Dealers, Inc. (the
"NASD"); and
WHEREAS, the Trust and the Distributor wish to enter into an agreement
with each other with respect to the continuous offering of the shares of
common stock of the Funds (the "Shares"),
NOW, THEREFORE, the parties agree as follows:
l. APPOINTMENT OF DISTRIBUTOR. The Trust hereby appoints the
Distributor as exclusive agent to sell and to arrange for the sale of the
Shares, on the terms and for the period set forth in this Agreement, and the
Distributor hereby accepts such appointment and agrees to act hereunder
directly and/or through the Funds' transfer agent in the manner set forth in
the Prospectuses (as defined below). It is understood and agreed that the
services of the Distributor hereunder are not exclusive, and the Distributor
may act as principal underwriter for the shares of any other registered
investment company.
2. SERVICES AND DUTIES OF THE DISTRIBUTOR
(a) The Distributor agrees to sell the Shares, as agent for the Funds
from time to time during the term of this Agreement upon the terms described
in the Funds' Prospectus. As used in this Agreement, the term "Prospectus"
shall mean the prospectus and statement of additional information of the
Funds included as part of the Trust's Registration Statement, as such
prospectuses and statement of additional information may be amended or
supplemented from time to time, and the term "Registration Statement" shall
mean the Registration Statement most recently filed from time to time by the
Trust with the Securities and Exchange Commission and effective under the
1933 Act and the 1940 Act, as such Registration Statement is amended by any
amendments thereto at the time in effect. The Distributor shall not be
obligated to sell any certain number of Shares.
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(b) Upon commencement of the Funds' operations, the Distributor will
hold itself available to receive orders, satisfactory to the Distributor, for
the purchase of the Shares and will accept such orders and will transmit such
orders and funds received by it in payment for such Shares as are so accepted
to the Funds' transfer agent or custodian, as appropriate, as promptly as
practicable. Purchase orders shall be deemed effective at the time and in
the manner set forth in the Prospectuses. The Distributor shall not make any
short sales of Shares.
(c) The offering price of the Shares shall be the net asset value per
share of the Shares as defined in the Trust Instrument, plus the sales
charge, if any,(determined as set forth in the prospectus). The Funds shall
furnish the Distributor, with all possible promptness, an advice of each
computation of net asset value and offering price.
(d) The Distributor agrees to file with the NASD, pursuant to applicable
rules, all advertisements and sales literature prepared by or for the Funds
and furnished to the Distributor. Distributor will promptly inform the Trust
of any comments received from the NASD with respect to such filed
advertisements and sales literature.
3. DUTIES OF THE TRUST.
(a) MAINTENANCE OF FEDERAL REGISTRATION. The Trust shall, at its
expense, take, from time to time, all necessary action and such steps,
including payment of the related filing fees, as may be necessary to register
and maintain registration of a sufficient number of Shares under the 1933
Act. The Trust agrees to file from time to time such amendments, reports and
other documents as may be necessary in order that there may be no untrue
statement of a material fact in a registration statement or prospectus, or
necessary in order that there may be no omission to state a material fact in
the registration statement or prospectus which omission would make the
statements therein misleading.
(b) MAINTENANCE OF "BLUE SKY" QUALIFICATIONS. The Trust shall, at its
expense, use its best efforts to qualify and maintain the qualification of an
appropriate number of Shares for sale under the securities laws of such
states as the Distributor and the Trust may approve, and, if necessary or
appropriate in connection therewith, to qualify and maintain the
qualification of the Trust as a broker or dealer in such states; provided
that the Trust shall not be required to amend its Trust Instrument or By-Laws
to comply with the laws of any state, to maintain an office in any state, to
change the terms of the offering of the Shares in any state, to change the
terms of the offering of the Shares in any state from the terms set forth in
the Prospectuses, to qualify as a foreign corporation in any state or to
consent to service of process in any state other than with respect to claims
arising out of the offering and sale of the Shares. The
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Distributor shall furnish such information and other material relating to its
affairs and activities as may be required by the Trust in connection with
such qualifications.
(c) COPIES OF REPORTS AND PROSPECTUSES. The Trust shall, at its
expense, keep the Distributor fully informed with regard to their affairs and
in connection therewith shall furnish to the Distributor copies of all
information, financial statements and other papers which the Distributor may
reasonably request for use in connection with the distribution of Shares,
including such reasonable number of copies of the Prospectuses and annual and
interim reports as the Distributor may request and shall cooperate fully in
the efforts of the Distributor to sell and arrange for the sale of the Shares
and in the performance of the Distributor under this Agreement.
4. CONFORMITY WITH APPLICABLE LAW AND RULES. The Distributor agrees
that in selling Shares hereunder it shall conform in all respects with the
laws of the United States and of any state in which Shares may be offered,
and with applicable rules and regulations of the NASD.
5. INDEPENDENT CONTRACTOR. In performing its duties hereunder, the
Distributor shall be an independent contractor and neither the Distributor,
nor any of its officers, directors, employees, or representatives is or shall
be an employee of the Trust in the performance of the Distributor's duties
hereunder. The Distributor shall be responsible for its own conduct and the
employment, control, and conduct of its agents and employees and for injury
to such agents or employees or to others through its agents or employees.
The Distributor assumes full responsibility for its agents and employees
under applicable statutes and agrees to pay all employee taxes thereunder.
6. INDEMNIFICATION.
(a) INDEMNIFICATION OF TRUST. The Distributor agrees to indemnify and
hold harmless the Trust and each of its present or former trustees, officers,
employees, representatives and each person, if any, who controls or
previously controlled the Trust within the meaning of Section l5 of the 1933
Act against any and all losses, liabilities, damages, claims or expenses
(including the reasonable costs of investigating or defending any alleged
loss, liability, damage, claims or expense and reasonable legal counsel fees
incurred in connection therewith) to which the Trust or any such person may
become subject under the 1933 Act, under any other statute, at common law, or
otherwise, arising out of the acquisition of any Shares by any person which
(i) may be based upon any wrongful act by the Distributor or any of the
Distributor's directors, officers, employees or representatives, or (ii) may
be based upon any untrue statement or alleged untrue statement of a material
fact contained in a registration statement, prospectus, shareholder report or
other information covering Shares filed or made public by the Trust or any
amendment
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thereof or supplement thereto, or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading if such statement or omission was made
in reliance upon information furnished to the Trust by the Distributor. In
no case (i) is the Distributor's indemnity in favor of the Trust, or any
person indemnified to be deemed to protect the Trust or such indemnified
person against any liability to which the Trust or such person would
otherwise be subject by reason of willful misfeasance, bad faith, or gross
negligence in the performance of such person's duties or by reason of
reckless disregard of such person's obligations and duties under this
Agreement or (ii) is the Distributor to be liable under its indemnity
agreement contained in this Paragraph with respect to any claim made against
the Trust or any person indemnified unless the Trust or such person, as the
case may be, shall have notified the Distributor in writing of the claim
within a reasonable time after the summons or other first written
notification giving information of the nature of the claim shall have been
served upon the Trust or upon such person (or after the Trust or such person
shall have received notice to such service on any designated agent).
However, failure to notify the Distributor of any such claim shall not
relieve the Distributor from any liability which the Distributor may have to
the Trust or any person against whom such action is brought otherwise than on
account of the Distributor's indemnity agreement contained in this Paragraph.
The Distributor shall be entitled to participate, at its own expense, in
the defense, or, if the Distributor so elects, to assume the defense of any
suit brought to enforce any such claim, but, if the Distributor elects to
assume the defense, such defense shall be conducted by legal counsel chosen
by the Distributor and satisfactory to the Trust, to the persons indemnified,
defendant or defendants, in the suit. In the event that the Distributor
elects to assume the defense of any such suit and retain such legal counsel,
the Trust, the persons indemnified, defendant or defendants in the suit,
shall bear the fees and expenses of any additional legal counsel retained by
them. If the Distributor does not elect to assume the defense of any such
suit, the Distributor will reimburse the Trust and the persons indemnified,
defendant or defendants in such suit for the reasonable fees and expenses of
any legal counsel retained by them. The Distributor agrees to notify the
Trust promptly of the commencement of any litigation of proceedings against
it or any of its officers, employees or representatives in connection with
the issue or sale of any Shares.
(b) INDEMNIFICATION OF THE DISTRIBUTOR. The Trust agrees to indemnify
and hold harmless the Distributor and each of its present or former
directors, officers, employees, representatives and each person, if any, who
controls or previously controlled the Distributor within the meaning of
Section l5 of the 1933 Act against any and all losses, liabilities, damages,
claims or expenses (including the reasonable costs of investigating or
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defending any alleged loss, liability, damage, claim or expense and
reasonable legal counsel fees incurred in connection therewith) to which the
Distributor or any such person may become subject under the 1933 Act, under
any other statute, at common law, or otherwise, arising out of the
acquisition of any Shares by any person which (i) may be based upon any
wrongful act by the Trust or any of the Trust's trustees, officers, employees
or representatives, or (ii) may be based upon any untrue statement or alleged
untrue statement of a material fact contained in a registration statement,
prospectus, shareholder report or other information covering Shares filed or
made public by the Trust or any amendment thereof or supplement thereto, or
the omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading
unless such statement or omission was made in reliance upon information
furnished to the Trust by the Distributor. In no case (i) is the Trust's
indemnity in favor of the Distributor, or any person indemnified to be deemed
to protect the Distributor or such indemnified person against any liability
to which the Distributor or such person would otherwise be subject by reason
of willful misfeasance, bad faith, or gross negligence in the performance of
such person's duties or by reason of reckless disregard of such person's
obligations and duties under this Agreement, or (ii) is the Trust to be
liable under the indemnity agreement contained in this Paragraph with respect
to any claim made against Distributor, or person indemnified unless the
Distributor, or such person, as the case may be, shall have notified the
Trust in writing of the claim within a reasonable time after the summons or
other first written notification giving information of the nature of the
claim shall have been served upon the Distributor or upon such person (or
after the Distributor or such person shall have received notice of such
service on any designated agent). However, failure to notify the Trust of any
such claim shall not relieve the Trust from any liability which the Trust may
have to the Distributor or any person against whom such action is brought
otherwise than on account of the Trust's indemnity agreement contained in
this Paragraph.
The Trust shall be entitled to participate, at their own expense, in the
defense, or, if the Trust so elects, to assume the defense of any suit
brought to enforce any such claim, but if the Trust elects to assume the
defense, such defense shall be conducted by legal counsel chosen by the Trust
and satisfactory to the Distributor, to the persons indemnified, defendant or
defendants, in the suit. In the event that the Trust elects to assume the
defense of any such suit and retain such legal counsel, the Distributor, and
the persons indemnified, defendant or defendants, in the suit, shall bear the
fees and expenses of any additional legal counsel retained by them. If the
Trust does not elect to assume the defense of any such suit, the Trust will
reimburse the Distributor and the persons indemnified, defendant or
defendants in such suit for the reasonable fees and expenses of any legal
counsel retained by them. The Trust agrees to notify the Distributor
promptly of the commencement of any litigation or
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proceedings against them or any of their directors, officers, employees or
representatives in connection with the issue or sale of any Shares.
7. AUTHORIZED REPRESENTATIONS. The Distributor is not authorized by
the Trust to give on behalf of any Fund any information or to make any
representations in connection with the sale of Shares other than the
information and representations contained in a registration statement or
prospectus filed with the Securities and Exchange Commission ("SEC") under
the 1933 Act and/or the 1940 Act, covering Shares, as such registration
statement and prospectus may be amended or supplemented from time to time, or
contained in shareholder reports or other material that may be prepared by or
on behalf of the Funds for the Distributor's use. No person other than the
Distributor is authorized to act as principal underwriter (as such term is
defined in the 1940 Act) for the Trust.
8. TERM OF AGREEMENT. The term of this Agreement shall begin on the
date first above written, and unless sooner terminated as hereinafter
provided, this Agreement shall remain in effect for a period of two years
from the date first above written. Thereafter, this Agreement shall continue
in effect from year to year, subject to the termination provisions and all
other terms and conditions thereof, so long as such continuation shall be
specifically approved at least annually by the Board of Trustees or by vote
of a majority of the outstanding voting securities of each Fund and,
concurrently with such approval by the Board of Trustees or prior to such
approval by the holders of the outstanding voting securities of each Fund, as
the case may be, by the vote, cast in person at a meeting called for the
purpose of voting on such approval, of a majority of the Trustees of the
Trust who are not parties to this Agreement or interested persons of any such
party. The Distributor shall furnish to the Trust, promptly upon its
request, such information as may reasonably be necessary to evaluate the
terms of this Agreement or any extension, renewal or amendment hereof.
9. AMENDMENT OR ASSIGNMENT OF AGREEMENT. This Agreement may not be
amended or assigned except as permitted by the 1940 Act, and this Agreement
shall automatically and immediately terminate in the event of its assignment.
10. TERMINATION OF AGREEMENT. This Agreement may be terminated by
either party hereto, without the payment of any penalty, on not more than 60
days' nor less than 30 days' prior notice in writing to the other party;
provided, that in the case of termination by the Trust such action shall have
been authorized by resolution of a majority of the Trustees of the Trust who
are not parties to this Agreement or interested persons of any such party, or
by vote of a majority of the outstanding voting securities of each Fund.
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11. FEES AND EXPENSES. The Distributor will not be entitled to any
compensation from the Trust for its services under this Agreement and shall
be compensated for its services and reimbursed for its expenses by Berger
Associates, Inc., as described in Schedule A attached hereto.
12. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or delineate any of the
provisions hereof or otherwise affect their construction or effect.
This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Nothing herein contained shall be deemed to require the Trust to take
any action contrary to its Trust Instrument or By-Laws, or any applicable
statutory or regulatory requirement to which it is subject or by which it is
bound, or to relieve or deprive the Board of Trustees of the Trust of
responsibility for and control of the conduct of the affairs of the Trust.
13. DEFINITION OF TERMS. Any question of interpretation of any term or
provision of this Agreement having a counterpart in or otherwise derived from
a term or provision of the 1940 Act shall be resolved by reference to such
term or provision of the 1940 Act and to interpretation thereof, if any, by
the United States courts or, in the absence of any controlling decision of
any such court, by rules, regulations or orders of the Securities and
Exchange Commission validly issued pursuant to the 1940 Act. Specifically,
the terms "vote of a majority of the outstanding voting securities",
"interested persons", "assignment", and "affiliated person", as used in
Paragraphs 8, 9 and 10 hereof, shall have the meanings assigned to them by
Section 2(a) of the 1940 Act. In addition, where the effect of a requirement
of the 1940 Act reflected in any provision of this Agreement is relaxed by a
rule, regulation or order of the Securities and Exchange Commission, whether
of special or of general application, such provision shall be deemed to
incorporate the effect of such rule, regulation or order.
14. COMPLIANCE WITH SECURITIES LAWS. The Trust represents that it is
registered as an open-end management investment company under the 1940 Act,
and agree that they will comply with all the provisions of the 1940 Act and
of the rules and regulations thereunder. The Trust and the Distributor each
agree to comply with all of the applicable terms and provisions of the 1940
Act, the 1933 Act and, subject to the provisions of Section 4(d), all
applicable "Blue Sky" laws. The Distributor agrees to comply with all of the
applicable terms and provisions of the Securities Exchange Act of 1934.
15. NOTICES. Any notice required to be given pursuant to this Agreement
shall be deemed duly given if delivered or mailed
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by registered mail, postage prepaid, to the Distributor at 4455 E. Camelback
Rd., Ste. 261-E, Phoenix, AZ 85018 or to the Trust at 210 University Blvd,
Suite 900, Denver, CO 80206.
16. GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of Arizona.
17. LIMITATION ON PERSONAL LIABILITY. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of
State of the State of Delaware. All parties to this Agreement acknowledge
and agree that the Trust is a series trust and all debts, liabilities,
obligations and expenses incurred, contracted for or otherwise existing with
respect to a particular series shall be enforceable against the assets held
with respect to such series only, and not against the assets of the Trust
generally or against the assets held with respect to any other series and
further that no Trustee, officer or holder of shares of beneficial interest
of the Trust shall be personally liable for any of the foregoing.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their duly authorized representatives and their respective
corporate seals to be hereunto affixed, as of the day and year first above
written.
BERGER/BIAM WORLDWIDE FUNDS TRUST
By:
------------------------------------------
Attest:
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FIRST FUND DISTRIBUTORS, INC.
By:
------------------------------------------
Attest:
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SCHEDULE A
Distributor shall be entitled to compensation for its services under this
agreement in the amount of Twelve Thousand Five Hundred Dollars ($12,500.00)
per quarter, with the first such quarter beginning on the first day of the
month that this Agreement is executed, payable in advance by Berger
Associates, Inc. In the event of termination of this Agreement, Distributor
shall refund such portion of the fee as prorated from the date of termination
to the end of such quarter. In addition, Distributor shall be entitled to
reimbursement of expenses incurred subject to Section 2(d) of the Agreement,
by Berger Associates, Inc., upon delivery of a valid invoice.
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EXHIBIT 8
CUSTODY AGREEMENT
THIS AGREEMENT made effective as of the day of , 1996,
by and between INVESTORS FIDUCIARY TRUST COMPANY, a trust company chartered
under the laws of the state of Missouri, having its trust office located at 127
West 10th Street, Kansas City, Missouri 64105 ("Custodian"), BERGER/BIAM
WORLDWIDE FUNDS TRUST, a Delaware business trust, referred to as the "Fund,"
consisting of separate portfolios represented by separate series of shares of
beneficial interest (referred to herein, together with any such portfolios
hereafter constituted, where appropriate, individually as a "Portfolio," or
collectively as the "Portfolios,") having its principal office and place of
business at 210 University Boulevard, Suite 900, Denver, Colorado 80206, and
BBOI WORLDWIDE LLC, a Delaware limited liability company having its principal
office and place of business at 210 University Boulevard, Denver, Colorado 80206
("BBOI").
WITNESSETH:
WHEREAS, Fund and BBOI desire to appoint Investors Fiduciary Trust Company
as Custodian of the securities and monies of Fund's investment portfolio; and
WHEREAS, Investors Fiduciary Trust Company is willing to accept such
appointment;
NOW THEREFORE, for and in consideration of the mutual promises contained
herein, the parties hereto, intending to be legally bound, mutually covenant and
agree as follows:
1. APPOINTMENT OF CUSTODIAN. Fund hereby constitutes and appoints Custodian
as custodian of the Fund which is to include appointment as custodian of
the securities and monies at any time owned by the Fund.
2. DELIVERY OF CORPORATE DOCUMENTS. Fund has delivered or will deliver to
Custodian prior to the effective date of this Agreement, copies of the
following documents and all amendments or supplements thereto, properly
certified or authenticated:
A. Resolutions of the Trustees of Fund appointing Custodian as custodian
hereunder and approving the form of this Agreement; and
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B. Resolutions of the Trustees of Fund designating certain persons to
give instructions on behalf of Fund to Custodian and authorizing
Custodian to rely upon written instructions over their signatures.
3. DUTIES AND RESPONSIBILITIES OF CUSTODIAN.
A. DELIVERY OF ASSETS
Fund will deliver or cause to be delivered to Custodian on the
effective date of this Agreement, or as soon thereafter as
practicable, and from time to time thereafter, all portfolio
securities acquired by it and monies then owned by it except as
permitted by the Investment Company Act of 1940 or from time to time
coming into its possession during the time this Agreement shall
continue in effect. Custodian shall have no responsibility or
liability whatsoever for or on account of securities or monies not so
delivered. All securities so delivered to Custodian (other than
bearer securities) shall be registered in the name of the applicable
Portfolio or its nominee, or of a nominee of Custodian, or shall be
properly endorsed and in form for transfer satisfactory to Custodian.
B. DELIVERY OF ACCOUNTS AND RECORDS
Fund shall turn over to Custodian all of each Portfolio's relevant
accounts and records previously maintained by it. Custodian shall be
entitled to rely conclusively on the completeness and correctness of
the accounts and records turned over to it by Fund, and Fund shall
indemnify and hold Custodian harmless of and from any and all
expenses, damages and losses whatsoever arising out of or in
connection with any error, omission, inaccuracy or other deficiency of
such accounts and records or in the failure of Fund to provide any
portion of such or to provide any information needed by the Custodian
knowledgeably to perform its function hereunder.
C. DELIVERY OF ASSETS TO THIRD PARTIES
Custodian will receive delivery of and keep safely the assets of each
Portfolio delivered to it from time to time segregated in a separate
account. Custodian will not deliver, assign, pledge or hypothecate
any such assets to any person except as permitted by the provisions of
this Agreement or any agreement executed by it according to the terms
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of section 3.S. of this Agreement. Upon delivery of any such assets
to a subcustodian pursuant to Section 3.S. of this agreement,
Custodian will create and maintain records identifying those assets
which have been delivered to the subcustodian as belonging to each
such Portfolio. The Custodian is responsible for the securities and
monies of Fund only until they have been transmitted to and received
by other persons as permitted under the terms of this Agreement,
except for securities and monies transmitted to subcustodians
appointed under Section 3.S of this Agreement for which Custodian
remains responsible to the extent provided in Section 3.S of this
Agreement. Custodian may participate directly or indirectly through a
subcustodian in the Depository Trust Company, Treasury/Federal Reserve
Book Entry System or Participant Trust Company (PTC) or other
depository approved by the Fund (as such entities are defined at 17
CFR Section 270.17f-4(b)) (each a "Depository" and collectively the
"Depositories").
D. REGISTRATION OF SECURITIES
Custodian will hold stocks and other registerable portfolio securities
of Fund registered in the name of the applicable Portfolio or in the
name of any nominee of Custodian for whose fidelity and liability
Custodian will be fully responsible, or in street certificate form,
so-called, with or without any indication of fiduciary capacity.
Unless otherwise instructed, Custodian will register all such
portfolio securities in the name of its authorized nominee. All
securities, and the ownership thereof by Fund, which are held by
Custodian hereunder, however, shall at all times be identifiable on
the records of the Custodian. The Fund agrees to hold Custodian and
its nominee harmless for any liability arising solely from Custodian
or its nominee acting as a recordholder of securities held in custody.
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E. EXCHANGE OF SECURITIES
Upon receipt of instructions as defined herein in Section 4.A,
Custodian will exchange, or cause to be exchanged, portfolio
securities held by it for the account of Fund for other securities or
cash issued or paid in connection with any reorganization,
recapitalization, merger, consolidation, split-up of shares, change of
par value, conversion or otherwise, and will deposit any such
securities in accordance with the terms of any reorganization or
protective plan. Without instructions, Custodian is authorized to
exchange securities held by it in temporary form for securities in
definitive form, to effect an exchange of shares when the par value of
the stock is changed, and, upon receiving payment therefor, to
surrender bonds or other securities held by it at maturity or when
advised of earlier call for redemption, except that Custodian shall
receive instructions prior to surrendering any convertible security.
F. PURCHASES OF INVESTMENTS OF THE FUND
Fund will, on each business day on which a purchase of securities
shall be made by it, deliver to Custodian instructions which shall
specify with respect to each such purchase:
1. The name of the Portfolio making such purchase;
2. The name of the issuer and description of the security;
3. The number of shares or the principal amount purchased, and
accrued interest, if any;
4. The trade date;
5. The settlement date;
6. The purchase price per unit and the brokerage commission, taxes
and other expenses payable in connection with the purchase;
7. The total amount payable upon such purchase; and
8. The name of the person from whom or the broker or dealer through
whom the purchase was made.
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In accordance with such instructions, Custodian will pay for out of
monies held for the account of the Portfolio, but only insofar as
monies are available therein for such purpose, and receive the
portfolio securities so purchased by or for the account of the
Portfolio except that Custodian may in its sole discretion advance
funds for the account of the Portfolio which may result in an
overdraft because the monies held by the Custodian for the account of
the Portfolio of the Fund are insufficient to pay the total amount
payable upon such purchase. Except as otherwise instructed by Fund,
such payment shall be made by the Custodian only upon receipt of
securities: (a) by the Custodian; (b) by a clearing corporation of a
national exchange of which the Custodian is a member; or (c) by a
Depository. Notwithstanding the foregoing, (i) in the case of a
repurchase agreement, the Custodian may release funds to a Depository
prior to the receipt of advice from the Depository that the securities
underlying such repurchase agreement have been transferred by book-
entry into the account maintained with such Depository by the
Custodian, on behalf of its customers, provided that the Custodian's
instructions to the Depository require that the Depository make
payment of such funds only upon transfer by book-entry of the
securities underlying the repurchase agreement in such account; (ii)
in the case of time deposits, call account deposits, currency deposits
and other deposits, foreign exchange transactions, futures contracts
or options, the Custodian may make payment therefor before receipt of
an advice or confirmation evidencing said deposit or entry into such
transaction; and (iii) in the case of the purchase of securities, the
settlement of which occurs outside of the United States of America,
the Custodian may make, or cause a subcustodian appointed pursuant to
Section 3.S.2. of this Agreement to make, payment therefor in
accordance with generally accepted local custom and market practice.
G. SALES AND DELIVERIES OF INVESTMENTS OF THE FUND - OTHER THAN OPTIONS
AND FUTURES
Fund will, on each business day on which a sale of investment
securities of Fund has been made, deliver to Custodian instructions
specifying with respect to each such sale:
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1. The name of the Portfolio making such sale;
2. The name of the issuer and description of the securities;
3. The number of shares or principal amount sold, and accrued
interest, if any;
4. The date on which the securities sold were purchased or other
information identifying the securities sold and to be delivered;
5. The trade date;
6. The settlement date;
7. The sale price per unit and the brokerage commission, taxes or
other expenses payable in connection with such sale;
8. The total amount to be received by Fund upon such sale; and
9. The name and address of the broker or dealer through whom or
person to whom the sale was made.
In accordance with such instructions, Custodian will deliver or cause
to be delivered the securities thus designated as sold for the account
of the Portfolio to the broker or other person specified in the
instructions relating to such sale. Except as otherwise instructed by
Fund, such delivery shall be made upon receipt of: (a) payment
therefor in such form as is satisfactory to the Custodian; (b) credit
to the account of the Custodian with a clearing corporation of a
national securities exchange of which the Custodian is a member; or
(c) credit to the account of the Custodian, on behalf of its
customers, with a Depository. Notwithstanding the foregoing: (i) in
the case of securities held in physical form, such securities shall be
delivered in accordance with "street delivery custom" to a broker or
its clearing agent; or (ii) in the case of the sale of securities, the
settlement of which occurs outside of the United States of America,
the Custodian may make, or cause a subcustodian appointed pursuant to
Section 3.S.2. of this Agreement to make, such delivery upon payment
therefor in accordance with generally accepted local custom and market
practice.
H. PURCHASES OR SALES OF SECURITY OPTIONS, OPTIONS ON INDICES AND
SECURITY INDEX FUTURES CONTRACTS
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Fund will, on each business day on which a purchase or sale of the
following options and/or futures shall be made by it, deliver to
Custodian instructions which shall specify with respect to each such
purchase or sale:
1. The name of the Portfolio making such purchase or sale;
2. Security Options
a. The underlying security;
b. The price at which purchased or sold;
c. The expiration date;
d. The number of contracts;
e. The exercise price;
f. Whether the transaction is an opening, exercising, expiring
or closing transaction;
g. Whether the transaction involves a put or call;
h. Whether the option is written or purchased;
i. Market on which option traded;
j. Name and address of the broker or dealer through whom the
sale or purchase was made.
3. Options on Indices
a. The index;
b. The price at which purchased or sold;
c. The exercise price;
d. The premium;
e. The multiple;
f. The expiration date;
g. Whether the transaction is an opening, exercising, expiring
or closing transaction;
h. Whether the transaction involves a put or call;
i. Whether the option is written or purchased;
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j. The name and address of the broker or dealer through whom
the sale or purchase was made, or other applicable
settlement instructions.
4. Security Index Futures Contracts
a. The last trading date specified in the contract and, when
available, the closing level, thereof;
b. The index level on the date the contract is entered into;
c. The multiple;
d. Any margin requirements;
e. The need for a segregated margin account (in addition to
instructions, and if not already in the possession of
Custodian, Fund shall deliver a substantially complete and
executed custodial safekeeping account and procedural
agreement which shall be incorporated by reference into this
Custody Agreement); and
f. The name and address of the futures commission merchant
through whom the sale or purchase was made, or other
applicable settlement instructions.
5. Option on Index Future Contracts
a. The underlying index futures contract;
b. The premium;
c. The expiration date;
d. The number of options;
e. The exercise price;
f. Whether the transaction involves an opening, exercising,
expiring or closing transaction;
g. Whether the transaction involves a put or call;
h. Whether the option is written or purchased; and
i. The market on which the option is traded.
I. SECURITIES PLEDGED OR LOANED
If specifically allowed for in the prospectus of Fund:
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1. Upon receipt of instructions, Custodian will release or cause to
be released securities held in custody to the pledgee designated
in such instructions by way of pledge or hypothecation to secure
any loan incurred by Fund; provided, however, that the securities
shall be released only upon payment to Custodian of the monies
borrowed, except that in cases where additional collateral is
required to secure a borrowing already made, further securities
may be released or caused to be released for that purpose upon
receipt of instructions. Upon receipt of instructions, Custodian
will pay, but only from funds available for such purpose, any
such loan upon redelivery to it of the securities pledged or
hypothecated therefor and upon surrender of the note or notes
evidencing such loan.
2. Upon receipt of instructions, Custodian will release securities
held in custody to the borrower designated in such instructions;
provided, however, that the securities will be released only upon
deposit with Custodian of full cash collateral as specified in
such instructions, and that Fund will retain the right to any
dividends, interest or distribution on such loaned securities.
Upon receipt of instructions and the loaned securities, Custodian
will release the cash collateral to the borrower.
J. ROUTINE MATTERS
Custodian will, in general, attend to all routine and mechanical
matters in connection with the sale, exchange, substitution, purchase,
transfer, or other dealings with securities or other property of Fund
except as may be otherwise provided in this Agreement or directed from
time to time by the Trustees of Fund.
K. DEPOSIT ACCOUNT
Custodian will open and maintain a special purpose deposit account in
the name of Custodian ("Account"), subject only to draft or order by
Custodian upon receipt of instructions. All monies received by
Custodian from or for the account of a Portfolio shall be deposited in
the Account of such Portfolio. Barring events not in the control of
the Custodian such as strikes, lockouts or labor disputes, riots, war
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or equipment or transmission failure or damage, fire, flood,
earthquake or other natural disaster, action or inaction of
governmental authority or other causes beyond its control, at 9:00
a.m., Kansas City time, on the second business day after deposit of
any check into a Portfolio's Account, Custodian agrees to make Fed
Funds available to such Portfolio in the amount of the check.
Deposits made by Federal Reserve wire will be available to the Fund
immediately and ACH wires will be available to the Fund on the next
business day. Income earned on the portfolio securities will be
credited to the Account of the applicable Portfolio based on the
schedule attached as Exhibit A. The Custodian will be entitled to
reverse any credited amounts where credits have been made and monies
are not finally collected, provided that the Custodian has made
reasonable efforts to collect such uncollected income. If monies are
collected after such reversal, the Custodian will credit the
applicable Portfolio in that amount. Custodian may open and maintain
Accounts in State Street Bank and Trust Company, and in such other
banks or trust companies as may be designated by Custodian and as
properly authorized by resolution of the Trustees of the Fund, such
Accounts, however, to be in the name of Custodian and subject only to
its draft or order.
L. INCOME AND OTHER PAYMENTS TO THE PORTFOLIO
Custodian will:
1. Collect, claim and receive and deposit for the account of the
Portfolio all income and other payments which become due and
payable on or after the effective date of this Agreement with
respect to the securities deposited under this Agreement, and
credit the account of the applicable Portfolio in accordance with
the schedule attached hereto as Exhibit A. If, for any reason, a
Portfolio is credited with income that is not subsequently
collected, Custodian may reverse that credited amount provided
that the Custodian has made reasonable efforts to collect such
uncollected income;
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2. Execute ownership and other certificates and affidavits for all
federal, state and local tax purposes in connection with the
collection of bond and note coupons; and
3. Take such other action as may be necessary or proper in
connection with:
a. the collection, receipt and deposit of such income and other
payments, including but not limited to the presentation for
payment of:
1. all coupons and other income items requiring
presentation; and
2. all other securities which may mature or be called,
redeemed, retired or otherwise become payable and
regarding which the Custodian has actual knowledge, or
notice of which is contained in publications of the
type to which it normally subscribes for such purpose;
and
b. the endorsement for collection, in the name of Fund, of all
checks, drafts or other negotiable instruments.
Custodian, however, will not be required to institute suit or take
other extraordinary action to enforce collection except upon receipt
of instructions and upon being indemnified to its satisfaction against
the costs and expenses of such suit or other actions. Custodian will
receive, claim and collect all stock dividends, rights and other
similar items and will deal with the same pursuant to instructions.
Unless prior instructions have been received to the contrary,
Custodian will, without further instructions, sell any rights held for
the account of a Portfolio on the last trade date prior to the date of
expiration of such rights.
M. PAYMENT OF DIVIDENDS AND OTHER DISTRIBUTIONS
On the declaration of any dividend or other distribution on the shares
of the Fund ("Fund Shares") by the Trustees of Fund, Fund shall
deliver to Custodian instructions with respect thereto. Except if the
ex-dividend date and the reinvestment date of any dividend are the
same, in which case funds shall remain in the Custody Account, on the
date specified in such instructions for the payment of such dividend
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or other distribution, Custodian will pay out of the monies held for
the account of the applicable Portfolio, insofar as the same shall be
available for such purposes, and credit to the account of the Dividend
Disbursing Agent for Fund, such amount as may be necessary to pay the
amount per share payable in cash on Fund Shares issued and outstanding
on the record date as given in such instructions.
N. SHARES OF FUND PURCHASED BY FUND
Whenever any Fund Shares are repurchased or redeemed by Fund, Fund or
its agent shall advise Custodian of the aggregate dollar amount to be
paid for such shares and shall confirm such advice in writing. Upon
receipt of such advice, Custodian shall charge such aggregate dollar
amount to the Account of the applicable Portfolio and either deposit
the same in the account maintained for the purpose of paying for the
repurchase or redemption of Fund Shares or deliver the same in
accordance with such advice.
Custodian shall not have any duty or responsibility to determine that
Fund Shares have been removed from the proper shareholder account or
accounts or that the proper number of such shares have been cancelled
and removed from the shareholder records.
O. SHARES OF FUND PURCHASED FROM FUND
Whenever Fund Shares are purchased from Fund, Fund will deposit or
cause to be deposited with Custodian the amount received for such
shares.
Custodian shall not have any duty or responsibility in its capacity as
Custodian of the Fund to determine that Fund Shares purchased from
Fund have been added to the proper shareholder account or accounts or
that the proper number of such shares have been added to the
shareholder records.
P. PROXIES AND NOTICES
Custodian will promptly deliver or mail or have delivered or mailed to
Fund all proxies properly signed, all notices of meetings, all proxy
statements and other notices, requests or announcements affecting or
relating to securities held by Custodian for Fund and will, upon
receipt of instructions, execute and deliver or cause its nominee to
execute and deliver or mail or have delivered or mailed such proxies
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or other authorizations as may be required. Except as provided by
this Agreement or pursuant to instructions hereafter received by
Custodian, neither it nor its nominee will exercise any power inherent
in any such securities, including any power to vote the same, or
execute any proxy, power of attorney, or other similar instrument
voting any of such securities, or give any consent, approval or waiver
with respect thereto, or take any other similar action.
Q. DISBURSEMENTS
Custodian will pay or cause to be paid insofar as funds are available
for the purpose, bills, statements and other obligations of Fund
(including but not limited to obligations in connection with the
conversion, exchange or surrender of securities owned by Fund,
interest charges, dividend disbursements, taxes, management fees,
custodian fees, legal fees, auditors' fees, transfer agents' fees,
brokerage commissions, compensation to personnel, and other operating
expenses of Fund) pursuant to instructions of Fund setting forth the
name of the person to whom payment is to be made, the amount of the
payment, and the purpose of the payment.
R. DAILY STATEMENT OF ACCOUNTS
Custodian will, within a reasonable time, render to Fund as of the
close of business on each day, a detailed statement of the amounts
received or paid and of securities received or delivered for the
account of the Portfolio during said day. Custodian will, from time
to time, upon request by Fund, render a detailed statement of the
securities and monies held for the Portfolios under this Agreement,
and Custodian will maintain such books and records as are necessary to
enable it to do so and will permit such persons as are authorized by
Fund, including Fund's independent public accountants, access to such
records or confirmation of the contents of such records; and if
demanded, will permit federal and state regulatory agencies to examine
the securities, books and records. Upon the written instructions of
Fund or as demanded by federal or state regulatory agencies, Custodian
will instruct any subcustodian to give such persons as are authorized
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by the Fund, including Fund's independent public accountants, access
to such records or confirmation of the contents of such records; and
if demanded, to permit federal and state regulatory agencies to
examine the books, records and securities held by subcustodian which
relate to Fund.
S. APPOINTMENT OF SUBCUSTODIAN
1. Notwithstanding any other provisions of this Agreement, all or
any of the monies or securities of Fund may be held in
Custodian's own custody or in the custody of one or more other
banks or trust companies selected by Custodian. Any such
subcustodian selected by the Custodian must have the
qualifications required for custodian under the Investment
Company Act of 1940, as amended. Custodian shall be responsible
to the Fund for any loss, damage or expense suffered or incurred
by the Fund resulting from the actions or omissions of any
subcustodians selected and appointed by Custodian (except
subcustodians appointed at the request of Fund and as provided in
Subsection 2 below) to the same extent Custodian would be
responsible to the Fund under Section 5. of this Agreement if it
committed the act or omission itself. Upon request of the Fund,
Custodian shall be willing to contract with other subcustodians
reasonably acceptable to the Custodian for purposes of (i)
effecting third-party repurchase transactions with banks,
brokers, dealers, or other entities through the use of a common
custodian or subcustodian, or (ii) providing depository and
clearing agency services with respect to certain variable rate
demand note securities, or (iii) for other reasonable purposes
specified by Fund; provided, however, that the Custodian shall be
responsible to the Fund for any loss, damage or expense suffered
or incurred by the Fund resulting from the actions or omissions
of any such subcustodian only to the same extent such
subcustodian is responsible to the Custodian. The Fund shall be
entitled to review the Custodian's contracts with any such
subcustodians appointed at the request of Fund.
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2. Notwithstanding any other provisions of this Agreement, Fund's
foreign securities (as defined in Rule 17f-5(c)(1) under the
Investment Company Act of 1940) and Fund's cash or cash
equivalents, in amounts reasonably necessary to effect Fund's
foreign securities transactions, may be held in the custody of
one or more banks or trust companies acting as subcustodians,
according to Section 3.S.1; and thereafter, pursuant to a written
contract or contracts as approved by Fund's governing Board, may
be transferred to an account maintained by such subcustodian with
an eligible foreign custodian, as defined in Rule 17f-5(c)(2),
provided that any such arrangement involving a foreign custodian
shall be in accordance with the provisions of Rule 17f-5 under
the Investment Company Act of 1940 as that Rule may be amended
from time to time. The Fund shall be provided the contract with
the domestic subcustodian who shall contract with the eligible
foreign subcustodians. The Custodian shall be responsible for
the monies and securities of Fund held by eligible foreign
subcustodians to the extent the domestic subcustodian with which
the Custodian contracts is responsible to Custodian.
T. ACCOUNTS AND RECORDS PROPERTY OF FUND
Custodian acknowledges that all of the accounts and records maintained
by Custodian pursuant to this Agreement are the property of Fund, and
will be made available to Fund for inspection or reproduction within a
reasonable period of time, upon demand. Custodian will assist Fund's
independent auditors, or upon approval of Fund, or upon demand, any
regulatory body having jurisdiction over the Fund or Custodian, in any
requested review of Fund's accounts and records but shall be
reimbursed for all expenses and employee time invested in any such
review outside of routine and normal periodic reviews.
U. ADOPTION OF PROCEDURES
Custodian and Fund may from time to time adopt procedures as they
agree upon, and Custodian may conclusively assume that no procedure
approved by Fund, or directed by Fund, conflicts with or violates any
requirements of its prospectus, Trust Instrument, Bylaws, or any rule
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or regulation of any regulatory body or governmental agency. Fund
will be responsible to notify Custodian of any changes in statutes,
regulations, rules or policies not specifically governing custodians
or banks which might necessitate changes in Custodian's
responsibilities or procedures.
V. ADVANCES
In the event Custodian or any subcustodian shall, in its sole
discretion, advance cash or securities for any purpose (including but
not limited to securities settlements, purchase or sale of foreign
exchange or foreign exchange contracts and assumed settlement) for the
benefit of any Portfolio, the advance shall be payable by the Fund on
demand. Any such cash advance shall be subject to an overdraft charge
at the rate set forth in the then-current fee schedule from the date
advanced until the date repaid. As security for each such advance,
Fund hereby grants Custodian and such subcustodian a lien on and
security interest in all property at any time held for the account of
the applicable Portfolio, including without limitation all assets
acquired with the amount advanced. Should the Fund fail to promptly
repay the advance, the Custodian and such subcustodian shall be
entitled to utilize available cash and to dispose of such Portfolio's
assets pursuant to applicable law to the extent necessary to obtain
reimbursement of the amount advanced and any related overdraft
charges.
W. EXERCISE OF RIGHTS; TENDER OFFERS
Upon receipt of instructions, the Custodian shall: (a) deliver
warrants, puts, calls, rights or similar securities to the issuer or
trustee thereof, or to the agent of such issuer or trustee, for the
purpose of exercise or sale, provided that the new securities, cash or
other assets, if any, are to be delivered to the Custodian; and (b)
deposit securities upon invitations for tenders thereof, provided that
the consideration for such securities is to be paid or delivered to
the Custodian or the tendered securities are to be returned to the
Custodian.
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4. INSTRUCTIONS.
A. The term "instructions", as used herein, means written or oral
instructions to Custodian from a designated representative of Fund.
Certified copies of resolutions of the Trustees of Fund naming one or
more designated representatives to give instructions in the name and
on behalf of Fund, may be received and accepted from time to time by
Custodian as conclusive evidence of the authority of any designated
representative to act for Fund and may be considered to be in full
force and effect (and Custodian will be fully protected in acting in
reliance thereon) until receipt by Custodian of notice to the
contrary. Unless the resolution delegating authority to any person to
give instructions specifically requires that the approval of anyone
else will first have been obtained, Custodian will be under no
obligation to inquire into the right of the person giving such
instructions to do so. Notwithstanding any of the foregoing
provisions of this Section 4, no authorizations or instructions
received by Custodian from Fund will be deemed to authorize or permit
any trustee, officer, employee, or agent of Fund to withdraw any of
the securities or similar investments of Fund upon the mere receipt of
such authorization or instructions from such trustee, officer,
employee or agent.
Notwithstanding any other provision of this Agreement, Custodian, upon
receipt (and acknowledgment if required at the discretion of
Custodian) of the instructions of a designated representative of Fund
will undertake to deliver for Fund's account monies, (provided such
monies are on hand or available) in connection with Fund's
transactions and to wire transfer such monies to such broker, dealer,
subcustodian, bank or other agent specified in such instructions by a
designated representative of Fund.
B. No later than the next business day immediately following each oral
instruction, Fund will send Custodian written confirmation of such
oral instruction. At Custodian's sole discretion, Custodian may
record on tape, or otherwise, any oral instruction whether given in
person or via telephone, each such recording identifying the parties,
the date and the time of the beginning and ending of such oral
instruction.
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C. If Custodian shall provide Fund direct access to any computerized
recordkeeping and reporting system used hereunder or if Custodian and
Fund shall agree to utilize any electronic system of communication,
Fund shall be fully responsible for any and all consequences of the
use or misuse of the terminal device, passwords, access instructions
and other means of access to such system(s) which are utilized by,
assigned to or otherwise made available to the Fund. Fund agrees to
implement and enforce appropriate security policies and procedures to
prevent unauthorized or improper access to or use of such system(s).
Custodian shall be fully protected in acting hereunder upon any
instructions, communications, data or other information received by
Custodian by such means as fully and to the same effect as if
delivered to Custodian by written instrument signed by the requisite
authorized representative(s) of Fund. Fund shall indemnify and hold
Custodian harmless from and against any and all losses, damages,
costs, charges, counsel fees, payments, expenses and liability which
may be suffered or incurred by Custodian as a result of the use or
misuse, whether authorized or unauthorized, of any such system(s) by
Fund or by any person who acquires access to such system(s) through
the terminal device, passwords, access instructions or other means of
access to such system(s) which are utilized by, assigned to or
otherwise made available to the Fund, except to the extent
attributable to any negligence or willful misconduct by Custodian.
5. LIMITATION OF LIABILITY OF CUSTODIAN.
A. Notwithstanding any other provisions of this Agreement, Custodian will
hold harmless and indemnify Fund from and against any loss or
liability, including attorney's fees, arising out of Custodian's
breach of this Agreement or its negligence, willful misconduct or bad
faith. Custodian shall not be liable for consequential, special, or
punitive damages. Custodian may request and obtain the advice and
opinion of counsel for Fund, or of its own counsel with respect to
questions or matters of law, and it shall be without liability to Fund
for any action taken or omitted by it in good faith, in conformity
with such advice or opinion. If Custodian reasonably believes that it
could not prudently act according to the instructions of the Fund or
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the Fund's counsel, it may in its discretion, with notice to the Fund,
not act according to such instructions.
B. Fund shall hold harmless and indemnify Custodian from and against any
loss or liability, including attorney's fees, arising out of Fund's
breach of this Agreement or its negligence, willful misconduct or bad
faith.
C. Custodian may rely upon the advice of Fund and upon statements of
Fund's public accountants and other persons believed by it in good
faith, to be expert in matters upon which they are consulted, and
Custodian shall not be liable for any actions taken, in good faith,
upon such statements.
D. If Fund requires Custodian in any capacity to take, with respect to
any securities, any action which involves the payment of money by it,
or which in Custodian's opinion might make it or its nominee liable
for payment of monies or in any other way, Custodian, upon notice to
Fund given prior to such actions, shall be and be kept indemnified by
Fund in an amount and form satisfactory to Custodian against any
liability on account of such action.
E. Custodian shall be entitled to receive, and Fund agrees to pay to
Custodian, on demand, reimbursement for such cash disbursements, costs
and expenses as may be agreed upon from time to time by the parties
hereto.
F. Custodian shall be protected in acting as custodian hereunder upon any
instructions, advice, notice, request, consent, certificate or other
instrument or paper reasonably appearing to it to be genuine and to
have been properly executed and shall, unless otherwise specifically
provided herein, be entitled to receive as conclusive proof of any
fact or matter required to be ascertained from Fund hereunder, a
certificate signed by the Fund's President, or other officer
specifically authorized for such purpose.
G. Without limiting the generality of the foregoing, Custodian shall be
under no duty or obligation to inquire into, and shall not be liable
for:
1. The validity of the issue of any securities purchased by or for
Fund, the legality of the purchase thereof or evidence of
ownership required by Fund to be received by Custodian, or the
propriety of the decision to purchase or amount paid therefor;
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2. The legality of the sale of any securities by or for Fund, or the
propriety of the amount for which the same are sold;
3. The legality of the issue or sale of any shares of beneficial
interest of Fund, or the sufficiency of the amount to be received
therefor;
4. The legality of the repurchase or redemption of any Fund Shares,
or the propriety of the amount to be paid therefor; or
5. The legality of the declaration of any dividend by Fund, or the
legality of the issue of any Fund Shares in payment of any stock
dividend.
H. Custodian shall not be liable for, or considered to be Custodian of,
any money represented by any check, draft, wire transfer,
clearinghouse funds, uncollected funds, or instrument for the payment
of money received by it on behalf of Fund, until Custodian actually
receives such money, provided only that it shall advise Fund promptly
if it fails to receive any such money in the ordinary course of
business, and use its best efforts and cooperate with Fund toward the
end that such money shall be received.
I. Except as otherwise provided in this Agreement, Custodian shall not be
responsible for loss occasioned by the acts, neglects, defaults or
insolvency of any broker, bank, trust company, or any other person
with whom Custodian may deal in the absence of negligence, or bad
faith on the part of Custodian.
J. Custodian shall be responsible to the Fund for any loss, damage or
expense suffered or incurred by the Fund resulting from the actions or omissions
of any Depository only to the same extent such Depository is responsible to
Custodian.
K. Notwithstanding anything herein to the contrary, Custodian may, and
with respect to any foreign subcustodian appointed under Section
3.S.2. must, provide Fund for its approval, agreements with banks or
trust companies which will act as subcustodians for Fund pursuant to
Section 3.S. of this Agreement.
20
<PAGE>
6. COMPENSATION.
A. Fund will pay to Custodian such compensation as is stated in the Fee
Schedule attached hereto as Exhibit B which may be changed from time
to time as agreed to in writing by Custodian and Fund. If payment of
fees and expenses are not made within a reasonable time, Custodian may
charge such compensation against monies held by it for the account of
Fund.
B. Custodian will also be entitled, notwithstanding the provisions of
Sections 5.C. or 5.D. hereof, to charge against any monies held by it
for the account of Fund the amount of any loss, damage, liability,
advance, or expense for which it shall be entitled to reimbursement
from the Fund under the provisions of this Agreement.
C. Notwithstanding the provisions set forth in this Agreement with
respect to payment by Fund to Custodian of compensation and the
reimbursement by Fund to Custodian of cash disbursements, costs and
expenses, the parties hereto acknowledge and agree that BBOI, as
administrator for Fund, and pursuant to an administrative services
agreement with Fund, shall pay directly or on behalf of Fund to
Custodian, such compensation as set forth in Section 6.A. hereof, such
reimbursements as set forth in Section 5.E. hereof, and such
compensation payable to Custodian upon termination of this Agreement
as set forth in Section 7 hereof, provided that if at any time such
administrative services agreement between Fund and BBOI is terminated,
upon such termination BBOI shall be under no obligation or have any
liability to pay any further amounts as set forth in this Section 6.C.
to Custodian, whether in the form of compensation, fees,
reimbursements or expenses. Notwithstanding the foregoing, the Fund
shall remain responsible for payment of such amounts in the event BBOI
fails to pay the same within a reasonable time or ceases serving as
administrator for the Fund.
7. TERMINATION. Any party to this Agreement may terminate the same by notice
in writing, delivered or mailed, postage prepaid, to the other parties
hereto and received not less than sixty (60) days prior to the date upon
which such termination will take effect. Upon termination of this
Agreement, Fund will pay to Custodian such compensation for its
reimbursable disbursements, costs and expenses paid or incurred to such
21
<PAGE>
date and Fund will use its best efforts to obtain a successor custodian.
Unless the holders of a majority of the outstanding shares of the Fund vote
to have the securities, funds and other properties held under this
Agreement delivered and paid over to some other person, firm or corporation
specified in the vote, having not less the Two Million Dollars ($2,000,000)
aggregate capital, surplus and undivided profits, as shown by its last
published report, and meeting such other qualifications for custodian as
set forth in the governing documents of Fund, the Trustees of Fund will,
forthwith upon giving or receiving notice of termination of this Agreement,
appoint as successor custodian a bank or trust company having such
qualifications. Custodian will, upon termination of this Agreement,
deliver to the successor custodian so specified or appointed, at
Custodian's office, all securities then held by Custodian hereunder, duly
endorsed and in form for transfer, all funds and other properties of Fund
deposited with or held by Custodian hereunder, or will co-operate in
effecting changes in book-entries at the Depository Trust Company or in the
Treasury/Federal Reserve Book-Entry System or other depository pursuant to
31 CFR Sec. 306.118. In the event no such vote has been adopted by the
stockholders of Fund and no written order designating a successor custodian
has been delivered to Custodian on or before the date when such termination
becomes effective, then Custodian will deliver the securities, funds and
properties of Fund to a bank or trust company at the selection of Custodian
and meeting the qualifications for custodian, if any, set forth in the
governing documents of Fund and having not less than Two Million Dollars
($2,000,000) aggregate capital, surplus and undivided profits, as shown by
its last published report. Upon either such delivery to a successor
custodian, Custodian will have no further obligations or liabilities under
this Agreement. Thereafter such bank or trust company will be the
successor custodian under this Agreement and will be entitled to reasonable
compensation for its services. In the event that no such successor
custodian can be found, Fund will submit to its shareholders, before
permitting delivery of the cash and securities owned by Fund to anyone
other than a successor custodian, the question of whether Fund will be
liquidated or function without a custodian. Notwithstanding the foregoing
requirement as to delivery upon termination of this Agreement, Custodian
may make any other delivery of the securities, funds and property of Fund
which is permitted by the Investment Company Act of 1940, Fund's Trust
22
<PAGE>
Instrument and Bylaws then in effect or apply to a court of competent
jurisdiction for the appointment of a successor custodian.
8. NOTICES. Notices, requests, instructions and other writings received by
Fund at 210 University Boulevard, Suite 900, Denver, Colorado 80206 or
at such other address as Fund may have designated to Custodian and BBOI in
writing, will be deemed to have been properly given to Fund hereunder;
notices, requests, instructions and other writings received by Custodian at
its offices at 127 West 10th Street, Kansas City, Missouri 64105, or to
such other address as it may have designated to Fund and BBOI in writing,
will be deemed to have been properly given to Custodian hereunder; and
notices, requests, instructions and other writings received by BBOI at its
offices at 210 University Blvd., Denver, Colorado, 80206, or to such other
address as it may have designated to Fund and IFTC in writing, will be
deemed to have been properly given to BBOI hereunder.
9. LIMITATION OF LIABILITY. Notice is hereby given that the Fund is a
business trust organized under the Delaware Business Trust Act pursuant to
a Certificate of Trust filed in the office of the Secretary of State of the
State of Delaware. All parties to this Agreement acknowledge and agree
that the Fund is a series Fund and all debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series shall be enforceable against the assets held with respect
to such series only, and not against the assets of the Fund general or
against the assets held with respect to any other series and further that
no trustee, officer or holder of shares of beneficial interest of the Fund
shall be personally liable for any of the foregoing.
10. MISCELLANEOUS.
A. This Agreement is executed and delivered in the State of Missouri and
shall be governed by the laws of said state.
B. All the terms and provisions of this Agreement shall be binding upon,
inure to the benefit of, and be enforceable by the respective
successor and assigns of the parties hereto.
23
<PAGE>
C. No provisions of the Agreement may be amended or modified, in any
manner except by a written agreement properly authorized and executed
by all parties hereto.
D. The captions in this Agreement are included for convenience of
reference only, and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
E. This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original but all of
which together will constitute one and the same instrument.
F. If any part, term or provision of this Agreement is by the courts held
to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not be
affected, and the rights and obligations of the parties shall be
construed and enforced as if the Agreement did not contain the
particular part, term or provision held to be illegal or invalid.
G. Custodian will not release the identity of Fund to an issuer which
requests such information pursuant to the Shareholder Communications
Act of 1985 for the specific purpose of direct communications between
such issuer and Fund unless the Fund directs the Custodian otherwise.
H. This Agreement may not be assigned by any party without prior written
consent of the other party.
I. If any provision of the Agreement, either in its present form or as
amended from time to time, limits, qualifies, or conflicts with the
Investment Company Act of 1940 and the rules and regulations
promulgated thereunder, such statutes, rules and regulations shall be
deemed to control and supersede such provision without nullifying or
terminating the remainder of the provisions of this Agreement.
24
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective duly authorized officers or member.
INVESTORS FIDUCIARY TRUST COMPANY
By:
-----------------------------------------
Title:
--------------------------------------
BERGER/BIAM WORLDWIDE FUNDS TRUST
By:
-----------------------------------------
Title:
--------------------------------------
BBOI WORLDWIDE LLC, BY BERGER ASSOCIATES,
INC., ITS MEMBER
By:
-----------------------------------------
Title:
--------------------------------------
25
<PAGE>
EXHIBIT A
INVESTORS FIDUCIARY TRUST COMPANY
AVAILABILITY SCHEDULE BY TRANSACTION TYPE
<TABLE>
<S> <C>
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
TRANSACTION DTC PHYSICAL FED
- -----------------------------------------------------------------------------------------------------
TYPE CREDIT DATE FUNDS TYPE CREDIT DATE FUNDS TYPE CREDIT DATE FUNDS TYPE
- -----------------------------------------------------------------------------------------------------
Calls Puts As Received C or F* As Received C or F*
- -----------------------------------------------------------------------------------------------------
Maturities As Received C or F* Mat. Date C or F* Mat. Date F
- -----------------------------------------------------------------------------------------------------
Tender Reorgs. As Received C As Received C N/A
- -----------------------------------------------------------------------------------------------------
Dividends Paydate C Paydate C N/A
- -----------------------------------------------------------------------------------------------------
Floating Rate Paydate C Paydate C N/A
Int.
- -----------------------------------------------------------------------------------------------------
Floating Rate N/A As Rate C N/A
Int. (No Rate) Received
- -----------------------------------------------------------------------------------------------------
Mtg. Backed Paydate C Paydate + 1 C Paydate F
P&I Bus. Day
- -----------------------------------------------------------------------------------------------------
Fixed Rate Paydate C Paydate C Paydate F
Int.
- -----------------------------------------------------------------------------------------------------
Euroclear N/A C Paydate C
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
</TABLE>
LEGEND
C = Clearinghouse Funds
F = Fed Funds
N/A = Not Applicable
* Availability based on how received.
26
<PAGE>
EXHIBIT 9.2.1
BERGER/BIAM INTERNATIONAL FUND
(A SERIES OF BERGER/BIAM WORLDWIDE FUNDS TRUST)
ADMINISTRATIVE SERVICES AGREEMENT
(BBOI WORLDWIDE LLC)
THIS ADMINISTRATIVE SERVICES AGREEMENT (the "Agreement") is entered into
effective as of the _______ day of __________________, 1996, by and between BBOI
WORLDWIDE LLC, a Delaware limited liability company ("BBOI Worldwide"), and
BERGER/BIAM WORLDWIDE FUNDS TRUST, a Delaware business trust (the "Trust"), with
respect to the BERGER/BIAM INTERNATIONAL FUND, a series of the Trust (the
"Fund").
RECITALS
A. The Trust is a Delaware business trust and an open-end, management
investment company registered under the Investment Company Act of 1940 (the
"1940 Act"), and the Fund is a series of the Trust.
B. The parties desire that BBOI Worldwide provide to or procure for the
Fund certain administrative services, on the terms and conditions set forth
herein.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. APPOINTMENT. The Trust hereby appoints BBOI Worldwide as the
administrator of the Fund, to provide to or procure for the Fund, at BBOI
Worldwide's expense except as specifically set forth below, all services
specified herein, for the period and on the terms set forth in this Agreement.
BBOI Worldwide hereby accepts such appointment and agrees to render the services
and assume the responsibilities herein set forth, for the compensation herein
provided. In performing its services under this Agreement, BBOI Worldwide shall
comply with all relevant provisions of the 1940 Act and all other applicable
federal and state laws and regulations.
2. SERVICES TO BE PROVIDED. BBOI Worldwide shall provide to the Fund all
administrative services reasonably necessary for the operation of the Fund
(other than those services specified in Sections 3 and 5 hereof), including but
not limited to:
(a) coordinating all matters relating to the operations of the Fund,
including any necessary coordination among the investment advisor,
sub-advisor, transfer agent, dividend disbursing agent, fund
accounting agent,
1
<PAGE>
accountants, attorneys and other parties performing services or
operational functions for the Fund;
(b) providing personnel and assistance necessary to maintain the
qualification and/or registration to sell shares under the federal
securities laws and in each state where BBOI Worldwide has determined
such qualification and/or registration to be advisable;
(c) monitoring the Fund's compliance with (i) its Trust Instrument, Bylaws
and currently effective registration statement under the Securities
Act of 1933 (the "1933 Act") and the 1940 Act and any amendments or
supplements thereto ("Registration Statement"); (ii) the written
policies, procedures and guidelines of the Fund, and the written
instructions from the Trustees of the Trust based on resolutions duly
adopted by the Trustees; (iii) the requirements of the 1933 Act, the
1940 Act, the Investment Advisers Act of 1940 ("Advisers Act"), the
rules thereunder, and all other applicable federal and state laws and
regulations; and (iv) the provisions of Subchapter M of the Internal
Revenue Code, applicable to the Fund as a "regulated investment
company";
(d) arranging for and supervising the preparation of any or all
registration statements (including prospectuses and statements of
additional information), tax returns, proxy materials, financial
statements, notices and reports for filings with regulatory
authorities and distribution to shareholders of the Fund;
(e) issuing certain correspondence to shareholders;
(f) maintaining or supervising the maintenance of certain books and
records;
(g) providing the Trust with adequate personnel, office space,
communications facilities and other facilities necessary for operation
of the Fund as contemplated by this Agreement; and
(h) preparing and rendering to the Trustees of the Trust such periodic and
special reports as the Trustees may reasonably request.
3. SERVICES TO BE PROCURED. BBOI Worldwide shall procure the following
services for the Fund from other qualified service providers: (i) custody
services to provide for the safekeeping of the Fund's assets; (ii) transfer
agency and dividend disbursing agency services; (iii) recordkeeping and pricing
agency services; (iv) tax and audit services; (v) insurance for fidelity and
other appropriate coverage; and (vi) printing and mailing to existing
shareholders of annual and semi-annual reports, prospectuses, statements of
additional
2
<PAGE>
information and any communications required by law (but not proxy statements
or proxy materials). Further, subject to the review, supervision and
approval of the Trustees of the Trust, BBOI Worldwide shall:
(a) evaluate and obtain such services from qualified parties that meet all
criteria established by law and by the Trustees of the Trust for
parties acting in those capacities;
(b) negotiate and enter into, or arrange for the Trust to enter into,
agreements with such service providers for the benefit of the Fund,
provided that the Trust may but is not required to be a party to any
such agreement entered into by BBOI Worldwide, and that BBOI
Worldwide, as paying agent, may but is not required to be a party to
any such agreement entered into by the Trust;
(c) establish procedures to monitor the nature and quality of the services
provided by such service providers;
(d) monitor the nature and quality of the services provided by such
service providers;
(e) periodically provide to the Fund written reports on the activities and
services of such service providers; the nature and amount of
disbursements made on account of the Fund with respect to each such
service agreement; and such other information as the Trustees shall
reasonably request to enable them to fulfill their duties and
obligations under the 1940 Act and otherwise; and
(f) periodically provide recommendations to the Trustees to enhance
customer services provided by such service providers.
4. EXPENSES. BBOI Worldwide shall pay, directly or on behalf of the
Fund, all expenses incurred in providing and procuring the services set forth in
Sections 2 and 3 hereof, and all fees and expenses charged by the service
providers whose services are procured on behalf of the Fund pursuant to Section
3 hereof.
5. EXCLUDED SERVICES AND EXPENSES. Notwithstanding any other provision
hereof, it is expressly agreed that BBOI Worldwide shall not be responsible
to provide to or procure for the Fund any of the following services, or to
pay, directly or on behalf of the Fund, any of the following fees and
expenses, which shall remain the Trust's own obligation and responsibility to
arrange for and pay: (a) investment advisory services performed by any
investment advisor for the Fund, or any fees and expenses thereof; (b)
expenses of registering the Trust with securities authorities, or
registration or filing fees incurred in registering shares
3
<PAGE>
of the Fund with securities authorities; (c) expenses of meetings of the
Trustees and shareholders of the Trust (including, without limitation,
printing and mailing proxy statements and proxy materials, proxy
solicitation, proxy tabulation, on-site space arrangements, catering and
meeting communications); (d) legal services or legal fees and expenses; (e)
distribution, marketing, underwriting or promotional services or any 12b-1
fees or other fees and expenses in connection therewith; (f) taxes imposed on
the Fund; (g) brokerage commissions and other costs in connection with the
purchase and sale of securities and other portfolio assets; or (h) any
non-recurring or extraordinary items as may arise from time to time.
6. COMPENSATION. The Trust shall pay to BBOI Worldwide for the services
rendered and responsibilities assumed by BBOI Worldwide under this Agreement a
fee, payable in United States dollars, equal to the lesser of:
(a) an amount equal to the per annum rate of 0.45% of the average daily
net asset value of the Fund; or
(b) the costs and expenses incurred by BBOI Worldwide annually under
Section 4 hereof to (i) provide and procure the services contemplated
by Sections 2 and 3 of this Agreement, and (ii) pay all fees and
expenses charged by the service providers whose services are procured
on behalf of the Fund pursuant to Section 3 hereof, plus an additional
0.02% of the average daily net asset value of the Fund.
This fee shall be computed and accrued daily and payable monthly on the
last day of each month during which or part of which this Agreement is in
effect.
In the event that BBOI Worldwide delegates to another party or parties
(each, a "sub-administrator") any of its duties and responsibilities to provide
or procure any of the services contemplated by Sections 2 and 3 of this
Agreement, BBOI Worldwide may take into account, in calculating the part of its
costs and expenses under Section 6(b)(i) hereof relating to providing or
procuring such services, only the costs and expenses incurred by such
sub-administrator(s) in discharging such delegated duties and responsibilities.
In the event any arrangement is entered into with an organization to
provide subtransfer agency, recordkeeping, shareholder communications,
subaccounting and/or other services to investors purchasing shares of the Fund
through pension plans or other programs established or serviced by that
organization, BBOI Worldwide may take into account, in calculating the part of
its costs and expenses under Section 6(b)(ii) hereof relating to the fees and
expenses charged by the provider of such services, only the fees and expenses
that BBOI Worldwide would otherwise pay to the provider of such services to the
Fund if all the investors who own Fund shares through that organization were
instead direct registered record holders of shares in the Fund.
4
<PAGE>
7. BOOKS AND RECORDS. BBOI Worldwide hereby agrees that all records
which it maintains for the Fund or the Trust hereunder are the property of the
Trust, agrees to permit the reasonable inspection thereof by the Trust or its
designees and agrees to preserve for the periods prescribed under the 1940 Act
any records which it maintains for the Fund or the Trust and which are required
to be maintained under the 1940 Act. BBOI Worldwide further agrees to surrender
promptly to the Trust or its designees any records which it maintains for the
Fund or the Trust upon request by the Trust.
8. TERM AND TERMINATION. This Agreement shall become effective as of the
date first set forth above and shall continue until terminated by either party
on 60 days' written notice to the other party. This Agreement may also be
terminated by the Trustees of the Trust at any time if BBOI Worldwide becomes
unable to discharge its duties and obligations under this Agreement.
9. ASSIGNMENT AND AMENDMENTS. This Agreement shall not be assigned by
either party without the prior written consent of the other party to the
Agreement. This Agreement may be amended in writing by the parties, provided
that all such amendments shall be subject to the approval of the Trustees of the
Trust.
10. DELEGATION. Notwithstanding anything herein to the contrary, BBOI
Worldwide may delegate any or all of its duties and responsibilities under this
Agreement to one or more parties subject to the approval of the Trustees of the
Trust. No delegation pursuant to this provision shall relieve BBOI Worldwide of
its duties or responsibilities hereunder, and BBOI Worldwide shall appropriately
supervise and monitor the activities of any party appointed hereunder for the
Fund.
11. LIMITATION OF LIABILITY OF BBOI WORLDWIDE. BBOI Worldwide shall not
be liable for any error of judgment or mistake of law or for any act or omission
taken with respect to the Fund, except for willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason of reckless
disregard of its obligations and duties hereunder and except to the extent
otherwise provided by law. BBOI Worldwide shall be entitled to rely upon any
written instructions from the Trustees of the Trust based on resolutions duly
adopted by the Trustees and shall incur no liability to the Trust or the Fund in
acting upon such written instructions. As used in this section, "BBOI
Worldwide" shall include any affiliate of BBOI Worldwide performing services for
the Fund contemplated hereunder, the Sub-Administrator as defined in Section 12
hereof, and managers, directors, officers and employees of BBOI Worldwide and
each of the foregoing.
12. INDEMNIFICATION. The Trust hereby indemnifies and holds harmless BBOI
Worldwide and its officers, managers, members, employees and agents, and any
controlling person thereof, and any person to whom BBOI Worldwide has delegated
any of its duties and responsibilities pursuant to Section 10 hereof, including
Berger Associates, Inc., to which BBOI Worldwide has delegated all its duties
and responsibilities under this Agreement (the "Sub-Administrator"), from all
losses, charges, claims and liabilities, and all costs and expenses,
5
<PAGE>
including without limitation reasonable attorneys' fees and disbursements,
arising from any action which BBOI Worldwide or the Sub-Administrator takes
or omits to take pursuant to written instructions from the Trustees of the
Trust based on resolutions duly adopted by the Trustees, provided that no
person shall be indemnified hereunder against any liability to the Trust or
its shareholders (or any expenses incident to such liability) arising out of
their own willful misfeasance, bad faith or gross negligence in the
performance of their duties or by reason of their reckless disregard of their
duties or obligations under this Agreement.
BBOI Worldwide hereby indemnifies and holds harmless the Trust and its
Trustees, officers, shareholders, employees and agents, and any controlling
person thereof, from all losses, charges, claims and liabilities, and all costs
and expenses, including without limitation reasonable attorneys' fees and
disbursements, arising out of BBOI Worldwide's or the Sub-Administrator's
willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its duties or obligations under
this Agreement, provided that no person shall be indemnified hereunder against
any liability to the Trust or its shareholders (or any expenses incident to such
liability) arising out of their own willful misfeasance, bad faith or gross
negligence in the performance of their duties or by reason of their reckless
disregard of their duties or obligations under this Agreement.
13. INDEPENDENT CONTRACTOR. BBOI Worldwide shall for all purposes
hereunder be deemed to be an independent contractor and shall, unless otherwise
provided or authorized, have no authority to act for or represent the Trust or
the Fund in any way, nor otherwise be deemed an agent of, partner or joint
venturer with, the Trust or the Fund.
14. NAMES. The Trust and the Fund (together, the "Trust Entities") may
use the name "Bank of Ireland Asset Management" or "Berger" or any name derived
from or similar to "Bank of Ireland Asset Management" or "Berger Associates,
Inc.," including without limitation "Berger/BIAM," only for so long as this
Agreement or any extension, renewal or amendment hereof shall remain in effect.
At such time as such a contract shall no longer be in effect, each of the Trust
Entities will (to the extent that each lawfully can) cease to use such a name or
any other name indicating that it is advised by or otherwise connected with Bank
of Ireland Asset Management (U.S.) Limited, an Irish company ("BIAM"), or Berger
Associates, Inc., a Delaware company ("Berger Associates"). The Trust Entities
acknowledge that they have adopted the term "Berger/BIAM" as part of their names
through permission of BIAM and Berger Associates, respectively, and agree that
BIAM and Berger Associates each reserve to themselves, their respective
affiliates and any successors to their respective businesses the right to grant
the non-exclusive right to use the name "Bank of Ireland Asset Management,"
"BIAM," "Berger" or "BAI" or any similar names to any other corporation or
entity.
15. ACTIVITIES OF BBOI WORLDWIDE. The services of BBOI Worldwide
hereunder are not to be deemed to be exclusive, and BBOI Worldwide is free to
render services to other parties, so long as its services under this Agreement
are not materially adversely affected or otherwise impaired thereby. Nothing in
this Agreement shall limit or restrict the
6
<PAGE>
right of any manager, officer or employee of BBOI Worldwide to engage in any
other business or to devote his or her time and attention in part to the
management or other aspects of any other business, whether of a similar
nature or a dissimilar nature.
16. LIMITATION ON PERSONAL LIABILITY. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Agreement acknowledge and agree
that the Trust is a series trust and all debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series shall be enforceable against the assets held with respect to
such series only, and not against the assets of the Trust generally or against
the assets held with respect to any other series and further that no Trustee,
officer or holder of shares of beneficial interest of the Trust shall be
personally liable for any of the foregoing.
17. GOVERNING LAW. This Agreement shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the 1940 Act. To the extent that the applicable
laws of the State of Colorado conflict with the applicable provisions of the
1940 Act, the latter shall control.
18. MISCELLANEOUS. The headings in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions thereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
IN WITNESS WHEREOF, the parties have caused their duly authorized member or
officer to execute this Agreement as of the date and year first above written.
BBOI WORLDWIDE LLC
By: Berger Associates, Inc.,
Its Member
By
---------------------------------
Title:
7
<PAGE>
BERGER/BIAM WORLDWIDE FUNDS TRUST, with
respect to the BERGER/BIAM INTERNATIONAL FUND
By
-------------------------------------
Title:
8
<PAGE>
EXHIBIT 9.2.2
BERGER/BIAM INTERNATIONAL INSTITUTIONAL FUND
(A SERIES OF BERGER/BIAM WORLDWIDE FUNDS TRUST)
ADMINISTRATIVE SERVICES AGREEMENT
(BBOI WORLDWIDE LLC)
THIS ADMINISTRATIVE SERVICES AGREEMENT (the "Agreement") is entered into
effective as of the _______ day of __________________, 1996, by and between BBOI
WORLDWIDE LLC, a Delaware limited liability company ("BBOI Worldwide"), and
BERGER/BIAM WORLDWIDE FUNDS TRUST, a Delaware business trust (the "Trust"), with
respect to the BERGER/BIAM INTERNATIONAL INSTITUTIONAL FUND, a series of the
Trust (the "Fund").
RECITALS
A. The Trust is a Delaware business trust and an open-end, management
investment company registered under the Investment Company Act of 1940 (the
"1940 Act"), and the Fund is a series of the Trust.
B. The parties desire that BBOI Worldwide provide to or procure for the
Fund certain administrative services, on the terms and conditions set forth
herein.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. APPOINTMENT. The Trust hereby appoints BBOI Worldwide as the
administrator of the Fund, to provide to or procure for the Fund, at BBOI
Worldwide's expense except as specifically set forth below, all services
specified herein, for the period and on the terms set forth in this Agreement.
BBOI Worldwide hereby accepts such appointment and agrees to render the services
and assume the responsibilities herein set forth, for the compensation herein
provided. In performing its services under this Agreement, BBOI Worldwide shall
comply with all relevant provisions of the 1940 Act and all other applicable
federal and state laws and regulations.
2. SERVICES TO BE PROVIDED. BBOI Worldwide shall provide to the Fund all
administrative services reasonably necessary for the operation of the Fund
(other than those services specified in Sections 3 and 5 hereof), including but
not limited to:
(a) coordinating all matters relating to the operations of the Fund,
including any necessary coordination among the investment advisor,
sub-advisor,
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transfer agent, dividend disbursing agent, fund accounting agent,
accountants, attorneys and other parties performing services or
operational functions for the Fund;
(b) providing personnel, assistance and filing and other fees necessary to
maintain the qualification and/or registration to sell shares under
the federal securities laws and in each state where BBOI Worldwide has
determined such qualification and/or registration to be advisable;
(c) monitoring the Fund's compliance with (i) its Trust Instrument, Bylaws
and currently effective registration statement under the Securities
Act of 1933 (the "1933 Act") and the 1940 Act and any amendments or
supplements thereto ("Registration Statement"); (ii) the written
policies, procedures and guidelines of the Fund, and the written
instructions from the Trustees of the Trust based on resolutions duly
adopted by the Trustees; (iii) the requirements of the 1933 Act, the
1940 Act, the Investment Advisers Act of 1940 ("Advisers Act"), the
rules thereunder, and all other applicable federal and state laws and
regulations; and (iv) the provisions of Subchapter M of the Internal
Revenue Code, applicable to the Fund as a "regulated investment
company";
(d) arranging for and supervising the preparation of any or all
registration statements (including prospectuses and statements of
additional information), tax returns, proxy materials, financial
statements, notices and reports for filings with regulatory
authorities and distribution to shareholders of the Fund;
(e) issuing certain correspondence to shareholders;
(f) maintaining or supervising the maintenance of certain books and
records;
(g) providing and maintaining a membership for the Fund in customary
industry associations;
(h) providing the Trust with adequate personnel, office space,
communications facilities and other facilities necessary for operation
of the Fund as contemplated by this Agreement; and
(i) preparing and rendering to the Trustees of the Trust such periodic and
special reports as the Trustees may reasonably request.
3. SERVICES TO BE PROCURED. BBOI Worldwide shall procure the following
services for the Fund from other qualified service providers: (i) custody
services to provide for
2
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the safekeeping of the Fund's assets; (ii) transfer agency and dividend
disbursing agency services; (iii) recordkeeping and pricing agency services;
(iv) tax and audit services; (v) insurance for fidelity and other appropriate
coverage; (vi) legal services; and (vii) printing and mailing to existing
shareholders of annual and semi-annual reports, prospectuses, statements of
additional information and any communications required by law (but not proxy
statements or proxy materials). Further, subject to the review, supervision
and approval of the Trustees of the Trust, BBOI Worldwide shall:
(a) evaluate and obtain such services from qualified parties that meet all
criteria established by law and by the Trustees of the Trust for
parties acting in those capacities;
(b) negotiate and enter into, or arrange for the Trust to enter into,
agreements with such service providers for the benefit of the Fund,
provided that the Trust may but is not required to be a party to any
such agreement entered into by BBOI Worldwide, and that BBOI
Worldwide, as paying agent, may but is not required to be a party to
any such agreement entered into by the Trust;
(c) establish procedures to monitor the nature and quality of the services
provided by such service providers;
(d) monitor the nature and quality of the services provided by such
service providers;
(e) periodically provide to the Fund written reports on the activities and
services of such service providers; the nature and amount of
disbursements made on account of the Fund with respect to each such
service agreement; and such other information as the Trustees shall
reasonably request to enable them to fulfill their duties and
obligations under the 1940 Act and otherwise; and
(f) periodically provide recommendations to the Trustees to enhance
customer services provided by such service providers.
4. EXPENSES. BBOI Worldwide shall pay, directly or on behalf of the
Fund, all expenses incurred in providing and procuring the services set forth in
Sections 2 and 3 hereof, and all fees and expenses charged by the service
providers whose services are procured on behalf of the Fund pursuant to Section
3 hereof.
5. EXCLUDED SERVICES AND EXPENSES. Notwithstanding any other provision
hereof, it is expressly agreed that BBOI Worldwide shall not be responsible to
provide to or procure for the Fund any of the following services, or to pay,
directly or on behalf of the Fund,
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any of the following fees and expenses, which shall remain the Trust's own
obligation and responsibility to arrange for and pay: (a) investment advisory
services performed by any investment advisor for the Fund, or any fees and
expenses thereof;(b) expenses of meetings of the Trustees and shareholders of
the Trust (including, without limitation, printing and mailing proxy
statements and proxy materials, proxy solicitation, proxy tabulation, on-site
space arrangements, catering and meeting communications);(c) distribution,
marketing, underwriting or promotional services or any 12b-1 fees or other
fees and expenses in connection therewith;(d) taxes imposed on the Fund;(e)
brokerage commissions and other costs in connection with the purchase and
sale of securities and other portfolio assets; or (f) any non-recurring or
extraordinary items as may arise from time to time.
6. COMPENSATION. The Trust shall pay to BBOI Worldwide for the services
rendered and responsibilities assumed by BBOI Worldwide under this Agreement a
fee, payable in United States dollars, equal to the lesser of:
(a) an amount equal to the per annum rate of 0.35% of the average daily
net asset value of the Fund; or
(b) the costs and expenses incurred by BBOI Worldwide annually under
Section 4 hereof to (i) provide and procure the services contemplated
by Sections 2 and 3 of this Agreement, and (ii) pay all fees and
expenses charged by the service providers whose services are procured
on behalf of the Fund pursuant to Section 3 hereof, plus an additional
0.02% of the average daily net asset value of the Fund.
This fee shall be computed and accrued daily and payable monthly on the
last day of each month during which or part of which this Agreement is in
effect.
In the event that BBOI Worldwide delegates to another party or parties
(each, a "sub-administrator") any of its duties and responsibilities to provide
or procure any of the services contemplated by Sections 2 and 3 of this
Agreement, BBOI Worldwide may take into account, in calculating the part of its
costs and expenses under Section 6(b)(i) hereof relating to providing or
procuring such services, only the costs and expenses incurred by such
sub-administrator(s) in discharging such delegated duties and responsibilities.
In the event any arrangement is entered into with an organization to
provide subtransfer agency, recordkeeping, shareholder communications,
subaccounting and/or other services to investors purchasing shares of the Fund
through pension plans or other programs established or serviced by that
organization, BBOI Worldwide may take into account, in calculating the part of
its costs and expenses under Section 6(b)(ii) hereof relating to the fees and
expenses charged by the provider of such services, only the fees and expenses
that BBOI Worldwide would otherwise pay to the provider of such services to the
Fund if all the investors
4
<PAGE>
who own Fund shares through that organization were instead direct registered
record holders of shares in the Fund.
7. BOOKS AND RECORDS. BBOI Worldwide hereby agrees that all records
which it maintains for the Fund or the Trust hereunder are the property of the
Trust, agrees to permit the reasonable inspection thereof by the Trust or its
designees and agrees to preserve for the periods prescribed under the 1940 Act
any records which it maintains for the Fund or the Trust and which are required
to be maintained under the 1940 Act. BBOI Worldwide further agrees to surrender
promptly to the Trust or its designees any records which it maintains for the
Fund or the Trust upon request by the Trust.
8. TERM AND TERMINATION. This Agreement shall become effective as of the
date first set forth above and shall continue until terminated by either party
on 60 days' written notice to the other party. This Agreement may also be
terminated by the Trustees of the Trust at any time if BBOI Worldwide becomes
unable to discharge its duties and obligations under this Agreement.
9. ASSIGNMENT AND AMENDMENTS. This Agreement shall not be assigned by
either party without the prior written consent of the other party to the
Agreement. This Agreement may be amended in writing by the parties, provided
that all such amendments shall be subject to the approval of the Trustees of the
Trust.
10. DELEGATION. Notwithstanding anything herein to the contrary, BBOI
Worldwide may delegate any or all of its duties and responsibilities under this
Agreement to one or more parties subject to the approval of the Trustees of the
Trust. No delegation pursuant to this provision shall relieve BBOI Worldwide of
its duties or responsibilities hereunder, and BBOI Worldwide shall appropriately
supervise and monitor the activities of any party appointed hereunder for the
Fund.
11. LIMITATION OF LIABILITY OF BBOI WORLDWIDE. BBOI Worldwide shall not
be liable for any error of judgment or mistake of law or for any act or omission
taken with respect to the Fund, except for willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason of reckless
disregard of its obligations and duties hereunder and except to the extent
otherwise provided by law. BBOI Worldwide shall be entitled to rely upon any
written instructions from the Trustees of the Trust based on resolutions duly
adopted by the Trustees and shall incur no liability to the Trust or the Fund in
acting upon such written instructions. As used in this section, "BBOI
Worldwide" shall include any affiliate of BBOI Worldwide performing services for
the Fund contemplated hereunder, the Sub-Administrator as defined in Section 12
hereof, and managers, directors, officers and employees of BBOI Worldwide and
each of the foregoing.
12. INDEMNIFICATION. The Trust hereby indemnifies and holds harmless BBOI
Worldwide and its officers, managers, members, employees and agents, and any
controlling person thereof, and any person to whom BBOI Worldwide has delegated
any of its duties and
5
<PAGE>
responsibilities pursuant to Section 10 hereof, including Berger Associates,
Inc., to which BBOI Worldwide has delegated all its duties and responsibilities
under 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-Administrator takes or omits to take pursuant to
written instructions from the Trustees of the Trust based on resolutions duly
adopted by the Trustees, provided that no person shall be indemnified
hereunder against any liability to the Trust or its shareholders (or any
expenses incident to such liability) arising out of their own willful
misfeasance, bad faith or gross negligence in the performance of their duties
or by reason of their reckless disregard of their duties or obligations under
this Agreement.
BBOI Worldwide hereby indemnifies and holds harmless the Trust and its
Trustees, officers, shareholders, employees and agents, and any controlling
person thereof, from all losses, charges, claims and liabilities, and all costs
and expenses, including without limitation reasonable attorneys' fees and
disbursements, arising out of BBOI Worldwide's or the Sub-Administrator's
willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its duties or obligations under
this Agreement, provided that no person shall be indemnified hereunder against
any liability to the Trust or its shareholders (or any expenses incident to such
liability) arising out of their own willful misfeasance, bad faith or gross
negligence in the performance of their duties or by reason of their reckless
disregard of their duties or obligations under this Agreement.
13. INDEPENDENT CONTRACTOR. BBOI Worldwide shall for all purposes
hereunder be deemed to be an independent contractor and shall, unless otherwise
provided or authorized, have no authority to act for or represent the Trust or
the Fund in any way, nor otherwise be deemed an agent of, partner or joint
venturer with, the Trust or the Fund.
14. NAMES. The Trust and the Fund (together, the "Trust Entities") may
use the name "Bank of Ireland Asset Management" or "Berger" or any name derived
from or similar to "Bank of Ireland Asset Management" or "Berger Associates,
Inc.," including without limitation "Berger/BIAM," only for so long as this
Agreement or any extension, renewal or amendment hereof shall remain in effect.
At such time as such a contract shall no longer be in effect, each of the Trust
Entities will (to the extent that each lawfully can) cease to use such a name or
any other name indicating that it is advised by or otherwise connected with Bank
of Ireland Asset Management (U.S.) Limited, an Irish company ("BIAM"), or Berger
Associates, Inc., a Delaware company ("Berger Associates"). The Trust Entities
acknowledge that they have adopted the term "Berger/BIAM" as part of their names
through permission of BIAM and Berger Associates, respectively, and agree that
BIAM and Berger Associates each reserve to themselves, their respective
affiliates and any successors to their respective businesses the right to grant
the non-exclusive right to use the name "Bank of Ireland Asset Management,"
"BIAM," "Berger" or "BAI" or any similar names to any other corporation or
entity.
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<PAGE>
15. ACTIVITIES OF BBOI WORLDWIDE. The services of BBOI Worldwide
hereunder are not to be deemed to be exclusive, and BBOI Worldwide is free to
render services to other parties, so long as its services under this Agreement
are not materially adversely affected or otherwise impaired thereby. Nothing in
this Agreement shall limit or restrict the right of any manager, officer or
employee of BBOI Worldwide to engage in any other business or to devote his or
her time and attention in part to the management or other aspects of any other
business, whether of a similar nature or a dissimilar nature.
16. LIMITATION ON PERSONAL LIABILITY. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Agreement acknowledge and agree
that the Trust is a series trust and all debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series shall be enforceable against the assets held with respect to
such series only, and not against the assets of the Trust generally or against
the assets held with respect to any other series and further that no Trustee,
officer or holder of shares of beneficial interest of the Trust shall be
personally liable for any of the foregoing.
17. GOVERNING LAW. This Agreement shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the 1940 Act. To the extent that the applicable
laws of the State of Colorado conflict with the applicable provisions of the
1940 Act, the latter shall control.
18. MISCELLANEOUS. The headings in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions thereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
IN WITNESS WHEREOF, the parties have caused their duly authorized member or
officer to execute this Agreement as of the date and year first above written.
BBOI WORLDWIDE LLC
By: Berger Associates, Inc.,
Its Member
By
----------------------------------
Title:
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<PAGE>
BERGER/BIAM WORLDWIDE FUNDS TRUST, with
respect to the BERGER/BIAM INTERNATIONAL
INSTITUTIONAL FUND
By
---------------------------------------
Title:
8
<PAGE>
EXHIBIT 9.2.3
BERGER/BIAM INTERNATIONAL CORE FUND
(A SERIES OF BERGER/BIAM WORLDWIDE FUNDS TRUST)
ADMINISTRATIVE SERVICES AGREEMENT
(BBOI WORLDWIDE LLC)
THIS ADMINISTRATIVE SERVICES AGREEMENT (the "Agreement") is entered into
effective as of the _______ day of __________________, 1996, by and between BBOI
WORLDWIDE LLC, a Delaware limited liability company ("BBOI Worldwide"), and
BERGER/BIAM WORLDWIDE FUNDS TRUST, a Delaware business trust (the "Trust"), with
respect to the BERGER/BIAM INTERNATIONAL CORE FUND, a series of the Trust (the
"Fund").
RECITALS
A. The Trust is a Delaware business trust and an open-end, management
investment company registered under the Investment Company Act of 1940 (the
"1940 Act"), and the Fund is a series of the Trust.
B. The parties desire that BBOI Worldwide provide to or procure for the
Fund certain administrative services, on the terms and conditions set forth
herein.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. APPOINTMENT. The Trust hereby appoints BBOI Worldwide as the
administrator of the Fund, to provide to or procure for the Fund, at BBOI
Worldwide's expense except as specifically set forth below, all services
specified herein, for the period and on the terms set forth in this Agreement.
BBOI Worldwide hereby accepts such appointment and agrees to render the services
and assume the responsibilities herein set forth, for the compensation herein
provided. In performing its services under this Agreement, BBOI Worldwide shall
comply with all relevant provisions of the 1940 Act and all other applicable
federal and state laws and regulations.
2. SERVICES TO BE PROVIDED. BBOI Worldwide shall provide to the Fund all
administrative services reasonably necessary for the operation of the Fund
(other than those services specified in Sections 3 and 5 hereof), including but
not limited to:
(a) coordinating all matters relating to the operations of the Fund,
including any necessary coordination among the investment advisor,
sub-advisor,
1
<PAGE>
transfer agent, dividend disbursing agent, fund accounting agent,
accountants, attorneys and other parties performing services or
operational functions for the Fund;
(b) providing personnel, assistance and filing and other fees necessary to
maintain the qualification and/or registration to sell shares under
the federal securities laws and in each state where BBOI Worldwide has
determined such qualification and/or registration to be advisable;
(c) monitoring the Fund's compliance with (i) its Trust Instrument, Bylaws
and currently effective registration statement under the Securities
Act of 1933 (the "1933 Act") and the 1940 Act and any amendments or
supplements thereto ("Registration Statement"); (ii) the written
policies, procedures and guidelines of the Fund, and the written
instructions from the Trustees of the Trust based on resolutions duly
adopted by the Trustees; (iii) the requirements of the 1933 Act, the
1940 Act, the Investment Advisers Act of 1940 ("Advisers Act"), the
rules thereunder, and all other applicable federal and state laws and
regulations; and (iv) the provisions of Subchapter M of the Internal
Revenue Code, applicable to the Fund as a "regulated investment
company";
(d) arranging for and supervising the preparation of any or all
registration statements (including prospectuses and statements of
additional information), tax returns, proxy materials, financial
statements, notices and reports for filings with regulatory
authorities and distribution to shareholders of the Fund;
(e) issuing certain correspondence to shareholders;
(f) maintaining or supervising the maintenance of certain books and
records;
(g) providing and maintaining a membership for the Fund in customary
industry associations;
(h) providing the Trust with adequate personnel, office space,
communications facilities and other facilities necessary for operation
of the Fund as contemplated by this Agreement; and
(i) preparing and rendering to the Trustees of the Trust such periodic and
special reports as the Trustees may reasonably request.
3. SERVICES TO BE PROCURED. BBOI Worldwide shall procure the following
services for the Fund from other qualified service providers: (i) custody
services to provide for
2
<PAGE>
the safekeeping of the Fund's assets; (ii) transfer agency and dividend
disbursing agency services; (iii) recordkeeping and pricing agency services;
(iv) tax and audit services; (v) insurance for fidelity and other appropriate
coverage; (vi) legal services; and (vii) printing and mailing to existing
shareholders of annual and semi-annual reports, prospectuses, statements of
additional information and any communications required by law (but not proxy
statements or proxy materials). Further, subject to the review, supervision
and approval of the Trustees of the Trust, BBOI Worldwide shall:
(a) evaluate and obtain such services from qualified parties that meet all
criteria established by law and by the Trustees of the Trust for
parties acting in those capacities;
(b) negotiate and enter into, or arrange for the Trust to enter into,
agreements with such service providers for the benefit of the Fund,
provided that the Trust may but is not required to be a party to any
such agreement entered into by BBOI Worldwide, and that BBOI
Worldwide, as paying agent, may but is not required to be a party to
any such agreement entered into by the Trust;
(c) establish procedures to monitor the nature and quality of the services
provided by such service providers;
(d) monitor the nature and quality of the services provided by such
service providers;
(e) periodically provide to the Fund written reports on the activities and
services of such service providers; the nature and amount of
disbursements made on account of the Fund with respect to each such
service agreement; and such other information as the Trustees shall
reasonably request to enable them to fulfill their duties and
obligations under the 1940 Act and otherwise; and
(f) periodically provide recommendations to the Trustees to enhance
customer services provided by such service providers.
4. EXPENSES. BBOI Worldwide shall pay, directly or on behalf of the
Fund, all expenses incurred in providing and procuring the services set forth in
Sections 2 and 3 hereof, and all fees and expenses charged by the service
providers whose services are procured on behalf of the Fund pursuant to Section
3 hereof.
5. EXCLUDED SERVICES AND EXPENSES. Notwithstanding any other provision
hereof, it is expressly agreed that BBOI Worldwide shall not be responsible to
provide to or procure for the Fund any of the following services, or to pay,
directly or on behalf of the Fund,
3
<PAGE>
any of the following fees and expenses, which shall remain the Trust's own
obligation and responsibility to arrange for and pay: (a) investment advisory
services performed by any investment advisor for the Fund, or any fees and
expenses thereof;(b) expenses of meetings of the Trustees and shareholders of
the Trust (including, without limitation, printing and mailing proxy
statements and proxy materials, proxy solicitation, proxy tabulation, on-site
space arrangements, catering and meeting communications);(c) distribution,
marketing, underwriting or promotional services or any 12b-1 fees or other
fees and expenses in connection therewith;(d) taxes imposed on the Fund;(e)
brokerage commissions and other costs in connection with the purchase and
sale of securities and other portfolio assets; or (f) any non-recurring or
extraordinary items as may arise from time to time.
6. COMPENSATION. The Trust shall pay to BBOI Worldwide for the services
rendered and responsibilities assumed by BBOI Worldwide under this Agreement a
fee, payable in United States dollars, equal to the lesser of:
(a) an amount equal to the per annum rate of 0.10% of the average daily
net asset value of the Fund; or
(b) the costs and expenses incurred by BBOI Worldwide annually under
Section 4 hereof to (i) provide and procure the services contemplated
by Sections 2 and 3 of this Agreement, and (ii) pay all fees and
expenses charged by the service providers whose services are procured
on behalf of the Fund pursuant to Section 3 hereof, plus an additional
0.01% of the average daily net asset value of the Fund.
This fee shall be computed and accrued daily and payable monthly on the
last day of each month during which or part of which this Agreement is in
effect.
In the event that BBOI Worldwide delegates to another party or parties
(each, a "sub-administrator") any of its duties and responsibilities to provide
or procure any of the services contemplated by Sections 2 and 3 of this
Agreement, BBOI Worldwide may take into account, in calculating the part of its
costs and expenses under Section 6(b)(i) hereof relating to providing or
procuring such services, only the costs and expenses incurred by such
sub-administrator(s) in discharging such delegated duties and responsibilities.
In the event any arrangement is entered into with an organization to
provide subtransfer agency, recordkeeping, shareholder communications,
subaccounting and/or other services to investors purchasing shares of the Fund
through pension plans or other programs established or serviced by that
organization, BBOI Worldwide may take into account, in calculating the part of
its costs and expenses under Section 6(b)(ii) hereof relating to the fees and
expenses charged by the provider of such services, only the fees and expenses
that BBOI Worldwide would otherwise pay to the provider of such services to the
Fund if all the investors
4
<PAGE>
who own Fund shares through that organization were instead direct registered
record holders of shares in the Fund.
7. BOOKS AND RECORDS. BBOI Worldwide hereby agrees that all records
which it maintains for the Fund or the Trust hereunder are the property of the
Trust, agrees to permit the reasonable inspection thereof by the Trust or its
designees and agrees to preserve for the periods prescribed under the 1940 Act
any records which it maintains for the Fund or the Trust and which are required
to be maintained under the 1940 Act. BBOI Worldwide further agrees to surrender
promptly to the Trust or its designees any records which it maintains for the
Fund or the Trust upon request by the Trust.
8. TERM AND TERMINATION. This Agreement shall become effective as of the
date first set forth above and shall continue until terminated by either party
on 60 days' written notice to the other party. This Agreement may also be
terminated by the Trustees of the Trust at any time if BBOI Worldwide becomes
unable to discharge its duties and obligations under this Agreement.
9. ASSIGNMENT AND AMENDMENTS. This Agreement shall not be assigned by
either party without the prior written consent of the other party to the
Agreement. This Agreement may be amended in writing by the parties, provided
that all such amendments shall be subject to the approval of the Trustees of the
Trust.
10. DELEGATION. Notwithstanding anything herein to the contrary, BBOI
Worldwide may delegate any or all of its duties and responsibilities under this
Agreement to one or more parties subject to the approval of the Trustees of the
Trust. No delegation pursuant to this provision shall relieve BBOI Worldwide of
its duties or responsibilities hereunder, and BBOI Worldwide shall appropriately
supervise and monitor the activities of any party appointed hereunder for the
Fund.
11. LIMITATION OF LIABILITY OF BBOI WORLDWIDE. BBOI Worldwide shall not
be liable for any error of judgment or mistake of law or for any act or omission
taken with respect to the Fund, except for willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason of reckless
disregard of its obligations and duties hereunder and except to the extent
otherwise provided by law. BBOI Worldwide shall be entitled to rely upon any
written instructions from the Trustees of the Trust based on resolutions duly
adopted by the Trustees and shall incur no liability to the Trust or the Fund in
acting upon such written instructions. As used in this section, "BBOI
Worldwide" shall include any affiliate of BBOI Worldwide performing services for
the Fund contemplated hereunder, the Sub-Administrator as defined in Section 12
hereof, and managers, directors, officers and employees of BBOI Worldwide and
each of the foregoing.
12. INDEMNIFICATION. The Trust hereby indemnifies and holds harmless BBOI
Worldwide and its officers, managers, members, employees and agents, and any
controlling
5
<PAGE>
person thereof, and any person to whom BBOI Worldwide has delegated any of
its duties and responsibilities pursuant to Section 10 hereof, including
Berger Associates, Inc., to which BBOI Worldwide has delegated all its duties
and responsibilities under 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-Administrator takes
or omits to take pursuant to written instructions from the Trustees of the
Trust based on resolutions duly adopted by the Trustees, provided that no
person shall be indemnified hereunder against any liability to the Trust or
its shareholders (or any expenses incident to such liability) arising out of
their own willful misfeasance, bad faith or gross negligence in the
performance of their duties or by reason of their reckless disregard of their
duties or obligations under this Agreement.
BBOI Worldwide hereby indemnifies and holds harmless the Trust and its
Trustees, officers, shareholders, employees and agents, and any controlling
person thereof, from all losses, charges, claims and liabilities, and all costs
and expenses, including without limitation reasonable attorneys' fees and
disbursements, arising out of BBOI Worldwide's or the Sub-Administrator's
willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its duties or obligations under
this Agreement, provided that no person shall be indemnified hereunder against
any liability to the Trust or its shareholders (or any expenses incident to such
liability) arising out of their own willful misfeasance, bad faith or gross
negligence in the performance of their duties or by reason of their reckless
disregard of their duties or obligations under this Agreement.
13. INDEPENDENT CONTRACTOR. BBOI Worldwide shall for all purposes
hereunder be deemed to be an independent contractor and shall, unless otherwise
provided or authorized, have no authority to act for or represent the Trust or
the Fund in any way, nor otherwise be deemed an agent of, partner or joint
venturer with, the Trust or the Fund.
14. NAMES. The Trust and the Fund (together, the "Trust Entities") may
use the name "Bank of Ireland Asset Management" or "Berger" or any name derived
from or similar to "Bank of Ireland Asset Management" or "Berger Associates,
Inc.," including without limitation "Berger/BIAM," only for so long as this
Agreement or any extension, renewal or amendment hereof shall remain in effect.
At such time as such a contract shall no longer be in effect, each of the Trust
Entities will (to the extent that each lawfully can) cease to use such a name or
any other name indicating that it is advised by or otherwise connected with Bank
of Ireland Asset Management (U.S.) Limited, an Irish company ("BIAM"), or Berger
Associates, Inc., a Delaware company ("Berger Associates"). The Trust Entities
acknowledge that they have adopted the term "Berger/BIAM" as part of their names
through permission of BIAM and Berger Associates, respectively, and agree that
BIAM and Berger Associates each reserve to themselves, their respective
affiliates and any successors to their respective businesses the right to grant
the non-exclusive right to use the name "Bank of Ireland Asset Management,"
"BIAM," "Berger" or "BAI" or any similar names to any other corporation or
entity.
6
<PAGE>
15. ACTIVITIES OF BBOI WORLDWIDE. The services of BBOI Worldwide
hereunder are not to be deemed to be exclusive, and BBOI Worldwide is free to
render services to other parties, so long as its services under this Agreement
are not materially adversely affected or otherwise impaired thereby. Nothing in
this Agreement shall limit or restrict the right of any manager, officer or
employee of BBOI Worldwide to engage in any other business or to devote his or
her time and attention in part to the management or other aspects of any other
business, whether of a similar nature or a dissimilar nature.
16. LIMITATION ON PERSONAL LIABILITY. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. All parties to this Agreement acknowledge and agree
that the Trust is a series trust and all debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series shall be enforceable against the assets held with respect to
such series only, and not against the assets of the Trust generally or against
the assets held with respect to any other series and further that no Trustee,
officer or holder of shares of beneficial interest of the Trust shall be
personally liable for any of the foregoing.
17. GOVERNING LAW. This Agreement shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the 1940 Act. To the extent that the applicable
laws of the State of Colorado conflict with the applicable provisions of the
1940 Act, the latter shall control.
18. MISCELLANEOUS. The headings in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions thereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
IN WITNESS WHEREOF, the parties have caused their duly authorized member or
officer to execute this Agreement as of the date and year first above written.
BBOI WORLDWIDE LLC
By: Berger Associates, Inc.,
Its Member
By
--------------------------------
Title:
7
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BERGER/BIAM WORLDWIDE FUNDS TRUST, with
respect to the BERGER/BIAM INTERNATIONAL
CORE FUND
By
-----------------------------------
Title:
8
<PAGE>
EXHIBIT 9.2.4
SUB-ADMINISTRATION AGREEMENT
(BBOI WORLDWIDE LLC/BERGER ASSOCIATES, INC.)
THIS SUB-ADMINISTRATION AGREEMENT (the "Agreement") is entered into
effective as of the _______ day of __________________, 1996, by and between BBOI
WORLDWIDE LLC, a Delaware limited liability company ("BBOI Worldwide"), and
BERGER ASSOCIATES, INC., a Delaware corporation ("Berger Associates").
RECITALS
A. BBOI Worldwide has entered into Administrative Services Agreements, of
even date herewith (the "Administrative Services Agreements"), with Berger/BIAM
Worldwide Funds Trust (the "Trust"), a Delaware business trust and an open-end,
management investment company registered under the Investment Company Act of
1940 (the "1940 Act"), pursuant to which BBOI Worldwide undertakes to provide
certain administrative services to the Berger/BIAM International Fund, the
Berger/BIAM International Institutional Fund and the Berger/BIAM International
CORE Fund (each, a "Fund" and together, the "Funds"), each a series of the
Trust.
B. BBOI Worldwide has also entered into an Investment Advisory Agreement,
of even date herewith (the "Investment Advisory Agreement"), with Berger/BIAM
Worldwide Portfolios Trust ("Worldwide Portfolios"), a Delaware business trust
and an open-end, management investment company registered under the 1940 Act,
pursuant to which BBOI Worldwide undertakes to provide, in addition to
investment advisory services, certain managerial and administrative services to
the Berger/BIAM International Portfolio (the "Portfolio"), a series of Worldwide
Portfolios in which all the investable assets of the Funds are invested.
C. The parties desire that the administrative and managerial duties and
responsibilities of BBOI Worldwide under the Administrative Services Agreements
and the Investment Advisory Agreement be delegated to and performed by Berger
Associates, on the terms and conditions set forth herein.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. DELEGATION. BBOI Worldwide hereby delegates to Berger Associates the
following duties and responsibilities:
(a) all duties and responsibilities required to be performed by BBOI
Worldwide pursuant to the Administrative Services Agreements,
including
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without limitation the services specified in Section 2 and
Section 3 thereof;
(b) all duties and responsibilities required to be performed by BBOI
Worldwide pursuant to Section 3 of the Investment Advisory Agreement.
Berger Associates hereby accepts such delegation and agrees to perform the
duties and assume the responsibilities specified in Sections 1(a) and (b)
hereof, for the compensation herein provided. In performing its duties under
this Agreement, Berger Associates shall comply with all relevant provisions of
the 1940 Act and all other applicable federal and state laws and regulations and
shall be subject to the same obligations, restrictions and limitations as would
apply to BBOI Worldwide if it were performing under the respective
Administrative Services Agreements and the Investment Advisory Agreement.
2. EXPENSES. Berger Associates shall pay all its own costs and expenses
incurred in providing and procuring the services set forth in Section 1 hereof,
but shall not be responsible to pay any fees or expenses of the service
providers whose services are procured on behalf of any Fund under the
Administrative Services Agreements, which shall remain BBOI Worldwide's
obligation and responsibility to pay.
3. EXCLUDED SERVICES AND EXPENSES. Berger Associates shall not be
responsible to provide to or procure for any Fund, or to pay, directly or on
behalf of any Fund or the Portfolio, any of the services, fees or expenses
specified in Section 5 of the Administrative Services Agreements or in Section 2
or Sections 7(a)-(j) of the Investment Advisory Agreement.
4. COMPENSATION. BBOI Worldwide shall pay to Berger Associates for the
services rendered by and responsibilities assumed by Berger Associates under
this Agreement a fee, payable in United States dollars, at an annual rate of
0.25% of the average daily net asset value of the Portfolio. This fee shall be
computed and accrued daily and payable monthly on the last day of each month
during which or part of which this Agreement is in effect. Notwithstanding the
foregoing, Berger Associates shall waive its fees hereunder for the period
commencing on the date on which shares of the first Fund are first offered to
the public (the "Launch Date") and ending on the fourth anniversary of the
Launch Date, or such other shorter period as BBOI Worldwide may determine.
5. BOOKS AND RECORDS. Berger Associates hereby agrees that all records
which it maintains for any Fund or the Trust hereunder are the property of the
Trust, and further agrees that all records which it maintains for the Portfolio
or Worldwide Portfolios hereunder are the property of Worldwide Portfolios.
Berger Associates agrees to permit the reasonable inspection thereof by the
Trust or Worldwide Portfolios, as the case may be, or their respective
designees, and agrees to preserve for the periods prescribed under the 1940 Act
any records which it maintains and which are required to be maintained under the
1940 Act. Berger Associates further agrees to surrender promptly upon request
to the Trust or Worldwide
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Portfolios or their designees, as the case may be, any
records which Berger Associates maintains for such entity.
6. TERM AND TERMINATION. This Agreement shall become effective as of the
date first set forth above and shall continue until terminated by either party
on 60 days' written notice to the other party. This Agreement may also be
terminated by the Trustees of the Trust (with respect to any Fund) or by the
Trustees of Worldwide Portfolios (with respect to the Portfolio) at any time
upon 60 days' written notice to Berger Associates or at any time if Berger
Associates becomes unable to discharge its duties and obligations under this
Agreement. This Agreement may be terminated as to only one of the Funds or the
Portfolio, in which case it shall continue in full force and effect with respect
to any remaining Fund and/or the Portfolio, until terminated with respect to
each of them.
7. ASSIGNMENT AND AMENDMENTS. This Agreement shall not be assigned by
either party without the prior written consent of the other party to the
Agreement. This Agreement may be amended in writing by the parties, provided
that all such amendments shall be subject to the approval of the Trustees of the
Trust and the Trustees of Worldwide Portfolios.
8. LIMITATION OF LIABILITY OF BERGER ASSOCIATES. Berger Associates
shall not be liable for any error of judgment or mistake of law or for any
act or omission taken with respect to any Fund or 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
hereunder and except to the extent otherwise provided by law. Berger
Associates shall be entitled to rely upon any written instructions from BBOI
Worldwide, the sub-advisor to which BBOI Worldwide has delegated its duties
and responsibilities specified in Section 2 of the Investment Advisory
Agreement (the "Sub-Advisor"), or officers or Trustees of the Trust or of
Worldwide Portfolios, and shall incur no liability to BBOI Worldwide in
acting upon such written instructions. As used in this section, "Berger
Associates" shall include any affiliate of Berger Associates performing
services for any Fund or the Portfolio contemplated hereunder and managers,
directors, officers and employees of Berger Associates and such affiliates.
9. INDEMNIFICATION. BBOI Worldwide hereby indemnifies and holds harmless
Berger Associates and its officers, directors, shareholders, employees and
agents, and any controlling person thereof, from all losses, charges, claims and
liabilities, and all costs and expenses, including without limitation reasonable
attorneys' fees and disbursements, arising from any action which Berger
Associates takes or omits to take pursuant to written instructions from BBOI
Worldwide, the Sub-Advisor or officers or Trustees of the Trust or of Worldwide
Portfolios, provided that no person shall be indemnified hereunder against any
liability to the Trust or Worldwide Portfolios or their 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.
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Berger Associates hereby indemnifies and holds harmless BBOI Worldwide, the
Trust 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 Berger Associates' willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of its reckless
disregard of its duties or obligations under this Agreement, provided that no
person shall be indemnified hereunder against any liability to the Trust or
Worldwide Portfolios or their 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.
10. INDEPENDENT CONTRACTOR. Berger Associates shall for all purposes
hereunder be deemed to be an independent contractor and shall, unless otherwise
provided or authorized, have no authority to act for or represent BBOI
Worldwide, the Trust, any Fund, the Portfolio or Worldwide Portfolios in any
way, nor otherwise be deemed an agent of, partner or joint venturer with, BBOI
Worldwide, the Trust, any Fund, the Portfolio or Worldwide Portfolios.
11. ACTIVITIES OF BERGER ASSOCIATES. The services of Berger Associates
hereunder are not to be deemed to be exclusive, and Berger Associates is free to
render services to other parties, so long as its services under this Agreement
are not materially adversely affected or otherwise impaired thereby. Nothing in
this Agreement shall limit or restrict the right of any director, officer or
employee of Berger Associates to engage in any other business or to devote his
or her time and attention in part to the management or other aspects of any
other business, whether of a similar nature or a dissimilar nature.
12. THIRD PARTY BENEFICIARIES. The parties expressly acknowledge and
agree that the Trust and Worldwide Portfolios are third party beneficiaries of
this Agreement and that the Trust and Worldwide Portfolios each shall have the
full right to sue upon and enforce this Agreement in accordance with its terms
as if they were signatories hereto.
13. GOVERNING LAW. This Agreement shall be construed in accordance with
the laws of the State of Colorado (without giving effect to the conflicts of
laws principles thereof) and the 1940 Act. To the extent that the applicable
laws of the State of Colorado conflict with the applicable provisions of the
1940 Act, the latter shall control.
14. MISCELLANEOUS. The headings in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions thereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
4
<PAGE>
IN WITNESS WHEREOF, the parties have caused their duly authorized member or
officer to execute this Agreement as of the date and year first above written.
BBOI WORLDWIDE LLC
By: Berger Associates, Inc.,
Its Member
By
----------------------------
Title:
BERGER ASSOCIATES, INC.
By
-----------------------------
Title:
5
<PAGE>
EXHIBIT 9.3
RECORDKEEPING AND PRICING AGENT AGREEMENT
THIS AGREEMENT made to be effective as of this ___ day of __________, 1996,
by and between BERGER/BIAM WORLDWIDE FUNDS TRUST, a Delaware business trust,
referred to as the "Fund," consisting of separate portfolios represented by
separate series of shares of beneficial interest, (referred to herein, together
with any such portfolios hereafter constituted, where appropriate, individually
as a "Portfolio," and collectively as the "Portfolios"), having its place of
business at 210 University Boulevard, Suite 900, Denver, Colorado 80206, BBOI
WORLDWIDE LLC, a Delaware limited liability company, having its principal place
of business at 210 University Blvd., Denver, Colorado 80206 ("BBOI"), and
INVESTORS FIDUCIARY TRUST COMPANY, a state chartered trust company organized and
existing under the laws of the State of Missouri, having its principal place of
business at 127 West 10th Street, Kansas City, Missouri, 64105 ("IFTC"):
WITNESSETH:
WHEREAS, Fund and BBOI desire to appoint IFTC as Recordkeeping and Pricing
Agent for the Fund and IFTC desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual promises herein contained,
the parties hereto, intending to be legally bound, mutually covenant and agree
as follows:
1. APPOINTMENT OF RECORDKEEPING AND PRICING AGENT
Fund hereby constitutes and appoints IFTC as Recordkeeping and Pricing
Agent to calculate the daily net asset value of each Portfolio and to
perform certain accounting and recordkeeping functions required of Fund as
a registered investment company under the Investment Company Act of 1940,
as amended (the "Act"); to provide certain information necessary for Fund
to file financial and other reports; to prepare, maintain and preserve
certain required books, accounts and records as the basis for such reports;
to perform certain daily functions in connection with such accounts and
records; and, upon request, to act as liaison with the Fund's independent
auditors.
<PAGE>
2. DELIVERY OF CORPORATE DOCUMENTS
Fund shall deliver to IFTC prior to the effective date of this Agreement
copies of a resolution of the Trustees of Fund certified by the Secretary
or Assistant Secretary of the Fund, appointing IFTC as Recordkeeping and
Pricing Agent for Fund and approving the form of this Agreement. Fund
shall also deliver a resolution of the Trustees of the Fund designating
certain persons to give instructions on behalf of the Fund to IFTC, and
authorizing IFTC to rely upon written instructions over his/her/their
signatures.
3. REPRESENTATIONS AND WARRANTIES OF FUND
A. Fund represents and warrants that it is a business trust duly
organized as an investment company and existing and in good standing
under the laws of the State of Delaware;
B. Fund represents and warrants that it has the power and authority under
applicable laws, its Trust Instrument and bylaws, and has taken all
action necessary to enter into and perform this Agreement, including
appropriate authorization from the Fund's Trustees;
C. Fund represents and warrants that it has determined that the automated
data processing system on which IFTC shall prepare, maintain and
preserve the books and records of the Fund (the "Portfolio System") is
suitable for its needs;
D. Fund acknowledges that IFTC, as Licensee, and DST Systems, Inc., as
Licensor ("Licensor"), have proprietary rights in and to the Portfolio
System and that the Portfolio System and the programs, documentation,
books, records, lists, pricing schedules, designs, plans and other
information relating to the Portfolio System or the business of IFTC
("IFTC Confidential Information") are confidential and constitute
trade secrets of IFTC;
E. During the term of this Agreement and for a period of five years after
termination of this Agreement, Fund shall preserve the confidentiality
of the IFTC Confidential Information and prevent its disclosure to
persons other than its own employees and agents who reasonably have a
need to know or have access to the IFTC Confidential Information
2
<PAGE>
pursuant to this Agreement, and shall take appropriate action to
protect the rights of IFTC and Licensor as to the IFTC Confidential
Information, including, but not limited to notification to all
employees and agents of the Fund of the necessity to maintain the
confidentiality of IFTC Confidential Information, provided, that IFTC
shall be solely responsible for protecting any trademarks, patents,
copyrights and licenses against unauthorized use and infringement by
parties other than the Fund, its employees and agents.
4. REPRESENTATION AND WARRANTIES OF IFTC
A. IFTC is a trust company duly organized and existing and in good
standing under the laws of the State of Missouri.
B. IFTC has the power and authority under applicable laws, its charter
and bylaws, and has taken all action necessary, to enter into this
Agreement and perform the services contemplated herein, and this
Agreement constitutes a legal, valid and binding obligation of IFTC,
enforceable in accordance with its terms.
C. IFTC has obtained and shall maintain throughout the term of this
Agreement all necessary proprietary rights and approvals, licenses and
permits which are required for IFTC to perform its duties and
obligations hereunder and to use the Portfolio System.
D. IFTC presently has, and shall maintain throughout the term of this
Agreement, facilities, equipment, computer hardware and software, and
personnel necessary to perform its duties and obligations under this
Agreement, and shall maintain or otherwise have readily available,
reasonable back-up facilities and equipment to ensure that there is no
material interruption in the services contemplated by this Agreement,
except as provided in Section 7 hereof.
5. DUTIES AND RESPONSIBILITIES OF IFTC
A. DELIVERY OF RECORDS.
Fund shall turn over to IFTC all of Fund's accounts and records
previously maintained relating to the services to be provided by IFTC
hereunder. IFTC shall be entitled to rely conclusively on the
completeness and correctness of the accounts and records turned over
to it by Fund or its previous service provider and Fund shall
indemnify and hold IFTC harmless of and from any and all costs,
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expenses, damages, losses and liabilities whatsoever, including
attorney's fees (collectively, "Damages"), arising out of or in
connection with any error, omission, inaccuracy or other deficiency of
such accounts and records or in the failure of Fund or its previous
service provider to provide any portion of such account and records or
to provide any information needed by IFTC to perform its function
hereunder.
B. ACCOUNTING AND PORTFOLIO DUTIES.
IFTC shall perform the duties specified on Schedule A attached hereto.
C. ACCOUNTS AND RECORDS
1. IFTC, with the direction of the Fund, its accountants and/or its
advisors, shall prepare, maintain and preserve all books,
records, ledgers, journals, accounts and other documents,
containing such information as may be required from time to time
under the Act relating to the activities performed by IFTC
pursuant to Schedule A (the "Records"); preserve the Records in a
readily accessible location for at least the periods required
under the Act, at all times during the term of this Agreement
and, as may be reasonably necessary, following the termination of
this Agreement, make the Records available for examination by the
Securities and Exchange Commission, the Fund, the Fund's
accountants and such other persons as the Fund may deem
appropriate; and maintain facilities and equipment necessary for
producing readable projections or hard copies of Records.
Notwithstanding the terms of this Section C.1. as heretofore
provided, IFTC shall not be responsible for maintaining or
furnishing such Records after termination of the Agreement to the
extent that such Records have been forwarded to the Fund or its
agent. Hard copies of Records will be furnished to the Fund
without additional cost unless such requests for Records are
unusual, repetitive, require special handling, or otherwise
reasonably warrant the Fund's reimbursement for the costs
associated therewith. The Fund shall pay for the costs of
maintaining microfiche records.
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2. It shall be the responsibility of Fund to furnish IFTC with the
declaration, record and payment dates and amounts of any
dividends or other distributions, other special actions, and the
value or price of the securities in Fund's portfolio to the
extent such information is not available from generally accepted
securities industry services or publications. IFTC shall incur
no liability and Fund shall indemnify and hold IFTC harmless from
any liability in connection with the Fund's furnishing of such
information.
3. The accounts, books and records prepared, maintained and
preserved by IFTC pursuant to this Agreement shall be the
property of the Fund and shall be made available to the Fund for
inspection or reproduction promptly upon demand.
4. IFTC shall assist Fund's independent accountants, and upon
instruction from Fund or upon proper demand, shall assist any
court or regulatory body, in any requested review of Fund's
accounts and records prepared and maintained by IFTC. Fund shall
reimburse IFTC for all reasonable expenses and employee time
associated with any such review which is not part of routine or
normal periodic reviews, unless such expenses are incurred as a
result of a breach of this Agreement by IFTC or IFTC's negligence
or willful misconduct. For purposes of this Agreement, routine
or normal periodic reviews include the annual audit of the Fund
and routine interim audits or reviews by the Fund's independent
accountants and the routine reviews by the Securities and
Exchange Commission (SEC).
5. IFTC shall provide Fund with information for tax returns,
questionnaires, and periodic reports to shareholders and such
other reports and information as Fund may request in conjunction
with IFTC's stated duties hereunder. IFTC shall provide such
information as soon as reasonably practicable following the
Fund's request or as may be otherwise agreed to by the parties.
5
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6. IFTC and Fund may from time to time adopt procedures as they may
agree upon, and IFTC may conclusively assume that any procedure
approved by Fund, or directed by Fund in the manner prescribed by
Section 6.B., does not conflict with or violate any requirements
of Fund's prospectus, Trust Instrument, bylaws, or any law, rule
or regulation applicable to Fund. Fund shall be responsible to
notify IFTC of any changes in its prospectus, Trust Instrument,
bylaws, or policies applicable to the Fund which may necessitate
changes in IFTC's responsibilities or procedures. The Fund may
conclusively assume that any procedure adopted by IFTC does not
conflict with or violate any requirements of IFTC's charter,
bylaws, or any law, rule or regulation applicable to IFTC. IFTC
shall be responsible to notify the Fund of any changes in its
charter, bylaws, or policies which may affect the Fund's
responsibilities or procedures.
7. IFTC will calculate each Portfolio's daily closing net asset
value, in accordance with the its prospectus. IFTC will prepare
and maintain a daily valuation of securities held in the
Portfolios for which market quotations are available by the use
of outside services normally used and contracted for this
purpose; all other securities will be valued in accordance with
Fund's instructions.
6. LIMITATION OF LIABILITY OF IFTC
A. IFTC shall not be liable for any loss or damage resulting from its
action or omission to act or otherwise, except for any loss or damage
arising from any breach of this Agreement or any negligent act or
omission or willful misconduct of IFTC and IFTC shall indemnify and
hold harmless Fund from and against any Damages arising from such
breach, negligence or willful misconduct. Without limiting the
generality of the foregoing, IFTC will use best efforts to resolve to
the satisfaction of the Fund the effect on shareowners of any IFTC
error which causes an incorrect calculation of the net asset value of
the Portfolios and which effect is considered material, as such term
is generally used by accountants in the mutual fund industry. IFTC
6
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shall not be liable for consequential, special, or punitive damages.
IFTC may request and obtain the advice and opinion of counsel for Fund
or its own counsel at the reasonable expense of Fund with respect to
questions or matters of law relating to its performance of this
Agreement, and it shall be without liability to Fund for any action
taken or omitted by it in good faith, in conformity with such advice
or opinion.
B. IFTC may rely, and be protected in acting in reliance upon any
instruction, advice, notice, consent, resolution, opinion, certificate
or other written instrument appearing to be genuine and properly
executed by an authorized representative of the Fund or any oral
instruction from an authorized representative of the Fund
("Instruction"), except trade instructions and adjustments to the
Fund's trial balance sheet, general ledger or balance sheet, which
must be in writing executed by two authorized representatives of the
Fund, unless IFTC has actual knowledge that any such Instruction is
incorrect or unauthorized.
C. IFTC shall be entitled to receive and Fund agrees to pay to IFTC, on
demand, reimbursement for such cash disbursements, costs and expenses
as may be agreed upon in writing from time to time by IFTC, Fund and
BBOI.
D. During the term of this Agreement and for a period of five years after
termination of this Agreement, IFTC shall not use and shall preserve
the confidentiality of all accounting and financial information,
investment portfolio records including, but not limited to,
transactional information, share subscription and redemption records,
and other records made available to or created by IFTC under the terms
of this Agreement ("Fund Confidential Information"), other than for
purposes of complying with its duties and responsibilities under this
Agreement or as specifically authorized by Fund in writing. IFTC
shall prevent disclosure of Fund Confidential Information to persons
other than its own agents and employees who reasonably have a need to
know or have access to Fund Confidential Information pursuant to this
Agreement, and shall take appropriate action to protect the rights of
Fund in such Fund Confidential Information including, but not limited
to, notification to all its employees and agents of the necessity to
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maintain the confidentiality of Fund Confidential Information,
provided, that Fund shall be solely responsible for protecting any
trademarks, patents, copyrights and licenses against unauthorized use
and infringement by parties other than IFTC, its employees and agents.
7. FORCE MAJEURE
IFTC shall not be responsible or liable for any failure or delay in
performance of its obligations under this Agreement arising out of or
caused, directly or indirectly, by circumstances beyond its reasonable
control, including without limitation any interruption, loss or
malfunction of any utility, transportation, computer (hardware or software)
or communication service; or inability to obtain labor, material, equipment
or transportation; nor shall any such failure or delay give Fund any
additional right to terminate this Agreement.
8. ADDITIONAL FUNDS
IFTC shall act as Recordkeeping and Pricing Agent for additional Portfolios
upon 30 days notice to IFTC provided that IFTC consents in writing in
advance to such arrangement. Rates or charges for serving as Recordkeeping
and Pricing Agent for any such additional Portfolios shall be as agreed to
by IFTC, Fund and BBOI in writing.
9. COMPENSATION
Fund shall pay to IFTC such compensation at such time as may from time to
time be agreed upon in writing by the parties hereto. The initial
compensation schedule is attached hereto as Schedule B.
10. ACKNOWLEDGMENT OF BBOI AS PAYOR
Notwithstanding the provisions set forth in this Agreement with respect to
payment by Fund to IFTC of compensation and the reimbursement by Fund to
IFTC of cash disbursements, costs and expenses, the parties hereto
acknowledge and agree that BBOI, as administrator for Fund, and pursuant to
an administrative services agreement with Fund, shall pay directly or on
behalf of Fund to IFTC, such compensation as set forth in Section 9 hereof,
such reimbursements as set forth in Section 6.C. hereof, and such
compensation payable to IFTC upon termination of this Agreement as set
forth in Section 11 hereof, provided that if at any time such
administrative services agreement between Fund and BBOI is terminated, upon
8
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such termination BBOI shall be under no obligation or have any liability to
pay any further amounts as set forth in this Section 10 to IFTC, whether in
the form of compensation, fees, reimbursements or expenses.
Notwithstanding the foregoing, the Fund shall remain responsible for
payment of such amounts in the event BBOI fails to pay the same within a
reasonable time or ceases serving as administrator for the Fund.
11. TERMINATION
Any party to this Agreement may terminate same by notice in writing
received by the other parties not less than sixty (60) days prior to the
date upon which such termination shall take effect. Upon termination of
this Agreement, Fund shall pay to IFTC such compensation for its
reimbursable disbursements, costs and expenses paid or incurred to such
date and Fund shall use its best efforts to obtain a successor agent. IFTC
shall, upon termination of this Agreement, deliver to the successor so
specified or appointed, or to Fund, at IFTC's office, all books, records,
ledgers, accounts, journals and other documents and information then held
by IFTC hereunder, all money, instruments and other funds and other
properties of Fund deposited with or held by IFTC hereunder. In the event
no written order designating a successor (which may be Fund) shall have
been delivered to IFTC on or before the date when such termination shall
become effective, then IFTC shall deliver such records, funds and
properties of Fund to a bank or trust company at the selection of IFTC
having not less than $2,000,000 aggregate capital, surplus and undivided
profits as shown by its most recent published report, and meeting the
requirements of the Act, or if a satisfactory successor cannot be obtained,
IFTC may deliver the assets to the Fund, at IFTC's offices or as otherwise
agreed to between the parties. Thereafter the Fund or such bank or trust
company shall be the successor under this Agreement and shall be entitled
to reasonable compensation for its services. Notwithstanding the foregoing
requirement as to delivery upon termination of this Agreement, IFTC may
make any other delivery of the records, funds and property of Fund which
shall be permitted by the Act and Fund's Trust Instrument or bylaws then in
effect.
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12. NOTICES
Notices, requests, instructions and other writings received by Fund at 210
University Boulevard, Suite 900, Denver, Colorado 80206, or at such
address as Fund may have designated to the other parties in writing, shall
be deemed to have been properly given to Fund hereunder; notices, requests,
instructions and other writings received by IFTC at its offices at 127 West
10th Street, Kansas City, Missouri 64105, or to such other address as it
may have designated to the other parties in writing, shall be deemed to
have been properly given to IFTC hereunder; and notices, requests,
instructions and other writings received by BBOI at its offices at 210
University Boulevard, Denver, Colorado 80206, or at such other address as
BBOI may have designated to the other parties in writing, shall be deemed
to have been properly given to BBOI hereunder.
13. LIMITATION OF LIABILITY.
Notice is hereby given that the Fund is a business trust organized under
the Delaware Business Trust Act pursuant to a Certificate of Trust filed in
the office of the Secretary of State of the State of Delaware. All parties
to this Agreement acknowledge and agree that the Fund is a series Fund and
all debts, liabilities, obligations and expenses incurred, contracted for
or otherwise existing with respect to a particular series shall be
enforceable against the assets held with respect to such series only, and
not against the assets of the Fund generally or against the assets held
with respect to any other series; and further that no trustee, officer or
holder of shares of beneficial interest of the Fund shall be personally
liable for any of the foregoing.
14. MISCELLANEOUS
A. This Agreement is executed and delivered in the State of Missouri and
shall be governed by the laws of said state.
B. All terms and provisions of this Agreement shall be binding upon,
inure to the benefit of and be enforceable by the respective
successors and assigns of the parties hereto.
C. No provisions of the Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed
by all parties hereto.
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D. The captions in the Agreement are included for convenience of
reference only, and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
E. This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
F. If any part, term or provision of this Agreement is by the courts held
to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not be
affected, and the rights and obligations of the parties shall be
construed and enforced as if the Agreement did not contain the
particular part, term or provision held to be illegal or invalid.
G. This Agreement may not be assigned by any party without prior written
consent of the other parties.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective and duly authorized corporate or trust officers or member.
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BERGER/BIAM WORLDWIDE FUNDS TRUST
By:
----------------------------------------
Title:
-------------------------------------
INVESTORS FIDUCIARY TRUST COMPANY
By:
---------------------------------------
Title:
------------------------------------
BBOI WORLDWIDE LLC, BY BERGER ASSOCIATES,
INC., ITS MEMBER
By:
----------------------------------------
Title:
-------------------------------------
12
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Schedule - A
ACCOUNTING AND PORTFOLIO DUTIES
In its capacity as the Recordkeeping and Pricing Agent for the Fund, IFTC
shall perform the following responsibilities:*
A. ON A DAILY BASIS.
1. Post Fund share receivables and payables to the Fund's general ledger;
send general ledger reflecting all the day's activities to Fund
preferably by 3:30 p.m. Mountain time but in no event later than 8
a.m. Mountain time the next day.
2. Reconcile ending share balance from transfer agent reports to general
ledger; report differences to fund and resolve with the transfer
agent.
3. Post manual journal entries to the general ledger.
4. Prepare Net Asset Value rollforward.
5. Review individual components of the change in each Portfolio's Net
Asset Value for accuracy and reasonableness.
6. Review allocation of net income, and gains and losses for proper
recording.
7. Review expense accruals for proper recording. Send Fund complete
pricing sheet for the Fund's Portfolios preferably by 3:30 p.m.
Mountain time but in no event later than 8:00 a.m. Mountain time the
next day.
8. Communicate required pricing information to Fund,
quotation/publication services and to transfer agents. Communicate
NAV to newspapers and quotation services in time for publication and
to the transfer agent in time to run the shareowner accounts
by the beginning of the next day. Communicate the NAV and
corresponding worksheet to the Fund preferably by 3:30 p.m. Mountain
time but in no event later than 8:00 a.m. Mountain time the
next day.
9. Attend to routine matters in connection with the calculation of the
net asset value and aggregate asset value of each Portfolio.
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B. ON A PERIODIC BASIS.
1. Provide information prepared by IFTC during the performance of its
duties hereunder for Fund's semiannual reports within 15 calendar days
after March 31st and September 30th or the end of the reporting period
of the Fund, as applicable.
2. As agreed upon, deliver information to Fund on days when the NYSE is
not open.
3. Prepare allocation of realized and unrealized security gains and
losses according to partnership rules using the aggregate method,
subject to review by fund auditors.
*Information shall be provided by IFTC's normal means as acceptable to the
Fund. Costs for communicating routine information shall be borne by IFTC;
costs other than routine information, including microfiche, shall be borne
by the Fund.
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EXHIBIT 9.4
AGENCY AGREEMENT
THIS AGREEMENT made as of the day of , 1996
by and between BERGER/BIAM WORLDWIDE FUNDS TRUST, a Delaware business
trust, referred to as the "Fund," consisting of separate portfolios represented
by separate series of shares of beneficial interest (referred to herein,
together with any such portfolios hereafter constituted, where appropriate,
individually as a "Portfolio," or collectively as the "Portfolios,") having its
principal place of business at 210 University Boulevard, Suite 900, Denver,
Colorado 80206, BBOI WORLDWIDE LLC, a Delaware limited liability company,
having its principal place of business at 210 University Blvd., Denver, Colorado
80206 ("BBOI") and INVESTORS FIDUCIARY TRUST COMPANY, a state chartered trust
company organized and existing under the laws of the State of Missouri, having
its principal place of business at 127 West 10th Street, Kansas City, Missouri
64105 ("IFTC"):
WITNESSETH:
WHEREAS, Fund and BBOI desire to appoint IFTC as Transfer Agent and
Dividend Disbursing Agent for the Fund, and IFTC desires to accept such
appointment;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. DOCUMENTS TO BE FILED WITH APPOINTMENT.
In connection with the appointment of IFTC as Transfer Agent and Dividend
Disbursing Agent for Fund, there will be filed with IFTC the following
documents:
A. A certified copy of the resolutions of the Trustees of the Fund
appointing IFTC as Transfer Agent and Dividend Disbursing Agent,
approving the form of this Agreement, and designating certain persons
to sign beneficial interest certificates, if any, and give written
instructions and requests on behalf of Fund;
B. A certified copy of the Trust Instrument of Fund and all amendments
thereto;
C. A certified copy of the Bylaws of Fund;
D. Copies of Registration Statements and amendments thereto, filed with
the Securities and Exchange Commission.
<PAGE>
E. Specimens of all forms of outstanding shares of beneficial interest,
in the forms approved by the Trustees of Fund, with a certificate of
the Secretary of Fund, as to such approval;
F. Specimens of the signatures of the officers of the Fund authorized to
sign beneficial interest certificates and individuals authorized to
sign written instructions and requests;
G. An opinion of counsel for Fund with respect to:
(1) Fund's organization and existence under the laws of its state of
organization,
(2) The status of all shares of beneficial interest of Fund covered
by the appointment under the Securities Act of 1933, as amended,
and any other applicable federal or state statute, and
(3) That all issued shares are, and all unissued shares will be, when
issued, validly issued, fully paid and nonassessable.
2. CERTAIN REPRESENTATIONS AND WARRANTIES OF IFTC.
IFTC represents and warrants to Fund that:
A. It is a trust company duly organized and existing and in good standing
under the laws of Missouri.
B. It is duly qualified to carry on its business in the State of
Missouri.
C. It is empowered under applicable laws and by its Trust Instrument and
bylaws to enter into and perform the services contemplated in this
Agreement.
D. It is registered as a transfer agent to the extent required under the
Securities Exchange Act of 1934.
E. All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
F. It has and will continue to have and maintain the necessary
facilities, equipment and personnel to perform its duties and
obligations under this Agreement.
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3. CERTAIN REPRESENTATIONS AND WARRANTIES OF FUND.
Fund represents and warrants to IFTC that:
A. It is a business trust duly organized and existing and in good
standing under the laws of the State of Delaware.
B. It is an open-end diversified management investment company registered
under the Investment Company Act of 1940, as amended.
C. A registration statement under the Securities Act of 1933 has been
filed and will be effective with respect to all shares of Fund being
offered for sale.
D. All requisite steps have been or will be taken to register Fund's
shares for sale in all applicable states.
E. Fund is empowered under applicable laws and by its Trust Instrument
and bylaws to enter into and perform this Agreement.
4. SCOPE OF APPOINTMENT.
A. Subject to the conditions set forth in this Agreement, Fund hereby
employs and appoints IFTC as Transfer Agent and Dividend Disbursing
Agent.
B. IFTC hereby accepts such employment and appointment and agrees that it
will act as Fund's Transfer Agent and Dividend Disbursing Agent. IFTC
agrees that it will also act as agent in connection with each
Portfolio's periodic withdrawal payment accounts and other open
accounts or similar plans for shareholders, if any.
C. IFTC agrees to provide the necessary facilities, equipment and
personnel to perform its duties and obligations hereunder in
accordance with industry practice.
D. Fund agrees to use its best efforts to deliver to IFTC in Kansas City,
Missouri, as soon as they are available, all of its shareholder
account records.
E. Subject to the provisions of Sections 19. and 20. hereof, IFTC agrees
that it will perform all of the usual and ordinary services of
Transfer Agent and Dividend Disbursing Agent and as Agent for the
various shareholder accounts, including, without limitation, the
following: issuing, transferring and cancelling beneficial interest
certificates, if any, maintaining all shareholder accounts, preparing
shareholder meeting lists, mailing proxies, receiving and tabulating
proxies, mailing shareholder reports and prospectuses, withholding
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taxes on nonresident alien and foreign corporation accounts, for
pension and deferred income, backup withholding or other instances
agreed upon by the parties, preparing and mailing checks for
disbursement of redemptions, income dividends and capital gains
distributions, preparing and filing U.S. Treasury Department Form 1099
for all shareholders, preparing and mailing confirmation forms to
shareholders and dealers with respect to all purchases and redemptions
of Fund shares and other transactions in shareholder accounts for
which confirmations are required, recording reinvestments of dividends
and distributions in Fund shares, and cooperating with broker-dealers
and financial intermediaries who represent shareholders of the Fund.
5. LIMIT OF AUTHORITY.
Unless otherwise expressly limited by the resolution of appointment or by
subsequent action by the Fund, the appointment of IFTC as Transfer Agent
will be construed to cover the full amount of authorized shares of
beneficial interest of the class or classes for which IFTC is appointed as
the same will, from time to time, be constituted, and any subsequent
increases in such authorized amount.
In case of such increase Fund will file with IFTC:
A. If the appointment of IFTC was theretofore expressly limited, a
certified copy of a resolution of the Trustees of Fund increasing the
authority of IFTC;
B. A certified copy of the amendment to the Trust Instrument of Fund
authorizing the increase of shares of beneficial interest;
C. A certified copy of the order or consent of each governmental or
regulatory authority required by law to consent to the issuance of the
increased shares of beneficial interest, and an opinion of counsel
that the order or consent of no other governmental or regulatory
authority is required;
D. Opinion of counsel for Fund stating:
(1) The status of the additional shares of beneficial interest of
Fund under the Securities Act of 1933, as amended, and any other
applicable federal or state statute; and
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<PAGE>
(2) That the additional shares are, or when issued will be, validly
issued, fully paid and nonassessable.
6. COMPENSATION AND EXPENSES.
A. In consideration for its services hereunder as Transfer Agent and
Dividend Disbursing Agent, Fund will pay to IFTC from time to time a
reasonable compensation for all services rendered as Agent, and also,
all its reasonable out-of-pocket expenses, charges, counsel fees, and
other disbursements (Compensation and Expenses) incurred in connection
with the agency. Such compensation is set forth in a separate
schedule, a copy of which is attached hereto and incorporated herein
by reference. IFTC shall make reasonable efforts to bill the Fund as
soon as practicable after the end of each calendar month for the
Compensation and Expenses due for that month and said billing shall be
detailed in accordance with the such schedule. If the Fund has not
paid such Compensation and Expenses to IFTC within a reasonable time,
IFTC may charge against any monies held under this Agreement, the
amount of any Compensation and/or Expenses for which it shall be
entitled to reimbursement under this Agreement.
B. Fund agrees to promptly reimburse IFTC for all reasonable out-of-
pocket expenses or advances incurred by IFTC in connection with the
performance of services under this Agreement, for postage (and first
class mail insurance in connection with mailing share certificates),
envelopes, check forms, continuous forms, forms for reports and
statements, stationery, and other similar items, telephone and
telegraph charges incurred in answering inquiries from dealers or
shareholders, microfilm used each year to record the previous year's
transactions in shareholder accounts and computer tapes used for
permanent storage of records and cost of insertion of materials in
mailing envelopes by outside firms. IFTC will provide to Fund no less
often than monthly a detailed accounting of all such expenses on
behalf of the Fund.
C. Notwithstanding the provisions set forth in this Agreement with
respect to payment by Fund to IFTC of compensation and the
reimbursement by Fund to IFTC of certain expenses or advances, the
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<PAGE>
parties hereto acknowledge and agreee that BBOI, as administrator for
the Fund, and pursuant to an administrative services agreement with
the Fund, shall pay directly or on behalf of Fund to IFTC, such
Compensation and Expenses as set forth in Section 6.A. hereof, such
reimbursement as set forth in Section 6.B. hereof, the amounts of such
Compensation and Expenses as set forth in Section 6.A. and such
reimbursements as set forth in Section 6.B. which become payable to
IFTC in the event of termination of this Agreement pursuant to Section
22.C. hereof, and such reasonable compensation in the event of
termination of this Agreement as set forth in Section 22.D. hereof,
provided that if at any time such administrative services agreement
between Fund and BBOI is terminated, upon such termination BBOI shall
be under no obligation or have any liability to pay any further
amounts as set forth in this Section 6.C. to IFTC, whether in the form
of compensation, fees, reimbursements or expenses. Notwithstanding
the foregoing, the Fund shall remain responsible for payment of such
amounts in the event BBOI fails to pay the same within a reasonable
time or ceases serving as administrator for the Fund.
7. OPERATION OF IFTC SYSTEM.
A. In connection with the performance of its services under this
Agreement, IFTC is responsible for such items as:
(1) The accuracy of entries in IFTC's records reflecting orders and
instructions received by IFTC from dealers, shareholders, Fund or
its principal underwriter;
(2) The availability and the accuracy of shareholder lists,
shareholder account verifications, confirmations and other
shareholder account information to be produced from its records
or data;
(3) The accurate and timely issuance of dividend and distribution
checks in accordance with instructions received from Fund;
(4) The accuracy of redemption transactions and payments in
accordance with redemption instructions received from dealers,
shareholders or Fund;
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<PAGE>
(5) The deposit daily in Fund's appropriate special bank account of
all checks and payments received from dealers or shareholders for
investment in shares;
(6) The requiring of proper forms of instructions, signatures and
signature guarantees and any necessary documents supporting the
legality of transfers, redemptions and other shareholder account
transactions, all in conformance with IFTC's and the Fund's
present procedures with such changes as may be required or
approved by Fund; and
(7) The maintenance of a current duplicate set of Fund's essential
records at a secure distant location, in a form available and
usable forthwith in the event of any breakdown or disaster
disrupting its main operation.
8. INDEMNIFICATION.
A. IFTC will not be responsible for, and Fund will hold harmless and
indemnify IFTC from and against any loss by or liability to the Fund
or a third party, including reasonable attorney's fees, in connection
with any claim or suit asserting any such liability arising out of or
attributable to actions taken or omitted by IFTC pursuant to this
Agreement, unless IFTC has acted negligently or in bad faith. The
matters covered by this indemnification include but are not limited to
those of Section 14. hereof. Fund will be responsible for, and will
have the right to conduct or control the defense of any litigation
asserting liability, including reasonable attorney's fees, against
which IFTC is indemnified hereunder. IFTC will not be under any
obligation to prosecute or defend any action or suit in respect of the
agency relationship hereunder, which, in its opinion, may involve it
in expense or liability, unless Fund will, as often as requested,
furnish IFTC with reasonable, satisfactory security and indemnity
against such expense or liability.
B. IFTC will hold harmless and indemnify Fund from and against any loss
or liability arising out of IFTC's negligence or bad faith in
performing its duties under this Agreement, including reasonable
attorney's fees.
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<PAGE>
9. CERTAIN COVENANTS OF IFTC AND FUND.
A. All requisite steps will be taken by Fund from time to time when and
as necessary to register the Fund's shares for sale in all states in
which Fund's shares shall at the time be offered for sale and require
registration. If at any time Fund will receive notice of any stop
order or other proceeding in any such state affecting such
registration or the sale of Fund's shares, or of any stop order or
other proceeding under the federal securities laws affecting the sale
of Fund's shares, Fund will give prompt notice thereof to IFTC.
B. IFTC hereby agrees to perform such transfer agency functions as are
set forth in Section 4.E. above and establish and maintain facilities
and procedures reasonably acceptable to Fund for safekeeping of shares
of beneficial interest certificates, check forms, and facsimile
signature imprinting devices, if any; and for the preparation or use,
and for keeping account of, such certificates, forms and devices, and
to carry such insurance as it considers adequate and reasonably
available and not to substantially reduce such level of insurance
without prior notice to the Fund.
C. To the extent required by Section 31 of the Investment Company Act of
1940 as amended and Rules thereunder, IFTC agrees that all records
maintained by IFTC relating to the services to be performed by IFTC
under this Agreement are the property of Fund and will be preserved
and will be surrendered promptly to Fund on request.
D. IFTC agrees to furnish Fund semiannual reports of its financial
condition, consisting of a balance sheet, earnings statement and any
other financial information reasonably requested by Fund. The annual
financial statements will be certified by IFTC's certified public
accountants.
E. IFTC represents and agrees that it will use its best efforts to keep
current on the trends of the investment company industry relating to
shareholder services and will use its best efforts to continue to
modernize and improve.
F. IFTC will permit Fund and its authorized representatives to make
periodic inspections of its operations as such would involve the Fund
at reasonable times during business hours.
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<PAGE>
10. RECAPITALIZATION OR READJUSTMENT.
In case of any recapitalization, readjustment or other change in the
capital structure of Fund requiring a change in the form of beneficial
interest certificates, IFTC will issue or register certificates in the new
form in exchange for, or in transfer of, the outstanding certificates in
the old form, upon receiving:
A. Written instructions from an officer of Fund;
B. Certified copy of the amendment to the Trust Instrument or other
document effecting the change;
C. Certified copy of the order or consent of each governmental or
regulatory authority, required by law to the issuance of the
beneficial interest certificate in the new form, and an opinion of
counsel that the order or consent of no other government or regulatory
authority is required;
D. Specimens of the new certificates in the form approved by the Trustees
of Fund, with a certificate of the Secretary of Fund as to such
approval;
E. Opinion of counsel for Fund stating:
(1) The status of the shares of beneficial interest of Fund in the
new form under the Securities Act of 1933, as amended and any
other applicable federal or state statute; and
(2) That the issued shares in the new form are, and all unissued
shares will be, when issued, validly issued, fully paid and
nonassessable.
11. BENEFICIAL INTEREST CERTIFICATES.
Fund will furnish IFTC with a sufficient supply of blank beneficial
interest certificates and from time to time will renew such supply upon the
request of IFTC. Such certificates will be signed manually or by facsimile
signatures of the officers of Fund authorized by law and by bylaws to sign
such certificates, and if required, will bear the corporate seal or
facsimile thereof.
12. DEATH, RESIGNATION OR REMOVAL OF SIGNING OFFICER.
Fund will file promptly with IFTC written notice of any change in the
officers authorized to sign certificates, written instructions or requests,
together with two signature cards bearing the specimen signature of each
newly authorized officer. In case any officer of Fund who will have signed
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<PAGE>
manually or whose facsimile signature will have been affixed to blank
certificates will die, resign, or be removed prior to the issuance of such
certificates, IFTC may issue or register such certificates as the
certificates of Fund notwithstanding such death, resignation, or removal,
until specifically directed to the contrary by Fund in writing. In the
absence of such direction, Fund will file promptly with IFTC such approval,
adoption, or ratification as may be required by law.
13. FUTURE AMENDMENTS OF TRUST INSTRUMENT AND BYLAWS.
Fund will promptly file with IFTC copies of all material amendments to its
Trust Instrument or bylaws made after the date of this Agreement.
14. INSTRUCTIONS, OPINION OF COUNSEL AND SIGNATURES.
At any time IFTC may apply to any person authorized by the Fund to give
instructions to IFTC, and may with the approval of a Fund officer consult
with legal counsel for Fund or its own legal counsel at the expense of
Fund, with respect to any matter arising in connection with the agency and
it will not be liable for any action taken or omitted by it in good faith
in reliance upon such instructions or upon the opinion of such counsel.
IFTC will be protected in acting upon any paper or document reasonably
believed by it to be genuine and to have been signed by the proper person
or persons and will not be held to have notice of any change of authority
of any person, until receipt of written notice thereof from Fund. It will
also be protected in recognizing beneficial interest certificates which it
reasonably believes to bear the proper manual or facsimile signatures of
the officers of Fund, and the proper countersignature of any former
Transfer Agent or Registrar, or of a co-Transfer Agent or co-Registrar.
15. PAPERS SUBJECT TO APPROVAL OF COUNSEL.
The acceptance by IFTC, of its appointment as Transfer Agent and Dividend
Disbursing Agent and all documents filed in connection with such
appointment and thereafter in connection with the agencies, will be subject
to the approval of legal counsel for IFTC (which approval will be not
unreasonably withheld).
16. CERTIFICATION OF DOCUMENTS.
The required copy of the Trust Instrument of Fund and copies of all
amendments thereto will be certified by the Secretary of State (or other
appropriate official) of the State of Certification, and if such Trust
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Instrument and amendments is required by law to be also filed with a
county, city or other officer of official body, a certificate of such
filing will appear on the certified copy submitted to IFTC. A copy of the
order or consent of each governmental or regulatory authority required by
law to the issuance of the beneficial interest certificate will be
certified by the Secretary or Clerk of such governmental or regulatory
authority, under proper seal of such authority. The copy of the Bylaws and
copies of all amendments thereto, and copies of resolutions of the Trustees
of Fund, will be certified by the Secretary or an Assistant Secretary of
Fund under the Fund's seal.
17. RECORDS.
IFTC will maintain customary records in connection with its agency, and
particularly will maintain those records required to be maintained pursuant
to subparagraph (2) (iv) of paragraph (b) of Rule 31a-1 for the period and
in the manner prescribed by Rule 31a-2 under the Investment Company Act of
1940, if any.
18. DISPOSITION OF BOOKS, RECORDS AND CANCELLED CERTIFICATES.
IFTC will send periodically to Fund, or to where designated by the
Secretary or an Assistant Secretary of Fund, all books, documents, and all
records no longer deemed needed for current purposes and beneficial
interest certificates which have been cancelled in transfer or in exchange,
upon the understanding that such books, documents, records, and beneficial
interest certificates will not be destroyed by Fund without the consent of
IFTC (which consent will not be unreasonably withheld), but will be safely
stored for possible future reference.
19. PROVISIONS RELATING TO IFTC AS TRANSFER AGENT.
A. IFTC will make original issues of beneficial interest certificates
upon written request of an officer of Fund and upon being furnished
with a certified copy of a resolution of the Trustees authorizing such
original issue, an opinion of counsel as outlined in paragraphs 1.D.
and G. of this Agreement, any documents required by paragraphs 5. or
10. of this Agreement, and necessary funds for the payment of any
original issue tax.
B. Before making any original issue of certificates Fund will furnish
IFTC with sufficient funds to pay all required taxes on the original
issue of the shares of beneficial interest, if any. Fund will furnish
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IFTC such evidence as may be required by IFTC to show the actual value
of such shares. If no taxes are payable IFTC will be furnished with
an opinion of outside counsel to that effect.
C. Shares of beneficial interest will be transferred and new certificates
issued in transfer, or shares of beneficial interest accepted for
redemption and funds remitted therefor, upon surrender of the old
certificates in form deemed by IFTC properly endorsed for transfer or
redemption accompanied by such documents as IFTC may deem necessary to
evidence that authority of the person making the transfer or
redemption, and bearing satisfactory evidence of the payment of any
applicable transfer taxes. IFTC reserves the right to refuse to
transfer or redeem shares until it is satisfied that the endorsement
or signature on the certificate or any other document is valid and
genuine, and for that purpose it may require a guaranty of signature
by a financial institution as permitted by the Fund's prospectus or as
otherwise required by applicable law. IFTC also reserves the right to
refuse to transfer or redeem shares until it is satisfied that the
requested transfer or redemption is legally authorized, and it will
incur no liability for the refusal in good faith to make transfers or
redemptions which, in its judgment, are improper or unauthorized.
IFTC may, in effecting transfers or redemptions, rely upon
Simplification Acts or other statutes which protect it and Fund in not
requiring complete fiduciary documentation. In cases in which IFTC is
not directed or otherwise required to maintain the consolidated
records of shareholder's accounts, IFTC will not be liable for any
loss which may arise by reason of not having such records, provided
that such loss could not have been prevented by the exercise of
ordinary diligence.
D. When mail is used for delivery of beneficial interest certificates
IFTC will forward certificates in "nonnegotiable" form by first class
or registered mail and certificates in "negotiable" form by registered
mail, all such mail deliveries to be covered while in transit to the
addressee by insurance arranged for by IFTC.
E. IFTC will issue and mail subscription warrants, certificates
representing dividends, exchanges or split ups, or act as Conversion
Agent upon receiving written instructions from any officer of Fund and
such other documents as IFTC deems necessary.
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F. IFTC will issue, transfer, and split up certificates and will issue
certificates of beneficial interest representing full shares upon
surrender of scrip certificates aggregating one full share or more
when presented to IFTC for that purpose upon receiving written
instructions from an officer of Fund and such other documents as IFTC
may deem necessary.
G. IFTC may issue new certificates in place of certificates represented
to have been lost, destroyed, stolen or otherwise wrongfully taken
upon receiving instructions from Fund and indemnity satisfactory to
IFTC and Fund, and may issue new certificates in exchange for, and
upon surrender of, mutilated certificates. Such instructions from
Fund will be in such form as will be approved by the Trustees of Fund
and will be in accordance with the provisions of law and the bylaws of
Fund governing such matter.
H. IFTC will supply a shareholder's list to Fund for its annual meeting
upon receiving a request from an officer of Fund. It will also supply
lists at such other times as may be requested by an officer of Fund.
I. Upon receipt of written instructions of an officer of Fund, IFTC will
address and mail notices to shareholders.
J. In case of any request or demand for the inspection of the shareholder
records of Fund or any other books in the possession of IFTC, IFTC
will endeavor to notify Fund and to secure instructions as to
permitting or refusing such inspection. IFTC reserves the right,
however, to exhibit the shareholder records or other books to any
person in case it is advised by its counsel that it may be held
responsible for the failure to exhibit the shareholder records or
other books to such person.
K. In the event that any check or other order for the payment of money is
returned unpaid for any reason, IFTC will: (i) within three days give
written notice of such return to the Fund or its designee; (ii) place
a stop transfer order against all Fund shares issued in certificate
form as a result of such check or order or cancel the purchase of Fund
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shares issued in book-entry form as a result of such check or order,
(iii) take such other steps as IFTC may, in its discretion, deem
appropriate or as the Fund or its designee may instruct.
L. Upon receipt of all necessary information and documentation relating
to a redemption, IFTC will issue to the Fund's custodian an advice
setting forth the number of shares of the Fund received by IFTC for
redemption. IFTC shall, upon notification that the custodian has
transferred funds for the redemption of shares to a redemption account
at IFTC or at another bank, pay such moneys to the shareholder, his
authorized agent or legal representative.
M. IFTC is authorized to review and process transfers of shares of the
Fund and exchanges between the Fund and other mutual funds for which
IFTC acts as transfer agent as permitted in the prospectus for the
Fund, on the records of the Fund maintained by IFTC. If shares to be
transferred are represented by outstanding certificates, IFTC shall,
upon surrender to it of the certificates in proper form for transfer,
and upon cancellation thereof, countersign and issue new certificates
for a like number of shares (if so requested by the registered holder
thereof) and deliver the same. If the shares to be transferred are
not represented by outstanding certificates, IFTC shall upon an order
thereof by or on behalf of the registered holder thereof in proper
form, credit the same to the transferee on its books. If shares are
to be exchanged for shares of another mutual fund, IFTC will process
such shares exchanged in the same manner as a redemption and sale of
shares, except that it may in its discretion waive requirements for
information and documentation.
N. Unless otherwise instructed by the Fund, IFTC shall maintain records
showing for each investor's account the following: (i) names,
addresses, tax identifying numbers and assigned account numbers; (ii)
numbers of shares held; (iii) historical information regarding the
account of each shareholder, including dividends paid and date and
price of all transactions on a shareholder's account; (iv) any stop or
restraining order placed against a shareholder's account or on lost
and/or replaced certificates; (v) information with respect to
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withholdings in the case of a foreign account; (vi) any capital gain
or dividend reinvestment order, account application, dividend address
and correspondence relating to the current maintenance of a
shareholder's account; (vii) certificate numbers and denominations for
any shareholders holding certificates; and (viii) any information
required in order to permit the Fund to confirm that IFTC has properly
performed the calculations contemplated or required by this Agreement.
O. IFTC will maintain records necessary to reflect the crediting of
dividends which are reinvested in shares of the Fund.
P. IFTC will investigate all shareholder inquiries related to shareholder
accounts and respond promptly to correspondence from shareholders.
Q. If requested and as directed by the Fund, IFTC will address and mail
all communications to shareholders or their nominees, including proxy
material and periodic reports to shareholders.
R. In connection with special and annual meetings of shareholders, IFTC
will prepare shareholder lists, mail and certify as to the mailing of
proxy materials, process and tabulate returned proxy cards, report on
proxies voted and received by IFTC prior to meetings as stated in the
proxy statement, and certify to the Secretary of the Fund shares to be
voted at meetings.
S. In addition to the duties expressly provided for herein, IFTC shall
perform such other duties and functions as are set forth in the
Compensation and Expenses schedule hereto from time to time.
20. PROVISIONS RELATING TO DIVIDEND DISBURSING AGENCY.
A. IFTC will maintain one or more deposit accounts as Agent for the Fund,
into which the funds for payment of dividends, distributions,
redemptions or other disbursements provided for hereunder will be
deposited, and against which checks for the foregoing purposes will be
drawn (Accounts). Such Accounts may be maintained in IFTC's own
banking department, in State Street Bank and Trust Company, and in
such other banks or trust companies as may be designated by IFTC and
as properly authorized by resolution of the Trustees of the Fund, such
Accounts, however, to be in the name of IFTC as agent of the Fund and
subject only to its draft or order.
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B. Upon the receipt of proper instructions, as described below, which may
be continuing instructions when deemed appropriate by the parties,
IFTC shall pay out monies of the Fund in such Accounts in the
following cases only:
1. For the redemption of Fund shares according to the Fund's then
current prospectus;
2. For the payment of any dividends declared by the Fund or other
distributions to shareholders of the Fund; and
3. For any other proper purpose, but only upon receipt of proper
instructions specifying the amount of such payment, setting forth
the purpose for which such payment is to be made, declaring such
purpose to be a proper purpose, and naming the person or persons
to whom such payment is to be made.
IFTC shall disburse funds from such Accounts as directed upon receipt
of instructions from the Fund. All instructions shall be given only
by persons designated in writing to IFTC by the Fund to be authorized
to give instructions to IFTC under this Agreement. Instructions may
be in writing executed by an authorized representative of the Fund or,
if IFTC reasonably believes such instructions to be by an authorized
representative of the Fund, via telecommunications.
C. The Fund will promptly notify IFTC of the declaration of any dividend
or distribution. The Fund shall furnish to IFTC a written document
specifying the date of the declaration of such dividend or
distribution, the date of payment thereof, the record date as of which
shareholders entitled to payment shall be determined, the amount
payable per share to shareholders of record as of that date, and the
total amount payable to IFTC on the payment date.
D. IFTC will, on or before the payable date of any dividend or
distribution, notify the Fund's custodian and the Fund of the
estimated amount of cash required to pay said dividend or
distribution. On or before the mailing date of such dividend or
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<PAGE>
distribution, Fund shall instruct the custodian to place in a dividend
disbursing account at IFTC or another bank, funds equal to the cash
amount to be paid out. IFTC will calculate, prepare and mail checks
to, or (where appropriate) credit such dividend or distribution to the
account of, Fund shareholders, and maintain and safeguard all required
underlying records.
E. As directed by the Fund, IFTC shall prepare and mail to each Fund
shareholder such information with respect to each dividend or
distribution as is required by applicable federal income tax laws and
regulations and by the Investment Company Act of 1940.
F. As directed by the Fund, IFTC shall file such appropriate information
returns concerning the payment of dividends and capital gain
distributions with the proper federal authorities as are required by
federal law to be filed by the Fund and shall withhold such sums as
are required to be withheld by federal law.
G. IFTC will, at the expense of the Fund, provide a special form of check
containing the imprint of any device or other matter desired by Fund.
Such form of checks must, however, be compatible with the equipment
employed by IFTC and its agents.
H. If the Fund desires to include additional printed matter, financial
statements, etc. with the dividend checks, the same will be furnished
to IFTC within a reasonable time prior to the date of mailing of the
dividend checks, at no expense to IFTC.
I. If the Fund desires that its distributions be mailed in any special
form of envelopes, a sufficient supply of the same will be furnished
to IFTC, but the size and form of said envelopes will be subject to
the approval of IFTC. If stamped envelopes are used, they must be
furnished by Fund or, if postage stamps are to be affixed to the
envelopes, the stamps or the cash necessary for such stamps must be
furnished by the Fund prior to mailing.
J. IFTC is authorized and directed to stop payment of checks theretofore
issued hereunder, but not presented for payment, when the payees
thereof allege either that they have not received the checks or that
such checks have been mislaid, lost, stolen, destroyed or through no
fault of theirs, are otherwise beyond their control, and cannot be
17
<PAGE>
produced by them for presentation and collections, and, to issue and
deliver duplicate checks in replacement thereof upon receipt of
properly executed affidavits.
21. ASSUMPTION OF DUTIES BY THE FUND.
The Fund may assume certain duties and responsibilities of IFTC or those
usual and ordinary services of Transfer Agent and Dividend Disbursement
Agent as those terms are referred to in Section 4.E. of this Agreement
including but not limited to accepting shareholder instructions and
transmitting orders based on such instructions to IFTC, preparing and
mailing confirmations, obtaining certified TIN numbers, and disbursing
monies of the Fund. To the extent the Fund or its agent or affiliate
assumes such duties and responsibilities, IFTC shall be relieved from all
responsibility and liability therefor.
22. TERMINATION OF AGREEMENT.
A. Any party to this agreement may terminate same by notice in writing
received by the other parties not less than sixty (60) days prior to
the date upon which such termination shall take effect.
B. Fund, in addition to any other rights and remedies, shall have the
right to terminate this Agreement forthwith upon the occurrence at any
time of any of the following events:
(1) Any interruption or cessation of operations by IFTC or its
assigns which materially interferes with the business operation
of Fund;
(2) The bankruptcy of IFTC or its assigns or the appointment of a
receiver for IFTC or its assigns;
(3) Any merger, consolidation or sale of substantially all the assets
of IFTC or its assigns;
(4) The acquisition of a controlling interest in IFTC or its assigns,
by any broker, dealer, investment adviser or investment company
except as may presently exist; or
(5) Failure by IFTC or its assigns to perform its duties in
accordance with the Agreement, which failure materially adversely
affects the business operations of Fund and which failure
continues for thirty (30) days after receipt of written notice
from Fund.
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C. In the event of termination, Fund will promptly pay IFTC all amounts
due to IFTC hereunder.
D. In the event of termination, IFTC will use its best efforts to
transfer the books and records of the Fund to the designated successor
transfer agent and to provide other information relating to its
service provided hereunder for reasonable compensation therefor.
23. ASSIGNMENT.
A. Neither this Agreement nor any rights or obligations hereunder may be
assigned by IFTC without the written consent of Fund and BBOI;
provided, however, no assignment will relieve IFTC of any of its
obligations hereunder. IFTC may, however, employ agents to assist it
in performing its duties hereunder.
B. This Agreement will inure to the benefit of and be binding upon the
parties and their respective successors and assigns.
24. CONFIDENTIALITY.
A. IFTC agrees that, except as provided in the last sentence of Section
19.J hereof, or as otherwise required by law, IFTC will keep
confidential all records of and information in its possession relating
to Fund or its shareholders or shareholder accounts and will not
disclose the same to any person except at the request or with the
consent of Fund.
B. Fund agrees to keep confidential all financial statements and other
financial records (other than statements and records relating solely
to Fund's business dealings with IFTC) and all manuals, systems and
other technical information and data, not publicly disclosed, relating
to IFTC's operations and programs furnished to it by IFTC pursuant to
this Agreement and will not disclose the same to any person except at
the request or with the consent of IFTC.
C. The Fund acknowledges that IFTC and DST Systems, Inc. (DST) have
proprietary rights in and to the computerized data processing
recordkeeping system used by IFTC to perform services hereunder
including, but not limited to the maintenance of shareholder accounts
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and records, processing of related information and generation of
output (the MFS System), including, without limitation any changes or
modifications of the MFS System and any other IFTC or DST programs,
data bases, supporting documentation, or procedures ("collectively
IFTC Protected Information") which the Fund's access to the MFS System
or computer hardware or software may permit the Fund or its employees
or agents to become aware of or to access and that the IFTC Protected
Information constitutes confidential material and trade secrets of
IFTC. The Fund agrees to maintain the confidentiality of the IFTC
Protected Information. The Fund acknowledges that any unauthorized
use, misuse, disclosure or taking of IFTC Protected Information which
is confidential as provided by law, or which is a trade secret,
residing or existing internal or external to a computer, computer
system, or computer network, or the knowing and unauthorized accessing
or causing to be accessed of any computer, computer system, or
computer network, may be subject to civil liabilities and criminal
penalties under applicable state law. The Fund will advise all of its
employees and agents who have access to any IFTC Protected Information
or to any computer equipment capable of accessing IFTC or DST hardware
or software of the foregoing. IFTC and DST are intended to be, and
shall be, third party beneficiaries of the Fund's obligations and
undertakings contained in this Section.
25. SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
All representations and warranties by IFTC or Fund herein contained will
survive the execution and delivery of this Agreement.
26. LIMITATION OF LIABILITY.
Notice is hereby given that the Fund is a business trust organized under
the Delaware Business Trust Act pursuant to a Certificate of Trust filed in
the office of the Secretary of State of the State of Delaware. All parties
to this Agreement acknowledge and agree that the Fund is a series Fund and
all debts, liabilities, obligations and expenses incurred, contracted for
or otherwise existing with respect to a particular series shall be
enforceable against the assets held with respect to such series only, and
not against the assets of the Fund generally or against the assets held
20
<PAGE>
with respect to any other series and further that no trustee, officer or
holder of shares of beneficial interest of the Fund shall be personally
liable for any of the foregoing.
27. MISCELLANEOUS.
A. This Agreement is executed and delivered in the State of Missouri and
shall be governed by the laws of said state.
B. All the terms and provisions of this Agreement shall be binding upon,
inure to the benefit of, and be enforceable by the respective
successors and assigns of the parties hereto.
C. No provisions of the Agreement may be amended or modified, in any
manner except by a written agreement properly authorized and executed
by all parties hereto.
D. The captions in this Agreement are included for convenience of
reference only, and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
E. This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
F. If any part, term or provision of this Agreement is by the courts held
to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not be
affected, and the rights and obligations of the parties shall be
construed and enforced as if the Agreement did not contain the
particular part, term or provision held to be illegal or invalid.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective duly authorized officers or member.
INVESTORS FIDUCIARY TRUST COMPANY
By:
--------------------------------------
Title:
-----------------------------------
BERGER/BIAM WORLDWIDE FUNDS TRUST
By:
--------------------------------------
Title:
-----------------------------------
BBOI WORLDWIDE LLC, BY BERGER ASSOCIATES, INC.,
ITS MEMBER
By:
---------------------------------------
Title:
------------------------------------
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EXHIBIT B
INSURANCE COVERAGE
Minimum Insurance Coverages:
DESCRIPTION OF POLICY:
BROKERS BLANKET BOND, STANDARD FORM 14
Covering losses caused by dishonesty of employees, physical loss of
securities on or outside of premises while in possession of authorized
person, loss caused by forgery or alteration of checks or similar
instruments.
Minimum Coverage: $75,000,000
ERRORS AND OMISSIONS INSURANCE
Indemnifies against loss in providing shareholder accounting services
by reason of neglect, error or omission.
Minimum Coverage: $10,000,000
MAIL INSURANCE (APPLIES TO ALL FULL SERVICE OPERATIONS)
Provides indemnity for security lost in the mails.
Minimum Coverage:
$10,000,000 per envelope nonnegotiable securities mailed to domestic
locations via registered mail.
$1,000,000 per envelope nonnegotiable securities mailed to domestic
locations via first-class or certified mail.
$1,000,000 per envelope nonnegotiable securities mailed to foreign
locations via registered mail.
$1,000,000 per envelope negotiable securities mailed to all locations
via registered mail.
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EXHIBIT 15
RULE 12b-1 PLAN OF
BERGER/BIAM INTERNATIONAL FUND
(A SERIES OF BERGER/BIAM WORLDWIDE FUNDS TRUST)
1. THE PLAN. The Trustees of Berger/BIAM Worldwide Funds Trust, a
Delaware business trust (the "Trust"), have adopted this Rule 12b-1 Plan (the
"Plan") pursuant to the terms of Rule 12b-1 under the Investment Company Act of
1940, as amended (the "Act"), with respect to the shares of the Trust's series
known as Berger/BIAM International Fund (the "Fund"). In accordance with the
terms of this Plan, the Trust may act as a "distributor" (as that term is used
in said Rule 12b-1) of shares of the Fund.
2. AUTHORIZED PAYMENTS. During each fiscal year of the Fund, the Trust
is hereby authorized to pay out of the assets of the Fund on a monthly basis, an
amount computed at a rate of twenty-five one-hundredths of one percent (.25%) of
the average daily net assets of the Fund during such fiscal year to Berger
Associates, Inc. ("Berger Associates") to finance activities primarily intended
to result in the sale of the Fund's shares, which shall include, but not be
limited to: payments made to, and costs incurred by, the Fund's principal
underwriter in connection with the distribution of the Fund's shares, including
payments made to and expenses of officers and registered representatives of
Berger Distributors, Inc.; payments made to and expenses of other persons
(including employees of Berger Associates) who are engaged in, or provide
support services in connection with, the distribution of the Fund's shares, such
as answering routine telephone inquiries and processing prospective investor
requests for information; compensation paid to securities dealers, financial
institutions and other organizations which render distribution and
administrative services in connection with the distribution of the Fund's
shares, including services to shareholders of the Fund and prospective
investors; costs related to the formulation and implementation of marketing and
promotional activities, including direct mail promotions and television, radio,
newspaper, magazine and other mass media advertising; costs of printing and
distributing prospectuses and reports to prospective shareholders of the Fund;
costs involved in preparing, printing and distributing sales literature for the
Fund; costs involved in obtaining whatever information, analyses and reports
with respect to marketing and promotional activities on behalf of the Fund that
Berger Associates deems advisable; and such other costs as may from time to time
be agreed upon by the Fund. Such payments shall be made by the Trust to Berger
Associates with respect to each fiscal year of the Fund without regard to the
actual distribution expenses incurred by Berger Associates in such year; I.E.,
if distribution expenditures incurred by Berger Associates are less than the
total of such payments in such year, the difference shall not be reimbursed to
the Trust by Berger Associates, and if distribution expenditures incurred by
Berger Associates are more than the total of such payments, the excess shall not
be reimbursed to Berger Associates by the Trust.
3. TRUSTEE APPROVAL. This Plan shall not take effect until it has been
approved, together with any related agreements, by votes of a majority of both
(a) the Trustees of the Trust and (b) those Trustees of the Trust who are not
"interested persons" of the Trust and the Fund (as defined in the Act) and have
no direct or indirect financial interest in the operation of this Plan or any
agreements related to it (the "Rule 12b-1 Trustees"), cast in person
<PAGE>
at a meeting (or meetings) called for the purpose of voting on this Plan and
such related agreements.
4. ANNUAL REAPPROVAL. Unless sooner terminated pursuant to paragraph 5,
this Plan shall continue in effect for so long as such continuance is
specifically approved at least annually in the manner provided for approval of
this Plan in paragraph 3.
5. TERMINATION OF PLAN. This Plan may be terminated at any time by a
vote of a majority of the Rule 12b-1 Trustees, or by vote of a majority of the
Fund's outstanding shares.
6. AMENDMENTS. This Plan may not be amended to increase materially the
amount of distribution expenses provided for in paragraph 2 hereof without
shareholder approval as provided in Rule 12b-1 under the Act (or any successor
provision), and no material amendment to the Plan shall be made unless approved
in the manner provided for approval of this Plan in paragraph 3 hereof.
7. QUARTERLY REPORTS. Any person authorized to direct the disposition of
monies paid or payable by the Fund pursuant to this Plan or any related
agreements shall provide to the Trustees of the Trust, and the Trustees shall
review at least quarterly, a written report of the amounts so expended and the
purposes for which such expenditures were made. Unless directed otherwise by
the Trustees with respect to a particular expenditure or type of expenditure,
any expenditure made by Berger Associates which jointly promotes the sale of
shares of the Fund and the sale of shares of other investment companies for
which Berger Associates or its affiliate serves as investment adviser or
administrator, and which expenditures are not readily identifiable as related to
the Fund or one or more of such other investment companies, shall be allocated
to the Fund and such other investment companies on a basis such that the Fund
will be allocated only its proportional share of such expenditures based upon
the relative net assets of the Fund as compared to the net assets of all such
other investment companies thus promoted.
8. SELECTION AND NOMINATION OF TRUSTEES. While this Plan is in effect,
the selection and nomination of Trustees of the Trust who are not interested
persons (as defined in the Act) of the Fund shall be committed to the discretion
of the Trustees who are not interested persons of the Fund.
9. RECORDS. The Fund shall preserve copies of this Plan and any related
agreements and all reports made pursuant to paragraph 7 hereof for a period of
not less than six years from the date of this Plan, or the agreements or such
reports, as the case may be, and shall preserve the Plan, agreement or report
the first two years in an easily accessible place.
10. LIMITATION ON PERSONAL LIABILITY. NOTICE IS HEREBY GIVEN that the
Trust is a business trust organized under the Delaware Business Trust Act
pursuant to a Certificate of Trust filed in the office of the Secretary of State
of the State of Delaware. The Trust is a series trust and all debts,
liabilities, obligations and expenses incurred, contracted for or otherwise
existing with respect to a particular series shall be enforceable against the
assets
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<PAGE>
held with respect to such series only, and not against the assets of the
Trust generally or against the assets held with respect to any other series
and further that no trustee, officer or holder of shares of beneficial
interest of the Trust shall be personally liable for any of the foregoing.
IN WITNESS WHEREOF, the adoption of this Rule 12b-1 Plan by the Trustees of
the Trust with respect to the Fund is hereby confirmed as of the day and year
set forth below.
BERGER/BIAM WORLDWIDE FUNDS TRUST
Date: , 1996 By
--------------------- -----------------------------------
Gerard M. Lavin, President
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