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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M N-1A
Registration Statement Under the Securities Act of 1933 /x/
Pre-Effective Amendment No. __ / /
Post-Effective Amendment No. 1 /x/
and
Registration Statement Under the Investment Company Act of 1940 /x/
Amendment No. 2 /x/
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BERKELEY CAPITAL MANAGEMENT FUNDS
(Exact Name of Registrant as Specified in Charter)
650 California Street, Suite 2800, San Francisco, California 94108
(Address of Principal Executive Office)
(415) 393-0300
(Registrant's Telephone Number, Including Area Code)
ROBERT A. CORNMAN
650 California Street, Suite 2800, San Francisco, California 94108
(Name and Address of Agent for Service)
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Approximate Date of Proposed Public Offering: As soon as possible after this
Registration Statement becomes effective.
It is proposed that this filing will become effective (check appropriate box):
- --- immediately upon filing pursuant to paragraph (b)
- --- on [date] pursuant to paragraph (b)
x
- --- 60 days after filing pursuant to paragraph (a)(1)
- --- on [date] pursuant to paragraph (a)(1)
- --- 75 days after filing pursuant to paragraph (a)(2)
- --- on [date] pursuant to paragraph (a)(2) of Rule 485.
If appropriate, check the following box:
- --- this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Registrant has previously registered an indefinite number of shares of
beneficial interest of Berkeley Capital Management Funds pursuant to Rule
24f-2 of the Investment Company Act of 1940, as amended. Registrant will file
a Notice pursuant to Rule 24f-2 for the fiscal year ended October 31, 1997 on
or before December 30, 1997.
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Please Send Copy of Communications to:
MITCHELL E. NICHTER, ESQ.
STEPHANIE OWEN WOODWORTH, ESQ.
Heller, Ehrman, White & McAuliffe
333 Bush Street
San Francisco, California 94104
(415) 772-6000
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BERKELEY CAPITAL MANAGEMENT FUNDS
BERKELEY CAPITAL MANAGEMENT MONEY MARKET FUND
CONTENTS OF POST-EFFECTIVE AMENDMENT TO REGISTRATION STATEMENT
This Post-Effective Amendment to the Registration Statement of Berkeley
Capital Management Funds contains the following documents:
- Facing Sheet
- Contents of Post-Effective Amendment to Registration Statement
- Cross-Reference Sheet for Berkeley Capital Management Money
Market Fund
- Part A: Prospectus for Berkeley Capital Management Money
Market Fund
- Part B: Statement of Additional Information for Berkeley Capital
Management Money Market Fund
- Part C: Other Information
- Signature Page
- Exhibits
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BERKELEY CAPITAL MANAGEMENT FUNDS
Berkeley Capital Management Money Market Fund
CROSS REFERENCE SHEET
FORM N-1A
N-1A Location in
ITEM NO. ITEM REGISTRATION STATEMENT
Part A: INFORMATION REQUIRED IN PROSPECTUS
1. Cover Page Cover Page
2. Synopsis "Key Features of the Fund" and
"Summary of Expenses"
3. Condensed Financial Information Not Applicable
4. General Description of Registrant "Key Features of the Fund,"
"Investment Objective and
Policies," and "Organization and
Management of the Fund"
5. Management of the Fund "Organization and Management of the
Fund"
5A. Management's Discussion of Not Applicable
Fund Performance
6. Capital Stock and Other "Organization and Management of the
Securities Fund," "Distributions and Taxes,"
and "Other Important Information"
7. Purchase of Securities "Investing in Shares of the Fund"
Being Offered
8. Redemption or Repurchase "How to Sell Shares"
9. Pending Legal Proceedings Not Applicable
ii
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Part B: Information Required in Statement of
Additional Information
------------------------------------
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History "General Information"
13. Investment Objectives and "Investment Techniques" and
Policies "Investment Restrictions"
14. Management of the Fund "Management of the Trust"
15. Control Persons and "Principal Holders of Securities"
Principal Holders of
Securities
16. Investment Advisory and "Management of the Trust"
Other Services
17. Brokerage Allocation and "Portfolio Transactions and
Other Practices Turnover"
18. Capital Stock and Other "General Information"
Securities
19. Purchase, Redemption and "Purchase and Redemption
Pricing of Securities Being of Shares"
Offered
20. Tax Status "Distributions and Taxes"
21. Underwriters "Management of the Trust"
22. Calculation of Performance Data "Yield"
23. Financial Statements Not Applicable
iii
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PART A
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PROSPECTUS
Berkeley Capital Management Money Market Fund
-----------------------
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[LOGO]
BERKELEY CAPITAL MANAGEMENT MONEY MARKET FUND
PROSPECTUS
MAY , 1997
TO PLACE ORDERS AND FOR ACCOUNT INFORMATION: Contact Firstar Trust Company
(the "Transfer Agent") toll free at (888) 889-0799.
BERKELEY CAPITAL MANAGEMENT MONEY MARKET FUND (the "Fund") is designed for
investors who seek current income consistent with liquidity and stability of
capital. The Fund is a diversified investment portfolio of Berkeley Capital
Management Funds (the "Trust"), an open-end, management investment company. The
Fund's investment manager (the "Investment Manager") is Berkeley Capital
Management.
ABOUT THIS PROSPECTUS: THIS PROSPECTUS CONCISELY PRESENTS IMPORTANT
INFORMATION YOU SHOULD KNOW BEFORE INVESTING IN THE FUND. PLEASE READ IT
CAREFULLY AND RETAIN IT FOR FUTURE REFERENCE. You can find more detailed
information about the Fund in the Statement of Additional Information dated May
, 1997 (as amended from time to time). The Statement of Additional Information
has been filed with the Securities and Exchange Commission ("SEC") and is
incorporated by reference into this Prospectus. To receive a free copy of this
Prospectus or the Statement of Additional Information, call the Transfer Agent
toll free at (888) 889-0799, or write the Fund at 650 California Street, 28th
Floor, San Francisco, California 94108.
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.
AN INVESTMENT IN THE FUND IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT. THERE CAN BE NO ASSURANCE THAT THE FUND WILL BE ABLE TO MAINTAIN A
STABLE NET ASSET VALUE OF $1.00 PER SHARE.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY, ANY
DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE
BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISK, INCLUDING THE
POSSIBLE LOSS OF PRINCIPAL.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Key Features of the Fund.............................................................. 1
Summary of Expenses................................................................... 1
Matching the Fund to Your Investment Needs............................................ 2
Investment Objective and Policies..................................................... 2
Organization and Management of the Fund............................................... 6
Distributions and Taxes............................................................... 8
Share Price Calculation............................................................... 9
How the Fund Reports Performance...................................................... 9
Investing in Shares of the Fund....................................................... 10
How to Sell Shares.................................................................... 13
Other Important Information........................................................... 15
</TABLE>
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KEY FEATURES OF THE FUND
CURRENT INCOME AND SAFETY. The Fund is designed for investors who seek
current income consistent with liquidity and stability of capital. The Fund
invests in high-quality, short-term debt securities. The Fund attempts to
maintain a stable net asset value of $1.00 per share. (See "Investment Objective
and Policies.")
LIQUIDITY. You can conveniently sell your shares of the Fund at any time.
(See "How to Sell Shares.")
LOW COST INVESTING. The Fund imposes no sales or transaction fees on
purchases or redemptions of shares of the Fund. (See "Matching the Fund to Your
Investment Needs" and "Organization and Management of the Fund.")
PROFESSIONAL MANAGEMENT. The Investment Manager currently provides
investment management services to institutional and other investors. As of
December 31, 1996, the Investment Manager had approximately $1.6 billion of
total assets under discretionary management under several investment strategies
(including over $700 million invested in fixed-income securities). (See
"Organization and Management of the Fund.")
RISK CONSIDERATIONS. The value of securities in the Fund's portfolio will
be affected by general changes in interest rates which will result in increases
or decreases in the market value of the obligations held by the Fund. In
addition, securities in which the Fund may invest may not yield as high a level
of current income as might be achieved by investing in securities with less
liquidity and safety and longer maturities. The Fund's performance may also be
affected by changes in market or economic conditions and other circumstances
affecting the financial services industry.
SUMMARY OF EXPENSES
<TABLE>
<S> <C>
Shareholder Transaction Expenses:................................... None
Annual Fund Operating Expenses
(as a percentage of average net assets)
Management Fee.................................................... 0.25%
Service Fee....................................................... 0.25%
12b-1 Fees........................................................ None
Other Expenses.................................................... 0.13%
Total Fund Operating Expenses....................................... 0.63%
</TABLE>
EXAMPLE. You would pay the following expenses on a $1,000 investment,
assuming (1) a 5% annual return and (2) redemption at the end of each period:
<TABLE>
<S> <C>
1 Year................................................................ $ 6
3 Years............................................................... $ 20
</TABLE>
The purpose of the preceding table is to assist investors in understanding
the various costs and expenses that an investor in the Fund will bear directly
or indirectly. In the table above, "Other Expenses" is based on estimated
amounts for the current fiscal year. THE EXAMPLE SHOULD NOT BE CONSIDERED A
REPRESENTATION OF PAST OR FUTURE EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR
LESS THAN THOSE SHOWN. The example assumes a 5% annual rate of return pursuant
to requirements of the SEC. This hypothetical rate of return is not intended to
be representative of past or future performance.
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MATCHING THE FUND TO YOUR INVESTMENT NEEDS
The Fund may be appropriate for a variety of investment programs which can
be long-term or short-term in nature. While the Fund is not a substitute for
building an investment portfolio tailored to an individual's investment needs
and risk tolerance, it can be used as a high-quality, conveniently liquid money
market investment for cash when an investor is not fully invested in other
securities or assets.
Because the Fund is designed to provide liquidity and stability of capital,
it may be especially suitable for investors with short-term investment
objectives, including those who are awaiting an opportune time to invest in the
equity and/or bond markets.
The Fund may also be appropriate for long-term investors seeking low-risk
investment alternatives which are designed to provide current income. The Fund
is newly formed and has no operating history.
INVESTMENT OBJECTIVE AND POLICIES
The Fund seeks current income consistent with liquidity and stability of
capital. The Fund pursues its objective by investing exclusively in the
following types of U.S. dollar-denominated money market instruments which are
deemed to mature in 397 days or less in accordance with federal securities
regulations and which the Investment Manager has determined present minimal
credit risk:
- Certificates of deposit, time deposits, notes and bankers' acceptances of
U.S. domestic banks (including their foreign branches), Canadian chartered
banks, U.S. branches of foreign banks and foreign branches of foreign
banks having total assets of $5 billion or greater.
- Commercial paper, including asset-backed commercial paper, rated in one of
the two highest rating categories by Moody's Investors Service
("Moody's"), Standard & Poor's Corporation ("S&P"), Duff & Phelps Credit
Rating Co. ("Duff"), Fitch Investors Service, Inc. ("Fitch"), or any other
nationally recognized statistical rating organization ("NRSRO"), or
commercial paper or notes of issuers with an unsecured debt issue
outstanding currently rated in one of the two highest rating categories by
any NRSRO where the obligation is on the same or a higher level of
priority and collateralized to the same extent as the rated issue.
- The Fund may also invest in other corporate obligations such as publicly
traded bonds, debentures, and notes rated in one of the two highest rating
categories by any NRSRO and other similar securities which, if unrated by
any NRSRO, are determined by the Investment Manager, using guidelines
approved by the Trust's Board of Trustees, to be at least equal in quality
to one or more of the above referenced securities.
- Obligations of, or guaranteed by, the U.S. or Canadian governments, their
agencies or instrumentalities.
- Repurchase agreements involving obligations that are suitable for
investment under the categories listed above.
EURODOLLAR CERTIFICATES OF DEPOSIT AND FOREIGN SECURITIES. To the extent
the Fund purchases Eurodollar certificates of deposit and other similar
obligations, consideration will be given to the fact that these issuers may not
be subject to the same regulatory requirements as U.S. issuers, including U.S.
banks.
Investments in securities of foreign issuers or securities principally
traded overseas may involve certain special risks due to foreign economic,
political, and legal developments. Furthermore, issuers of foreign
2
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securities are subject to different, often less comprehensive, accounting,
reporting, and disclosure requirements than domestic issuers. The securities of
some foreign companies and foreign securities markets are less liquid and at
times more volatile than securities of comparable U.S. companies and U.S.
securities markets. Foreign brokerage commissions and other fees are also
generally higher than in the United States. There are also special tax
considerations which apply to securities of foreign issuers and securities
principally traded overseas. All such securities will be U.S.
dollar-denominated.
CONCENTRATION. The Fund will not invest more than 5% of its total assets in
the securities of a single issuer, and will not invest 25% or more of the value
of its total assets in the securities of issuers conducting their principal
business activities in the same industry. However, these limitations will not
apply to certificates of deposit or bankers' acceptances issued by domestic
branches of U.S. banks and U.S. branches of certain foreign banks, or to
obligations of or guaranteed by the U.S. Government or its agencies or
instrumentalities. See "Investment Restrictions" in the Statement of Additional
Information.
ILLIQUID SECURITIES. The Fund will not purchase illiquid securities,
including time deposits and repurchase agreements maturing in more than seven
days, if, as a result of the purchase, more than 10% of the Fund's net assets
valued at the time of the transaction are invested in such securities. The
investment policy on the purchase of illiquid securities, as set forth in the
Statement of Additional Information, is nonfundamental.
ASSET-BACKED COMMERCIAL PAPER. The Fund may invest in asset-backed
commercial paper. Repayment of this type of commercial paper is intended to be
obtained from an identified pool of assets including automobile receivables,
credit-card receivables, and other types of assets. Asset-backed commercial
paper is issued by a special purpose vehicle (usually a corporation) that has
been established for the purpose of issuing the commercial paper and purchasing
the underlying pool of assets. The issuer of commercial paper bears the direct
risk of prepayment on the receivables constituting the underlying pool of
assets. Credit support for asset-backed securities may be based on the
underlying assets or provided by a third party. Credit enhancement techniques
include letters of credit, insurance bonds, limited guarantees, and
over-collateralization.
ASSET-BACKED SECURITIES. The Fund may invest in asset-backed securities.
These types of securities represent a direct or indirect participation in, or
are secured by and payable from, pools of assets, such as motor vehicle
installment sales contracts, installment loan contracts, leases of various types
of real and personal property, and receivables from revolving credit (e.g.,
credit card) agreements. Payments or distributions of principal and interest on
asset-backed securities may be supported by credit enhancements, such as various
forms of cash collateral accounts or letters of credit. These securities are
subject to the risk of prepayment. Prepayments of principal of asset-backed
securities affect the average life of the asset-backed securities in the Fund's
portfolio. Prepayments are affected by the level of interest rates and other
factors, including general economic conditions. In periods of rising interest
rates, the prepayment rate tends to decrease, lengthening the average life of a
pool of asset-backed securities. In periods of falling interest rates, the
prepayment rate tends to increase, shortening the average life of a pool.
Reinvestment of prepayments may occur at higher or lower interest rates than the
original investment, affecting the Fund's yield. Thus, asset-backed securities
may have less potential for capital appreciation in periods of falling interest
rates than other fixed-income securities of comparable duration, although they
may have a comparable risk of decline in market value in periods of rising
interest rates. Payment of principal and interest may be largely dependent upon
the cash flows generated by the assets backing the securities.
3
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SECTION 4(2) COMMERCIAL PAPER. The Fund may invest in commercial paper and
other securities that are issued in reliance on the so-called "private
placement" exemption from registration afforded by Section 4(2) of the
Securities Act of 1933, as amended (the "1933 Act") ("Section 4(2) paper").
Federal securities laws restrict the disposition of Section 4(2) paper. Section
4(2) paper generally is sold to institutional investors such as the Fund who
agree that they are purchasing the paper for investment and not for public
distribution. Any resale of Section 4(2) paper by the purchaser must be in an
exempt transaction and may be accomplished in accordance with Rule 144A under
the 1933 Act. Section 4(2) paper normally may be resold to other institutional
investors such as the Fund through or with the assistance of the issuer or
investment dealers who make a market in the Section 4(2) paper, thus providing
liquidity. Because it is not possible to predict with assurance exactly how this
market for Section 4(2) paper sold and offered under Rule 144A will continue to
develop, the Investment Manager, pursuant to guidelines approved by the Trust's
Board of Trustees, will monitor the Fund's investments in these securities,
focusing on such important factors, among others, as valuation, liquidity, and
availability of information.
RULE 144A SECURITIES. Rule 144A under the 1933 Act establishes a safe
harbor from the registration requirements of the 1933 Act for resales of certain
securities to qualified institutional buyers. Institutional markets for
restricted securities sold pursuant to Rule 144A in many cases provide both
readily ascertainable values for restricted securities and the ability to
liquidate an investment to satisfy share redemption orders. Such markets might
include automated systems for the trading, clearance, and settlement of
unregistered securities of domestic and foreign issuers, such as the PORTAL
System sponsored by the National Association of Securities Dealers, Inc. An
insufficient number of qualified buyers interested in purchasing Rule
144A-eligible restricted securities, however, could adversely affect the
marketability of such portfolio securities and result in the Fund's inability to
dispose of such securities promptly or at favorable prices.
The Board of Trustees has delegated the function of making day-to-day
determinations of liquidity to the Fund's Investment Manager, pursuant to
guidelines approved by the Board. The Investment Manager takes into account a
number of factors in reaching liquidity decisions, including, but not limited
to: (i) the frequency of trades for the security, (ii) the number of dealers
that quote prices for the security, (iii) the number of dealers that have
undertaken to make a market in the security, (iv) the number of other potential
purchasers, and (v) the nature of the security and how trading is effected
(e.g., the time needed to sell the security, how bids are solicited, and the
mechanics of transfer). The Investment Manager monitors the liquidity of
restricted securities in the Fund's portfolio and reports periodically on such
decisions to the Board.
BANK NOTES. The Fund may invest in bank notes, which are unsecured
promissory notes representing debt obligations that are issued by banks in large
denominations.
For more information regarding the Fund's investments, see "Share Price
Calculation."
OTHER INVESTMENT TECHNIQUES
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES. The Fund may purchase
securities on a "when-issued" or "delayed delivery" basis. When-issued or
delayed delivery securities are securities purchased for future delivery at a
stated price and yield. The Fund generally will not pay for such securities or
start earning interest on them until they are received. Securities purchased on
a when-issued or delayed delivery basis
4
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are recorded as an asset. The value of such securities may change as the general
level of interest rates changes.
The Fund will not invest more than 25% of its assets in when-issued or
delayed delivery securities. The Fund will not purchase these types of
securities for speculative purposes and will expect actually to acquire the
securities when purchased. However, the Fund reserves the right to sell any of
these securities before their settlement dates if the Investment Manager deems
such a sale advisable.
REPURCHASE TRANSACTIONS. The Fund may engage in repurchase agreements,
which are instruments under which the Fund acquires ownership of a security from
a broker-dealer or bank that agrees to repurchase the security at a mutually
agreed upon time and price (which price is higher than the purchase price),
thereby determining the yield during the Fund's holding period. Maturity of the
securities subject to repurchase agreements may exceed one year.
If the seller in a repurchase agreement becomes bankrupt or otherwise
defaults, the Fund might incur expenses in enforcing its rights, and could
experience losses, including a decline in the value of the underlying securities
and loss of income. The Fund will enter into repurchase agreements only with
banks and broker-dealers that the Investment Manager deems creditworthy.
It is not currently anticipated that the Fund will engage in reverse
repurchase agreements.
VARIABLE RATE SECURITIES. The Fund may invest in instruments having rates
of interest that are adjusted periodically, or which "float" continuously
according to formulas intended to minimize any fluctuation in the values of the
instruments ("Variable Rate Securities"). The interest rate of Variable Rate
Securities ordinarily is determined by reference to, or is a percentage of, an
objective standard such as a bank's prime rate, the 90-day U.S. Treasury Bill
rate, or the rate of return on commercial paper or bank certificates of deposit.
As interest rates decrease or increase, Variable Rate Securities can be expected
to experience less appreciation or depreciation than fixed-rate obligations.
Some Variable Rate Securities ("Variable Rate Demand Securities") have a
demand feature entitling the purchaser to resell the securities at an amount
approximately equal to amortized cost, or the principal amount thereof plus
accrued interest. As is the case for other Variable Rate Securities, the
interest rate on Variable Rate Demand Securities varies according to some
objective standard intended to minimize fluctuation in the values of the
instruments. The Fund determines the maturity of Variable Rate Securities in
accordance with SEC rules.
BORROWING POLICY. Pursuant to a fundamental policy as set forth in the
Statement of Additional Information, the Fund may not borrow money except as a
temporary measure for extraordinary or emergency purposes, and then only in an
amount up to one-third of the value of its total assets in order to meet
redemption requests without immediately selling any portfolio securities. The
Fund will not borrow for leverage purposes or purchase securities or make
investments while borrowings are outstanding. If for any reason the current
value of the total assets of the Fund falls below an amount equal to three times
the amount of indebtedness for money borrowed, the Fund will, within three
business days, reduce its indebtedness to the extent necessary to meet that
limitation. Any borrowings under this provision will not be collateralized.
RISK CONSIDERATIONS. The Fund's portfolio will be affected by general
changes in interest rates which will result in increases or decreases in the
market value of the obligations held by the Fund. The market value of the
obligations in the Fund's portfolio can be expected to vary inversely to changes
in prevailing
5
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interest rates. Investors also should recognize that, in periods of declining
interest rates, the Fund's yield will tend to be somewhat higher than prevailing
market rates, and in periods of rising interest rates, the Fund's yield will
tend to be somewhat lower. Also, when interest rates are falling, the inflow of
net new money to the Fund from the continuous sale of its shares will likely be
invested in portfolio instruments producing lower yields than the balance of its
portfolio, thereby reducing the Fund's current yield. In periods of rising
interest rates, the opposite can be expected to occur. In addition, securities
in which the Fund may invest may not yield as high a level of current income as
might be achieved by investing in securities with less liquidity and safety and
longer maturities.
The Fund's portfolio is subject to the risk of default by issuers of the
securities in the Fund's portfolio. The value of commercial paper and other
securities in the Fund's portfolio may be adversely affected by the inability of
the issuers (or related supporting institutions) to make principal or interest
payments on the obligations in a timely manner. As discussed above, the Fund
will invest in securities which the Investment Manager has determined present
minimal credit risk. The ratings assigned to commercial paper and other
corporate obligations, as well as the guidelines approved by the Trust's Board
of Trustees, are intended to enable the Investment Manager to minimize the
credit risk with respect to the securities in the Fund's portfolio, but there
can be no absolute assurance that the Investment Manager will be successful in
this regard. If issuer defaults nevertheless occur respecting a sufficiently
large portion of the Fund's portfolio, the Fund may be unable to maintain a
stable net asset value of $1.00 per share.
The Fund's performance also may be affected by changes in market or economic
conditions and other circumstances affecting the financial services industry.
Government regulation of banks, savings and loan associations, and finance
companies may limit both the amounts and types of loans and other financial
commitments these entities can make and the interest rates and fees they can
charge. The profitability of the financial services industry, which is largely
dependent on the availability and cost of capital funds, has fluctuated in
response to volatility in interest rate levels. In addition, the financial
services industry is subject to risks resulting from general economic conditions
and the potential exposure to credit losses.
ADDITIONAL INFORMATION. Please see the Statement of Additional Information
for further information regarding foreign securities, the investment rating
categories employed by various NRSROs, and other investment techniques used by
the Fund.
ORGANIZATION AND MANAGEMENT OF THE FUND
GENERAL OVERSIGHT. The Board of Trustees and officers of the Trust meet
regularly to review the Fund's investments, performance, expenses, and other
business affairs.
THE INVESTMENT MANAGER. Professional investment management for the Fund is
provided by the Investment Manager, Berkeley Capital Management, 650 California
Street, Suite 2800, San Francisco, California 94108. The Investment Manager
provides a continuous investment program including general investment and
economic advice regarding the Fund's investment strategies; manages the Fund's
investment portfolio and performs expense management, accounting, and
recordkeeping; and provides other services necessary to the operation of the
Fund and the Trust.
The Investment Manager has been engaged in the investment management
business since 1972 and currently provides investment management services to
institutional and other investors with respect to fixed-income securities,
equity securities of small- to large-cap issuers, and asset allocation
strategies. As of December 31, 1996, the Investment Manager had approximately
$1.6 billion of total assets under
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discretionary management under several investment strategies (including over
$700 million invested in fixed-income securities).
TRANSFER AGENT AND SHAREHOLDER SERVICES. Firstar Trust Company, P.O. Box
701, Milwaukee, Wisconsin 53201-0701 (the "Transfer Agent") serves as
shareholder services agent and transfer agent for the Fund. The Transfer Agent
provides information and services to shareholders which include reporting share
ownership, sales, and dividend activity (and associated tax consequences),
responding to daily inquiries, and effecting the transfer of Fund shares. It
furnishes such office space and equipment, telephone facilities, personnel, and
informational literature distribution as is necessary or appropriate in
providing shareholder and transfer agency information and services.
THE PRINCIPAL UNDERWRITER. The Fund's principal underwriter (the "Principal
Underwriter") is Berkeley International Securities Corporation, 650 California
Street, Suite 2800, San Francisco, California 94108, an affiliate of the
Investment Manager. (See "Management of the Trust" in the Statement of
Additional Information for further information about the Principal Underwriter.)
OPERATING FEES AND EXPENSES. Pursuant to its Investment Management
Agreement with the Trust, the Investment Manager receives from the Fund an
annual fee, payable monthly, of 0.25% of the Fund's average daily net assets.
SERVICE FEE. As more fully described in the Statement of Additional
Information, the Trust and the Investment Manager have entered into a
Shareholder Services Agreement pursuant to which the Investment Manager will
provide, or arrange for others to provide, certain specified shareholder
services to shareholders of the Fund. As compensation for the provision of
shareholder services, the Fund will pay the Investment Manager up to 0.25% of
the Fund's average daily net assets on an annual basis, payable monthly. The
Investment Manager will pay certain banks, trust companies, broker-dealers, and
other institutions (each, a "Participating Organization") out of the fees the
Investment Manager receives from the Fund under the Shareholder Services
Agreement to the extent that the Participating Organization performs shareholder
servicing functions for the Fund with respect to shares of the Fund owned from
time to time by customers of the Participating Organization. In certain cases,
the Investment Manager may also pay a fee, out of its own resources and not out
of the service fee payable under the Shareholder Services Agreement, to a
Participating Organization for providing other administrative services to its
customers who invest in the Fund.
Pursuant to the Shareholder Services Agreement, the Investment Manager may
also enter into special contractual arrangements with Participating
Organizations that process substantial volumes of purchases and redemptions of
shares of the Fund for their customers. Under these arrangements, the Transfer
Agent will ordinarily maintain an omnibus account for a Participating
Organization and the Participating Organization will maintain sub-accounts for
its customers for whom it processes purchases and redemptions of shares. A
Participating Organization may charge its customers a fee, as agreed upon by the
Participating Organization and the customer, for the services it provides.
Customers of Participating Organizations should read this Prospectus in
conjunction with the service agreement and other literature describing the
services and related fees provided by the Participating Organization to its
customers prior to any purchase of shares.
OTHER EXPENSES. The Trust pays the expenses of its operations, including:
the fees and expenses for independent accountants, legal counsel, and the
custodian of its assets; the cost of maintaining books and
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records of account; registration fees; the fees and expenses of qualifying the
Trust and its shares for distribution under federal and state securities laws;
and industry association membership dues.
OTHER INFORMATION
The Trust was organized as a business trust under the laws of Delaware on
October 28, 1996 and may issue an unlimited number of shares of beneficial
interest or classes of shares in one or more separate series. Currently, the
Trust offers shares of only one series (the Fund described in this Prospectus).
The Board of Trustees may authorize the issuance of shares of additional series
or classes of shares of beneficial interest if it deems it desirable.
SHAREHOLDER MEETINGS AND VOTING RIGHTS. The Trust is not required to hold
annual shareholders' meetings and does not intend to do so. It will, however,
hold special meetings as required or deemed desirable by the Board of Trustees
for such purposes as changing fundamental policies, electing or removing
Trustees, or approving or amending an investment advisory agreement. In
addition, a Trustee may be removed by shareholders at a special meeting called
upon written request of shareholders owning in the aggregate at least 10% of the
outstanding shares of the Trust.
As of the date of this Prospectus, Berkeley International Securities
Corporation owned all of the outstanding shares of the Fund. It is contemplated
that the public offering of shares of the Fund will reduce Berkeley
International Securities Corporation's holdings to less than 5% of the total
shares outstanding.
DISTRIBUTIONS AND TAXES
DIVIDENDS AND OTHER DISTRIBUTIONS. On each day that the net asset value per
share of the Fund is determined (a "Business Day"), the Fund's net investment
income is declared as of the close of trading on the New York Stock Exchange
(the "Exchange") (generally 4:00 p.m. Eastern time) as a dividend to
shareholders of record at that time. Conditions which must be met in order for
an investor to receive a dividend for the Business Day on which a purchase order
is received by the Transfer Agent or its authorized agent are: (1) receipt by
the Transfer Agent of the purchase order before 1:30 p.m. Eastern time; and (2)
payment in immediately available funds wired to the Transfer Agent by the close
of business the same day. Purchases made by check will begin receiving dividends
on the Business Day the Transfer Agent receives the check if the check is
received by 1:30 p.m. Eastern time, or on the following Business Day if the
check is received after 1:30 p.m. Eastern time. Dividends are normally paid
(and, where applicable, reinvested) on the last Business Day of each month.
FEDERAL INCOME TAX INFORMATION. The Fund intends to qualify and elect, and
to continue to qualify, to be treated as a regulated investment company under
the Internal Revenue Code of 1986, as amended (the "Code"). In order to so
qualify, the Fund will distribute each year substantially all of its investment
company taxable income (if any), its net exempt-interest income (if any), and
its net capital gains (if any), and will seek to meet certain other
requirements. Such qualification relieves the Fund of liability for federal
income taxes to the extent the Fund's earnings are distributed.
Generally, all Fund distributions are taxable to shareholders as ordinary
income.
Records of dividends and other distributions, purchases, and redemptions
will be reflected on shareholders' account statements. The Fund will notify
shareholders at least annually as to the federal income tax consequences of
distributions made each year.
8
<PAGE>
The foregoing is only a brief summary of some of the federal income tax
considerations affecting the Fund and its shareholders. Accordingly, potential
investors should consult their tax advisers with specific reference to their own
tax situations.
SHARE PRICE CALCULATION
The price of a share on any given day is its "net asset value" or "NAV." The
NAV is computed by taking total Fund assets, subtracting any liabilities of the
Fund, and dividing the resulting amount by the number of shares of the Fund
outstanding. The NAV per share of the Fund is determined on each day both the
Federal Reserve Bank of New York and the Exchange are open for business as of
the close of normal trading on the Exchange (generally 4:00 p.m. Eastern time).
Purchase or redemption orders will be executed at the net asset value next
determined after receipt of the order by the Fund, the Transfer Agent or their
authorized agents. While the Fund attempts to maintain its net asset value at a
constant $1.00 per share, there can be no assurance that the Fund will be able
to do so, and Fund shares are not insured against a reduction in their net asset
value.
The Fund values its portfolio securities at amortized cost, which means that
they are valued at their acquisition cost (as adjusted for amortization of
premium or discount) rather than at current market value. Calculations are made
to compare the value of the Fund's investments using the amortized cost method
with market values. Except as described below, market valuations are obtained by
using: (1) actual quotations provided by third-party pricing services or market
makers; (2) estimates of market value; or (3) values obtained from yield data
relating to comparable classes of money market instruments published by
reputable sources at the bid prices for the instruments. If a deviation of 1/2
of 1% or more were to occur between the net asset value per share of the Fund
calculated by reference to market values and the $1.00 per share amortized cost
value of the Fund, or if there were any other deviation which the Board of
Trustees believed may result in a material dilution or other unfair result to
investors or existing shareholders, the Board of Trustees would cause the Fund
to take such action as it deems appropriate to eliminate or reduce to the extent
reasonably practicable such dilution or unfair results.
HOW THE FUND REPORTS PERFORMANCE
From time to time the Fund may advertise its yield and effective yield.
Performance figures are based upon historical results and are not intended to
indicate future performance.
Yield refers to the income generated by a hypothetical investment in the
Fund over a specific seven-day period. This income is then annualized, which
means that the income generated during the seven-day period is assumed to be
generated each week over an annual period and is shown as a percentage of the
hypothetical investment.
Effective yield is calculated similarly, but the income earned by the
investment is assumed to be compounded weekly when annualized. Effective yield
will be slightly higher than yield due to this compounding effect.
The performance of the Fund may be compared to that of other mutual funds
tracked by mutual fund rating services, various indices of investment
performance, U.S. Government obligations, bank certificates of deposit, other
investments for which reliable performance data is available, interest rates,
and the consumer price index.
9
<PAGE>
Additional performance information about the Fund will be available in the
Fund's Annual Report, which is sent to all shareholders. When available,
shareholders may request a free copy by calling the Transfer Agent at (888)
889-0799.
INVESTING IN SHARES OF THE FUND
HOW TO BUY SHARES
Before investing in shares of the Fund for the first time, you must complete
and sign an Account Application and forward it to:
Berkeley Capital Management Funds
c/o Firstar Trust Company
P.O. Box 701
Milwaukee, WI 53201-0701
or, if forwarding by overnight courier, to:
Berkeley Capital Management Funds
c/o Firstar Trust Company
615 East Michigan Street, 3rd Floor
Milwaukee, WI 53202
Please see "Investing in Shares of the Fund--General
Information--Distribution Options" below for important information concerning
the distribution options you may select on your Account Application.
Once you have money invested in the Fund, you can place a purchase order and
wire money into your account or make additional purchases by mail.
INVESTING THROUGH A FINANCIAL INSTITUTION. If you are investing through a
securities dealer (including through the Fund's Principal Underwriter, Berkeley
International Securities Corporation, an affiliate of the Investment Manager),
fiduciary, or a financial or other institution (each, a "Financial
Institution"), you should contact that Financial Institution directly for
instructions and other information. Certain features of the Fund may be modified
when shares are made available through a program of services offered by a
Financial Institution, and administrative charges may be imposed by the
Financial Institution for the services performed. In particular, a broker may
charge transaction fees with respect to the purchase and sale of Fund shares. It
is the responsibility of your Financial Institution to submit purchases and
redemptions in a timely manner in order for you to receive the next-determined
NAV.
INVESTING BY WIRE. For wiring information and instructions, call the
Financial Institution through which you trade, or, if you trade directly through
the Transfer Agent, call the Transfer Agent toll free at (888) 889-0799. There
currently is no fee imposed by the Fund for wire purchases. However, if you buy
shares through a Financial Institution, the Financial Institution may impose a
fee for wire purchases.
- If the Transfer Agent receives your purchase order by 1:30 p.m., Eastern
time, and receives your payment by the close of business (i.e., by the
close of regular trading hours on the New York Stock Exchange, generally
4:00 p.m. Eastern time), your purchase will be executed as of the close of
business and you will accrue a dividend for that day.
- If the Transfer Agent receives your purchase order after 1:30 p.m. Eastern
time but before the close of business and receives your payment by the
close of business, your purchase will be executed as of
10
<PAGE>
the close of business, but you will not accrue a daily dividend for the
shares purchased until the next Business Day.
- If the Transfer Agent receives your purchase order by the close of
business but does not receive your payment by the close of business, your
purchase will be executed, and a dividend on the shares purchased will be
accrued, as of the close of business following the receipt of your payment
in proper form by the Transfer Agent.
- If the Transfer Agent receives your purchase order after the close of
business or on a non-business day, your purchase will be executed, and a
dividend on the shares purchased will be accrued, as of the close of
business following the receipt of your payment in proper form by the
Transfer Agent.
Payment for shares of the Fund must be in immediately available funds. For a
payment to be received by the Transfer Agent by the close of business, the wire
must be received by the Transfer Agent in good order at the Fund's designated
wire bank before the close of business of the Federal Reserve Wire System. You
are advised to wire funds as early in the day as possible and to provide advance
notice to the Transfer Agent for all wire transfers by calling the Transfer
Agent toll free at (888) 889-0799.
INVESTING BY MAIL. To purchase shares of the Fund by mail, mail your
written purchase order, along with a check made payable to Berkeley Capital
Management Money Market Fund, to the Transfer Agent at the following address:
Berkeley Capital Management Funds
c/o Firstar Trust Company
P.O. Box 701
Milwaukee, WI 53201-0701
or, if forwarding by overnight courier, to:
Berkeley Capital Management Funds
c/o Firstar Trust Company
615 East Michigan Street, 3rd Floor
Milwaukee, WI 53202
Your written purchase order must include the following information:
- your shareholder account number, or a completed and signed shareholder
Account Application for an initial investment; and
- the dollar amount of shares you would like to buy.
Once you have mailed your purchase order, you may not revoke, modify, or
cancel it.
- If the Transfer Agent receives your purchase order and your payment by
mail by 1:30 p.m. Eastern time on a Business Day, your purchase will be
executed as of the close of business the same day, and you will accrue a
dividend for that day.
- If the Transfer Agent receives your purchase order and your payment by
mail after 1:30 p.m. Eastern time but before the close of business on a
Business Day, your purchase will be executed as of the close of business
the same day, but you will not accrue a dividend on the shares purchased
until the following Business Day.
11
<PAGE>
- If the Transfer Agent receives your purchase order and your payment by
mail after the close of business on a Business Day or on a non-business
day, your purchase will be executed, and a dividend will be accrued on the
shares purchased, as of the close of business on the next Business Day.
GENERAL INFORMATION
The minimum initial investment in the Fund is $100,000, and subsequent
investments must be at least $1,000. Exceptions to the minimum investment
requirements may be made at the discretion of the Investment Manager including,
without limitation, for employees and affiliates (and their employees) of the
Investment Manager or investors who are, or are related to or affiliated with,
clients of the Investment Manager. The Fund will accept only investments in U.S.
dollars.
All applications to purchase shares of the Fund are subject to acceptance or
rejection by authorized officers of the Fund and are not binding upon the Fund
until accepted. Applications will not be accepted unless accompanied by payment
in U.S. funds. Payment by check should be drawn on a U.S. bank, savings and loan
association, or credit union. The Fund will not accept payment in cash or third
party checks for the purchase of shares. The Custodian will charge a $20 fee
against a shareholder's account, in addition to any loss sustained by the Fund,
for any payment check returned to the Custodian for insufficient funds. It is
the policy of the Fund not to accept applications in amounts or under
circumstances considered disadvantageous to shareholders; for example, the Fund
reserves the right to reject any application of an individual who previously
tried to purchase shares with a bad check, or which does not include a certified
social security or tax identification number.
To minimize administrative costs, share certificates will not be issued.
Records of share ownership are maintained by the Transfer Agent.
DISTRIBUTION OPTIONS. You may elect one of the following distribution
options in your shareholder Account Application, which must precede or accompany
your initial investment in the Fund:
AUTOMATIC REINVESTMENT. Distributions will be reinvested in additional
full and fractional shares of the Fund at the net asset value next
determined after each dividend payable date.
RECEIVE DIVIDENDS BY MAIL. All distributions will be credited to your
account as of the payable date. If your account is coded to have dividends
mailed to you, checks will normally be mailed the Business Day after
distributions are credited to your account.
Distributions will automatically be reinvested in additional shares of the
Fund unless the Fund, the Transfer Agent, or their authorized agents have
received instructions that distributions are to be mailed to you as they are
paid. To change the distribution option you have selected, call the Transfer
Agent toll free at (888) 889-0799.
IMPORTANT INFORMATION ABOUT TELEPHONE TRANSACTIONS. Once you have completed
an Account Application, including all applicable bank information, which has
been accepted by the Transfer Agent, you automatically have the privilege to
place Fund purchase orders and orders to sell shares by calling the Transfer
Agent toll free at (888) 889-0799, where trained representatives are available
to answer questions about the Fund and your account.
The Fund and the Transfer Agent will employ reasonable procedures to confirm
that instructions communicated by telephone are genuine. If the Fund and the
Transfer Agent follow telephone instructions
12
<PAGE>
that they reasonably believe to be genuine, they will not be liable for any
losses a shareholder may experience. If the Fund and the Transfer Agent do not
follow reasonable procedures to confirm that a telephone order is genuine, the
Fund or the Transfer Agent may be liable for any losses a shareholder may suffer
from unauthorized or fraudulent orders. These procedures may include:
- requiring a form of personal identification prior to acting upon
instructions received by telephone;
- providing written confirmation of instructions received by telephone; and
- tape recording telephone instructions.
Investors should remember that it may be difficult to complete transactions
by telephone during periods of drastic economic or market changes, when phone
lines may become busy with calls from other investors. If you want to buy or
sell shares but have trouble reaching the Fund by telephone, you may want to use
another method for completing a transaction, even though an alternative
procedure may mean that completing your transaction may take longer.
HOW TO SELL SHARES
You may sell your shares at any time by telephone or by mail, subject to the
following terms and conditions:
- a check normally will be mailed to you within one or two Business Days,
but no later than the seventh Business Day after receipt by the Transfer
Agent of the redemption request in good order;
- we may suspend the right to sell shares or postpone payment for a sale of
shares when trading on the Exchange is restricted; when the Exchange is
closed for any reason other than its normal weekend or holiday closings;
during emergency circumstances as determined by the SEC; or in any other
circumstances as the SEC may permit; and
- if you purchased your shares by check and place a redemption order before
your check clears, we will issue a redemption check as soon as your check
clears your bank, which may take up to 12 days.
No redemption request will become effective until all documents have been
received in proper form by the Transfer Agent. The shareholder should contact
the Transfer Agent for further information concerning documentation required for
a redemption of Fund shares.
A signature guarantee is required on the written redemption request if (1)
the redemption proceeds are to be sent to a bank or brokerage account not
previously authorized by the shareholder in accordance with the instructions on
the account application, or (2) the address of record has changed within the
last 15 days. The guarantor must be a bank, member firm of a national securities
exchange, savings and loan association, credit union, or other entity authorized
by state law to guarantee signatures. A notary public is not an acceptable
guarantor. Additional documentary evidence of authority is required in the event
redemption is requested by a corporation, partnership, trust, fiduciary,
executor, or administrator. Checks to third parties other than a bank or
brokerage account as authorized above are not permitted. Redemption checks will
not be forwarded by the U.S. postal service. The redemption request should also
indicate the change of address and include a signature guarantee.
Shareholders who have an individual retirement account (an "IRA") or other
retirement plan must indicate on their redemption request whether or not to
withhold federal income tax. Redemption requests that fail to indicate an
election not to have tax withheld will be subject to withholding.
13
<PAGE>
BY TELEPHONE. You can sell your shares by telephone by calling the Transfer
Agent at (888) 889-0799.
The following information is needed in order to process your telephone
redemption order:
- your account number and your name for verification;
- your social security number/tax identification number; and
- the number of shares you want to sell.
BY MAIL. You can also sell shares by writing to the address on the cover of
this Prospectus. The following information is needed in order to process your
mail redemption order:
- your name;
- your account number;
- the number of shares you want to redeem; and
- the signature of all registered account holders in the exact form
specified in the account.
Once a redemption check is mailed, a sale is irrevocable and may not be
modified or cancelled.
Redemption proceeds may be wired via the Federal Reserve Wire System to your
bank account of record at your election. To choose this option, you must
designate on your Account Application the U.S. commercial bank account(s) into
which you wish the redemption proceeds to be deposited. You may change the bank
account designated to receive redemption proceeds at any time prior to making a
redemption request by sending a letter of instruction, including a signature
guarantee, to the Transfer Agent at the address shown on page 9. Alternatively,
you may elect to have redemption proceeds mailed to you at your address of
record.
You should be able to obtain a signature guarantee from a bank,
broker-dealer, credit union (if authorized under state law), securities exchange
or association, clearing agency, or savings association. A notary public cannot
provide a signature guarantee.
The Fund currently charges a $12 fee for wiring of redemption proceeds. If
you sell shares through a Financial Institution, the Financial Institution may
impose a fee for wire redemptions.
The Fund reserves the right, if conditions exist which make cash payments
undesirable, to honor any request for redemption or repurchase order in-kind by
making payment in readily marketable securities chosen by the Fund and valued as
they are for purposes of computing the Fund's net asset value. However, the
Trust has elected to commit itself to pay in cash all requests for redemption by
any shareholder of record, limited in amount with respect to each shareholder
during any 90-day period to the lesser of: (1) $250,000, or (2) one percent of
the net asset value of the Fund at the beginning of such period. If payment is
made in securities, a shareholder may incur transaction expenses in converting
these securities into cash.
The Fund may be required to withhold federal income tax at a rate of 31%
(backup withholding) from dividend payments, distributions, and redemption
proceeds if a shareholder fails to furnish the Fund with his/her certified
social security or tax identification number. The shareholder also must certify
that the number is correct and that he/she is not subject to backup withholding.
The certification is included as part of the share purchase application form. If
the shareholder does not have a social security number, he/she should indicate
on the purchase form that an application to obtain a number is pending. The Fund
is required to withhold taxes if a number is not delivered to the Fund within
seven days.
14
<PAGE>
OTHER IMPORTANT INFORMATION
MINIMUM BALANCE REQUIREMENTS. Due to the relatively high cost of
maintaining smaller accounts, the Fund reserves the right to redeem a
shareholder's shares if, as a result of redemptions, their aggregate value drops
below the $100,000 minimum balance requirement for the Fund. The Fund will
notify shareholders in writing 30 days before taking such action to allow them
to increase their holdings to at least the minimum level.
SHAREHOLDER FEES (billed to shareholders):
<TABLE>
<CAPTION>
- - Outgoing Wire Transfer.................................... $12.00/wire
<S> <C>
- - Qualified Plan Distribution............................... $15.00/request
- - Qualified Plan Transfer Out............................... $15.00/request
- - Refund of Excess Contribution............................. $15.00/request
- - Annual Qualified Plan Maintenance
(Maximum $25.00 per social security number)............... $12.50/account
- - Returned Check............................................ $20.00/item
- - Stop Payment Request...................................... $20.00/request
</TABLE>
READING THIS PROSPECTUS. References to "you" and "your" in this Prospectus
refer to prospective investors and/or current shareholders, while references to
"we," "us," "our," or "our Fund" refer to the Fund generally.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH THE OFFERING
MADE BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND OR
ITS DISTRIBUTOR.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING BY THE FUND OR BY THE
DISTRIBUTOR IN ANY JURISDICTION IN WHICH SUCH OFFERING MAY NOT BE LAWFULLY MADE.
15
<PAGE>
INVESTMENT MANAGER
Berkeley Capital Management
650 California Street, Suite 2800
San Francisco, CA 94108
(888) 889-0799
ADMINISTRATOR, TRANSFER AGENT,
DIVIDEND PAYING AGENT,
SHAREHOLDER SERVICING AGENT
& CUSTODIAN
Firstar Trust Company
P.O. Box 701
Milwaukee, WI 53201-0701
(800) 261-6950
LEGAL COUNSEL
Heller Ehrman White & McAuliffe
333 Bush Street
San Francisco, CA 94104
INDEPENDENT AUDITORS
Price Waterhouse LLP
100 E. Wisconsin Avenue, Suite 1500
Milwaukee, WI 53202
[LOGO]
PROSPECTUS
MAY , 1997
Berkeley Capital Management
650 California Street, Suite 2800
San Francisco, CA 94108
(888) 889-0799
<PAGE>
PART B
------------------
STATEMENT OF
ADDITIONAL INFORMATION
Berkeley Capital Management Funds
------------------
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
BERKELEY CAPITAL MANAGEMENT FUNDS
650 California Street, Suite 2800, San Francisco, CA 94108
BERKELEY CAPITAL MANAGEMENT MONEY MARKET FUND
MAY __, 1997
This Statement of Additional Information is not a prospectus. It
should be read in conjunction with the Prospectus dated May __, 1997, which
may be amended from time to time, for Berkeley Capital Management Money Market
Fund (the "Fund"), a separately managed investment portfolio of Berkeley Capital
Management Funds (the "Trust"). To obtain a free copy of the above-referenced
Prospectus, please contact Firstar Trust Company (the "Transfer Agent") at
(888) 889-0799.
TABLE OF CONTENTS
Page
INVESTMENT TECHNIQUES. . . . . . . . . . . . . . . . . . . . . . . . . . 2
INVESTMENT RESTRICTIONS. . . . . . . . . . . . . . . . . . . . . . . . . 3
MANAGEMENT OF THE TRUST. . . . . . . . . . . . . . . . . . . . . . . . . 7
PORTFOLIO TRANSACTIONS AND TURNOVER. . . . . . . . . . . . . . . . . . . 11
DISTRIBUTIONS AND TAXES. . . . . . . . . . . . . . . . . . . . . . . . . 13
SHARE PRICE CALCULATION. . . . . . . . . . . . . . . . . . . . . . . . . 16
YIELD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
GENERAL INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . 17
PRINCIPAL HOLDERS OF SECURITIES. . . . . . . . . . . . . . . . . . . . . 18
PURCHASE AND REDEMPTION OF SHARES. . . . . . . . . . . . . . . . . . . . 18
OTHER INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
APPENDIX - RATINGS OF INVESTMENT SECURITIES. . . . . . . . . . . . . . . A-1
<PAGE>
INVESTMENT TECHNIQUES
EURODOLLAR CERTIFICATES OF DEPOSIT AND FOREIGN SECURITIES
Before investing in Eurodollar certificates of deposit, the Fund will
consider their marketability, possible restrictions on international currency
transactions, and any regulations imposed by the domicile country of the foreign
issuer. Eurodollar certificates of deposit may not be subject to the same
regulatory requirements as certificates of deposit issued by U.S. banks, and
associated income may be subject to the imposition of foreign taxes,
including withholding taxes.
Investments in securities of foreign issuers or securities principally
traded overseas may involve certain special risks due to foreign economic,
political, and legal developments, including expropriation of assets or
nationalization, imposition of withholding taxes on dividend or interest
payments, and possible difficulty in obtaining and enforcing judgments against
foreign entities.
ASSET-BACKED COMMERCIAL PAPER AND OTHER SECURITIES
The Fund can invest a portion of its assets in asset-backed commercial
paper and other money market fund Eligible Securities (as that term is defined
below). The credit quality of most asset-backed commercial paper depends
primarily on the credit quality of the assets underlying such securities, how
well the entity issuing the security is insulated from the credit risk of the
originator (or any other affiliated entities),
-2-
<PAGE>
and the amount and quality of any credit support provided to the securities.
Asset-backed commercial paper is often backed by a pool of assets
representing the obligations of a number of different parties. To lessen the
effect of failures by obligors on these underlying assets to make payments, such
securities may contain elements of credit support.
Such credit support falls into two classes: liquidity protection and
protection against ultimate default on the underlying assets. Liquidity
protection refers to the provision of advances, generally by the entity
administering the pool of assets, to ensure that scheduled payments on the
underlying pool are made in a timely fashion. Protection against ultimate
default ensures payment on at least a portion of the assets in the pool. This
protection may be provided through guarantees, insurance policies, or letters of
credit obtained from third parties, through various means of structuring the
transaction, or through a combination of such approaches. The degree of credit
support provided on each issue is based generally on historical information
respecting the level of credit risk associated with such payments. Delinquency
or loss in excess of that anticipated could adversely affect the return on an
investment in an asset-backed security.
Tax-exempt commercial paper is unsecured short-term obligations issued
by a government or political sub-division thereof. It is not currently
expected that the Fund will invest more than 5% of its net assets in
tax-exempt commercial paper.
INVESTMENT RESTRICTIONS
EXCEPT AS OTHERWISE NOTED WITH AN *, THE RESTRICTIONS BELOW ARE NONFUNDAMENTAL
AND CAN BE CHANGED WITHOUT APPROVAL OF THE HOLDERS OF A MAJORITY OF THE
OUTSTANDING VOTING SECURITIES (AS DEFINED IN THE INVESTMENT COMPANY ACT OF 1940,
AS AMENDED, HEREINAFTER THE "1940 ACT") OF THE FUND. THE FUND MAY NOT:
*(1) Purchase securities of any issuer (other than obligations of, or
guaranteed by, the U.S. Government, its agencies or instrumentalities) if, as a
result thereof, more than 5% of the value of its assets would be invested in the
securities of such issuer.
(2) Purchase more than 10% of any class of securities of any issuer. All
debt securities and all preferred stocks are each considered as one class.
*(3) Concentrate 25% or more of the value of its total assets in any one
industry; provided, however, that the Fund may invest up to 100% of its assets
in certificates of deposit or bankers' acceptances issued
by domestic branches of
-3-
<PAGE>
U.S. banks and U.S. branches of foreign banks (which the Fund has determined
to be subject to the same regulation as U.S. banks), or obligations of, or
guaranteed by, the U.S. Government, its agencies or instrumentalities in
accordance with its investment objective and policies.
(4) Enter into repurchase agreements if, as a result thereof, more than
10% its net assets valued at the time of the transaction would be subject to
repurchase agreements maturing in more than seven days and invested in
securities restricted as to disposition under the federal securities laws
(except commercial paper issued under Section 4(2) of the Securities Act of
1933). The Fund will invest no more than 10% of its net assets in illiquid
securities.
(5) Invest more than 5% of its total assets in securities restricted as to
disposition under the federal securities laws (except commercial paper issued
under Section 4(2) of the Securities Act of 1933).
*(6) Invest in commodities or commodity contracts, futures contracts, real
estate or real estate limited partnerships, although it may invest in securities
which are secured by real estate and securities of issuers which invest or deal
in real estate.
(7) Invest for the purpose of exercising control or management of another
issuer.
(8) Purchase securities of other investment companies, except in
connection with a merger, consolidation, reorganization, or acquisition of
assets, or as may otherwise be permitted by the 1940 Act.
*(9) Make loans to others (except through the purchase of debt obligations
or repurchase agreements in accordance with its investment objectives and
policies).
*(10) Borrow money, except as a temporary measure for extraordinary or
emergency purposes, and then only in an amount up to one-third of the value
of its total assets in order to meet redemption requests without immediately
selling any portfolio securities. The Fund will not borrow for leverage
purposes or purchase securities or make investments while borrowings are
outstanding. Any borrowings by the Fund will not be collateralized. If for
any reason the current value of the total assets of the Fund falls below an
amount equal to three times the amount of indebtedness for money
-4-
<PAGE>
borrowed, the Fund will, within three business days, reduce its indebtedness to
the extent necessary to meet that limitation.
(11) Write, purchase, or sell puts, calls, or combinations thereof.
(12) Make short sales of securities or purchase any securities on margin,
except to obtain such short-term credits as may be necessary for the clearance
of transactions.
*(13) Underwrite securities issued by others, except to the extent it may be
deemed to be an underwriter under the federal securities laws in connection
with the disposition of securities from its investment portfolio.
*(14) Issue senior securities as defined in the 1940 Act.
Except for restrictions (3) and (10), if a percentage restriction is adhered to
at the time of investment, a later increase in percentage resulting from a
change in values or net or total assets will not be considered a violation of
that restriction.
The Fund will only purchase securities that present minimal credit risk and
which are First Tier or Second Tier Securities (otherwise referred to as
"Eligible Securities"). An Eligible Security is:
(1) a security with a remaining maturity of 397 days or less: (a) that is
rated by the requisite nationally recognized statistical rating organizations
("NRSROs") designated by the Securities and Exchange Commission (the "SEC")
(currently Moody's Investors Service ("Moody's"), Standard & Poor's Ratings
Group ("S&P"), Duff and Phelps Credit Rating Co. ("Duff"), Fitch Investors
Service, Inc. ("Fitch"), Thomson BankWatch, and, with respect to debt issued
by banks, bank holding companies, United Kingdom building societies,
broker-dealers and broker-dealers' parent companies, and bank-supported
debt, IBCA Limited and its affiliate, IBCA, Inc.) in one of the two highest
rating categories for short-term debt obligations (two NRSROs are required
but one rating suffices if only one NRSRO rates the security), or (b) that
itself was unrated by any NRSRO, but was issued by an issuer that has
outstanding a class of short-term debt obligations (or any security within
that class) meeting the requirements of subparagraph 1(a) above that is of
comparable priority and security;
(2) a security that at the time of issuance was a long-term security but has a
remaining maturity of 397 days or less, and whose issuer received a rating
within one of the two highest rating categories from the requisite NRSROs for
short-term debt obligations with respect to a class of short-term debt
obligations (or any security within that class) that is now comparable in
priority and security with the subject security; or
-5-
<PAGE>
(3) a security not rated by an NRSRO but deemed by the Investment Manager,
pursuant to guidelines adopted by the Trust's Board of Trustees, to be of
comparable quality to securities described in (1) and (2) above and to
represent minimal credit risk.
A First Tier Security is any Eligible Security that carries (or if other
relevant securities issued by its issuer carry) top NRSRO ratings from at
least two NRSROs (a single top rating suffices if only one NRSRO rates the
security), that has been determined by the Investment Manager, pursuant to
guidelines adopted by the Trust's Board of Trustees, to be of comparable
quality to such a security, that is a security issued by a registered
investment company that is a money market fund, or that is a U.S. government
security (a "Government security"). A Second Tier Security is any other
Eligible Security.
The Fund will limit its investments in the First Tier Securities of any one
issuer to no more than 5% of its total assets. (Repurchase agreements
collateralized by non-Government securities will be taken into account when
making this calculation.) Moreover, the Fund's total holdings of Second Tier
Securities will not exceed 5% of its total assets, with investment in the
Second Tier Securities of any one issuer being limited to the greater of 1%
of the Fund's total assets or $1 million. In addition, the underlying
securities involved in repurchase agreements collateralized by non-Government
securities will be First Tier Securities at the time the repurchase
agreements are executed.
-6-
<PAGE>
MANAGEMENT OF THE TRUST
OFFICERS AND TRUSTEES
The officers and trustees of the Trust, their principal occupations during the
past five years, and their affiliations, if any, with the Investment Manager or
Berkeley International Securities Corporation are as follows:
<TABLE>
<CAPTION>
Position with the Principal Occupation
Name Age Trust for the Past Five Years
- ----------------- --- ----------------- -----------------------
<S> <C> <C> <C>
Debra McGinty-Poteet* 40 Chairman of the Board Executive Vice
225 Broadway of Trustees, President, President and
San Diego, CA 92101-5030 and Principal Executive Chief Operating
Officer Officer, North
American Trust Co.
(February 1997 -
present); formerly,
Senior Vice President
and Managing Director,
Bank of America Funds
Management (1986 - 1997)
Cindee Beechwood* 41 Trustee, Treasurer, Assistant Group
Principal Accounting Financial Controller,
Officer, and Principal London Pacific Group
Financial Officer Limited and Controller,
Berkeley Capital
Management (1993 -
present); formerly,
Controller, Govett Asset
Management (formerly
Associated Capital
Management) (1990-1993)
Donald O. Dempster* 31 Compliance Officer Director of Compliance,
Berkeley Capital Manage-
ment (1996-present);
formerly, Director of
Compliance, Robertson
Stephens (1994-1996);
prior thereto, Assistant
Vice President,
Compliance, BA Secur-
ities (1994); prior
thereto, Staff
Accountant, Securities
and Exchange Commission
(1990-1994)
Danell J. Doty* 33 Vice President Vice President
and Secretary of Operations,
Berkeley Capital Man-
agement (1995 - present)
and Chief Operations
Officer, Berkeley
International Securities
Corporation
(1991 - present)
Bryan W. Brown 51 Trustee Financial and
950 Hayman Place technological systems
Los Altos, CA 94024 consultant (1992-
present); formerly,
Chief Financial Officer,
Bailard, Biehl & Kaiser,
Inc. (1980-1992)
William R. Sweet 59 Trustee Retired; formerly,
81 Mt. Tiburon Road Executive Vice
Tiburon, CA 94920 President, The Bank of
California (1985-1996)
Barnett Teich 72 Trustee Retired; formerly,
3136 Ptarmigan consultant (1987-1989);
Drive No. 6 prior thereto, First
Walnut Creek, Vice-President, Lehman
CA 94595 Management Co., Inc.
(1958-1986)
Joseph Neuberger* 34 Assistant Secretary Vice President and
615 East Michigan St. Manager of Fund
Milwaukee, WI 53202 Administration and
Compliance, Firstar
Trust Company (1994-
present); formerly,
Manager, Arthur
Andersen LLP
Nancy E. Frohna* 29 Assistant Secretary Trust Officer and
615 E. Michigan St. Compliance
Milwaukee, WI 53202 Administrator, Firstar
Trust Company (1994-
present); formerly,
accountant, Strong
Funds
</TABLE>
*These individuals are interested persons of the Trust as defined in Section
2(a)(19) of the 1940 Act. Mr. Dempster is also Sales Manager and Ms. Doty is
Chief Operations Officer of Berkeley International Securities Corporation,
the Fund's Principal Underwriter.
The address of each individual listed above, unless otherwise indicated, is 650
California Street, Suite 2800, San Francisco, California 94108.
-7-
<PAGE>
COMPENSATION TABLE(1)
<TABLE>
<CAPTION>
Total
Compensation
Aggregate From Registrant
Compensation and Fund Complex
Name, Position From Registrant Paid to Directors
- -------------- --------------- -----------------
<S> <C> <C>
Debra McGinty-Poteet, None None
Trustee
Cindee Beechwood, None None
Trustee
Barnett Teich, $2,000 $2,000
Trustee
Bryan W. Brown, $2,000 $2,000
Trustee
William R. Sweet, $2,000 $2,000
Trustee
- -------------------
(1) Estimated for current fiscal year.
</TABLE>
-8-
<PAGE>
INVESTMENT MANAGER
Berkeley Capital Management serves as the Fund's discretionary
investment manager pursuant to an Investment Management Agreement dated
January 22, 1997 between it and the Trust on behalf of the Fund. The
Investment Manager is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended, and currently provides
investment management services to institutional and other investors. As of
December 31, 1996, the Investment Manager had approximately $1.6 billion of
total assets under management under several investment strategies (including
over $700 million invested in fixed-income securities).
The Investment Management Agreement will be in effect for a two-year
term from its effective date, and thereafter will continue in effect for
one-year terms, subject to annual approval by: (1) the Trust's Board of Trustees
or (2) a vote of the majority (as defined in the 1940 Act) of the outstanding
voting securities of the Fund. In either event, the continuance must also be
approved by a majority of the Trust's Board of Trustees who are not parties to
the Agreement, or interested persons (as defined in the 1940 Act) of any such
party, by vote cast in person at a meeting called for the purpose of voting on
such approval. The Investment Management Agreement may be terminated at any
time upon 60-days notice by either party, or by a majority vote of the
outstanding shares of the Fund, and will terminate automatically upon assignment
(as defined in the 1940 Act).
Pursuant to the Investment Management Agreement, the Investment
Manager is entitled to receive from the Fund an annual fee, payable monthly,
of 0.25% of the Fund's average daily net assets. The Investment Management
Agreement allows the Investment Manager voluntarily to waive its fees payable
under the Agreement and to reimburse all or a portion of the Fund's expenses.
The Investment Management Agreement further provides that the Investment
Manager may seek reimbursement of any reductions made to its management fee
and any payments by the Investment Manager of operating expenses that the
Fund is obligated to pay within the three-year period following such
reduction or payment, subject to the Fund's ability to effect such
reimbursement and remain in compliance with any applicable expense
limitations. The Investment Manager will generally seek reimbursement for
the oldest of any reductions and/or waivers before payment by the Fund for
fees and expenses for the current year. Such reimbursement may be paid prior
to the Fund's payment of current expenses if so requested by the Investment
Manager even if such payment may require the Investment Manager to waive or
reduce its current fees under the Investment Management Agreement or to pay
current Fund expenses.
-9-
<PAGE>
SHAREHOLDER SERVICES AGREEMENT. The Investment Manager has entered
into a Shareholder Services Agreement with the Trust on behalf of the Fund.
Pursuant to the Shareholder Services Agreement, the Investment Manager will
provide, or will arrange for others to provide, certain specified shareholder
services to shareholders of the Fund. As compensation for the provision of
such services, the Fund will pay the Investment Manager a fee of up to 0.25%
of the Fund's average daily net assets on an annual basis, payable monthly.
The Investment Manager will pay certain banks, trust companies,
broker-dealers, and other institutions (each a "Participating Organization")
out of the fees the Investment Manager receives from the Fund under the
Shareholder Services Agreement to the extent that the Participating
Organization performs shareholder servicing functions for the Fund with
respect to shares of the Fund owned from time to time by customers of the
Participating Organization. In certain cases, the Investment Manager may
also pay a fee, out of its own resources and not out of the service fee
payable under the Shareholder Services Agreement, to a Participating
Organization for providing other administrative services to its customers who
invest in the Fund.
Pursuant to the Shareholder Services Agreement, the Investment
Manager will provide or arrange with a Participating Organization for the
provision of the following shareholder services: responding to shareholder
inquiries; processing purchases and redemptions of the Fund's shares,
including reinvestment of dividends; assisting shareholders in changing
dividend options, account designations, and addresses; transmitting proxy
statements, annual reports, prospectuses, and other correspondence from the
Fund to shareholders (including, upon request, copies, but not originals, of
regular correspondence, confirmations, or regular statements of account)
where such shareholders hold shares of the Fund registered in the name of the
Investment Manager, a Participating Organization, or their nominees; and
providing such other information and assistance to shareholders as may be
reasonably requested by such shareholders.
The Investment Manager may also enter into agreements with
Participating Organizations that process substantial volumes of purchases and
redemptions of shares of the Fund for their customers. Under these
arrangements, the Transfer Agent will ordinarily maintain an omnibus account
for a Participating Organization and the Participating Organization will
maintain sub-accounts for its customers for whom it processes purchases and
redemptions of shares.
EXPENSES
The Trust pays the expenses of its operations, including: the fees and
expenses of independent accountants,
-10-
<PAGE>
counsel and the custodian; the cost of reports and notices to shareholders; the
cost of calculating net asset value; registration fees; the fees and expenses of
qualifying the Trust and its shares for distribution under federal and state
securities laws; and membership dues in the Investment Company Institute or any
similar organization.
PRINCIPAL UNDERWRITER
Pursuant to an Underwriting Agreement, Berkeley International
Securities Corporation (the "Principal Underwriter") is the principal
underwriter for shares of the Trust and is the Trust's agent for the purpose
of the continuous offering of the Fund's shares. The Pricipal Underwriter is
an affiliate of the Investment Manager. The Fund pays the cost for the
prospectuses and shareholder reports to be prepared and delivered to existing
shareholders. The Principal Underwriter pays such costs when the described
materials are used in connection with the offering of shares to prospective
investors and for supplementary sales literature and advertising. The
Principal Underwriter receives no fee under the Underwriting Agreement.
Terms of continuation, termination, and assignment under the Underwriting
Agreement are identical to those described above with respect to the
Investment Management Agreement.
CUSTODIAN AND FUND ACCOUNTANT
Pursuant to a Custodian Agreement, Firstar Trust Company, the Fund's
transfer agent (the "Custodian"), also serves as the Custodian of the
Fund's assets. Under the terms of the Custodian Agreement, the Custodian
holds and administers the securities and cash in the Fund's portfolio.
Pursuant to a Fund Accounting Servicing Agreement, Firstar Trust
Company also provides fund accounting services to the Trust and the Fund.
INDEPENDENT ACCOUNTANTS AND REPORTS TO SHAREHOLDERS
The Trust's independent accountants, Price Waterhouse LLP, audit and
report on the annual financial statements of the Fund and review the Fund's
federal income tax return. Price Waterhouse LLP may also perform other
professional accounting, auditing, tax, and advisory services when engaged to
do so by the Trust. Shareholders will be sent audited annual and unaudited
semi-annual financial statements. The address of Price Waterhouse LLP is
100 East Wisconsin Avenue, Suite 1500, Milwaukee, Wisconsin 53202.
LEGAL COUNSEL
The validity of the shares of beneficial interest offered hereby will
be passed upon by Heller Ehrman White & McAuliffe, 333 Bush Street, San
Francisco, California 94104.
PORTFOLIO TRANSACTIONS AND TURNOVER
PORTFOLIO TRANSACTIONS
Portfolio transactions are undertaken principally to: pursue the
objective of the Fund in relation to movements in the general level of interest
rates; invest money obtained from the
-11-
<PAGE>
sale of Fund shares; reinvest proceeds from maturing portfolio securities; and
meet redemptions of Fund shares. Portfolio transactions may increase or
decrease the yield of the Fund depending upon management's ability correctly to
time and execute them.
The Investment Manager, in effecting purchases and sales of portfolio
securities for the account of the Fund, seeks to obtain best price and
execution. Subject to the supervision of the Board of Trustees, the Investment
Manager generally selects broker-dealers for the Fund primarily on the basis of
the quality and reliability of services provided, including execution capability
and financial responsibility.
When the execution and price offered by two or more broker-dealers are
comparable, the Investment Manager may, in its discretion, utilize the services
of broker-dealers that provide it with investment information and other research
resources. Such resources may also be used by the Investment Manager when
providing advisory services to other investment advisory clients, including
other mutual funds.
The Trust expects that purchases and sales of portfolio securities will
usually be principal transactions. Securities will normally be purchased
directly from the issuer or from an underwriter or market maker for the
securities.
Purchases from underwriters will include a commission or concession
paid by the issuer to the underwriter, and purchases from dealers serving as
market makers will include the spread between the bid and asked prices.
Investment decisions for the Fund are reached independently from
those for other accounts managed by the Investment Manager. Such other
accounts may also make investments in instruments or securities at the same
time as the Fund. On occasions when the Investment Manager determines the
purchase or sale of a security to be in the best interest of the Fund as well
as of other clients, the Investment Manager, to the extent permitted by
applicable laws and regulations, may aggregate the securities to be so
purchased or sold in an attempt to obtain the most favorable price or lower
brokerage commissions and the most efficient execution. In such event,
allocation of the securities so purchased or sold, as well as the expenses
incurred in the transaction, will be made by the Investment Manager in the
manner it considers to be the most equitable under the circumstances and
consistent with its fiduciary obligations to the Fund and to its other
participating clients. In some cases this procedure may affect the size or
price of the position obtainable for the Fund.
PORTFOLIO TURNOVER
Because securities with maturities of less than one year are
excluded from required portfolio turnover rate calculations, the Fund's
portfolio turnover rate for reporting purposes is expected to be zero.
-12-
<PAGE>
DISTRIBUTIONS AND TAXES
DISTRIBUTIONS
On each day that the Fund's net asset value per share is determined
(each a "Business Day"), the Fund's net investment income will be declared as
of the close of trading on the New York Stock Exchange (normally 4:00 p.m.
Eastern time) as a dividend to shareholders of record as of the last
calculation of net asset value prior to the declaration and to shareholders
investing on that day subject to the following conditions: (1) receipt of the
purchase order by the Transfer Agent before 1:30 p.m. Eastern time; and (2)
payment in immediately available funds wired to the Transfer Agent by the
close of business the same day. Purchases made by check will begin receiving
dividends on the Business Day the Transfer Agent receives the check if the
check is received by 1:30 p.m. Eastern time, or on the following Business Day
if the check is received after 1:30 p.m. Eastern time. Shareholders will
receive dividends in additional shares unless they elect to receive cash.
Dividends will normally be reinvested monthly in full and fractional shares of
the Fund at the net asset value on the last Business Day of each month. If
cash payment is requested, checks will normally be mailed on the Business Day
following the dividend reinvestment date. The Fund will pay shareholders who
redeem all of their shares all dividends accrued to the time of the redemption
within seven days after the redemption.
The Fund calculates its dividends based on its daily net investment
income. For this purpose, the net investment income of the Fund consists of:
(1) accrued interest income, plus or minus amortized discount or premium, minus
(2) accrued expenses allocated to the Fund. If the Fund realizes any capital
gains, they will be distributed at least once during the year as determined by
the Board of Trustees. Any realized capital losses to the extent not offset by
realized capital gains will be carried forward. It is not anticipated that the
Fund will realize any long-term capital gains. Expenses of the Trust are
accrued daily. Should the net asset value of the Fund deviate significantly
from market value, the Board of Trustees could decide to value the investments
at market value, and any unrealized gains and losses could affect the amount of
the Fund's distributions.
FEDERAL INCOME TAXES
It is the policy of the Fund to qualify for taxation, and to elect
to be taxed, as a "regulated investment company" by meeting the requirements
of Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code"). By following this policy, the Fund expects to eliminate or reduce
to a nominal amount the federal income tax to which it is subject.
In order to qualify as a regulated investment company, the Fund
must, among other things, annually (1) derive at least 90% of its gross
income from dividends, interest, payments with respect to securities loans
and gains from the sale or other disposition of stocks, securities, foreign
currencies or other income (including
-13-
<PAGE>
gains from options, futures or forward contracts) derived with respect to its
business of investing in stocks, securities or currencies; (2) derive less
than 30% of its gross income from gains from the sale or other disposition of
certain assets (including stocks and securities) held for less than three
months; and (3) diversify its holdings so that at the end of each quarter of
its taxable year (i) at least 50% of the market value of the Fund's total
assets is represented by cash or cash items, U.S. Government securities,
securities of other regulated investment companies and other securities
limited, in respect of any one issuer, to a value not greater than 5% of the
value of the Fund's total assets and 10% of the outstanding voting securities
of such issuer, and (ii) not more than 25% of the value of its assets is
invested in the securities of any one issuer (other than U.S. Government
securities or securities of any other regulated investment company) or of two
or more issuers that the Fund controls, within the meaning of the Code, and
that are engaged in the same, similar or related trades or businesses. These
requirements may restrict the degree to which the Fund may engage in
short-term trading and certain hedging transactions and may limit the range
of the Fund's investments. If the Fund qualifies as a regulated investment
company, it will not be subject to federal income tax on the part of its net
investment income and net realized capital gains, if any, which it
distributes to shareholders, provided that the Fund meets certain minimum
distribution requirements. To comply with these requirements, the Fund must
distribute annually at least (a) 90% of its "investment company taxable
income" (as that term is defined in the Code) and (b) 90% of the excess of
its (i) tax-exempt interest income over (ii) certain deductions attributable
to that income (with certain exceptions), for its taxable year. The Fund
intends to make sufficient distributions to shareholders to meet these
requirements.
If the Fund fails to distribute in a calendar year (regardless of
whether it has a non-calendar taxable year) at least 98 percent of its (i)
ordinary income for such year; and (ii) capital gain net income for the
one-year period ending on October 31 of that calendar year (or later if the
Fund is permitted so to elect and so elects), plus any retained amount from
the prior year, the Fund will be subject to a nondeductible 4% excise tax on
the undistributed amounts. The Fund intends generally to make distributions
sufficient to avoid imposition of this excise tax.
Any distributions declared by the Fund in October, November, or
December to shareholders of record during those months and paid during the
following January are treated, for tax purposes, as if they were received by
each shareholder on December 31 of the year declared. The Fund may adjust
its schedule for the reinvestment of distributions for the month of December
to assist in complying with the reporting and minimum distribution
requirements of the Code.
The Fund does not expect to realize any significant amount of long-term
capital gain. However, any distributions by the Fund of
-14-
<PAGE>
long-term capital gain will be taxable to the shareholders as long-term capital
gain, regardless of how long a shareholder has held the Fund's shares. If a
shareholder disposes of shares at a loss before holding such shares for longer
than six months, the loss will be treated as a long-term capital loss to the
extent the shareholder received a capital gain dividend on the shares.
The Fund may engage in investment techniques that may alter the timing
and character of the Fund's income. The Fund may be restricted in its use of
these techniques by rules relating to its qualification as a regulated
investment company.
As described in the Prospectus, the Fund may invest in some Variable
Rate Demand Securities which have a feature entitling the purchaser to resell
the securities at a specified amount (a "put option"). The Internal
Revenue Service (the "IRS") has issued a revenue ruling to the effect that,
under specified circumstances, a regulated investment company will be the
owner of tax-exempt municipal obligations acquired with a put option. The
IRS subsequently announced that it will not ordinarily issue advance ruling
letters as to the identity of the true owner of property in cases involving
the sale of securities (or participation interests therein) if the purchaser
has the right to cause the security (or participation interest therein) to be
purchased by the seller or a third party. The Fund intends to take the
position that it is the owner of any securities with respect to which it also
holds a put option.
The Fund will be required in certain cases to withhold and remit to
the U.S. Treasury 31% of taxable dividends paid to any shareholder (1) who
fails to provide a correct taxpayer identification number certified under
penalty of perjury; (2) who provides an incorrect taxpayer identification
number; (3) who is subject to withholding for failure to properly report to
the IRS all payments of interest or dividends; or (4) who fails to provide a
certified statement that he or she is not subject to "backup withholding."
This "backup withholding" is not an additional tax and any amounts withheld
may be credited against the shareholder's ultimate U.S. tax liability.
The foregoing discussion relates only to federal income tax law as
applicable to U.S. citizens or residents. Foreign shareholders (i.e.,
nonresident alien individuals and foreign corporations, partnerships, trusts and
estates) generally are subject to U.S. withholding tax at the rate of 30% (or a
lower tax treaty rate) on distributions derived from net investment income and
short-term capital gains. Distributions to foreign shareholders of long-term
capital gains and any gains from the sale or disposition of shares of the Fund
generally are not subject to U.S. taxation, unless the recipient is an
individual who meets the Code's definition of "resident alien." Different tax
consequences may result if the foreign shareholder is engaged in a trade or
business within the U.S. In addition, the tax consequences to a foreign
shareholder entitled to claim the benefits of a tax treaty may be different than
those described above. Distributions by the Fund may also be subject to state,
local and foreign taxes, and their treatment under applicable tax laws may
differ from the U.S. federal income tax treatment.
-15-
<PAGE>
The information above is only a summary of some of the tax
considerations generally affecting the Fund and its shareholders. No attempt
has been made to discuss individual tax consequences and this discussion should
not be construed as applicable to all shareholders' tax situations. Investors
should consult their own tax advisors to determine the suitability of the Fund
and the applicability of any state, local, or foreign taxation. Heller Ehrman
White & McAuliffe has expressed no opinion in respect thereof. Foreign
shareholders should consider, in particular, the possible application of U.S.
withholding taxes on certain taxable distributions from the Fund at rates up to
30% (subject to reduction under certain income tax treaties).
SHARE PRICE CALCULATION
The Fund values its portfolio instruments at amortized cost, which means
they are valued at their acquisition cost, as adjusted for amortization of
premium or discount, rather than at current market value. Calculations are
made to compare the value of the Fund's investments at amortized cost with
market values. Market valuations are obtained by using actual quotations
provided by market makers, estimates of market value, or values obtained from
yield data relating to classes of money market instruments published by
reputable sources at the bid prices for the instruments. The amortized cost
method of valuation seeks to maintain a stable $1.00 per share net asset
value even where there are fluctuations in interest rates that affect the
value of portfolio instruments. Accordingly, this method of valuation can in
certain circumstances lead to a dilution of a shareholder's interest.
If a deviation of 1/2 of 1% or more were to occur between the net asset
value per share calculated by reference to market values and the Fund's $1.00
per share net asset value, or if there were any other deviation that the Board
of Trustees of the Trust believed may result in a material dilution or other
unfair results to investors or existing shareholders, the Board of Trustees is
required to cause the Fund to take such action as it deems appropriate to
eliminate or reduce to the extent reasonably practicable such dilution or unfair
results. If the Fund's net asset value per share (computed using market values)
declined, or were expected to decline, below $1.00 (computed using amortized
cost), the Board of Trustees might temporarily reduce or suspend dividend
payments in an effort to maintain the net asset value at $1.00 per share. As a
result of such reduction or suspension of dividends or other action by the Board
of Trustees, an investor would receive less income during a given period than if
such a reduction or suspension had not taken place. Such action could result in
investors receiving no dividends for the period during which they hold their
shares and receiving, upon redemption, a price per share lower than that which
they paid. On the other
-16-
<PAGE>
hand, if the Fund's net asset value per share (computed using market values)
were to increase, or were anticipated to increase above $1.00 (computed using
amortized cost), the Board of Trustees might supplement dividends in an effort
to maintain the net asset value at $1.00 per share.
YIELD
The historical performance of the Fund may be shown in the form of
yield and effective yield. These measures of performance are described below.
YIELD
Yield refers to the net investment income generated by a
hypothetical investment in the Fund over a specific seven-day period. This
net investment income is then annualized, which means that the net investment
income generated during the seven-day period is assumed to be generated in
each seven-day period over an annual period, and is shown as a percentage of
the investment.
EFFECTIVE YIELD
Effective yield is calculated similarly, but the net investment income
earned by the investment is assumed to be compounded weekly when annualized.
The effective yield will be slightly higher than the yield due to this
compounding effect.
GENERAL INFORMATION
The Trust is generally not required to hold shareholder meetings.
However, as provided in its Agreement and Declaration of Trust and its
Bylaws, shareholder meetings may be called by the Trustees for the purpose of
electing Trustees and for such other purposes as may be prescribed by law,
the Agreement and Declaration of Trust, or the Bylaws, or for the purpose of
taking action upon any other matter deemed by the Trustees to be necessary or
desirable.
Each Trustee serves until the next meeting of shareholders, if any,
called for the purpose of electing trustees and until the election and
qualification of his or her successor or until death, resignation,
declaration of bankruptcy or incompetence by a court of competent
jurisdiction, or removal by a majority vote of the shares entitled to vote
(as described below) or of a majority of the Trustees. In accordance with
the 1940 Act (i) the Trust will hold a shareholder meeting for the election
of trustees when less than a majority of the trustees have been elected by
shareholders, and (ii) if, as a result of a vacancy in the Board of Trustees,
less than two-thirds of the trustees have been elected by the shareholders,
that vacancy will be filled by a vote of the shareholders.
The Agreement and Declaration of Trust provides that one-third of the
shares entitled to vote shall be a quorum for the transaction of business at a
shareholders' meeting, except when a
-17-
<PAGE>
larger quorum is required by applicable law, by the Bylaws or by the
Agreement and Declaration of Trust, and except that where any provision of
law, of the Agreement and Declaration of Trust, or of the Bylaws permits or
requires that (i) holders of any series shall vote as a series, then a
majority of the aggregate number of shares of that series entitled to vote
shall be necessary to constitute a quorum for the transaction of business by
that series; or (ii) holders of any class shall vote as a class, then a
majority of the aggregate number of shares of that class entitled to vote
shall be necessary to constitute a quorum for the transaction of business by
that class. Any lesser number shall be sufficient for adjournments. Any
adjourned session or sessions may be held, within a reasonable time after the
date set for the original meeting, without the necessity of further notice.
The Agreement and Declaration of Trust specifically authorizes the Board of
Trustees to terminate the Trust (or any of its investment portfolios) by
notice to the shareholders without shareholder approval.
For further information, please refer to the registration statement and
exhibits for the Trust on file with the SEC in Washington, D.C. and available
upon payment of a copying fee. The statements in the Prospectus and this
Statement of Additional Information concerning the contents of contracts or
other documents, copies of which are filed as exhibits to the registration
statement, are qualified by reference to such contracts or documents.
PRINCIPAL HOLDERS OF SECURITIES
As of the date of this Statement of Additional Information, Berkeley
International Securities Corporation, 650 California Street, San Francisco,
California 94108, owned 100% of the outstanding shares of the Fund. By
virtue of its ownership of all of the Fund's outstanding voting securities,
Berkeley International Securities Corporation is deemed to control the Fund.
It is contemplated that the public offering of shares of the Fund will reduce
Berkeley International Securities Corporation's holdings to less than 5% of
the total shares outstanding.
PURCHASE AND REDEMPTION OF SHARES
The Fund's minimum initial investment is $100,000 and subsequent
investments of $1,000 or more may be made. These minimum requirements may be
changed at any time and are not applicable to certain types of investors.
Exceptions to the minimum investment requirements may be made at the
discretion of the Investment Manager including, without limitation, for
employees or affiliates of the Investment Manager or investors who are, or
are related to or affiliated with, clients of the Investment Manager. The
Fund will accept investments in cash only in U.S. dollars. The Trust
reserves the right, if conditions exist which make cash payments undesirable,
to honor any request for redemption or repurchase order in-kind by making
payment in readily marketable securities chosen by the Fund and valued as
they are for purposes of computing the Fund's net asset value. However, the
Trust has elected to commit itself to pay in cash all requests for redemption
by any Shareholder of record, limited in amount with respect to each
Shareholder during any 90-day period to the lesser of: (i) $250,000, or (ii)
one percent of the net asset value of the Fund at the beginning of such
period.
-18-
<PAGE>
OTHER INFORMATION
The Prospectus of the Fund and this Statement of Additional Information
do not contain all the information included in the Registration Statement filed
with the SEC under the Securities Act of 1933, as amended, with respect to the
securities offered by the Prospectus.
Certain portions of the Registration Statement have been omitted
from the Prospectus and this Statement of Additional Information pursuant to
the rules and regulations of the SEC. The Registration Statement including
the exhibits filed therewith may be examined at the office of the SEC in
Washington, D.C.
Statements contained in the Prospectus or in this Statement of
Additional Information as to the contents of any contract or other document
referred to are not necessarily complete, and, in each instance, reference is
made to the copy of such contract or other document filed as an exhibit to the
Registration Statement of which the Prospectus and this Statement of Additional
Information form a part, each such statement being qualified in all respects by
such reference.
THIS STATEMENT OF ADDITIONAL INFORMATION DOES NOT CONSTITUTE AN
OFFERING BY THE TRUST, THE FUND, OR BY THE PRINCIPAL UNDERWRITER IN ANY
JURISDICTION IN WHICH SUCH OFFERING MAY NOT BE LAWFULLY MADE.
-19-
<PAGE>
APPENDIX - RATINGS OF INVESTMENT SECURITIES
COMMERCIAL PAPER
MOODY'S INVESTORS SERVICE
Prime-1 is the highest commercial paper rating assigned by Moody's.
Issuers (or related supporting institutions) of commercial paper with this
rating are considered to have a superior ability to repay short-term promissory
obligations. Issuers (or related supporting institutions) of securities rated
Prime-2 are viewed as having a strong capacity to repay short-term promissory
obligations. This capacity will normally be evidenced by many of the
characteristics of issuers whose commercial paper is rated Prime-1 but to a
lesser degree.
STANDARD & POOR'S RATINGS GROUP
An S&P A-1 commercial paper rating indicates either an overwhelming or
very strong degree of safety regarding timely payment of principal and interest.
Issues determined to possess overwhelming safety characteristics are denoted
A-1+. Capacity for timely payment on commercial paper rated A-2 is strong, but
the relative degree of safety is not as high as for issues designated A-1.
DUFF & PHELPS CREDIT RATING CO.
Duff-1+ is the highest commercial paper rating assigned by Duff &
Phelps Credit Rating Co. ("Duff"). Three gradations exist within this rating
category: a Duff-1+ rating indicates the highest certainty of timely payment
(issuer short-term liquidity is found to be outstanding and safety is deemed to
be just below that of risk-free short-term U.S. Treasury obligations), a Duff-1
rating signifies a very high certainty of timely payment (issuer liquidity is
determined to be excellent and risk factors are considered minor) and a Duff-1-
rating denotes high certainty of timely payment (issuer liquidity factors are
strong and risk is very small). A Duff-two rating indicates a good certainty of
timely payment; liquidity factors and company fundamentals are sound and risk
factors are small.
FITCH INVESTORS SERVICE, INC.
F-1+ is the highest category, and indicates the strongest degree of
assurance for timely payment. Issues rated F-1 reflect an assurance of timely
payment only slightly less than issues rated F-1+. Issues assigned an F-2
rating have a satisfactory degree of assurance for timely payment, but the
margin of safety is not as great as for issues in the first two rating
categories.
SHORT-TERM NOTES AND VARIABLE RATE DEMAND OBLIGATIONS
MOODY'S INVESTORS SERVICE
Short-term notes/variable rate demand obligations bearing the
designations MIG-1/VMIG-1 are considered to be of the
A-1
<PAGE>
best quality, enjoying strong protection from established cash flows, superior
liquidity support or demonstrated broad-based access to the market for
refinancing. Obligations rated MIG-2/VMIG-2 are of high quality and enjoy ample
margins of protection although not as large as those of the top rated
securities.
STANDARD & POOR'S RATINGS GROUP
An S&P SP-1 rating indicates that the subject securities' issuer has a
very strong capacity to pay principal and interest. Issues determined to
possess overwhelming safety characteristics are given a plus (+) designation.
S&P's determination that an issuer has a satisfactory capacity to pay principal
and interest is denoted by an SP-2 rating.
IBCA
Obligations supported by the highest capacity for timely repayment are
rated A1+. An A1 rating indicates that the obligation is supported by a very
strong capacity for timely repayment. Obligations rated A2 are supported by a
strong capacity for timely repayment, although adverse changes in business,
economic, or financial conditions may affect this capacity.
BONDS
MOODY'S INVESTORS SERVICE
Moody's rates the bonds it judges to be of the best quality Aaa. These
bonds carry the smallest degree of investment risk and are generally referred to
as "gilt edge." Interest payments are protected by a large or extraordinarily
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 these issues. Bonds carrying an Aa
designation are deemed to be of high quality by all standards. Together with
Aaa rated bonds, they comprise what are generally known as high grade bonds. Aa
bonds are rated lower than the best bonds because they may enjoy relatively
lower margins of protections, fluctuations of protective elements may be of
greater amplitude or there may be other factors present which make them appear
to be subject to somewhat greater long-term risks.
STANDARD & POOR'S RATINGS GROUP
AAA is the highest rating assigned by S&P to a bond and indicates the
issuer's extremely strong capacity to pay interest and repay principal. An AA
rating denotes a bond whose issuer has a very strong capacity to pay interest
and repay principal and differs from an AAA rating only in small degree.
A-2
<PAGE>
DUFF & PHELPS CREDIT RATING CO.
Duff confers an AAA designation to bonds of issuers with the highest
credit quality. The risk factors associated with these bonds are negligible,
being only slightly more than for risk-free U.S. Treasury debt. AA rated bonds
are of high credit quality and have strong protection factors. The risks
associated with them are modest but may vary slightly from time to time because
of economic conditions.
COMMERCIAL PAPER, SHORT-TERM OBLIGATIONS AND DEPOSIT
OBLIGATIONS ISSUED BY BANKS
THOMSON BANKWATCH (TBW)
TBW-1 is the highest category and indicates the degree of safety
regarding timely repayment of principal and interest is very strong. TBW-2 is
the second highest category and while the degree of safety regarding timely
repayment of principal and interest is strong, the relative degree of safety is
not as high as for issues rated TBW-1.
A-3
<PAGE>
PART C
------------------
OTHER INFORMATION
------------------
<PAGE>
BERKELEY CAPITAL MANAGEMENT FUNDS
F O R M N-1A
PART C. OTHER INFORMATION
Item 24. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements -- Not Applicable
(b) Exhibits:
(1) Agreement and Declaration of Trust(1)
(2) By-Laws(1)
(3) Voting Trust Agreement -- Not Applicable
(4) Specimen Share Certificate -- Not Applicable
(5) Investment Management Agreement(1)
(6) Underwriting Agreement with Berkeley International Securities
Corporation(1)
(7) Bonus, Profit Sharing, Pension and Other Similar Arrangements
-- Not Applicable
(8) Custodian Agreement(1)
(9)(A)Fund Administration Servicing Agreement(1)
(9)(B)Fund Accounting Servicing Agreement(1)
(9)(C)Transfer Agent Agreement(1)
(9)(D)Shareholder Services Agreement
(10) Opinion and Consent of Counsel(1)
(11) Consent of Independent Accountants
(12) Financial Statements Omitted from Item 23 -- Not Applicable
(13) Subscription Agreement(1)
(14) Model Retirement Plan(1)
(15) Rule 12b-1 Plan -- Not Applicable
(16) Performance Calculations
(17) Financial Data Schedule -- Not Applicable
(18) Multiple Class Plan -- Not Applicable
- --------------
(1) Previously filed as an exhibit to Registrant's Registration Statement
(File Nos. 333-16093 and 811-7923) and incorporated herein by reference.
Item 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT.
None.
C-1
<PAGE>
Item 26. NUMBER OF HOLDERS OF SECURITIES.
Berkeley Capital Management
Money Market Fund: 1
Item 27. INDEMNIFICATION.
Please see Article VI of the Registrant's By-Laws, previously filed as an
Exhibit. Pursuant to Rule 484 under the Securities Act of 1933, as amended, the
Registrant furnishes the following undertaking:
"Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to trustees, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, 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 liabilities (other than the payment by the Registrant of expenses
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
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."
Notwithstanding the provisions contained in the Registrant's By-Laws, in
the absence of authorization by the appropriate court on the merits pursuant to
Sections 4 and 5 of Article VI of said By-Laws, any indemnification under said
Article shall be made by Registrant only if authorized in the manner provided in
either subsection (a) or (b) of Section 6 of said Article VI.
Item 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER.
Please see Parts A and B of this Registration Statement for discussion of
the Investment Adviser.
Item 29. PRINCIPAL UNDERWRITERS.
(a) Not Applicable.
C-2
<PAGE>
(b) The following information is furnished with respect to the
officers and directors of Berkeley International Securities
Corporation, the Registrant's principal underwriter:
Name Positions and Offices Positions and Offices
with Underwriter with Registrant
- ------------------ --------------------- ---------------------
Robert A. Cornman President None
Diane E. Worthington Financial/Operations None
Principal
Donald O. Dempster Sales Manager Compliance Officer
Danell J. Doty Chief Operations Vice President
Officer and Secretary
Michael J. Mayer Director None
The principal business address of each individual named above is 650
California Street, Suite 2800, San Francisco, California 94108.
(c) Not Applicable.
Item 30. LOCATIONS OF ACCOUNTS AND RECORDS.
The accounts, books or other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the Rules thereunder
are kept by the Registrant at its offices, 650 California Street, Suite 2800,
San Francisco, California 94108. Firstar Trust Company, 615 E. Michigan
Street, Milwaukee, Wisconsin 53202 is the Registrant's transfer agent, and
maintains records relating to such activities.
Item 31. MANAGEMENT SERVICES.
There are no management-related service contracts not discussed in Part A
or Part B of this Registration Statement.
Item 32. UNDERTAKINGS.
(a) Not applicable.
(b) Registrant hereby undertakes to file a post-effective amendment, using
financial statements which need not be certified, within four to six months from
the effective date of Registrant's 1933 Act Registration Statement with respect
to shares of Berkeley Capital Management Money Market Fund.
C-3
<PAGE>
(c) Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered with a copy of Registrant's latest annual report to
shareholders, once such report becomes available, upon request and without
charge.
C-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
and the Investment Company Act of 1940, as amended, Registrant has duly
caused this Post-Effective Amendment to its Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the
City of San Francisco, the State of California, on the 14th day of March,
1997.
BERKELEY CAPITAL MANAGEMENT FUNDS
By: /s/ Debra McGinty-Poteet*
-----------------------------
Debra McGinty-Poteet, Chairman,
President, and Principal
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to the Registration Statement has been signed below
by the following persons in the capacities and on the dates indicated.
/s/ Debra McGinty-Poteet*
- ----------------------------- Chairman, President, and March 14, 1997
Debra McGinty-Poteet Principal Executive Officer
/s/ Cindee Beechwood*
- ----------------------------- Trustee, Treasurer, Principal March 14, 1997
Cindee Beechwood Financial Officer,
and Principal Accounting
Officer
/s/ Bryan W. Brown*
- ----------------------------- Trustee March 14, 1997
Bryan W. Brown
/s/ William R. Sweet*
- ----------------------------- Trustee March 14, 1997
William R. Sweet
/s/ Barnett Teich*
- ----------------------------- Trustee March 14, 1997
Barnett Teich
* By: /s/ Mitchell E. Nichter
- -----------------------------
Mitchell E. Nichter, pursuant to power of attorney filed
herewith.
C-5
<PAGE>
POWER OF ATTORNEY
FOR
SECURITIES AND EXCHANGE COMMISSION
AND RELATED FILINGS
__________________________________
The undersigned Trustee of BERKELEY CAPITAL MANAGEMENT FUNDS (the "Trust")
hereby appoints MITCHELL E. NICHTER, JULIE ALLECTA, and CINDEE BEECHWOOD
(with full power to each of them to act alone), his attorneys-in-fact and
agents, in all capacities, to execute and to file any documents relating to
the Registration Statement of the Trust on Forms N-8A, N-1A and N-14 under
the Investment Company Act of 1940, under the Securities Act of 1933, and
under the laws of all states and other domestic and foreign jurisdictions,
including any and all amendments thereto, covering the registration and the
sale of shares by the Trust, including all exhibits and any and all documents
required to be filed with respect thereto with any regulatory authority,
including applications for exemptive orders, rulings, or filings of proxy
materials. The undersigned grants to each of said attorneys full authority
to do every act necessary to be done in order to effectuate the same as
fully, to all intents and purposes, as they could do if personally present,
thereby ratifying all that said attorneys-in-fact and agents may lawfully do
or cause to be done by virtue hereof.
The undersigned Trustee hereby executes this Power of Attorney as of this
11th day of March, 1997.
/s/ William R. Sweet
-----------------------------------
William R. Sweet
<PAGE>
POWER OF ATTORNEY
FOR
SECURITIES AND EXCHANGE COMMISSION
AND RELATED FILINGS
__________________________________
The undersigned Trustee of BERKELEY CAPITAL MANAGEMENT FUNDS (the "Trust")
hereby appoints MITCHELL E. NICHTER, JULIE ALLECTA, and CINDEE BEECHWOOD
(with full power to each of them to act alone), his attorneys-in-fact and
agents, in all capacities, to execute and to file any documents relating to
the Registration Statement of the Trust on Forms N-8A, N-1A and N-14 under
the Investment Company Act of 1940, under the Securities Act of 1933, and
under the laws of all states and other domestic and foreign jurisdictions,
including any and all amendments thereto, covering the registration and the
sale of shares by the Trust, including all exhibits and any and all documents
required to be filed with respect thereto with any regulatory authority,
including applications for exemptive orders, rulings, or filings of proxy
materials. The undersigned grants to each of said attorneys full authority
to do every act necessary to be done in order to effectuate the same as
fully, to all intents and purposes, as they could do if personally present,
thereby ratifying all that said attorneys-in-fact and agents may lawfully do
or cause to be done by virtue hereof.
The undersigned Trustee hereby executes this Power of Attorney as of this
11th day of March, 1997.
/s/ Bryan W. Brown
-----------------------------------
Bryan W. Brown
<PAGE>
POWER OF ATTORNEY
FOR
SECURITIES AND EXCHANGE COMMISSION
AND RELATED FILINGS
__________________________________
The undersigned Officer and Trustee of BERKELEY CAPITAL MANAGEMENT FUNDS
(the "Trust") hereby appoints MITCHELL E. NICHTER and JULIE ALLECTA (with full
power to each of them to act alone), her attorneys-in-fact and agents, in all
capacities, to execute and to file any documents relating to the Registration
Statement of the Trust on Forms N-8A, N-1A and N-14 under the Investment
Company Act of 1940, under the Securities Act of 1933, and under the laws of
all states and other domestic and foreign jurisdictions, including any and all
amendments thereto, covering the registration and the sale of shares by the
Trust, including all exhibits and any and all documents required to be filed
with respect thereto with any regulatory authority, including applications for
exemptive orders, rulings, or filings of proxy materials. The undersigned
grants to each of said attorneys full authority to do every act necessary to
be done in order to effectuate the same as fully, to all intents and purposes,
as they could do if personally present, thereby ratifying all that said
attorneys-in-fact and agents may lawfully do or cause to be done by virtue
hereof.
The undersigned Officer and Trustee hereby executes this Power of Attorney
as of this 11th day of March, 1997.
/s/ Cindee Beechwood
-----------------------------------
Cindee Beechwood
<PAGE>
POWER OF ATTORNEY
FOR
SECURITIES AND EXCHANGE COMMISSION
AND RELATED FILINGS
__________________________________
The undersigned Trustee of BERKELEY CAPITAL MANAGEMENT FUNDS (the "Trust")
hereby appoints MITCHELL E. NICHTER, JULIE ALLECTA, and CINDEE BEECHWOOD
(with full power to each of them to act alone), his attorneys-in-fact and
agents, in all capacities, to execute and to file any documents relating to
the Registration Statement of the Trust on Forms N-8A, N-1A and N-14 under
the Investment Company Act of 1940, under the Securities Act of 1933, and
under the laws of all states and other domestic and foreign jurisdictions,
including any and all amendments thereto, covering the registration and the
sale of shares by the Trust, including all exhibits and any and all documents
required to be filed with respect thereto with any regulatory authority,
including applications for exemptive orders, rulings, or filings of proxy
materials. The undersigned grants to each of said attorneys full authority
to do every act necessary to be done in order to effectuate the same as
fully, to all intents and purposes, as they could do if personally present,
thereby ratifying all that said attorneys-in-fact and agents may lawfully do
or cause to be done by virtue hereof.
The undersigned Trustee hereby executes this Power of Attorney as of this
11th day of March, 1997.
/s/ Barnett Teich
-----------------------------------
Barnett Teich
<PAGE>
POWER OF ATTORNEY
FOR
SECURITIES AND EXCHANGE COMMISSION
AND RELATED FILINGS
__________________________________
The undersigned Officer of BERKELEY CAPITAL MANAGEMENT FUNDS (the "Trust")
hereby appoints MITCHELL E. NICHTER, JULIE ALLECTA, and CINDEE BEECHWOOD (with
full power to each of them to act alone), her attorneys-in-fact and agents, in
all capacities, to execute and to file any documents relating to the
Registration Statement of the Trust on Forms N-8A, N-1A and N-14 under the
Investment Company Act of 1940, under the Securities Act of 1933, and under
the laws of all states and other domestic and foreign jurisdictions, including
any and all amendments thereto, covering the registration and the sale of
shares by the Trust, including all exhibits and any and all documents required
to be filed with respect thereto with any regulatory authority, including
applications for exemptive orders, rulings, or filings of proxy materials.
The undersigned grants to each of said attorneys full authority to do every
act necessary to be done in order to effectuate the same as fully, to all
intents and purposes, as they could do if personally present, thereby
ratifying all that said attorneys-in-fact and agents may lawfully do or cause
to be done by virtue hereof.
The undersigned Officer hereby executes this Power of Attorney as of this
11th day of March, 1997.
/s/ Debra McGinty-Poteet
-----------------------------------
Debra McGinty-Poteet
<PAGE>
EXHIBIT 9(D)
BERKELEY CAPITAL MANAGEMENT FUNDS
SHAREHOLDER SERVICES AGREEMENT
THIS SHAREHOLDER SERVICES AGREEMENT (this "Agreement") is made as of
the [_____] day of [_______], 1997 by and between BERKELEY CAPITAL MANAGEMENT
FUNDS, a business trust organized under the laws of the State of Delaware
(the "Trust"), and BERKELEY CAPITAL MANAGEMENT (the "Adviser").
WITNESSETH
WHEREAS, the Trust is registered as open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Trust, on behalf of certain series of the Trust listed
on EXHIBIT A hereto, as the same may be amended from time to time (each, a
"Fund"), wishes to retain the Adviser to coordinate the provision of services
to shareholders of the Funds, either by the Adviser directly or by
broker-dealers, retirement plan administrators, and other shareholder service
providers ("Service Providers"), which may include affiliates of the Adviser,
and the Adviser is willing to furnish those services and to arrange for the
provision of those services, subject to the oversight of the Trust's Board of
Trustees.
NOW, THEREFORE, in consideration of the promises and mutual
covenants herein contained, it is agreed between the parties hereto as
follows:
1. APPOINTMENT. The Trust, on behalf of the Funds, hereby appoints
the Adviser to provide the shareholder services specified in Section 2 to all
shareholders of the Funds, some of whom may be clients of the Service
Providers. The Adviser accepts the appointment and agrees to furnish through
its own organization, or through the Service Providers, as the case may be,
those shareholder services in return for compensation as provided in Section
6 of this Agreement. The Adviser agrees that the shareholder services
required to be furnished hereunder shall be furnished in compliance with all
relevant provisions of state and federal law, and in compliance with all
applicable rules and regulations of all relevant regulatory agencies,
including, without limitation, the 1940 Act, the Securities Exchange Act of
1934, as amended (the "1934 Act"), the applicable rules and regulations
promulgated thereunder, and the Conduct Rules of the National Association of
Securities Dealers, Inc.
2. SERVICES AND RESPONSIBILITIES ON A CONTINUING BASIS. The Adviser
will arrange for the provision of the following shareholder services on a
regular basis which shall be daily, weekly, or as otherwise appropriate,
unless otherwise specified by the Trust:
<PAGE>
(a) responding to shareholder inquiries;
(b) processing purchases and redemptions of shares of the Funds,
including reinvestment of dividends;
(c) assisting shareholders in changing dividend options, account
designations, and addresses;
(d) transmitting proxy statements, annual reports, prospectuses,
and other correspondence from the Funds to shareholders
(including, upon request, copies, but not originals, of regular
correspondence, confirmations, or regular statements of account)
where such shareholders hold shares of the Funds registered in
the name of the Adviser, a Service Provider, or their nominees;
and
(e) providing such other information and assistance to
shareholders as may be reasonably requested by such shareholders.
The Adviser and the Service Providers are under no obligation to, and shall
not, provide pursuant to this Agreement any services with respect to the sale
or distribution of shares of the Funds.
3. STANDARD OF CARE. The Adviser and the Service Providers shall be
under no duty to take any action on behalf of the Funds except as
specifically set forth herein or as may be specifically agreed to by the
Adviser or the Service Providers with the Trust in writing. In the
performance of the duties hereunder, the Adviser and the Service Providers
shall be obligated to exercise due care and diligence and to act in good
faith and to use their best efforts. Agreements with Service Providers shall
provide for at least the same standard of care, indemnification coverage,
confidentiality, requirements for use of information about the Funds, and
other material requirements to which the Adviser is subject under this
Agreement. Without limiting the generality of the foregoing or of any other
provision of this Agreement, neither the Adviser nor any Service Provider
shall be liable for delays or errors or losses of data that result from acts
of war or terrorism, national emergencies, or catastrophes directly affecting
the Adviser or Service Provider, but such relief from liability shall not
extend to delays, errors, or losses of data that result from power failures
or other contingencies that typically are addressed by contingency or
emergency plans meeting industry standards.
4. CONFIDENTIALITY. The Adviser agrees, on behalf of itself and its
employees, to treat confidentially all records and other information about
the Funds and the Trust and all prior, present, or potential shareholders of
the Funds. This confidential information may be disclosed only after prior
notification to, and approval of release of information in writing by, the
Trust, which approval shall not be unreasonably withheld, nor may it be
withheld where the Adviser or a Service Provider may be exposed to civil or
criminal contempt proceedings for failure to comply, when requested to
divulge such information by duly constituted authorities, or when so
requested by the Trust.
-2-
<PAGE>
5. INDEPENDENT CONTRACTOR. The Adviser shall, for all purposes
herein, be deemed to be an independent contractor, and the Adviser and the
Service Providers shall, unless otherwise expressly provided and authorized
to do so, have no authority under this Agreement to act for or represent the
Trust or the Funds in any way, or in any way be deemed an agent for the Trust
or for the Funds, except to the limited extent expressly provided in this
Agreement. It is expressly understood and agreed that the services to be
rendered by the Adviser under the provisions of this Agreement are not to be
deemed exclusive, and the Adviser shall be free to render similar or
different services to others so long as its ability to render the services
provided for in this Agreement shall not be impaired materially thereby.
6. COMPENSATION. As compensation for the services rendered by, and
responsibilities assumed by, the Adviser during the term of this Agreement,
each Fund will pay to the Adviser a service fee not to exceed the per annum
percentage of the average daily net asset value of such Fund's shares set
forth on EXHIBIT A. The Adviser will collect such fee applicable to clients
of the Service Providers that furnish the shareholder services specified in
Section 2 above for the separate account of each such Service Provider. The
service fee shall be accrued daily by the Funds and paid to the Adviser on a
monthly basis.
7. INDEMNIFICATION.
(a) The Funds agree to indemnify and hold harmless the Adviser and
its officers and directors from all taxes, charges, expenses, assessments,
claims, and liabilities (including, without limitation, liabilities arising
under the Securities Act of 1933, the 1934 Act, the 1940 Act, and any state
and foreign securities laws, all as amended from time to time) and expenses,
including (without limitation) reasonable attorneys' fees and disbursements,
arising directly or indirectly from any action or thing which the Adviser
takes or does or omits to take or do (i) at the request or on the direction
of or in reliance on the advice of the Funds or (ii) upon oral or written
instructions from an officer of the Funds, provided that the Adviser shall
not be indemnified against any liability to the Funds or to the Funds'
shareholders (or any expenses incident to such liability) arising out of the
Adviser's or any Service Provider's own willful misfeasance, bad faith,
negligence, or reckless disregard of its duties and obligations under this
Agreement.
(b) The Adviser agrees to indemnify and hold harmless the Funds, the
Trust, and its officers and Trustees from all claims and liabilities
(including, without limitation, liabilities arising under the Securities Act
of 1933, the 1934 Act, the 1940 Act, and any state and foreign securities
laws, all as amended from time to time) and expenses, including (without
limitation) reasonable attorneys' fees and disbursements, arising directly or
indirectly from any action or thing which the Adviser or any Service Provider
takes or does or omits to take or do which is in violation of this Agreement,
not in accordance with written instructions given by an officer of the Trust,
in violation of written procedures then in effect, or arising out of the
Adviser's or the Service Provider's own willful misfeasance, bad faith,
negligence, or reckless disregard of the duties and obligations under this
Agreement.
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(c) The Adviser shall provide such security as is necessary to
prevent unauthorized use of any on-line computer facilities. The Adviser
agrees to release, indemnify, and hold harmless the Trust and the Funds from
any and all direct or indirect liabilities or losses resulting from requests,
directions, actions, or inactions of or by the Adviser or any Service
Provider, its officers, employees, or agents regarding the redemption,
transfer, or registration of the Funds' shares for accounts of shareholders or
the Service Provider, its clients and other shareholders. Principals of the
Adviser will be available to consult from time to time with officers of the
Trust and the Trustees concerning performance of the services contemplated by
Section 2 of this Agreement.
8. FUNDS INFORMATION. No person is authorized to make any
representations concerning the Funds, or shares of the Funds or shareholder
services that are inconsistent with the terms of this Agreement. Neither the
Adviser nor any Service Provider, nor any of their respective agents will use
or distribute, or authorize the use or distribution of, any statements other
than those contained in the Funds' current Prospectuses or Statements of
Additional Information or in such current supplemental literature as may be
authorized by the Funds.
9. DURATION AND TERMINATION. This Agreement shall continue until
termination by the Trust or the Adviser on 60 days' prior written notice to
the other. The Adviser's indemnification obligations under Section 7(b)
shall survive the termination of this Agreement. All notices and other
communications hereunder shall be in writing.
10. AMENDMENTS. This Agreement or any part hereof may be changed or
waived only by an instrument in writing signed by the party against which
enforcement of such charge or waiver is sought.
11. MISCELLANEOUS.
(a) This Agreement embodies the entire agreement and understanding
between the parties hereto, and supersedes all prior agreements and
understandings, relating to the subject matter hereof.
(b) The captions in this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
(c) This Agreement shall be governed by and construed in accordance
with the laws of the State of California as applicable to contracts between
California residents entered into and to be performed entirely within
California.
(d) 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.
(e) The Adviser acknowledges that it has received notice of and
accepts the limitations of the Funds' liability set forth in the Trust's
Agreement and Declaration of Trust.
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The Adviser agrees that each Fund's obligations under this Agreement shall be
limited to the Fund and to its assets, and that neither the Adviser nor any
Service Provider shall seek satisfaction of any such obligation from the
shareholders of the Fund or from any trustee, officer, employee, or agent of
the Trust or the Fund.
(f) This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
(g) This Agreement may not be assigned without the prior mutual
written consent of all parties.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their officers designated below on the day and year first
above written.
BERKELEY CAPITAL MANAGEMENT FUNDS
By: /s/ Cindee Beechwood
-----------------------------------
Cindee Beechwood,
Treasurer, Chief Accounting Officer,
and Chief Financial Officer
BERKELEY CAPITAL MANAGEMENT
By: /s/ Michael J. Mayer
-----------------------------------
Michael J. Mayer,
Chairman
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EXHIBIT A
Funds Covered by the
Shareholder Services Agreement
Annual
Name of Fund Service Fee Rate
- ------------ ----------------
Berkeley Capital Management Money Market Fund 0.25%
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CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the reference to us under the heading "Independent
Accountants and Reports to Shareholders" in the Statement of Additional
Information constituting part of this Post-Effective Amendment No. 1 to the
Registration Statement on Form N-1A.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
Milwaukee, Wisconsin
March 13, 1997
<PAGE>
BERKELEY CAPITAL MANAGEMENT FUNDS
Berkeley Capital Management Money Market Fund
Schedule of Computation of Performance Quotations
YIELD
SEVEN-DAY CURRENT YIELD
Formula: (Base Period Return/1*365/7)
Where the Base Period Return equals the sum of the previous seven daily
dividend rates
SEVEN-DAY EFFECTIVE YIELD
Formula: (Base Period Return + 1)^365/7-1
Where the Base Period Return equals the sum of the previous seven daily
dividend rates
