SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X/
Pre-Effective Amendment No. / /
Post-Effective Amendment No. / /
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT /X/
OF 1940
Amendment No. / /
(Check appropriate box or boxes.)
Star Select Funds - File Nos. 33- and 811-
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429 North Pennsylvania Street, Indianapolis, Indiana 46204
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(Address of Principal Executive Offices) Zip Code
Registrant's Telephone Number, including Area Code: 317-634-3300
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Jennie Carlson, c/o Star Bank, N.A., 425 Walnut Street, Cincinnati, Ohio
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45202
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(Name and Address of Agent for Service)
With copy to:
Donald S. Mendelsohn, Brown, Cummins & Brown Co., L.P.A.
3500 Carew Tower, Cincinnati, Ohio 45202
Release Date: , 1997
It is proposed that this filing will become effective:
/ / immediately upon filing pursuant to paragraph (b)
/ / on ________________ pursuant to paragraph (b)
/ / 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.
Pursuant to Rule 24f-2, the Registrant hereby declares that an indefinite number
and amount of its securities are being registered by this Registration
Statement.
If appropriate, check the following box:
/ / this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective such date as the Commission, acting pursuant to said Section 8(a) may
determine.
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Star Select Funds
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CROSS REFERENCE SHEET
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FORM N-1A
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FOR STAR REIT-PLUS FUND
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ITEM SECTION IN PROSPECTUS
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1.............................. Cover Page
2.............................. Summary of Fund Expenses
3.............................. None
4.............................. The Fund, Investment Objective and
Strategies and Risk Considerations,
Investment Policies and Techniques,
Operation of the Fund, General
Information
5.............................. Operation of the Fund
5A............................. None
6.............................. Cover Page, Dividends and
Distributions, Taxes, General
Information, Redeeming Shares
7.............................. Cover Page, How to Invest in the
Fund, Share Price Calculation,
Operation of the Fund, Redeeming
Shares
8.............................. Redeeming Shares
9.............................. None
13.............................. General Information
15.............................. General Information
SECTION IN STATEMENT OF
ITEM ADDITIONAL INFORMATION
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10.............................. Cover Page
11.............................. Table of Contents
12.............................. None
13.............................. Additional Information About Fund
Investments and Risk Considerations,
Investment Limitations
14.............................. Trustees and Officers
15.............................. None
16.............................. The Investment Adviser, Custodian,
Transfer Agent, Accountants,
Trustees and Officers
17.............................. Portfolio Transactions and Brokerage
18.............................. Description of the Trust
19.............................. Determination of Share Price
20.............................. None
21.............................. Distributor
22.............................. Investment Performance
23.............................. None
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STAR REIT-PLUS FUND
PROSPECTUS __________, 1997
429 North Pennsylvania Street
Indianapolis, Indiana 46204
For Information, Shareholder Services and Requests:
(800) 677-FUND
Star REIT-Plus Fund (the "Fund") is a diversified, open-end mutual fund
whose investment objective is to provide above average income and long term
growth of capital. The Fund seeks to achieve its objective by investing
primarily in REITs (real estate investment trusts) and other real estate related
equity securities believed by the Fund's investment adviser, Star Bank, N.A., to
offer superior prospects for growth and/or income. The Fund is "no-load," which
means there are no sales charges or commissions.
This Prospectus provides the information a prospective investor ought
to know before investing and should be retained for future reference. A
Statement of Additional Information dated _______, 1997 ("SAI") has been filed
with the Securities and Exchange Commission (the "SEC"), is incorporated herein
by reference, and can be obtained without charge by calling the Fund at the
phone number listed above. The SEC maintains a Web Site (http://www.sec.gov)
that contains the SAI, material incorporated by reference, and other information
regarding registrants that file electronically with the SEC.
Shares of the Fund are not deposits or obligations of Star Bank, N.A.
or its affiliates, are not endorsed or guaranteed by Star Bank, N.A. or its
affiliates, and are not insured by the Federal Deposit Insurance Corporation
(FDIC), the Federal Reserve Board or any other government agency, entity, or
person. The purchase of Fund shares involves investment risks, including the
possible loss of principal.
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.
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SUMMARY OF FUND EXPENSES
The tables below are provided to assist an investor in understanding
the direct and indirect expenses that an investor may incur as a shareholder in
the Fund. The expense information is based on estimated amounts for the current
fiscal year. The expenses are expressed as a percentage of average net assets.
The Example should not be considered a representation of future Fund performance
or expenses, both of which may vary.
Shareholders should be aware that the Fund is a no-load fund and,
accordingly, a shareholder does not pay any sales charge or commission upon
purchase or redemption of shares of the Fund.
Shareholder Transaction Expenses
Maximum Sales Load on Purchases.........................................NONE
Sales Load Imposed on Reinvested Dividends..............................NONE
Maximum Contingent Deferred Sales Load..................................NONE
Redemption Fee..........................................................NONE
Exchange Fees...........................................................NONE
Annual Fund Operating Expenses (as a percentage of average net assets)
Management Fees.....................................0.75%
12b-1 Charges(1)....................................0.25%
Other Expenses......................................____%
Total Fund Operating Expenses..........................................____%
(1) The Fund incurs 12b-1 fees of 0.25% of average net assets. Long-term
shareholders may pay more than the economic equivalent of the maximum front end
sales loads permitted by the National Association of Securities Dealers.
Example
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You would pay the following expenses on a $1,000 investment, assuming (1) 5%
annual return and (2) redemption at the end of each time period:
1 Year 3 Years
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$_____ $______
THE FUND
Star REIT-Plus Fund (the "Fund") was organized as a series of Star
Select Funds, an Ohio business trust (the "Trust") on February 28, 1997, and
commenced operations on ___________, 1997. This prospectus offers shares of the
Fund and each share represents an undivided, proportionate interest in the Fund.
The investment adviser to the Fund is Star Bank, N.A. (the "Adviser" or "Star
Bank").
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INVESTMENT OBJECTIVE AND STRATEGIES AND RISK CONSIDERATIONS
The investment objective of the Fund is to provide shareholders with
above average income and long term growth of capital. The Fund seeks to achieve
its objective by investing primarily in real estate investment trusts ("REITs")
and other real estate related equity securities believed by the Adviser to offer
superior prospects for growth and/or income. Under normal circumstances, the
Fund will invest at least 65% of its total assets in REITs and other real estate
related securities (including common stock, preferred stock and securities
convertible into common stock).
A REIT is a corporation or business trust that invests substantially
all of its assets in interests in real estate. Equity REITs are those which
purchase or lease land and buildings and generate income primarily from rental
income. Equity REITs may also realize capital gains (or losses) when selling
property that has appreciated (or depreciated) in value. Mortgage REITs are
those which invest in real estate mortgages and generate income primarily from
interest payments on mortgage loans. Hybrid REITs generally invest in both real
property and mortgages. It is anticipated that the Fund's investments in REITs
will be primarily those characterized as equity REITs. Real estate related
securities also include those issued by real estate developers, companies with
substantial real estate holdings, as well as companies whose products and
services are related to the real estate industry, such as building supply
manufacturers, mortgage lenders or mortgage servicing companies.
The Fund is not intended to be a complete investment program. The
concentration of the Fund's investments in the real estate industry will subject
the Fund to risks in addition to those that apply to the general equity market.
Economic, legislative or regulatory developments may occur which significantly
affect the entire real estate industry and thus may subject the Fund to greater
market fluctuations than a fund that does not concentrate in a particular
industry. In addition, the Fund will generally be subject to risks associated
with direct ownership of real estate, such as decreases in real estate values or
fluctuations in rental income caused by a variety of factors, including
increases in interest rates, increases in property taxes and other operating
costs, casualty or condemnation losses, possible environmental liabilities and
changes in supply and demand for properties.
Risks associated with REIT investments include the fact that equity
and mortgage REITs are dependent upon specialized management skills and are not
fully diversified. These characteristics subject REITs to the risks associated
with financing a limited number of projects. They are also subject to heavy cash
flow dependency, defaults by borrowers, and self-liquidation. Additionally,
equity REITs may be affected by any changes in the value of the underlying
property owned by the trusts, and mortgage REITs may be affected by the quality
of any credit extended. The Adviser seeks to mitigate these risks by selecting
REITs diversified by sector (shopping malls, apartment building complexes and
health care facilities) and geographic location.
Although the Fund will invest primarily in real estate related equity
securities, the Fund may invest outside the real estate industry. For temporary
defensive purposes under abnormal market conditions, the Fund may hold all or a
portion of its assets in money market instruments (high quality income
securities with maturities of less than one year), securities of money market
funds or U.S. government repurchase agreements. The Fund may also invest in such
instruments at any time to maintain liquidity or pending selection of
investments in accordance with its policies. To the
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extent the Fund invests in other mutual funds, shareholders of the Fund will be
subject to duplicative management fees.
As all investment securities are subject to inherent market risks and
fluctuations in value due to earnings, economic and political conditions and
other factors, the Fund cannot give any assurance that its investment objective
will be achieved. While the Fund has no operating history, the investment
methodology used by the Adviser in managing the Fund's portfolio has been used
by the Adviser since 1987 in the management of an internal common trust fund.
Rates of total return quoted by the Fund may be higher or lower than past
quotations, and there can be no assurance that any rate of total return will be
maintained. See "Investment Policies and Techniques" for a more detailed
discussion of the Fund's investment practices.
HOW TO INVEST IN THE FUND
Minimum Investment Required
The minimum initial investment in the Fund by an investor is $1,000
($25 for Star Bank Connections Group banking customers and Star Bank employees
and members of their immediate family). The minimum subsequent investment is
$25. For customers of Star Bank, an institutional investor's minimum investment
will be calculated by combining all Fund accounts it maintains with Star Bank
and invests with the Fund.
Systematic Investment Plan
Once a Fund account has been opened, shareholders may add to their
investment on a regular basis in a minimum amount of $25. Under this plan, funds
may be withdrawn periodically from the shareholder's checking account and
invested in shares of the Fund at the net asset value next determined after an
order is received by Star Bank. A shareholder may apply for participation in
this plan through Star Bank.
Share Purchases
A customer of Star Bank may purchase shares of the Fund through Star
Bank. Texas residents must purchase shares through Unified Management
Corporation, the Fund's distributor (the "Distributor") at 429 N. Pennsylvania
Street, Indianapolis, Indiana 46204. In connection with the sale of shares of
the Fund, the Distributor may from time to time offer certain items of nominal
value to any shareholder or investor. The Fund reserves the right to reject any
purchase request.
Through Star Bank. To place an order to purchase shares of the Fund, a customer
of Star Bank may telephone Star Bank at 1-800-677-FUND or place the order in
person. Purchase orders given by telephone may be electronically recorded.
Payment may be made to Star Bank either by check or federal funds.
When payment is made with federal funds, the order is considered received when
federal funds are received by Star Bank. Purchase orders must be telephoned to
Star Bank by 3:30 p.m. (Eastern time) and payment by federal funds must be
received by Star Bank before 3:00 p.m. (Eastern time) on the following day.
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Orders are considered received after payment by check is converted into federal
funds. This is normally the next business day after Star Bank receives the
check.
Purchase requests must be received by Star Bank by 3:30 p.m. (Eastern
time) and payment is normally required in three business days. Shares cannot be
purchased on days on which the New York Stock Exchange is closed or on federal
holidays restricting wire transfers.
By Mail. To purchase shares of the Fund by mail, individual investors may send a
check made payable to Star REIT-Plus Fund to: Star Select Funds Shareholder
Services, Star Bank, N.A., 425 Walnut Street, ML 7135, Cincinnati, Ohio 45202.
Orders by mail are considered received after payment by check is
converted by Star Bank into federal funds. This is normally the next business
day after Star Bank receives the check.
Other Purchase Information
Dividends begin to accrue after you become a shareholder. The Fund
does not issue share certificates. All shares are held in non-certificate form
registered on the books of the Fund and Unified Advisers, Inc., the Fund's
transfer agent (the "Transfer Agent"), for the account of the shareholder. The
rights to limit the amount of purchases and to refuse to sell to any person are
reserved by the Fund. If your check or wire does not clear, you will be
responsible for any loss incurred by the Fund. If you are already a shareholder,
the Fund can redeem shares from any identically registered account in the Fund
as reimbursement for any loss incurred. You may be prohibited or restricted from
making future purchases in the Fund.
REDEEMING SHARES
The Fund redeems shares at its net asset value next determined after
Star Bank receives the redemption request. Redemptions will be made on days on
which the Fund computes its net asset value. Redemption requests cannot be
executed on days on which the New York Stock Exchange is closed or on federal
holidays restricting wire transfers. Requests for redemption for the Fund can be
made in person, by telephone, or by mail.
By Telephone. Shareholders may redeem shares of the Fund by telephoning Star
Bank at 1-800-677-FUND. Redemption requests given by telephone may be
electronically recorded. For calls received by Star Bank before 3:30 p.m.
(Eastern time), proceeds will normally be wired the following day to the
shareholder's account at Star Bank or a check will be sent to the address of
record. In no event will proceeds be wired or a check mailed more than five
business days after a proper request for redemption has been received. If, at
any time, the Fund shall determine it necessary to terminate or modify this
method of redemption, shareholders will be promptly notified.
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In the event of drastic economic or market changes, a shareholder may
experience difficulty in redeeming by telephone, although neither the Fund nor
the transfer agent has ever experienced difficulties in receiving and in a
timely fashion responding to telephone requests for redemptions. If such a case
should occur, another method of redemption should be considered.
If reasonable procedures are not followed by the Fund, it may be
liable for losses, due to unauthorized or fraudulent telephone instructions.
By Mail. Shareholders may also redeem shares by sending a written request to
Star Select Funds Shareholder Services, Star Bank, N.A., 425 Walnut Street, ML
7135, Cincinnati, Ohio 45202. The written request must include the shareholder's
name, the Fund name, the account number, and the share or dollar amount
requested. Shareholders may call the Fund for assistance in redeeming by mail.
Signatures. Shareholders requesting a redemption of any amount to be
sent to an address other than that on record with the Fund or a redemption
payable other than to the shareholder of record must have signatures on written
redemption requests guaranteed by:
o a trust company or commercial bank whose deposits are insured by
the BIF, which is administered by the FDIC;
o a member of the New York, American, Boston, Midwest, or Pacific
Stock Exchange;
o a savings bank or savings and loan association whose deposits are
insured by the SAIF, which is administered by the FDIC; or
o any other "eligible guarantor institution" as defined in the
Securities Exchange Act of 1934.
The Fund does not accept signatures guaranteed by a notary public.
The Trust and its Transfer Agent have adopted standards for accepting
signature guarantees from the above institutions. The Trust may elect in the
future to limit eligible signature guarantors to institutions that are members
of a signature guarantee program. The Trust and its Transfer Agent reserve the
right to amend these standards at any time without notice.
Normally, a check for the proceeds is mailed within one business day,
but in no event more than five business days, after receipt of a proper written
redemption request.
Systematic Withdrawal Plan
Shareholders of the Fund may engage in a Systematic Withdrawal Plan.
Under this plan, shareholders may arrange for regular monthly or quarterly fixed
withdrawal payments. Each payment must be at least $25. Depending upon the
amount of the withdrawal payments and the amount of dividends paid with respect
to shares of the Fund, redemptions may reduce, and eventually deplete, the
shareholder's investment in the Fund. For this reason, payments under this plan
should not be considered as yield or income on the shareholder's investment in
the Fund.
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Additional Information - If you are not certain of the requirements
for a redemption please call Star Bank at (800) 677-FUND. Redemptions specifying
a certain date or share price cannot be accepted and will be returned. You will
be mailed the proceeds on or before the fifth business day following the
redemption. However, payment for redemption made against shares purchased by
check will be made only after the check has been collected, which normally may
take up to fifteen days.
Because the Fund incurs certain fixed costs in maintaining shareholder
accounts, the Fund reserves the right to require any shareholder to redeem all
of his or her shares in the Fund on 30 days' written notice if the value of his
or her shares in the Fund is less than $1,000 due to redemption, or such other
minimum amount as the Fund may determine from time to time. An involuntary
redemption constitutes a sale. You should consult your tax adviser concerning
the tax consequences of involuntary redemptions. A shareholder may increase the
value of his or her shares in the Fund to the minimum amount within the 30 day
period. Each share of the Fund is subject to redemption at any time if the Board
of Trustees determines in its sole discretion that failure to so redeem may have
materially adverse consequences to all or any of the shareholders of the Fund.
SHARE PRICE CALCULATION
The value of an individual share in the Fund (the net asset value) is
calculated by dividing the total value of the Fund's investments and other
assets (including accrued income), less any liabilities (including estimated
accrued expenses), by the number of shares outstanding, rounded to the nearest
cent. Net asset value per share is determined as of the close of the New York
Stock Exchange (4:00 p.m., Eastern time) on each day that the exchange is open
for business, and on any other day on which there is sufficient trading in the
Fund's securities to materially affect the net asset value. The net asset value
per share of the Fund will fluctuate.
Securities which are traded on any exchange or on the NASDAQ
over-the-counter market are valued at the last quoted sale price. Lacking a last
sale price, a security is valued at its last bid price except when, in the
Adviser's opinion, the last bid price does not accurately reflect the current
value of the security. All other securities for which over-the-counter market
quotations are readily available are valued at their last bid price. When market
quotations are not readily available, when the Adviser determines the last bid
price does not accurately reflect the current value or when restricted
securities are being valued, such securities are valued as determined in good
faith by the Adviser, subject to review by the Board of Trustees of the Trust.
Fixed income securities generally are valued by using market
quotations, but may be valued on the basis of prices furnished by a pricing
service when the Adviser believes such prices accurately reflect the fair market
value of such securities. A pricing service utilizes electronic data processing
techniques based on yield spreads relating to securities with similar
characteristics to determine prices for normal institutional-size trading units
of debt securities without regard to sale or bid prices. When prices are not
readily available from a pricing service, or when restricted or illiquid
securities are being valued, securities are valued at fair value as determined
in good faith by the Adviser, subject to review by the Board of Trustees. Short
term investments in fixed income securities with maturities of less than 60 days
when acquired, or which subsequently are within 60 days of maturity, are valued
by using the amortized cost method of valuation, which the Board has determined
will represent fair value.
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DIVIDENDS AND DISTRIBUTIONS
The Fund intends to distribute substantially all of its net investment
income as dividends to its shareholders on a quarterly basis, and intends to
distribute its net long term capital gains and its net short term capital gains
at least once a year.
Income dividends and capital gain distributions are automatically
reinvested in additional shares at the net asset value per share on the
distribution date. An election to receive a cash payment of dividends and/or
capital gain distributions may be made in the application to purchase shares or
by separate written notice to Star Bank. Shareholders will receive a
confirmation statement reflecting the payment and reinvestment of dividends and
summarizing all other transactions. If cash payment is requested, a check
normally will be mailed within five business days after the payable date. You
may elect to have distributions on shares held in IRAs and 403(b) plans paid in
cash only if you are 59 1/2 years old or permanently and totally disabled or if
you otherwise qualify under the applicable plan.
TAXES
The Fund intends to qualify each year as a "regulated investment
company" under the Internal Revenue Code of 1986, as amended. By so qualifying,
the Fund will not be subject to federal income taxes to the extent that it
distributes substantially all of its net investment income and any realized
capital gains.
For federal income tax purposes, dividends paid by the Fund from
ordinary income are taxable to shareholders as ordinary income, but may be
eligible in part for the dividends received deduction for corporations. Pursuant
to the Tax Reform Act of 1986 (the "Tax Reform Act"), all distributions of net
capital gains to individuals are taxed at the same rate as ordinary income. All
distributions of net capital gains to corporations are taxed at regular
corporate rates. Any distributions designated as being made from net realized
long term capital gains are taxable to shareholders as long term capital gains
regardless of the holding period of the shareholder.
The Fund will mail to each shareholder after the close of the calendar
year a statement setting forth the federal income tax status of distributions
made during the year. Dividends and capital gains distributions may also be
subject to state and local taxes. Shareholders are urged to consult their own
tax advisers regarding specific questions as to federal, state or local taxes
and the tax effect of distributions and withdrawals from the Fund.
On the application or other appropriate form, the Fund will request
the shareholder's certified taxpayer identification number (social security
number for individuals) and a certification that the shareholder is not subject
to backup withholding. Unless the shareholder provides this information, the
Fund will be required to withhold and remit to the U.S. Treasury 31% of the
dividends, distributions and redemption proceeds payable to the shareholder.
Shareholders should be aware that, under regulations promulgated by the Internal
Revenue Service, the Fund may be fined $50 annually for each account for which a
certified taxpayer identification number is not provided. In the event that such
a fine is imposed with respect to a specific account in any year, the Fund may
make a corresponding charge against the account.
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OPERATION OF THE FUND
The Fund is a diversified series of Star Select Funds, an open-end
management investment company organized as an Ohio business trust on February
____, 1997. The Board of Trustees supervises the business activities of the
Fund. Like other mutual funds, the Fund retains various organizations to perform
specialized services.
The Fund retains Star Bank, N.A., 425 Walnut Street, Cincinnati, Ohio
45201 (the "Adviser" or "Star Bank") to manage the Fund's investments. The
Adviser continually conducts investment research and supervision for the Fund
and is responsible for the purchase or sale of portfolio instruments, for which
it receives an annual fee from the Fund. The Fund is authorized to pay the
Adviser a monthly fee equal to an annual average rate of 0.75% of its average
daily net assets.
Star Bank, a national bank, was founded in 1863 and is the largest
bank and trust organization of Star Banc Corporation. As of December 31, 1996,
Star Bank had an asset base of $10.1 billion. Star Bank's expertise in trust
administration, investments, and estate planning ranks it among the most
predominant trust institutions in Ohio, with assets of $30.2 billion as of
December 31, 1996.
Star Bank has managed commingled funds since 1957. As of December 31,
1996, it managed one common trust funds and two collective investment funds
having a market value in excess of $65.9 million. Additionally, Star Bank has
managed the portfolios of the Star Funds, another registered investment company,
since 1989. As of December 31, 1996, the combined assets of the Star Funds and
the commingled funds managed by the Adviser exceeded $2 billion.
As part of its regular banking operations, Star Bank may make loans to
public companies. Thus, it may be possible, from time to time, for the Fund to
hold or acquire the securities of issuers which are also lending clients of Star
Bank. The lending relationship will not be a factor in the selection of
securities.
Fred A. Brink has been primarily responsible for the day-to-day
management of the Fund's portfolio since its inception. He is a Fund Manager and
Trust Investment Officer for the Capital Management Division of Star Bank. Mr.
Brink managed the cash components of the Star Funds from July 1991 through July
1994. In July of 1994, Mr. Brink assumed the responsibility for managing the
REIT components of the Stellar Fund and the Star Strategic Income Fund, and from
August 1995, he has managed the Star Capital Appreciation Fund. The Stellar
Fund, the Star Strategic Income Fund and the Star Capital Appreciation Fund are
all series of the Star Funds. Mr. Brink earned a Bachelor of Business
Administration degree in Finance from the University of Cincinnati and he is
currently enrolled in the Chartered Financial Analyst Program.
The Fund also retains Star Bank to act as shareholder servicing agent
on its behalf. The Fund is authorized to pay Star Bank up to 0.25% of its
average daily net assets to provide shareholder support services and to maintain
shareholder accounts. Star Bank currently receives 0.05% of the Fund's average
daily net assets for shareholder services and it is anticipated that the fee
will remain at 0.05% for the foreseeable future. Star Bank also acts as the
Fund's custodian, for which it receives a monthly fee equal to an annual average
rate of ______% of its average daily net assets.
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The Fund retains Unified Advisers, Inc. ("Unified"), 429 N.
Pennsylvania Street, Indianapolis, Indiana 46204, to act as the Fund's
administrator and transfer agent. As administrator, Unified manages the Fund's
business affairs and provides the Fund with administrative services, including
compliance and accounting services and all regulatory reporting, and necessary
office equipment, personnel and facilities to operate the Fund. For these
administrative and transfer agency services, it receives a monthly fee from the
Fund equal to an annual average rate of 0.25% of the Fund's average daily net
assets.
The Fund retains Unified Management Corporation, 429 N. Pennsylvania
Street, Indianapolis, Indiana 46204 (the "Distributor") to act as the principal
distributor of the Fund's shares. The 12b-1 fees paid by the Fund are described
below under "Distribution Plan."
Consistent with the Rules of Fair Practice of the National Association
of Securities Dealers, Inc., and subject to its obligation of seeking best
qualitative execution, the Adviser may give consideration to sales of shares of
the Fund as a factor in the selection of brokers and dealers to execute
portfolio transactions.
DISTRIBUTION PLAN
Pursuant to the provisions of a distribution plan adopted in
accordance with the Investment Company Act Rule 12b-1 (the "Plan"), the Fund may
pay to the Distributor an amount computed at an annual rate of up to 0.25% of
the average daily net assets to finance any activity which is principally
intended to result in the sale of shares subject to the Plan. The Distributor
may from time to time, and for such periods as it deems appropriate, voluntarily
reduce its compensation under the Plan to the extent the expenses attributable
to the shares exceed such lower expense limitation as the Distributor may, by
notice to the Trust, voluntarily declare to be effective.
The Distributor may select financial institutions such as banks
(including the Adviser), fiduciaries, custodians for public funds, investment
advisers, and broker/dealers to provide sales and/or administrative support
services as agents for their clients or customers who beneficially own shares of
the Fund. Financial institutions will receive fees from the distributor based
upon shares owned by their clients or customers. The schedules of such fees and
the basis upon which such fees will be paid will be determined from time to time
by the Distributor.
The Fund Plan is a compensation type plan. As such, the Fund makes no
payments to the Distributor except as described above. Therefore, the Fund does
not pay for unreimbursed expenses of the Distributor, including amounts expended
by the Distributor in excess of amounts received by it from the Fund, interest,
carrying or other financing charges in connection with excess amounts expended,
or the Distributor's overhead expenses. However, the Distributor may be able to
recover such amounts or may earn a profit from future payments made by the Fund
under the Plan.
The Glass-Steagall Act limits the ability of a depository institution
(such as a commercial bank or a savings and loan association) to become an
underwriter or distributor of securities. In the event the Glass-Steagall Act is
deemed to prohibit depository institutions from acting in the capacities
described above or should Congress relax current restrictions on depository
institutions, the Trustees will consider appropriate changes in the services.
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State securities laws governing the ability of depository institutions
to act as underwriters or distributors of securities may differ from
interpretations given to the Glass-Steagall Act and, therefore, banks and
financial institutions may be required to register as dealers pursuant to state
law.
INVESTMENT POLICIES AND TECHNIQUES
This section contains general information about various types of
securities and investment techniques that the Fund may purchase or employ.
Equity Securities
The Fund may invest in common stock, preferred stock and common stock
equivalents (such as convertible preferred stock and convertible debentures) of
real estate related companies (including REITs) and other companies. Convertible
preferred stock is preferred stock that can be converted into common stock
pursuant to its terms. Convertible debentures are debt instruments that can be
converted into common stock pursuant to their terms. The Adviser intends to
invest only in convertible debentures rated A or higher by Standard & Poor's
Corporation ("S&P") or by Moody's Investors Services, Inc. ("Moody's") or, if
unrated, are deemed to be of comparable quality by the Adviser. The Fund may
hold warrants and rights issued in conjunction with common stock, but in general
will sell any such warrants or rights as soon as practicable after they are
received. Warrants are options to purchase equity securities at a specified
price valid for a specific time period. Rights are similar to warrants, but
normally have a short duration and are distributed by the issuer to its
shareholders.
General
The Fund may invest up to 5% of its net assets in U.S. government
obligations, and up to 5% of its net assets in corporate bonds and notes. The
Fund intends to invest only in fixed income securities rated A or higher by
Moody's Investors Services, Inc. or by Standard and Poor's Corporation or, if
unrated, are deemed to be of comparable quality by the Adviser.
The Fund may utilize the following investment techniques, provided the
Fund's investment in each does not exceed 5% of its net assets: purchasing call
options on stocks and stock indices; purchasing put options on stocks and stock
indices; writing (selling) call options on stocks and stock indices; and writing
(selling) put options on stocks and stock indices. See "Additional Information
About Fund Investments and Risk Considerations" in the Statement of Additional
Information.
GENERAL INFORMATION
Fundamental Policies. The investment limitations set forth in the
Statement of Additional Information as fundamental policies may not be changed
without the affirmative vote of the majority of the outstanding shares of the
Fund. The investment objective of the Fund may be changed without the
affirmative vote of a majority of the outstanding shares of the Fund. Any such
change may result in the Fund having an investment objective different from the
objective which the shareholders considered appropriate at the time of
investment in the Fund.
Portfolio Turnover. The Fund does not intend to purchase or sell
securities for short term trading purposes. The Fund will, however, sell any
portfolio security (without regard to the length of
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<PAGE>
time it has been held) when the Adviser believes that market conditions,
creditworthiness factors or general economic conditions warrant such action. It
is anticipated that the Fund will have a portfolio turnover rate of less than
100%.
Shareholder Rights. Any Trustee of the Trust may be removed by vote of
the shareholders holding not less than two-thirds of the outstanding shares of
the Trust. The Trust does not hold an annual meeting of shareholders. When
matters are submitted to shareholders for a vote, each shareholder is entitled
to one vote for each whole share he owns and fractional votes for fractional
shares he owns. All shares of the Fund have equal voting rights and liquidation
rights. Prior to the offering made by this Prospectus, First Cinco purchased for
investment all of the outstanding shares of the Fund. As a result, First Cinco
may be deemed to control the Fund.
Effect of Banking Laws. The Glass-Steagall Act and other banking laws
and regulations presently prohibit a bank holding company registered under the
Bank Holding Company Act of 1956 or any affiliate thereof from sponsoring,
organizing, or controlling a registered, open-end management investment company
continuously engaged in the issuance of its shares, and from issuing,
underwriting, selling, or distributing securities in general. Such laws and
regulations do not prohibit such a holding company or affiliate from acting as
investment adviser, transfer agent, or custodian to such an investment company
or from purchasing shares of such a company as agent for and upon the order of
their customers. The Fund's investment adviser, Star Bank, is subject to such
banking laws and regulations.
Star Bank believes that it may perform the investment advisory
services for the Fund contemplated by its advisory agreement with the Trust
without violating the Glass-Steagall Act or other applicable banking laws or
regulations. Changes in either federal or state statutes and regulations
relating to the permissible activities of banks and their subsidiaries or
affiliates, as well as further judicial or administrative decisions or
interpretations of present or future statutes and regulations, could prevent
Star Bank from continuing to perform all or a part of the above services for its
customers and/or the Fund.
In such event, changes in the operation of the Fund may occur,
including the possible alteration or termination of any automatic or other Fund
share investment and redemption services then being provided by Star Bank, and
the Trustees would consider alternative investment advisers and other means of
continuing available investment services. It is not expected that shareholders
would suffer any adverse financial consequences (if another adviser with
equivalent abilities to Star Bank is found) as a result of any of these
occurrences.
PERFORMANCE INFORMATION
The Fund may periodically advertise "average annual total return." The
"average annual total return" of the Fund refers to the average annual
compounded rate of return over the stated period that would equate an initial
amount invested at the beginning of a stated period to the ending redeemable
value of the investment. The calculation of "average annual total return"
assumes the reinvestment of all dividends and distributions.
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<PAGE>
The Fund may also periodically advertise its total return over various
periods in addition to the value of a $10,000 investment (made on the date of
the initial public offering of the Fund's shares) as of the end of a specified
period. The "total return" for the Fund refers to the percentage change in the
value of an account between the beginning and end of the stated period, assuming
no activity in the account other than reinvestment of dividends and capital
gains distributions.
The Fund may also include in advertisements data comparing
performance with other mutual funds as reported in non-related investment media,
published editorial comments and performance rankings compiled by independent
organizations and publications that monitor the performance of mutual funds
(such as Lipper Analytical Services, Inc., Morningstar, Inc., Fortune or
Barron's). Performance information may be quoted numerically or may be presented
in a table, graph or other illustration. In addition, Fund performance may be
compared to well-known indices of market performance including the NAREIT
(National Association of Real Estate Investment Trusts) Index, the Standard &
Poor's (S&P) 500 Index or the Dow Jones Industrial Average.
The advertised performance data of the Fund is based on historical
performance and is not intended to indicate future performance. Rates of total
return quoted by the Fund may be higher or lower than past quotations, and there
can be no assurance that any rate of total return will be maintained. The
principal value of an investment in the Fund will fluctuate so that a
shareholder's shares, when redeemed, may be worth more or less than the
shareholder's original investment.
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<PAGE>
Investment Adviser Transfer Agent and Administrator
Star Bank, N.A. Unified Advisers, Inc.
425 Walnut Street 429 N. Pennsylvania Street
Cincinnati, Ohio 45201 Indianapolis, Indiana 46204
Custodian and Shareholder Servicing Agent Auditors
Star Bank, N.A. McCurdy & Associates CPA's, Inc.
P.O. Box 641083 27955 Clemens Road
Cincinnati, Ohio 45264 Westlake, Ohio 44145
Distributor
Unified Management Corporation
429 N. Pennsylvania Street
Indianapolis, Indiana 46204
No person has been authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offering contained in this Prospectus, and if given or made, such
information or representations must not be relied upon as being authorized by
the Fund. This Prospectus does not constitute an offer by the Fund to sell its
shares in any state to any person to whom it is unlawful to make such offer in
such state.
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<PAGE>
TABLE OF CONTENTS
PAGE
SUMMARY OF FUND EXPENSES.................................................. 2
Shareholder Transaction Expenses................................ 2
Annual Fund Operating Expenses.................................. 2
THE FUND ................................................................ 2
INVESTMENT OBJECTIVE AND STRATEGIES AND RISK CONSIDERATIONS............... 3
HOW TO INVEST IN THE FUND................................................. 4
Minimum Investment Required..................................... 4
Systematic Investment Plan...................................... 4
Share Purchases................................................. 4
Other Purchase Information...................................... 5
REDEEMING SHARES.......................................................... 5
Systematic Withdrawal Plan...................................... 6
Additional Information.......................................... 7
SHARE PRICE CALCULATION................................................... 7
DIVIDENDS AND DISTRIBUTIONS............................................... 8
TAXES ................................................................ 8
OPERATION OF THE FUND..................................................... 9
DISTRIBUTION PLAN......................................................... 10
INVESTMENT POLICIES AND TECHNIQUES ....................................... 11
Equity Securities............................................... 11
General ....................................................... 11
GENERAL INFORMATION....................................................... 12
Fundamental Policies............................................ 12
Portfolio Turnover.............................................. 12
Shareholder Rights.............................................. 12
Effect of Banking Laws.......................................... 12
PERFORMANCE INFORMATION................................................... 13
<PAGE>
STAR REIT-PLUS FUND
STATEMENT OF ADDITIONAL INFORMATION
_________________, 1997
This Statement of Additional Information is not a prospectus. It should
be read in conjunction with the Prospectus of Star REIT Plus Fund dated
____________________, 1997. A copy of the Prospectus can be obtained by writing
the Transfer Agent at 429 N. Pennsylvania Street, Indianapolis, Indiana 46204,
or by calling 1-800-677-FUND.
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
-----------------------------------
TABLE OF CONTENTS
-----------------
PAGE
----
DESCRIPTION OF THE TRUST..................................................... 1
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS
AND RISK CONSIDERATIONS...................................................... 1
INVESTMENT LIMITATIONS....................................................... 3
THE INVESTMENT ADVISER....................................................... 5
TRUSTEES AND OFFICERS........................................................ 6
PORTFOLIO TRANSACTIONS AND BROKERAGE......................................... 7
DISTRIBUTION PLAN............................................................ 8
SHAREHOLDER SERVICES PLAN.................................................... 9
CONVERSION TO FEDERAL FUNDS.................................................. 9
DETERMINATION OF SHARE PRICE................................................. 9
INVESTMENT PERFORMANCE....................................................... 9
CUSTODIAN.................................................................... 10
TRANSFER AGENT AND ADMINISTRATOR............................................. 10
ACCOUNTANTS.................................................................. 10
DISTRIBUTOR.................................................................. 11
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<PAGE>
DESCRIPTION OF THE TRUST
Star REIT-Plus Fund (the "Fund") was organized as a series of Star
Select Funds (the "Trust"). The Trust is an open-end investment company
established under the laws of Ohio by an Agreement and Declaration of Trust
dated February 28, 1997 (the "Trust Agreement"). The Trust Agreement permits the
Trustees to issue an unlimited number of shares of beneficial interest of
separate series without par value. The Fund is the only series currently
authorized by the Trustees.
Each share of a series represents an equal proportionate interest in
the assets and liabilities belonging to that series with each other share of
that series and is entitled to such dividends and distributions out of income
belonging to the series as are declared by the Trustees. The shares do not have
cumulative voting rights or any preemptive or conversion rights, and the
Trustees have the authority from time to time to divide or combine the shares of
any series into a greater or lesser number of shares of that series so long as
the proportionate beneficial interest in the assets belonging to that series and
the rights of shares of any other series are in no way affected. In case of any
liquidation of a series, the holders of shares of the series being liquidated
will be entitled to receive as a class a distribution out of the assets, net of
the liabilities, belonging to that series. Expenses attributable to any series
are borne by that series. Any general expenses of the Trust not readily
identifiable as belonging to a particular series are allocated by or under the
direction of the Trustees in such manner as the Trustees determine to be fair
and equitable. No shareholder is liable to further calls or to assessment by the
Trust without his or her express consent.
The Fund has filed an election with the Securities and Exchange
Commission which permits the Fund to make redemption payments in whole or in
part in securities or other property if the Trustees determine that existing
conditions make cash payments undesirable. However, the Fund has committed to
pay in cash all redemptions for any shareholder, limited in amount with respect
to each shareholder during any ninety day period to the lesser of (a) $250,000
or (b) one percent of the net asset value of the Fund at the beginning of such
period. For other information concerning the purchase and redemption of shares
of the Fund, see "How to Invest in the Fund" and "Redeeming Shares" in the
Fund's Prospectus. For a description of the methods used to determine the share
price and value of the Fund's assets, see "Share Price Calculation" in the
Fund's Prospectus.
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS AND RISK
CONSIDERATIONS
This section contains a more detailed discussion of some of the
investments the Fund may make and some of the techniques it may use, as
described in the Prospectus (see "Investment Objective and Strategies and Risk
Considerations" and "Investment Policies and Techniques").
A. Corporate Debt Securities. Corporate debt securities are bonds or
notes issued by corporations and other business organizations, including
business trusts, in order to finance their credit needs. Corporate debt
securities include commercial paper which consists of short term (usually from
one to two hundred seventy days) unsecured promissory notes issued by
corporations in order to finance their current operations.
B. U.S. Government Obligations. U.S. government obligations may be
backed by the credit of the government as a whole or only by the issuing agency.
U.S. Treasury bonds, notes, and bills and some agency securities, such as those
issued by the Federal Housing Administration
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<PAGE>
and the Government National Mortgage Association (GNMA), are backed by the full
faith and credit of the U.S. government as to payment of principal and interest
and are the highest quality government securities. Other securities issued by
U.S. government agencies or instrumentalities, such as securities issued by the
Federal Home Loan Banks and the Federal Home Loan Mortgage Corporation, are
supported only by the credit of the agency that issued them, and not by the U.S.
government. Securities issued by the Federal Farm Credit System, the Federal
Land Banks, and the Federal National Mortgage Association (FNMA) are supported
by the agency's right to borrow money from the U.S. Treasury under certain
circumstances, but are not backed by the full faith and credit of the U.S.
government.
C. Repurchase Agreements. The Fund may invest in repurchase agreements
fully collateralized by U.S. Government obligations. A repurchase agreement is a
short-term investment in which the purchaser (i.e., the Fund) acquires ownership
of a U.S. Government obligation (which may be of any maturity) and the seller
agrees to repurchase the obligation at a future time at a set price, thereby
determining the yield during the purchaser's holding period (usually not more
than seven days from the date of purchase). Any repurchase transaction in which
the Fund engages will require full collateralization of the seller's obligation
during the entire term of the repurchase agreement. In the event of a bankruptcy
or other default of the seller, the Fund could experience both delays in
liquidating the underlying security and losses in value. However, the Fund
intends to enter into repurchase agreements only with banks with assets of $1
billion or more and registered securities dealers determined by the Advisor
(subject to review by the Board of Trustees) to be creditworthy. The Advisor
monitors the creditworthiness of the banks and securities dealers with which the
Fund engages in repurchase transactions.
D. Option Transactions. The Fund may engage in option transactions
involving individual securities and market indexes. An option involves either
(a) the right or the obligation to buy or sell a specific instrument at a
specific price until the expiration date of the option, or (b) the right to
receive payments or the obligation to make payments representing the difference
between the closing price of a market index and the exercise price of the option
expressed in dollars times a specified multiple until the expiration date of the
option. Options are sold (written) on securities and market indexes. The
purchaser of an option on a security pays the seller (the writer) a premium for
the right granted but is not obligated to buy or sell the underlying security.
The purchaser of an option on a market index pays the seller a premium for the
right granted, and in return the seller of such an option is obligated to make
the payment. A writer of an option may terminate the obligation prior to
expiration of the option by making an offsetting purchase of an identical
option. Options are traded on organized exchanges and in the over-the-counter
market. To cover the potential obligations involved in writing options, the Fund
will own the underlying security, or the Fund will segregate with the Custodian
(a) high grade liquid debt assets sufficient to purchase the underlying
security, or (b) high grade liquid debt assets equal to the market value of the
stock index.
The purchase and writing of options requires additional skills and
techniques beyond normal portfolio management, and involves certain risks. The
purchase of options limits the Fund's potential loss to the amount of the
premium paid and can afford the Fund the opportunity to profit from favorable
movements in the price of an underlying security to a greater extent than if
transactions were effected in the security directly. However, the purchase of an
option could result in the Fund losing a greater percentage of its investment
than if the transaction were effected directly. When the Fund writes a call
option, it will receive a premium, but it will give up the
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<PAGE>
opportunity to profit from a price increase in the underlying security above the
exercise price as long as its obligation as a writer continues, and it will
retain the risk of loss should the price of the security decline. When the Fund
writes a put option, it will assume the risk that the price of the underlying
security or instrument will fall below the exercise price, in which case the
Fund may be required to purchase the security or instrument at a higher price
than the market price of the security or instrument. In addition, there can be
no assurance that the Fund can effect a closing transaction on a particular
option it has written. Further, the total premium paid for any option may be
lost if the Fund does not exercise the option or, in the case of
over-the-counter options, the writer does not perform its obligations.
INVESTMENT LIMITATIONS
Fundamental. The investment limitations described below have been
adopted by the Trust with respect to the Fund and are fundamental
("Fundamental"), i.e., they may not be changed without the affirmative vote of a
majority of the outstanding shares of the Fund. As used in the Prospectus and
this Statement of Additional Information, the term "majority" of the outstanding
shares of the Fund means the lesser of (1) 67% or more of the outstanding shares
of the Fund present at a meeting, if the holders of more than 50% of the
outstanding shares of the Fund are present or represented at such meeting; or
(2) more than 50% of the outstanding shares of the Fund. Other investment
practices which may be changed by the Board of Trustees without the approval of
shareholders to the extent permitted by applicable law, regulation or regulatory
policy are considered non-fundamental ("Non-Fundamental").
1. Borrowing Money. The Fund will not borrow money, except (a) from a
bank, provided that immediately after such borrowing there is an asset coverage
of 300% for all borrowings of the Fund; or (b) from a bank or other persons for
temporary purposes only, provided that such temporary borrowings are in an
amount not exceeding 5% of the Fund's total assets at the time when the
borrowing is made. This limitation does not preclude the Fund from entering into
reverse repurchase transactions, provided that the Fund has an asset coverage of
300% for all borrowings and repurchase commitments of the Fund pursuant to
reverse repurchase transactions.
2. Senior Securities. The Fund will not issue senior securities. This
limitation is not applicable to activities that may be deemed to involve the
issuance or sale of a senior security by the Fund, provided that the Fund's
engagement in such activities is (a) consistent with or permitted by the
Investment Company Act of 1940, as amended, the rules and regulations
promulgated thereunder or interpretations of the Securities and Exchange
Commission or its staff and (b) as described in the Prospectus and this
Statement of Additional Information.
3. Underwriting. The Fund will not act as underwriter of securities
issued by other persons. This limitation is not applicable to the extent that,
in connection with the disposition of portfolio securities (including restricted
securities), the Fund may be deemed an underwriter under certain federal
securities laws.
4. Real Estate. The Fund will not purchase or sell real estate. This
limitation is not applicable to investments in marketable securities which are
secured by or represent interests in real estate. This limitation does not
preclude the Fund from investing in mortgage-related securities or
- 3 -
<PAGE>
investing in companies engaged in the real estate business or that have a
significant portion of their assets in real estate (including real estate
investment trusts).
5. Commodities. The Fund will not purchase or sell commodities unless
acquired as a result of ownership of securities or other investments. This
limitation does not preclude the Fund from purchasing or selling options or
futures contracts, from investing in securities or other instruments backed by
commodities or from investing in companies which are engaged in a commodities
business or have a significant portion of their assets in commodities.
6. Loans. The Fund will not make loans to other persons, except (a) by
loaning portfolio securities, (b) by engaging in repurchase agreements, or (c)
by purchasing nonpublicly offered debt securities. For purposes of this
limitation, the term "loans" shall not include the purchase of a portion of an
issue of publicly distributed bonds, debentures or other securities.
7. Concentration. The Fund will not invest 25% or more of its total
assets in any particular industry other than the real estate industry. This
limitation is not applicable to investments in obligations issued or guaranteed
by the U.S. government, its agencies and instrumentalities or repurchase
agreements with respect thereto.
With respect to the percentages adopted by the Trust as maximum
limitations on its investment policies and limitations, an excess above the
fixed percentage will not be a violation of the policy or limitation unless the
excess results immediately and directly from the acquisition of any security or
the action taken. This paragraph does not apply to the borrowing policy set
forth in paragraph 1 above.
Notwithstanding any of the foregoing limitations, any investment
company, whether organized as a trust, association or corporation, or a personal
holding company, may be merged or consolidated with or acquired by the Trust,
provided that if such merger, consolidation or acquisition results in an
investment in the securities of any issuer prohibited by said paragraphs, the
Trust shall, within ninety days after the consummation of such merger,
consolidation or acquisition, dispose of all of the securities of such issuer so
acquired or such portion thereof as shall bring the total investment therein
within the limitations imposed by said paragraphs above as of the date of
consummation.
Non-Fundamental. The following limitations have been adopted by the
Trust with respect to the Fund and are Non-Fundamental (see "Investment
Limitations" above).
1. Pledging. The Fund will not mortgage, pledge, hypothecate or in any
manner transfer, as security for indebtedness, any assets of the Fund except as
may be necessary in connection with borrowings described in limitation (1)
above. Margin deposits, security interests, liens and collateral arrangements
with respect to transactions involving options, futures contracts, short sales
and other permitted investments and techniques are not deemed to be a mortgage,
pledge or hypothecation of assets for purposes of this limitation.
2. Borrowing. The Fund will not purchase any security while borrowings
(including reverse repurchase agreements) representing more than 5% of its total
assets are outstanding.
- 4 -
<PAGE>
3. Margin Purchases. The Fund will not purchase securities or
evidences of interest thereon on "margin." This limitation is not applicable to
short term credit obtained by the Fund for the clearance of purchases and sales
or redemption of securities, or to arrangements with respect to transactions
involving options, futures contracts, short sales and other permitted
investments and techniques.
4. Options. The Fund will not purchase or sell puts, calls, options or
straddles, except as described in the Prospectus and this Statement of
Additional Information.
5. Short Sales. The Fund will not effect short sales of securities.
THE INVESTMENT ADVISER
The Fund's investment adviser is Star Bank, N.A., 425 Walnut Street,
Cincinnati, Ohio 45201 ("Star Bank" or the "Adviser"). The Adviser is a wholly
owned subsidiary of Star Banc Corporation. Because of internal controls
maintained by the Adviser to restrict the flow of non-public information, Fund
investments are typically made without any knowledge of Star Bank's or its
affiliates' lending relationships with an issuer.
Under the terms of the management agreement (the "Agreement"), the
Adviser manages the Fund's investments subject to approval of the Board of
Trustees. As compensation for its management services, the Fund is obligated to
pay the Adviser a fee computed and accrued daily and paid monthly at an annual
rate of 0.75% of the average daily net assets of the Fund. The Adviser may waive
all or part of its fee, at any time, and at its sole discretion, but such action
shall not obligate the Adviser to waive any fees in the future.
The Adviser retains the right to use the names "Star," "Star Select,"
"Star REIT-Plus" or any variation thereof in connection with another investment
company or business enterprise with which the Adviser is or may become
associated. The Trust's right to use the names "Star," "Star REIT-Plus" or any
variation thereof automatically ceases ninety days after termination of the
Agreement and may be withdrawn by the Adviser on ninety days written notice.
The Adviser will, and other banks and financial institutions may,
provide shareholder services and administer shareholder accounts. The
Glass-Steagall Act prohibits banks from engaging in the business of
underwriting, selling or distributing securities. Although the scope of this
prohibition under the Glass-Steagall Act has not been clearly defined by the
courts or appropriate regulatory agencies, management of the Fund believes that
the Glass-Steagall Act should not preclude a bank from providing shareholder and
shareholder account services. However, state securities laws on this issue may
differ from the interpretations of federal law expressed herein and banks and
financial institutions may be required to register as dealers pursuant to state
law. If a bank were prohibited from continuing to perform all or a part of such
services, management of the Fund believes that there would be no material impact
on the Fund or its shareholders. Banks may charge their customers fees for
offering these services to the extent permitted by applicable regulatory
authorities, and the overall return to those shareholders availing themselves of
the bank services will be lower than to those shareholders who do not. The Fund
may from time to time purchase securities issued by banks which provide such
services; however, in selecting investments for the Fund, no preference will be
shown for such securities. The Fund will not purchase securities issued by
Star Banc Corporation, the Adviser, or any of its affiliates.
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<PAGE>
TRUSTEES AND OFFICERS
The names of the Trustees and executive officers of the Trust are shown
below. Each Trustee who is an "interested person" of the Trust, as defined in
the Investment Company Act of 1940, is indicated by an asterisk.
Name, Address and Age Positions with the Trust and Principal Occupation
--------------------- -------------------------------------------------
* Timothy L. Ashburn (46) Trustee (Chairman of the Board) and President of
429 N. Pennsylvania St. the Trust and The Vintage Funds; Chairman of the
Indianapolis, IN 46204 Board and President, Vintage Advisers, Inc.
(December 1994 to present); Chairman of the
Board, Unified Corporation, Unified Management
Corporation and Unified Advisers, Inc.**
(December 1989 to present); Trust Division
Manager and Senior Trust Officer, Vine Street
Trust Company (July 1991 to April 1994).
Charles H. Binger (40) Trustee of the Trust and The Vintage Funds;
One Merchantile Center Partner, Thompson Coburn (1987 to present).
Suite 3300
St. Louis, MO 63101
Daniel J. Condon (46) Trustee of the Trust and The Vintage Funds;
101 Carley Court Vice President and Officer, International
Georgetown, KY 40324 Crankshaft Inc. (1990 to present);General
Manager, Van Leer Containers, Inc. (1988 through
1990).
Philip L. Conover (50) Trustee of the Trust and The Vintage Funds;
8218 Cypress Hollow Adjunct Professor of Finance, University of South
Sarasota, FL 34238 Florida (August 1994 to present); Managing
Director and Chief Operating Officer, Federal
Housing Finance Board (November 1990 through
April 1994); President and CEO, Trustcorp Bank
(February 1989 through November 1990).
David E. LaBelle (47) Trustee of the Trust and The Vintage Funds;
5005 LBJ Freeway Vice President of Compensation and Benefits,
Dallas, TX 76092 Occidental Chemical Corporation (May 1993 to
present); Vice President of Human Resources,
Island Creek Coal Company (A subsidiary of
Occidental Petroleum) (June 1990 to April
1993); Director of Human Resources, Occidental
Chemical Corporation (March 1989 to May 1990).
* Jack R. Orben (58) Trustee of the Trust and The Vintage Funds;
40 Wall St. Director, Unified Holdings, Inc.**; Chairman and
New York, NY 10005 CEO, Associated Family Services (January 1980 to
present); Chairman and CEO, Starwood Corporation
(March 1984 to present); Chairman, Fiduciary
Counsel, Inc. (April 1979 to present); Chairman,
Estate Management Company (January 1978 to
present).
- 6 -
<PAGE>
Thomas G. Napurano (55) Treasurer of the Trust and The Vintage Funds;
429 N. Pennsylvania St. Executive Vice President and Chief Financial
Indianapolis, IN 46204 Officer, Vintage Advisers, Inc. (January 1995
to present; Executive Vice President and Chief
Financial Officer of Unified Corporation,
Unified Management Corporation and Unified
Advisers, Inc.** (1990 to present).
Carol J. Highsmith (32) Secretary of the Trust and The Vintage Funds;
429 N. Pennsylvania St. Secretary of Unified Holdings, Inc. and
Indianapolis, IN 46204 Vintage Advisers, Inc. (October 1996 to
present); employed by Unified Advisers, Inc.**
(November 1994 to present).
Trustee fees are Trust expenses. The following table estimates the
Trustees' compensation for the first full year of the Trust ending
________________, 1997.
==========================================================================
Total Compensation
from Trust (the Trust is
Name not in a Fund Complex)
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
==========================================================================
** Unified Advisers, Inc. is the Fund's transfer agent and administrator, and
Unified Management Corporation is the Fund's principal underwriter. Unified
Advisers, Inc. and Unified Management Corporation are subsidiaries of Unified
Holdings, Inc.
PORTFOLIO TRANSACTIONS AND BROKERAGE
Subject to policies established by the Board of Trustees of the Trust,
the Adviser is responsible for the Fund's portfolio decisions and the placing of
the Fund's portfolio transactions. In placing portfolio transactions, the
Adviser seeks the best qualitative execution for the Fund, taking into account
such factors as price (including the applicable brokerage commission or dealer
spread), the execution capability, financial responsibility and responsiveness
of the broker or dealer and the brokerage and research services provided by the
broker or dealer. The Adviser generally seeks favorable prices and commission
rates that are reasonable in relation to the benefits received.
The Adviser is specifically authorized to select brokers or dealers who
also provide brokerage and research services to the Fund and/or the other
accounts over which the Adviser exercises investment discretion and to pay such
brokers or dealers a commission in excess of the commission another broker or
dealer would charge if the Adviser determines in good faith that the commission
is reasonable in relation to the value of the brokerage and research services
provided. The determination may be viewed in terms of a particular transaction
or the Adviser's overall responsibilities with respect to the Trust and to other
accounts over which it exercises investment discretion.
Research services include supplemental research, securities and
economic analyses, statistical services and information with respect to the
availability of securities or purchasers or sellers of
- 7 -
<PAGE>
securities and analyses of reports concerning performance of accounts. The
research services and other information furnished by brokers through whom the
Fund effects securities transactions may also be used by the Adviser in
servicing all of its accounts. Similarly, research and information provided by
brokers or dealers serving other clients may be useful to the Adviser in
connection with its services to the Fund. Although research services and other
information are useful to the Fund and the Adviser, it is not possible to place
a dollar value on the research and other information received. It is the opinion
of the Board of Trustees and the Adviser that the review and study of the
research and other information will not reduce the overall cost to the Adviser
of performing its duties to the Fund under the Agreement.
Over-the-counter transactions will be placed either directly with
principal market makers or with broker-dealers, if the same or a better price,
including commissions and executions, is available. Fixed income securities are
normally purchased directly from the issuer, an underwriter or a market maker.
Purchases include a concession paid by the issuer to the underwriter and the
purchase price paid to a market maker may include the spread between the bid and
asked prices.
Although investment decisions for the Fund are made independently from
those of the other accounts managed by the Adviser, investments of the type the
Fund may make may also be made by those other accounts. When the Fund and one or
more other accounts managed by the Adviser are prepared to invest in, or desire
to dispose of, the same security, available investments or opportunities for
sales will be allocated in a manner believed by the Adviser to be equitable to
each. In some cases, this procedure may adversely affect the price paid or
received by the Fund or the size of the position obtained or disposed of by the
Fund. In other cases, however, it is believed that coordination and the ability
to participate in volume transactions will be to the benefit of the Fund.
When the Fund and another of the Adviser's clients seek to purchase or
sell the same security at or about the same time, the Adviser may execute the
transaction on a combined ("blocked") basis. Blocked transactions can produce
better execution for the Fund because of the increased volume of the
transaction. If the entire blocked order is not filled, the Fund may not be able
to acquire as large a position in such security as it desires or it may have to
pay a higher price for the security. Similarly, the Fund may not be able to
obtain as large an execution of an order to sell or as high a price for any
particular portfolio security if the other client desires to sell the same
portfolio security at the same time. In the event that the entire blocked order
is not filled, the purchase or sale will normally be allocated on a pro rata
basis.
DISTRIBUTION PLAN
With respect to the Fund, the Trust has adopted a Plan pursuant to Rule
12b-1 which was promulgated by the Securities and Exchange Commission pursuant
to the Investment Company Act of 1940 (the "Plan"). The Plan provides for
payment of fees to Unified Management Corporation to finance any activity which
is principally intended to result in the sale of the Fund's shares subject to
the Plan. Such activities may include the advertising and marketing of shares of
the Fund; preparing, printing, and distributing prospectuses and sales
literature to prospective shareholders, brokers, or administrators; and
implementing and operating the Plan. Pursuant to the Plan, Unified Management,
Inc. may pay fees to brokers and others for such services. The Trustees expect
that the adoption of the Plan will result in the sale of a sufficient number of
shares so as to allow the Fund to achieve economic viability. It is also
anticipated that an increase in the size of the Fund
- 8 -
<PAGE>
will facilitate more efficient portfolio management and assist the Fund in
seeking to achieve its investment objective.
SHAREHOLDER SERVICES PLAN
This arrangement permits the payment of fees to the Fund and,
indirectly, to financial institutions to cause services to be provided to
shareholders by a representative who has knowledge of the shareholder's
particular circumstances and goals. These activities and services may include,
but are not limited to, providing office space, equipment, telephone facilities,
and various clerical, supervisory, computer, and other personnel as necessary or
beneficial to establish and maintain shareholder accounts and records;
processing purchase and redemption transactions and automatic investments of
client account cash balances; answering routine client inquiries; and assisting
clients in changing divided options, account designations, and addresses.
CONVERSION TO FEDERAL FUNDS
It is the Fund's policy to be as fully invested as possible so that
maximum interest may be earned. To this end, all payments from shareholders must
be in federal funds or be converted into federal funds. Star Bank acts as the
shareholder's agent in depositing checks and converting them to federal funds.
DETERMINATION OF SHARE PRICE
The price (net asset value) of the shares of the Fund is determined as
of 4:00 p.m., Eastern time on each day the Trust is open for business and on any
other day on which there is sufficient trading in the Fund's securities to
materially affect the net asset value. The Trust is open for business on every
day except Saturdays, Sundays and the following holidays: New Year's Day,
President's Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas. For a description of the methods used to determine
the net asset value (share price), see "Share Price Calculation" in the
Prospectus.
INVESTMENT PERFORMANCE
"Average annual total return," as defined by the Securities and
Exchange Commission, is computed by finding the average annual compounded rates
of return for the period indicated that would equate the initial amount invested
to the ending redeemable value, according to the following formula:
P(1+T)n=ERV
Where: P = a hypothetical $1,000 initial investment
T = average annual total return
n = number of years
ERV = ending redeemable value at the end of the
applicable period of the hypothetical $1,000
investment made at the beginning of the
applicable period.
The computation assumes that all dividends and distributions are reinvested at
the net asset value on the reinvestment dates and that a complete redemption
occurs at the end of the applicable period.
- 9 -
<PAGE>
The Fund's investment performance will vary depending upon market
conditions, the composition of the Fund's portfolio and operating expenses of
the Fund. These factors and possible differences in the methods and time periods
used in calculating non-standardized investment performance should be considered
when comparing the Fund's performance to those of other investment companies or
investment vehicles. The risks associated with the Fund's investment objective,
policies and techniques should also be considered. At any time in the future,
investment performance may be higher or lower than past performance, and there
can be no assurance that any performance will continue.
From time to time, in advertisements, sales literature and information
furnished to present or to prospective shareholders, the performance of the Fund
may be compared to indices of broad groups of unmanaged securities considered to
be representative of or similar to the portfolio holdings of the Fund or
considered to be representative of the stock market in general. The Fund may use
the NAREIT (National Association of Real Estate Investment Trusts) Index, the
Standard & Poor's 500 Stock Index or the Dow Jones Industrial Average.
In addition, the performance of the Fund may be compared to other
groups of mutual funds tracked by any widely used independent research firm
which ranks mutual funds by overall performance, investment objectives and
assets, such as Lipper Analytical Services, Inc. or Morningstar, Inc. The
objectives, policies, limitations and expenses of other mutual funds in a group
may not be the same as those of the Fund. Performance rankings and ratings
reported periodically in national financial publications such as Barron's and
Fortune also may be used.
CUSTODIAN
In addition to acting as the Fund's Adviser, Star Bank, is Custodian of
the Fund's investments. As Custodian, Star Bank acts as the Fund's depository,
safekeeps its portfolio securities, collects all income and other payments with
respect thereto, disburses funds at the Fund's request and maintains records in
connection with its duties. As Custodian, Star Bank receives an annual fee equal
to 0.025% of the Fund's average daily net assets.
TRANSFER AGENT AND ADMINISTRATOR
Unified Advisers, Inc., 429 N. Pennsylvania, Indianapolis, Indiana
46204, acts as the Fund's transfer agent and, in such capacity, maintains the
records of each shareholder's account, answers shareholders' inquiries
concerning their accounts, processes purchases and redemptions of the Fund's
shares, acts as dividend and distribution disbursing agent and performs other
accounting and shareholder service functions. In addition, Unified Advisers,
Inc., in its capacity as Fund Administrator, provides the Fund with certain
monthly reports, record-keeping and other management-related services. For a
description of the fees paid by the Adviser on behalf of the Fund for these
administrative services, see "Operation of the Fund" in the Fund's Prospectus.
ACCOUNTANTS
The firm of McCurdy & Associates, CPA's, 27955 Clemens Road, Westlake,
Ohio 44145, has been selected as independent public accountants for the Trust
for the fiscal year ending ______________________, 1998. McCurdy & Associates
performs an annual audit of the Fund's financial statements and provides
financial, tax and accounting consulting services as requested.
- 10 -
<PAGE>
DISTRIBUTOR
Unified Management, Inc., 429 N. Pennsylvania, Indianapolis, Indiana
46204, is the exclusive agent for distribution of shares of the Fund. The
Distributor is obligated to sell shares of the Fund on a best efforts basis only
against purchase orders for the shares. Shares of the Fund are offered to the
public on a continuous basis.
- 11 -
<PAGE>
Star Select Funds
PART C. OTHER INFORMATION
- ------- -----------------
Item 24. Financial Statements and Exhibits
- -------- ---------------------------------
(a) Financial Statements
Included in Part A: None
Included in Part B: None
(b) Exhibits
(1) Copy of Registrant's Declaration of Trust is filed herewith.
(2) Copy of Registrant's By-Laws is filed herewith.
(3) Voting Trust Agreements - None.
(4) Specimen of Share Certificates - None.
(5) Copy of Registrant's Management Agreement with its
Adviser, Star Bank, N.A. (to be supplied).
(6) Underwriting or Distribution Contracts and Agreements with
Principal Underwriters and Dealers (to be supplied).
(7) Bonus, Profit Sharing, Pension or Similar Contracts for the
benefit of Directors or Officers - None.
(8) Copy of Registrant's Agreement with the Custodian (to be
supplied).
(9) Other Material Contracts - None.
(10) Opinion and Consent of Brown, Cummins & Brown Co., L.P.A. is
filed herewith.
(11) Consent of independent public accountants - None.
(12) Financial Statements Omitted from Item 23 - None.
(13) Copy of Letter of Initial Stockholders (to be supplied).
(14) Model Plan used in Establishment of any Retirement Plan -
None.
- 1 -
<PAGE>
(15) 12b-1 Distribution Expense Plan - (to be supplied).
(16) Schedule for Computation of Each Performance Quotation -
None.
(17) Financial Data Schedule - None.
(18) Rule 18f-3 Plan - None.
Item 25. Persons Controlled by or Under Common Control
- -------- ---------------------------------------------
with the Registrant
-------------------
None.
Item 26. Number of Holders of Securities (as of March 1, 1997)
- -------- -----------------------------------------------------
Title of Class Number of Record Holders
-------------- ------------------------
Star REIT-Plus Fund 0
Item 27. Indemnification
- -------- ---------------
(a) Article VI of the Registrant's Declaration of Trust provides for
indemnification of officers and Trustees as follows:
Section 6.4 Indemnification of Trustees, Officers, etc.
-------------------------------------------------------
Subject to and except as otherwise provided in the Securities Act of 1933,
as amended, and the 1940 Act, the Trust shall indemnify each of its
Trustees and officers (including persons who serve at the Trust's request
as directors, officers or trustees of another organization in which the
Trust has any interest as a shareholder, creditor or otherwise (hereinafter
referred to as a "Covered Person") against all liabilities, including but
not limited to amounts paid in satisfaction of judgments, in compromise or
as fines and penalties, and expenses, including reasonable accountants' and
counsel fees, incurred by any Covered Person in connection with the defense
or disposition of any action, suit or other proceeding, whether civil or
criminal, before any court or administrative or legislative body, in which
such Covered Person may be or may have been involved as a party or
otherwise or with which such person may be or may have been threatened,
while in office or thereafter, by reason of being or having been such a
Trustee or officer, director or trustee, and except that no Covered Person
shall be indemnified against any liability to the Trust or its
- 2 -
<PAGE>
Shareholders to which such Covered Person would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of such Covered Person's
office.
Section 6.5 Advances of Expenses. The Trust shall advance attorneys'
---------------------------------
fees or other expenses incurred by a Covered Person in defending a
proceeding to the full extent permitted by the Securities Act of 1933, as
amended, the 1940 Act, and Ohio Revised Code Chapter 1707, as amended. In
the event any of these laws conflict with Ohio Revised Code Section
1701.13(E), as amended, these laws, and not Ohio Revised Code Section
1701.13(E), shall govern.
Section 6.6 Indemnification Not Exclusive, etc. The right of
------------------------------------------------------
indemnification provided by this Article VI shall not be exclusive of or
affect any other rights to which any such Covered Person may be entitled.
As used in this Article VI, "Covered Person" shall include such person's
heirs, executors and administrators. Nothing contained in this article
shall affect any rights to indemnification to which personnel of the Trust,
other than Trustees and officers, and other persons may be entitled by
contract or otherwise under law, nor the power of the Trust to purchase and
maintain liability insurance on behalf of any such person.
The Registrant may not pay for insurance which protects the Trustees and
officers against liabilities rising from action involving willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of their offices.
(b) The Registrant may maintain a standard mutual fund and investment
advisory professional and directors and officers liability policy. The
policy, if maintained, would provide coverage to the Registrant, its
Trustees and officers, and could cover its Advisers, among others. Coverage
under the policy would include losses by reason of any act, error,
omission, misstatement, misleading statement, neglect or breach of duty.
(c) 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 provisions of Ohio
law and the Agreement and Declaration of the Registrant or the By-Laws of
the Registrant, or otherwise, the Registrant
- 3 -
<PAGE>
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 Trust 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.
Item 28. Business and Other Connections of Investment Adviser
- -------- ----------------------------------------------------
A. Star Bank, N.A. ("Star Bank"), a national bank, was founded in 1863
and is the largest bank and trust organization of Star Banc Corporation.
Star Bank had an asset base of $9.6 billion as of June 30, 1996, and trust
assets of $23.6 billion as of June 30, 1996. Star Bank has managed
commingled funds since 1957. It currently manages The Star Funds, one
common trust fund and two collective investment funds having a market value
in excess of $2 billion. With respect to the officers and directors of Star
Bank, any other business, profession, vocation, or employment of a
substantial nature in which each such officer and director is or has been
engaged during the past two years, is set forth below.
B.
<TABLE>
<CAPTION>
Name Position with Other Substantial
---- the Advisor Business, Profession
----------- Vocation or Employment
----------------------
<S> <C> <C>
Jerry A. Grundhofer Chairman, President & CEO Traditional Interiors
Stephen E. Smith Executive Vice President S.E. Smith & Co.
S. Kay Geiger Executive Vice President Global Access Marketing, Inc.
James R. Bridgeland, Jr. Director Taft Stettinius and Hollister
Victoria B. Buyniski Director United Medical Resources, Inc.;
Mt. Auburn Partnership;
American Operations Mgmt.;
NCG; Schmidt Marble
Samuel M. Cassidy Director Cassidy & Cassidy, Ltd.
d/b/a/ Cave Spring Farm
V. Anderson Coombe Director The William Powell Company
John C. Dannemiller Director Bearings, Inc.
J.P. Hayden, Jr. Director The Midland Company;
American Family Home Insurance Co.;
American Modern Home Insurance Co.
Thomas J. Klinedinst, Jr. Director Thomas E. Wood, Inc.
Ohio Cap Insurance Co. Ltd.
The Tomba Co., Ltd.
David B. O'Maley Director Ohio National Life Insurance Co.
O'dell M. Owens, MD, MPH Director O'dell M. Owens, M.D., Inc.;
Moreno Food; MKO Investment;
Seven Hills Lab; Graphi Action
Thomas E. Petry Director Eagle-Picher Industries, Inc.
William C. Portman Director Portman Equipment Co.
</TABLE>
- 4 -
<PAGE>
Item 29. Principal Underwriters
- -------- ----------------------
(a) Unified Management Corporation, the Registrant's
distributor, acts as distributor for The Vintage Funds, 429
North Pennsylvania Street, Indianapolis, Indiana 46204.
(b) Information with respect to each director and officer of
Unified Management Corporation is incorporated by reference
to Schedule A of Form BD filed by it under the Securities
Exchange Act of 1934 (File No. 8-23508).
(c) Not applicable.
Item 30. Location of Accounts and Records
- -------- --------------------------------
Accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the Rules
promulgated thereunder will be maintained by the Registrant at
429 North Pennsylvania Street, Indianapolis, Indiana 46204 and/or
by the Registrant's Custodian, Star Bank, N.A., 425 Walnut
Street, Cincinnati, Ohio 45202, and/or by the Registrant's
Transfer Agent, Unified Advisers, Inc., 429 North Pennsylvania
Street, Indianapolis, Indiana 46204.
Item 31. Management Services Not Discussed in Parts A or B
- -------- -------------------------------------------------
None.
Item 32. Undertakings
- -------- ------------
(a) Not Applicable.
(b) The Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's latest
annual report to shareholders, upon request and without charge.
(c) The 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
this registration.
- 5 -
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Lexington, State of Kentucky, on the 25th day of
March, 1997.
Star Select Funds
By: /s/ Timothy L. Ashburn
-----------------------
Timothy L. Ashburn,
President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
/s/ Timothy L. Ashburn March 25, 1997
- ----------------------
Timothy L. Ashburn,
President and Trustee
- 6 -
<PAGE>
EXHIBIT INDEX
-------------
EXHIBIT
-------
1. Declaration of Trust ......................................EX-99.B1
2. By-Laws....................................................EX-99.B2
3. Opinion of Brown, Cummins & Brown Co., L.P.A. .............EX-99.B10
- 15 -
--------------------------------------------
STAR SELECT FUNDS
AGREEMENT AND DECLARATION OF TRUST
February 28, 1997
-------------------------
<PAGE>
STAR SELECT FUNDS
AGREEMENT AND DECLARATION OF TRUST
TABLE OF CONTENTS
ARTICLE I - NAME AND DEFINITIONS............................................ 1
Section 1.1 Name................................................. 1
Section 1.2 Definitions.......................................... 1
(a) The "Trust"................................. 1
(b) "Trustees".................................. 1
(c) "Shares".................................... 1
(d) "Series".................................... 1
(e) "Class"..................................... 2
(f) "Shareholder"............................... 2
(g) The "1940 Act".............................. 2
(h) "Commission"................................ 2
(i) "Declaration of Trust"...................... 2
(j) "By-Laws"................................... 2
ARTICLE II - PURPOSE OF TRUST............................................... 2
ARTICLE III - THE TRUSTEES.................................................. 2
Section 3.1 Number, Designation, Election, Term, etc........ 2
(a) Initial Trustees............................ 2
(b) Number...................................... 2
(c) Term........................................ 2
(d) Resignation and Retirement.................. 3
(e) Removal..................................... 3
(f) Vacancies................................... 3
(g) Effect of Death, Resignation, etc........... 3
(h) No Accounting............................... 3
Section 3.2 Powers of Trustees.............................. 4
(a) Investments................................. 4
(b) Disposition of Assets....................... 4
(c) Ownership Powers............................ 4
(d) Subscription................................ 5
(e) Form of Holding............................. 5
(f) Reorganization, etc......................... 5
(g) Voting Trusts, etc.......................... 5
(h) Compromise.................................. 5
<PAGE>
(i) Partnerships, etc........................... 5
(j) Borrowing and Security...................... 5
(k) Guarantees, etc............................. 5
(l) Insurance................................... 5
(m) Pensions, etc............................... 6
Section 3.3 Certain Contracts............................... 6
(a) Advisory.................................... 6
(b) Administration.............................. 7
(c) Distribution................................ 7
(d) Custodian and Depository.................... 7
(e) Transfer and Dividend Disbursing Agency..... 7
(f) Shareholder Servicing....................... 7
(g) Accounting.................................. 7
Section 3.4 Payment of Trust Expenses and Compensation
of Trustees................................... 8
Section 3.5 Ownership of Assets of the Trust................ 8
ARTICLE IV - SHARES......................................................... 8
Section 4.1 Description of Shares........................... 8
Section 4.2 Establishment and Designation of Series......... 10
(a) Assets Belonging to Series.................. 10
(b) Liabilities Belonging to Series............. 10
(c) Dividends................................... 11
(d) Liquidation................................. 12
(e) Voting...................................... 12
(f) Redemption by Shareholder................... 12
(g) Redemption by Trust......................... 12
(h) Net Asset Value............................. 13
(i) Transfer.................................... 13
(j) Equality.................................... 13
(k) Fractions................................... 14
(l) Conversion Rights........................... 14
Section 4.3 Ownership of Shares............................. 14
Section 4.4 Investments in the Trust........................ 14
Section 4.5 No Preemptive Rights............................ 14
Section 4.6 Status of Shares and Limitation of Personal
Liability................................... 14
- ii -
<PAGE>
ARTICLE V - SHAREHOLDERS' VOTING POWERS AND MEETINGS........................ 15
Section 5.1 Voting Powers................................... 15
Section 5.2 Meetings........................................ 15
Section 5.3 Record Dates.................................... 15
Section 5.4 Quorum and Required Vote........................ 16
Section 5.5 Action by Written Consent....................... 16
Section 5.6 Inspection of Records........................... 16
Section 5.7 Additional Provisions........................... 16
ARTICLE VI - LIMITATION OF LIABILITY; INDEMNIFICATION........................ 16
Section 6.1 Trustees, Shareholders, etc. Not Personally
Liable; Notice............................. 16
Section 6.2 Trustee's Good Faith Action; Expert Advice;
No Bond or Surety.......................... 17
Section 6.3 Indemnification of Shareholders................. 17
Section 6.4 Indemnification of Trustees, Officers, etc...... 18
Section 6.5 Advances of Expenses............................ 18
Section 6.6 Indemnification Not Exclusive, etc.............. 18
Section 6.7 Liability of Third Persons Dealing with
Trustees................................... 18
ARTICLE VII - MISCELLANEOUS.................................................. 18
Section 7.1 Duration and Termination of Trust............... 18
Section 7.2 Reorganization.................................. 19
Section 7.3 Amendments...................................... 19
Section 7.4 Filing of Copies; References; Headings.......... 20
Section 7.5 Applicable Law.................................. 20
- iii -
<PAGE>
STAR SELECT FUNDS
AGREEMENT AND DECLARATION OF TRUST
AGREEMENT AND DECLARATION OF TRUST made at Lexington, Kentucky, this
28th day of February, 1997, by the Trustees hereunder, and by the holders of
Shares of beneficial interest to be issued hereunder as hereinafter provided.
WITNESSETH:
WHEREAS, this Trust is being formed to carry on the business of an
investment company; and
WHEREAS, the Trustees have agreed to manage all property coming into
their hands as trustees of an Ohio business trust in accordance with the
provisions hereinafter set forth.
NOW, THEREFORE, the Trustees hereby declare that they will hold all
cash, securities and other assets which they may from time to time acquire in
any manner as Trustees hereunder IN TRUST to manage and dispose of the same upon
the following terms and conditions for the benefit of the holders from time to
time of shares of beneficial interest in this Trust as hereinafter set forth.
ARTICLE I
NAME AND DEFINITIONS
Section 1.1 Name. This Trust shall be known as "Star Select Funds" and
the Trustees shall conduct the business of the Trust under that name or any
other name as they may from time to time determine.
Section 1.2 Definitions. Whenever used herein, unless otherwise
required by the context or specifically provided:
(a) The "Trust" refers to the Ohio business trust established by
this Agreement and Declaration of Trust, as amended from
time to time;
(b) "Trustees" refers to the Trustees of the Trust named herein
or elected in accordance with Article III;
(c) "Shares" refers to the transferable units of interest into
which the beneficial interest in the Trust, shall be divided
from time to time, including the shares of any and all
Series or Classes which may be established by the Trustees,
and includes fractions of Shares as well as whole Shares;
(d) "Series" refers to Series of Shares established and
designated under or in accordance with the provisions of
Article IV;
(e) "Class" refers to a class or sub-series of any Series of
Shares established and designated under and in accordance
with the provisions of Article IV;
- 1 -
<PAGE>
(f) "Shareholder" means a record owner of Shares;
(g) The "1940 Act" refers to the Investment Company Act of 1940
and the Rules and Regulations thereunder, all as amended
from time to time;
(h) "Commission" shall have the meaning given it in the 1940
Act;
(i) "Declaration of Trust" shall mean this Agreement and
Declaration of Trust as amended or restated from time to
time; and
(j) "By-Laws" shall mean the By-Laws of the Trust as amended
from time to time.
ARTICLE II
PURPOSE OF TRUST
The purpose of the Trust is to operate as an investment company, to
offer Shareholders one or more investment programs primarily in securities and
debt instruments and to engage in any and all lawful acts or activities for
which business trusts may be formed under Chapter 1746 of the Ohio Revised Code.
ARTICLE III
THE TRUSTEES
Section 3.1 Number, Designation, Election, Term, etc.
(a) Initial Trustees. Upon his execution of this Declaration of
Trust or a counterpart hereof or some other writing in which
he accepts such Trusteeship and agrees to the provisions
hereof, Timothy L. Ashburn shall become Trustee hereof.
(b) Number. The Trustees serving as such, whether named above or
hereafter becoming a Trustee, may increase or decrease the
number of Trustees to a number other than the number
theretofore determined. No decrease in the number of
Trustees shall have the effect of removing any Trustee from
office prior to the expiration of his term, but the number
of Trustees may be decreased in conjunction with the removal
of a Trustee pursuant to subsection (e) of this Section 3.1.
(c) Term. Each Trustee shall serve as a Trustee during the
lifetime of the Trust and until its termination as
hereinafter provided or until such Trustee sooner dies,
resigns, retires or is removed. The Trustees may elect their
own successors and may, pursuant to Section 3.1(f) hereof,
appoint Trustees to fill vacancies; provided that,
immediately after filling a vacancy, at least two-thirds of
the Trustees then holding office shall have been elected to
such office by the Shareholders at an annual or special
meeting. If at any time less than a majority of the Trustees
then holding office were so elected, the Trustees shall
forthwith cause to be held as promptly as possible, and in
any event within 60 days, a meeting of Shareholders for the
purpose of electing Trustees to fill any existing vacancies.
- 2 -
<PAGE>
(d) Resignation and Retirement. Any Trustee may resign his trust
or retire as a Trustee, by written instrument signed by him
and delivered to the other Trustees or to any officer of the
Trust, and such resignation or retirement shall take effect
upon such delivery or upon such later date as is specified
in such instrument.
(e) Removal. Any Trustee may be removed with or without cause at
any time: (i) by written instrument, signed by at least
two-thirds of the number of Trustees prior to such removal,
specifying the date upon which such removal shall become
effective, (ii) by vote of the Shareholders holding not less
than two-thirds of the Shares then outstanding, cast in
person or by proxy at any meeting called for the purpose, or
(iii) by a declaration in writing signed by Shareholders
holding not less than two-thirds of the Shares then
outstanding and filed with the Trust's Custodian.
(f) Vacancies. Any vacancy or anticipated vacancy resulting from
any reason, including without limitation the death,
resignation, retirement, removal or incapacity of any of the
Trustees, or resulting from an increase in the number of
Trustees by the Trustees may (but so long as there are at
least three remaining Trustees, need not unless required by
the 1940 Act) be filled either by a majority of the
remaining Trustees through the appointment in writing of
such other person as such remaining Trustees in their
discretion shall determine (unless a shareholder election is
required by the 1940 Act) or by the election by the
Shareholders, at a meeting called for the purpose, of a
person to fill such vacancy, and such appointment or
election shall be effective upon the written acceptance of
the person named therein to serve as a Trustee and agreement
by such person to be bound by the provisions of this
Declaration of Trust, except that any such appointment or
election in anticipation of a vacancy to occur by reason of
retirement, resignation, or increase in number of Trustees
to be effective at a later date shall become effective only
at or after the effective date of said retirement,
resignation, or increase in number of Trustees. As soon as
any Trustee so appointed or elected shall have accepted such
appointment or election and shall have agreed in writing to
be bound by this Declaration of Trust and the appointment or
election is effective, the Trust estate shall vest in the
new Trustee, together with the continuing Trustees, without
any further act or conveyance.
(g) Effect of Death, Resignation, etc. The death, resignation,
retirement, removal, or incapacity of the Trustees, or any
one of them, shall not operate to annul or terminate the
Trust or to revoke or terminate any existing agency or
contract created or entered into pursuant to the terms of
this Declaration of Trust.
(h) No Accounting. Except to the extent required by the 1940 Act
or under circumstances which would justify his removal for
cause, no person ceasing to be a Trustee as a result of his
death, resignation, retirement, removal or incapacity (nor
the estate of any such person) shall be required to make an
accounting to the Shareholders or remaining Trustees upon
such cessation.
Section 3.2 Powers of Trustees. Subject to the provisions of this
Declaration of Trust, the business of the Trust shall be managed by the
Trustees, and they shall have all powers necessary or convenient to carry out
that responsibility and the purpose of the Trust. Without limiting the
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foregoing, the Trustees may adopt By-Laws not inconsistent with this Declaration
of Trust providing for the conduct of the business and affairs of the Trust and
may amend and repeal them to the extent that such By-Laws do not reserve that
right to the Shareholders; they may as they consider appropriate elect and
remove officers and appoint and terminate agents and consultants and hire and
terminate employees, any one or more of the foregoing of whom may be a Trustee,
and may provide for the compensation of all of the foregoing; they may appoint
from their own number, and terminate, any one or more committees consisting of
two or more Trustees, including without implied limitation an executive
committee, which may, when the Trustees are not in session and subject to the
1940 Act, exercise some or all of the power and authority of the Trustees as the
Trustees may determine; in accordance with Section 3.3 they may employ one or
more Advisers, Administrators, Depositories and Custodians and may authorize any
Depository or Custodian to employ subcustodians or agents and to deposit all or
any part of such assets in a system or systems for the central handling of
securities and debt instruments, retain transfer, dividend, accounting or
Shareholder servicing agents or any of the foregoing, provide for the
distribution of Shares by the Trust through one or more distributors, principal
underwriters or otherwise, set record dates or times for the determination of
Shareholders or certain of them with respect to various matters; they may
compensate or provide for the compensation of the Trustees, officers, advisers,
administrators, custodians, other agents, consultants and employees of the Trust
or the Trustees on such terms as they deem appropriate; and in general they may
delegate to any officer of the Trust, to any committee of the Trustees and to
any employee, adviser, administrator, distributor, principal underwriter,
depository, custodian, transfer and dividend disbursing agent, or any other
agent or consultant of the Trust such authority, powers, functions and duties as
they consider desirable or appropriate for the conduct of the business and
affairs of the Trust, including without implied limitation the power and
authority to act in the name of the Trust and of the Trustees, to sign documents
and to act as attorney-in-fact for the Trustees.
Without limiting the foregoing and to the extent not inconsistent with
the 1940 Act or other applicable law, the Trustees shall have power and
authority:
(a) Investments. To invest and reinvest cash and other property,
and to hold cash or other property uninvested without in any
event being bound or limited by any present or future law or
custom in regard to investments by trustees;
(b) Disposition of Assets. To sell, exchange, lend, pledge,
mortgage, hypothecate, write options on and lease any or all
of the assets of the Trust;
(c) Ownership Powers. To vote or give assent, or exercise any
rights of ownership, with respect to stock or other
securities, debt instruments or property; and to execute and
deliver proxies or powers of attorney to such person or
persons as the Trustees shall deem proper, granting to such
person or persons such power and discretion with relation to
securities, debt instruments or property as the Trustees
shall deem proper;
(d) Subscription. To exercise powers and rights of subscription
or otherwise which in any manner arise out of ownership of
securities or debt instruments;
(e) Form of Holding. To hold any security, debt instrument or
property in a form not indicating any trust, whether in
bearer, unregistered or other negotiable form, or in the
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name of the Trustees or of the Trust or in the name of a
custodian, subcustodian or other depository or a nominee or
nominees or otherwise;
(f) Reorganization, etc. To consent to or participate in any
plan for the reorganization, consolidation or merger of any
corporation or issuer, any security or debt instrument of
which is or was held in the Trust; to consent to any
contract, lease, mortgage, purchase or sale of property by
such corporation or issuer, and to pay calls or
subscriptions with respect to any security or debt
instrument held in the Trust;
(g) Voting Trusts, etc. To join with other holders of any
securities or debt instruments in acting through a
committee, depository, voting trustee or otherwise, and in
that connection to deposit any security or debt instrument
with, or transfer any security or debt instrument to, any
such committee, depository or trustee, and to delegate to
them such power and authority with relation to any security
or debt instrument (whether or not so deposited or
transferred) as the Trustees shall deem proper, and to agree
to pay, and to pay, such portion of the expenses and
compensation of such committee, depository or trustee as the
Trustees shall deem proper;
(h) Compromise. To compromise, arbitrate or otherwise adjust
claims in favor of or against the Trust or any matter in
controversy, including but not limited to claims for taxes;
(i) Partnerships, etc. To enter into joint ventures, general or
limited partnerships and any other combinations or
associations;
(j) Borrowing and Security. To borrow funds and to mortgage and
pledge the assets of the Trust or any part thereof to secure
obligations arising in connection with such borrowing;
(k) Guarantees, etc. To endorse or guarantee the payment of any
notes or other obligations of any person; to make contracts
of guaranty or suretyship, or otherwise assume liability for
payment thereof; and to mortgage and pledge the Trust
property or any part thereof to secure any of or all such
obligations;
(l) Insurance. To purchase and pay for entirely out of Trust
property such insurance as they may deem necessary or
appropriate for the conduct of the business, including,
without limitation, insurance policies insuring the assets
of the Trust and payment of distributions and principal on
its portfolio investments, and insurance policies insuring
the Shareholders, Trustees, officers, employees, agents,
consultants, investment advisers, managers, administrators,
distributors, principal underwriters, or independent
contractors, or any thereof (or any person connected
therewith), of the Trust individually against all claims and
liabilities of every nature arising by reason of holding,
being or having held any such office or position, or by
reason of any action alleged to have been taken or omitted
by any such person in any such capacity, including any
action taken or omitted that may be determined to constitute
negligence; provided, however, that insurance which protects
the Trustees and officers against liabilities rising from
action involving willful misfeasance, bad faith, gross
negligence
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or reckless disregard of the duties involved in the conduct
of their offices may not be purchased; and
(m) Pensions, etc. To pay pensions for faithful service, as
deemed appropriate by the Trustees, and to adopt, establish
and carry out pension, profit-sharing, share bonus, share
purchase, savings, thrift and other retirement, incentive
and benefit plans, trusts and provisions, including the
purchasing of life insurance and annuity contracts as a
means of providing such retirement and other benefits, for
any or all of the Trustees, officers, employees and agents
of the Trust.
Except as otherwise provided by the 1940 Act or other applicable law,
this Declaration of Trust or the By-Laws, any action to be taken by the Trustees
may be taken by a majority of the Trustees present at a meeting of Trustees (a
quorum, consisting of at least a majority of the Trustees then in office, being
present), within or without Ohio, including any meeting held by means of a
conference telephone or other communications equipment by means of which all
persons participating in the meeting can hear each other at the same time and
participation by such means shall constitute presence in person at a meeting, or
by written consents of a majority of the Trustees then in office (or such larger
or different number as may be required by the 1940 Act or other applicable law).
Section 3.3 Certain Contracts. Subject to compliance with the
provisions of the 1940 Act, but notwithstanding any limitations of present and
future law or custom in regard to delegation of powers by trustees generally,
the Trustees may, at any time and from time to time and without limiting the
generality of their powers and authority otherwise set forth herein, enter into
one or more contracts with any one or more corporations, trusts, associations,
partnerships, limited partnerships, other type of organizations, or individuals
("Contracting Party") to provide for the performance and assumption of some or
all of the following services, duties and responsibilities to, for or of the
Trust and/or the Trustees, and to provide for the performance and assumption of
such other services, duties and responsibilities in addition to those set forth
below as the Trustees may determine appropriate:
(a) Advisory. Subject to the general supervision of the Trustees
and in conformity with the stated policy of the Trustees
with respect to the investments of the Trust or of the
assets belonging to any Series of Shares of the Trust (as
that phrase is defined in subsection (a) of Section 4.2), to
manage such investments and assets, make investment
decisions with respect thereto, and to place purchase and
sale orders for portfolio transactions relating to such
investments and assets;
(b) Administration. Subject to the general supervision of the
Trustees and in conformity with any policies of the Trustees
with respect to the operations of the Trust, to supervise
all or any part of the operations of the Trust, and to
provide all or any part of the administrative and clerical
personnel, office space and office equipment and services
appropriate for the efficient administration and operations
of the Trust;
(c) Distribution. To distribute the Shares of the Trust, to be
principal underwriter of such Shares, and/or to act as agent
of the Trust in the sale of Shares and the acceptance or
rejection of orders for the purchase of Shares;
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(d) Custodian and Depository. To act as depository for and to
maintain custody of the property of the Trust and accounting
records in connection therewith;
(e) Transfer and Dividend Disbursing Agency. To maintain records
of the ownership of outstanding Shares, the issuance and
redemption and the transfer thereof, and to disburse any
dividends declared by the Trustees and in accordance with
the policies of the Trustees and/or the instructions of any
particular Shareholder to reinvest any such dividends;
(f) Shareholder Servicing. To provide service with respect to
the relationship of the Trust and its Shareholders, records
with respect to Shareholders and their Shares, and similar
matters; and
(g) Accounting. To handle all or any part of the accounting
responsibilities, whether with respect to the Trust's
properties, Shareholders or otherwise.
The same person may be the Contracting Party for some or all of the services,
duties and responsibilities to, for and of the Trust and/or the Trustees, and
the contracts with respect thereto may contain such terms interpretive of or in
addition to the delineation of the services, duties and responsibilities
provided for, including provisions that are not inconsistent with the 1940 Act
relating to the standard of duty of and the rights to indemnification of the
Contracting Party and others, as the Trustees may determine. Nothing herein
shall preclude, prevent or limit the Trust or a Contracting Party from entering
into subcontractual arrangements relative to any of the matters referred to in
Sections 3.3(a) through (g) hereof.
Subject to the provisions of the 1940 Act, the fact that:
(i) any of the Shareholders, Trustees or officers of the Trust
is a shareholder, director, officer, partner, trustee, employee,
manager, adviser, principal underwriter or distributor or agent of or
for any Contracting Party, or of or for any parent or affiliate of any
Contracting Party or that the Contracting Party or any parent or
affiliate thereof is a Shareholder or has an interest in the Trust, or
that
(ii) any Contracting Party may have a contract providing for
the rendering of any similar services to one or more other
corporations, trusts, associations, partnerships, limited partnerships
or other organizations, or has other business or interests,
shall not affect the validity of any contract for the performance and assumption
of services, duties and responsibilities to, for or of the Trust and/or the
Trustees or disqualify any Shareholder, Trustee or officer of the Trust from
voting upon or executing the same or create any liability or accountability to
the Trust or its Shareholders, provided that in the case of any relationship or
interest referred to in the preceding clause (i) on the part of any Trustee or
officer of the Trust either (l) the material facts as to such relationship or
interest have been disclosed to or are known by the Trustees not having any such
relationship or interest and the contract involved is approved in good faith
reasonably justified by such facts by a majority of such Trustees not having any
such relationship or interest (even though such unrelated or disinterested
Trustees are less than a quorum of all of the Trustees), (2) the material facts
as to such relationship or interest and as to the contract have been
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disclosed to or are known by the Shareholders not having such relationship or
interest and who are entitled to vote thereon and the contract involved is
specifically approved in good faith by majority vote of such Shareholders, or
(3) the specific contract involved is fair to the Trust as of the time it is
authorized, approved or ratified by the Trustees or by such Shareholders.
Section 3.4 Payment of Trust Expenses and Compensation of Trustees.
The Trustees are authorized to pay or to cause to be paid out of the principal
or income of the Trust, or partly out of principal and partly out of income, and
to charge or allocate the same to, between or among such one or more of the
Series and Classes that may be established and designated pursuant to Article
IV, as the Trustees deem fair, all expenses, fees, charges, taxes and
liabilities incurred or arising in connection with the Trust, or in connection
with the management thereof, including, but not limited to, the Trustees'
compensation and such expenses and charges for the services of the Trust's
officers, employees, investment adviser, administrator, distributor, principal
underwriter, auditor, counsel, depository, custodian, transfer agent, dividend
disbursing agent, accounting agent, Shareholder servicing agent, and such other
agents, consultants, and independent contractors and such other expenses and
charges as the Trustees may deem necessary or proper to incur. Without limiting
the generality of any other provision hereof, the Trustees shall be entitled to
reasonable compensation from the Trust for their services as Trustees and may
fix the amount of such compensation.
Section 3.5 Ownership of Assets of the Trust. Title to all of the
assets of the Trust shall at all times be considered as vested in the Trustees.
ARTICLE IV
SHARES
Section 4.1 Description of Shares. The beneficial interest in the
Trust shall be divided into Shares, all without par value. The Trustees shall
have the authority from time to time to issue or reissue Shares in one or more
Series of Shares (including without limitation the Series specifically
established and designated in Section 4.2), as they deem necessary or desirable,
to establish and designate such Series, and to fix and determine the relative
rights and preferences as between the different Series of Shares as to right of
redemption and the price, terms and manner of redemption, special and relative
rights as to dividends and other distributions and on liquidation, sinking or
purchase fund provisions, conversion rights, and conditions under which the
several Series shall have separate voting rights or no voting rights.
The Shares of each Series may be issued or reissued from time to time
in one or more Classes, as determined by the Board of Trustees pursuant to
resolution. Each Class shall be appropriately designated, prior to the issuance
of any shares thereof, by some distinguishing letter, number or title. All
Shares within a Class shall be alike in every particular. All Shares of each
Series shall be of equal rank and have the same powers, preferences and rights,
and shall be subject to the same qualifications, limitations and restrictions
without distinction between the shares of different Classes thereof, except with
respect to such differences among such Classes, as the Board of Trustees shall
from time to time determine to be necessary or desirable, including without
limitation differences in expenses, in voting rights and in the rate or rates of
dividends or distributions. The Board of Trustees may from time to time increase
the number of Shares allocated to any Class already created by providing that
any unissued Shares of the applicable Series shall constitute part of such
Class, or may decrease the number of Shares allocated to any Class already
created by
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providing that any unissued Shares previously assigned to such Class shall no
longer constitute part thereof. The Board of Trustees is hereby empowered to
classify or reclassify from time to time any unissued Shares of each Series by
fixing or altering the terms thereof and by assigning such unissued shares to an
existing or newly created Class. Notwithstanding anything to the contrary in
this paragraph the Board of Trustees is hereby empowered (i) to redesignate any
issued Shares of any Series by assigning a distinguishing letter, number or
title to such shares and (ii) to reclassify all or any part of the issued Shares
of any Series to make them part of an existing or newly created Class.
The number of authorized Shares and the number of Shares of each
Series and Class that may be issued is unlimited, and the Trustees may issue
Shares of any Series or Class for such consideration and on such terms as they
may determine (or for no consideration if pursuant to a Share dividend or
split-up), all without action or approval of the Shareholders. All Shares when
so issued on the terms determined by the Trustees shall be fully paid and
non-assessable (but may be subject to mandatory contribution back to the Trust
as provided in subsection (h) of Section 4.2). The Trustees may classify or
reclassify any unissued Shares or any Shares previously issued and reacquired of
any Series or Class into one or more Series or Classes that may be established
and designated from time to time. The Trustees may hold as treasury Shares (of
the same or some other Series), reissue for such consideration and on such terms
as they may determine, or cancel, at their discretion from time to time, any
Shares of any Series or Class reacquired by the Trust.
The Trustees may from time to time close the transfer books or
establish record dates and times for the purposes of determining the holders of
Shares entitled to be treated as such, to the extent provided or referred to in
Section 5.3.
The establishment and designation of any Series of Shares in addition
to those established and designated in Section 4.2, or of any Class of Shares,
shall be effective upon the execution by a majority of the then Trustees of an
instrument setting forth such establishment and designation and the relative
rights and preferences of such Series or Class, or as otherwise provided in such
instrument. At any time that there are no Shares outstanding of any particular
Series or Class previously established and designated the Trustees may by an
instrument executed by a majority of their number abolish that Series or Class
and the establishment and designation thereof. Each instrument referred to in
this paragraph shall have the status of an amendment to this Declaration of
Trust.
Any Trustee, officer or other agent of the Trust, and any organization
in which any such person is interested may acquire, own, hold and dispose of
Shares to the same extent as if such person were not a Trustee, officer or other
agent of the Trust; and the Trust may issue and sell or cause to be issued and
sold and may purchase Shares from any such person or any such organization
subject only to the general limitations, restrictions or other provisions
applicable to the sale or purchase of Shares generally.
Section 4.2 Establishment and Designation of Series. Without limiting
the authority of the Trustees set forth in Section 4.1 to establish and
designate any further Series, the Trustees hereby establish and designate one
Series of Shares: the "Star REIT-Plus Fund." The Shares of this Series and any
Shares of any further Series or Class that may from time to time be established
and designated by the Trustees shall (unless the Trustees otherwise determine
with respect to some
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further Series or Class at the time of establishing and designating the same)
have the following relative rights and preferences:
(a) Assets Belonging to Series. All consideration received by
the Trust for the issuance or sale of Shares of a particular
Series or Class, together with all assets in which such
consideration is invested or reinvested, all income,
earnings, profits, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation of
such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may
be, shall irrevocably belong to that Series or Class for all
purposes, subject only to the rights of creditors, and shall
be so recorded upon the books of account of the Trust. Such
consideration, assets, income, earnings, profits and
proceeds thereof, including any proceeds derived from the
sale, exchange or liquidation of such assets, and any funds
or payments derived from any reinvestment of such proceeds,
in whatever form the same may be, together with any General
Items allocated to that Series or Class as provided in the
following sentence, are herein referred to as "assets
belonging to" that Series or Class. In the event that there
are any assets, income, earnings, profits, and proceeds
thereof, funds, or payments which are not readily
identifiable as belonging to any particular Series or Class
(collectively "General Items"), the Trustees shall allocate
such General Items to and among any one or more of the
Series or Classes established and designated from time to
time in such manner and on such basis as they, in their sole
discretion, deem fair and equitable; and any General Items
so allocated to a particular Series or Class shall belong to
that Series or Class. Each such allocation by the Trustees
shall be conclusive and binding upon the Shareholders of all
Series and Classes for all purposes.
The Trustees shall have full discretion, to the extent not
inconsistent with the 1940 Act, to determine which items
shall be treated as income and which items as capital; and
each such determination and allocation shall be conclusive
and binding upon the Shareholders.
(b) Liabilities Belonging to Series. The assets belonging to
each particular Series and Class thereof shall be charged
with the liabilities of the Trust in respect of that Series
or Class and all expenses, costs, charges and reserves
attributable to that Series or Class, and any general
liabilities, expenses, costs, charges or reserves of the
Trust which are not readily identifiable as belonging to any
particular Series shall be allocated and charged by the
Trustees to and among any one or more of the Series and
Classes established and designated from time to time in such
manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. The liabilities,
expenses, costs, charges and reserves allocated and so
charged to a Series or Class are herein referred to as
"liabilities belonging to" that Series or Class. Each
allocation of liabilities, expenses, costs, charges and
reserves by the Trustees shall be conclusive and binding
upon the Shareholders of all Series for all purposes.
(c) Dividends. Dividends and distributions on Shares of a
particular Series may be paid with such frequency as the
Trustees may determine, which may be daily or otherwise
pursuant to a standing resolution or resolutions adopted
only once or with such frequency as the Trustees may
determine, to the holders of Shares of that Series, from
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such of the estimated income and capital gains, accrued or
realized, from the assets belonging to that Series, as the
Trustees may determine, after providing for actual and
accrued liabilities belonging to that Series. All dividends
and distributions on Shares of a particular Series shall be
distributed pro rata to the holders of that Series in
proportion to the number of Shares of that Series held by
such holders at the date and time of record established for
the payment of such dividends or distributions, except that
in connection with any dividend or distribution program or
procedure the Trustees may determine that no dividend or
distribution shall be payable on Shares as to which the
Shareholder's purchase order and/or payment have not been
received by the time or times established by the Trustees
under such program or procedure, and except that if Classes
have been established for any Series, the rate of dividends
or distributions may vary among such Class pursuant to
resolution, which may be a standing resolution, of the Board
of Trustees. Such dividends and distributions may be made in
cash or Shares or a combination thereof as determined by the
Trustees or pursuant to any program that the Trustees may
have in effect at the time for the election by each
Shareholder of the mode of the making of such dividend or
distribution to that Shareholder. Any such dividend or
distribution paid in Shares will be paid at the net asset
value thereof as determined in accordance with subsection
(h) of Section 4.2.
The Trust intends to qualify each Series as a "regulated
investment company" under the Internal Revenue Code of 1954,
as amended, or any successor or comparable statute thereto,
and regulations promulgated thereunder. Inasmuch as the
computation of net income and gains for federal income tax
purposes may vary from the computation thereof on the books
of the Trust, the Board of Trustees shall have the power, in
its sole discretion, to distribute in any fiscal year as
dividends, including dividends designated in whole or in
part as capital gains distributions, amounts sufficient, in
the opinion of the Board of Trustees, to enable each Series
to qualify as a regulated investment company and to avoid
liability of the Series for federal income tax in respect of
that year. However, nothing in the foregoing shall limit the
authority of the Board of Trustees to make distributions
greater than or less than the amount necessary to qualify as
a regulated investment company and to avoid liability of
each Series for such tax.
(d) Liquidation. In event of the liquidation or dissolution of
the Trust, the Shareholders of each Series or Class that has
been established and designated shall be entitled to
receive, as a Series or Class, when and as declared by the
Trustees, the excess of the assets belonging to that Series
or Class over the liabilities belonging to that Series or
Class. The assets so distributable to the Shareholders of
any particular Series or Class shall be distributed among
such Shareholders in proportion to the number of Shares of
that Series or Class held by them and recorded on the books
of the Trust. The liquidation of any particular Series or
Class may be authorized by vote of a majority of the
Trustees then in office subject to the approval of a
majority of the outstanding voting Shares of that Series or
Class, as defined in the 1940 Act.
(e) Voting. All Shares shall have "equal voting rights" as such
term is defined in the Investment Company Act of 1940 and
except as otherwise provided by that Act or rules,
regulations or orders promulgated thereunder. On each matter
submitted to a
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vote of the Shareholders, each Series shall vote as a
separate series except (i) as to any matter with respect to
which a vote of all Series voting as a single series is
required by the 1940 Act or rules and regulations
promulgated thereunder, or would be required under the Ohio
General Corporation Law if the Trust were an Ohio
corporation; and (ii) as to any matter which the Trustees
have determined affects only the interests of one or more
Series or Classes, only the holders of Shares of the one or
more affected Series or Classes shall be entitled to vote
thereon.
(f) Redemption by Shareholder. Each holder of Shares of a
particular Series or Class shall have the right at such
times as may be permitted by the Trust, but no less
frequently than once each week, to require the Trust to
redeem all or any part of his Shares of that Series or Class
at a redemption price equal to the net asset value per Share
of that Series or Class next determined in accordance with
subsection (h) of this Section 4.2 after the Shares are
properly tendered for redemption. Payment of the redemption
price shall be in cash; provided, however, that if the
Trustees determine, which determination shall be conclusive,
that conditions exist which make payment wholly in cash
unwise or undesirable, the Trust may make payment wholly or
partly in securities or other assets belonging to the Series
or Class of which the Shares being redeemed are part at the
value of such securities or assets used in such
determination of net asset value.
Notwithstanding the foregoing, the Trust may postpone
payment of the redemption price and may suspend the right of
the holders of Shares of any Series to require the Trust to
redeem Shares of that Series during any period or at any
time when and to the extent permissible under the 1940 Act,
and such redemption is conditioned upon the Trust having
funds or property legally available therefor.
(g) Redemption by Trust. Each Share of each Series or Class that
has been established and designated is subject to redemption
by the Trust at the redemption price which would be
applicable if such Share was then being redeemed by the
Shareholder pursuant to subsection (f) of this Section
4.2:(a) at any time, if the Trustees determine in their sole
discretion that failure to so redeem may have materially
adverse consequences to all or any of the holders of the
Shares, or any Series or Class thereof, of the Trust, or (b)
upon such other conditions as may from time to time be
determined by the Trustees and set forth in the then current
Prospectus of the Trust with respect to maintenance of
Shareholder accounts of a minimum amount. Upon such
redemption the holders of the Shares so redeemed shall have
no further right with respect thereto other than to receive
payment of such redemption price.
(h) Net Asset Value. The net asset value per Share of any Series
or Class shall be the quotient obtained by dividing the
value of the net assets of that Series or Class (being the
value of the assets belonging to that Series or Class less
the liabilities belonging to that Series or Class) by the
total number of Shares of that Series or Class outstanding,
all determined in accordance with the methods and
procedures, including without limitation those with respect
to rounding, established by the Trustees from time to time,
and net asset value shall be determined separately for each
Class of a Series.
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The Trustees may determine to maintain the net asset value
per Share of any Series or Class at a designated constant
dollar amount and in connection therewith may adopt
procedures not inconsistent with the 1940 Act for the
continuing declarations of income attributable to that
Series or Class as dividends payable in additional Shares of
that Series or Class at the designated constant dollar
amount and for the handling of any losses attributable to
that Series or Class . Such procedures may provide that in
the event of any loss each Shareholder shall be deemed to
have contributed to the capital of the Trust attributable to
that Series or Class his pro rata portion of the total
number of Shares required to be canceled in order to permit
the net asset value per Share of that Series or Class to be
maintained, after reflecting such loss, at the designated
constant dollar amount. Each Shareholder of the Trust shall
be deemed to have agreed, by his investment in any Series
with respect to which the Trustees shall have adopted any
such procedure, to make the contribution referred to in the
preceding sentence in the event of any such loss.
(i) Transfer. All Shares of each particular Series or Class
shall be transferable, but transfers of Shares of a
particular Series or Class will be recorded on the Share
transfer records of the Trust applicable to that Series or
Class only at such times as Shareholders shall have the
right to require the Trust to redeem Shares of that Series
or Class and at such other times as may be permitted by the
Trustees.
(j) Equality. All Shares of each particular Series shall
represent an equal proportionate interest in the assets
belonging to that Series (subject to the liabilities
belonging to that Series), and each Share of any particular
Series shall be equal to each other Share of that Series;
but the provisions of this sentence shall not restrict any
distinctions permissible under this Section 4.2 that may
exist with respect to a Class of the same Series. The
Trustees may from time to time divide or combine the Shares
of any particular Series or Class into a greater or lesser
number of Shares of that Series or Class without thereby
changing the proportionate beneficial interest in the assets
belonging to that Series or Class or in any way affecting
the rights of Shares of any other Series or Class.
(k) Fractions. Any fractional Share of any Series or Class, if
any such fractional Share is outstanding, shall carry
proportionately all the rights and obligations of a whole
Share of that Series or Class, including with respect to
voting, receipt of dividends and distributions, redemption
of Shares, and liquidation of the Trust.
(l) Conversion Rights. Subject to compliance with the
requirements of the 1940 Act, the Trustees shall have the
authority to provide that holders of Shares of any Series or
Class shall have the right to convert said Shares into
Shares of one or more other Series or Classes in accordance
with such requirements and procedures as may be established
by the Trustees.
Section 4.3 Ownership of Shares. The ownership of Shares shall be
recorded on the books of the Trust or of a transfer or similar agent for the
Trust, which books shall be maintained separately for the Shares of each Series
and Class that has been established and designated. No certificates certifying
the ownership of Shares need be issued except as the Trustees may otherwise
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determine from time to time. The Trustees may make such rules as they consider
appropriate for the issuance of Share certificates, the use of facsimile
signatures, the transfer of Shares and similar matters. The record books of the
Trust as kept by the Trust or any transfer or similar agent, as the case may be,
shall be conclusive as to who are the Shareholders and as to the number of
Shares of each Series and Class held from time to time by each such Shareholder.
Section 4.4 Investments in the Trust. The Trustees may accept
investments in the Trust from such persons and on such terms and for such
consideration, not inconsistent with the provisions of the 1940 Act, as they
from time to time authorize. The Trustees may authorize any distributor,
principal underwriter, custodian, transfer agent or other person to accept
orders for the purchase of Shares that conform to such authorized terms and to
reject any purchase orders for Shares whether or not conforming to such
authorized terms.
Section 4.5 No Preemptive Rights. Shareholders shall have no
preemptive or other right to subscribe to any additional Shares or other
securities issued by the Trust.
Section 4.6 Status of Shares and Limitation of Personal Liability.
Shares shall be deemed to be personal property giving only the rights provided
in this instrument. Every Shareholder by virtue of having become a Shareholder
shall be held to have expressly assented and agreed to the terms hereof and to
have become a party hereto. The death of a Shareholder during the continuance of
the Trust shall not operate to terminate the Trust nor entitle the
representative of any deceased Shareholder to an accounting or to take any
action in court or elsewhere against the Trust or the Trustees, but only to the
rights of said decedent under this Trust. Ownership of Shares shall not entitle
the Shareholder to any title in or to the whole or any part of the Trust
property or right to call for a partition or division of the same or for an
accounting, nor shall the ownership of Shares constitute the Shareholders
partners. Neither the Trust nor the Trustees, nor any officer, employee or agent
of the Trust shall have any power to bind personally any Shareholder, nor except
as specifically provided herein to call upon any Shareholder for the payment of
any sum of money or assessment whatsoever other than such as the Shareholder may
at any time personally agree to pay.
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<PAGE>
ARTICLE V
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 5.1 Voting Powers. The Shareholders shall have power to vote
only (i) for the election or removal of Trustees as provided in Section 3.1,
(ii) with respect to any contract with a Contracting Party as provided in
Section 3.3 as to which Shareholder approval is required by the 1940 Act, (iii)
with respect to any termination or reorganization of the Trust or any Series to
the extent and as provided in Sections 7.1 and 7.2, (iv) with respect to any
amendment of this Declaration of Trust to the extent and as provided in Section
7.3, (v) to the same extent as the stockholders of an Ohio business corporation
as to whether or not a court action, proceeding or claim should or should not be
brought or maintained derivatively or as a class action on behalf of the Trust
or the Shareholders, and (vi) with respect to such additional matters relating
to the Trust as may be required by the 1940 Act, this Declaration of Trust, the
By-Laws or any registration of the Trust with the Commission (or any successor
agency) or any state, or as the Trustees may consider necessary or desirable.
There shall be no cumulative voting in the election of any Trustee or Trustees.
Shares may be voted in person or by proxy. A proxy with respect to Shares held
in the name of two or more persons shall be valid if executed by any one of them
unless at or prior to exercise of the proxy the Trust receives a specific
written notice to the contrary from any one of them. A proxy purporting to be
executed by or on behalf of a Shareholder shall be deemed valid unless
challenged at or prior to its exercise and the burden of proving invalidity
shall rest on the challenger. Until Shares are issued, the Trustees may exercise
all rights of Shareholders and may take any action required by law, this
Declaration of Trust or the By-Laws to be taken by Shareholders.
Section 5.2 Meetings. Meetings (including meetings involving only the
holders of Shares of one or more but less than all Series or Classes) of
Shareholders may be called by the Trustees from time to time for the purpose of
taking action upon any matter requiring the vote or authority of the
Shareholders as herein provided or upon any other matter deemed by the Trustees
to be necessary or desirable. Written notice of any meeting of Shareholders
shall be given or caused to be given by the Trustees by mailing such notice at
least seven days before such meeting, postage prepaid, stating the time, place
and purpose of the meeting, to each Shareholder at the Shareholder's address as
it appears on the records of the Trust. If the Trustees shall fail to call or
give notice of any meeting of Shareholders (including a meeting involving only
the holders of Shares of one or more but less than all Series or Classes) for a
period of 30 days after written application by Shareholders holding at least 25%
of the Shares then outstanding requesting a meeting be called for any other
purpose requiring action by the Shareholders as provided herein or in the
By-Laws, then Shareholders holding at least 25% of the Shares then outstanding
may call and give notice of such meeting, and thereupon the meeting shall be
held in the manner provided for herein in case of call thereof by the Trustees.
Section 5.3 Record Dates. For the purpose of determining the
Shareholders who are entitled to vote or act at any meeting or any adjournment
thereof, or who are entitled to participate in any dividend or distribution, or
for the purpose of any other action, the Trustees may from time to time close
the transfer books for such period, not exceeding 30 days (except at or in
connection with the termination of the Trust), as the Trustees may determine; or
without closing the transfer books the Trustees may fix a date and time not more
than 60 days prior to the date of any meeting of Shareholders or other action as
the date and time of record for the determination of Shareholders entitled to
vote at such meeting or any adjournment thereof or to be treated as Shareholders
of record for purposes of such other action, and any Shareholder who was a
Shareholder at the date and time
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<PAGE>
so fixed shall be entitled to vote at such meeting or any adjournment thereof or
(subject to any provisions permissible under subsection (c) of Section 4.2 with
respect to dividends or distributions on Shares that have not been ordered
and/or paid for by the time or times established by the Trustees under the
applicable dividend or distribution program or procedure then in effect) to be
treated as a Shareholder of record for purposes of such other action, even
though he has since that date and time disposed of his Shares, and no
Shareholder becoming such after that date and time shall be so entitled to vote
at such meeting or any adjournment thereof or to be treated as a Shareholder of
record for purposes of such other action.
Section 5.4 Quorum and Required Vote. A majority of Shares entitled to
vote shall be a quorum for the transaction of business at a Shareholders'
meeting, except that where any provision of law or of this Declaration of Trust
permits or requires that holders of any Series or Class thereof shall vote as a
Series or Class, then a majority of the aggregate number of Shares of that
Series or Class thereof entitled to vote shall be necessary to constitute a
quorum for the transaction of business by that Series or 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. Except when a larger vote is
required by any provision of this Declaration of Trust or the By-Laws, a
majority of the Shares voted, at a meeting at which a quorum is present, shall
decide any questions and a plurality shall elect a Trustee, provided that where
any provision of law or of this Declaration of Trust permits or requires that
the holders of any Series or Class shall vote as a Series or Class, then a
majority of the Shares of that Series or Class voted on the matter shall decide
that matter insofar as that Series or Class is concerned.
Section 5.5 Action by Written Consent. Subject to the provisions of
the 1940 Act and other applicable law, any action taken by Shareholders may be
taken without a meeting if a majority of Shareholders entitled to vote on the
matter (or such other proportion thereof as shall be required by the 1940 Act or
by any express provision of this Declaration of Trust or the By-Laws) consent to
the action in writing and such written consents are filed with the records of
the meetings of Shareholders. Such consent shall be treated for all purposes as
a vote taken at a meeting of Shareholders.
Section 5.6 Inspection of Records. The records of the Trust shall be
open to inspection by Shareholders to the same extent as is permitted
stockholders of an Ohio corporation under the Ohio General Corporation Law.
Section 5.7 Additional Provisions. The By-Laws may include further
provisions for Shareholders' votes and meetings and related matters not
inconsistent with the provisions hereof.
ARTICLE VI
LIMITATION OF LIABILITY; INDEMNIFICATION
Section 6.1 Trustees, Shareholders, etc. Not Personally Liable;
Notice. All persons extending credit to, contracting with or having any claim
against any Series of the Trust (or the Trust on behalf of any Series) shall
look only to the assets of that Series for payment under such credit, contract
or claim; and neither the Shareholders nor the Trustees, nor any of the Trust's
officers, employees or agents, whether past, present or future, shall be
personally liable therefor. Every note, bond, contract, instrument, certificate
or undertaking and every other act or thing whatsoever
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<PAGE>
executed or done by or on behalf of the Trust or the Trustees or any of them in
connection with the Trust shall be conclusively deemed to have been executed or
done only by or for the Trust or the Trustees and not personally. Nothing in
this Declaration of Trust shall protect any Trustee or officer against any
liability to the Trust or the Shareholders to which such Trustee or officer
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of the
office of Trustee or of such officer.
Every note, bond, contract, instrument, certificate or undertaking
made or issued by the Trustees or by any officers or officer shall give notice
that this Declaration of Trust is on file with the Secretary of the State of
Ohio and shall recite to the effect that the same was executed or made by or on
behalf of the Trust or by them as Trustees or Trustee or as officers or officer
and not individually and that the obligations of such instrument are not binding
upon any of them or the Shareholders individually but are binding only upon the
assets and property of the Trust, but the omission thereof shall not operate to
bind any Trustees or Trustee or officers or officer or Shareholders or
Shareholder individually.
Section 6.2 Trustee's Good Faith Action; Expert Advice; No Bond or
Surety. The exercise by the Trustees of their powers and discretions hereunder
shall be binding upon everyone interested. A Trustee shall be liable for his own
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of the office of Trustee, and for nothing else,
and shall not be liable for errors of judgment or mistakes of fact or law.
Subject to the foregoing, (a) the Trustees shall not be responsible or liable in
any event for any neglect or wrongdoing of any officer, agent, employee,
consultant, adviser, administrator, distributor or principal underwriter,
custodian or transfer, dividend disbursing, Shareholder servicing or accounting
agent of the Trust, nor shall any Trustee be responsible for the act or omission
of any other Trustee; (b) the Trustees may take advice of counsel or other
experts with respect to the meaning and operation of this Declaration of Trust
and their duties as Trustees, and shall be under no liability for any act or
omission in accordance with such advice or for failing to follow such advice;
and (c) in discharging their duties, the Trustees, when acting in good faith,
shall be entitled to rely upon the books of account of the Trust and upon
written reports made to the Trustees by any officer appointed by them, any
independent public accountant, and (with respect to the subject matter of the
contract involved) any officer, partner or responsible employee of a Contracting
Party appointed by the Trustees pursuant to Section 3.3. The Trustees as such
shall not be required to give any bond or surety or any other security for the
performance of their duties. Nothing stated herein is intended to detract from
the protection accorded to Trustees by Ohio Revised Code Sections 1746.08 and
1701.59, as amended from time to time.
Section 6.3 Indemnification of Shareholders. In case any Shareholder
or former Shareholder shall be charged or held to be personally liable for any
obligation or liability of the Trust solely by reason of being or having been a
Shareholder and not because of such Shareholder's acts or omissions or for some
other reason, the Trust (upon proper and timely request by the Shareholder)
shall assume the defense against such charge and satisfy any judgment thereon,
and the Shareholder or former Shareholder (or his heirs, executors,
administrators or other legal representatives or in the case of a corporation or
other entity, its corporate or other general successor) shall be entitled out of
the assets of the Trust estate to be held harmless from and indemnified against
all loss and expense arising from such liability; provided that, in the event
the Trust shall consist of more than one Series, Shareholders of a particular
Series who are faced with claims or liabilities solely by reason of their status
as Shareholders of that Series shall be limited to the assets of that Series for
recovery of such
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<PAGE>
loss and related expenses. The rights accruing to a Shareholder under this
Section 6.3 shall not exclude any other right to which such Shareholder may be
lawfully entitled, nor shall anything herein contained restrict the right of the
Trust to indemnify or reimburse a Shareholder in any appropriate situation even
though not specifically provided herein.
Section 6.4 Indemnification of Trustees, Officers, etc. Subject to and
except as otherwise provided in the Securities Act of 1933, as amended, and the
1940 Act, the Trust shall indemnify each of its Trustees and officers (including
persons who serve at the Trust's request as directors, officers or trustees of
another organization in which the Trust has any interest as a shareholder,
creditor or otherwise (hereinafter referred to as a "Covered Person") against
all liabilities, including but not limited to amounts paid in satisfaction of
judgments, in compromise or as fines and penalties, and expenses, including
reasonable accountants' and counsel fees, incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such person may be or may have been
threatened, while in office or thereafter, by reason of being or having been
such a Trustee or officer, director or trustee, and except that no Covered
Person shall be indemnified against any liability to the Trust or its
Shareholders to which such Covered Person would otherwise be subject by reason
of willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such Covered Person's office.
Section 6.5 Advances of Expenses. The Trust shall advance attorneys'
fees or other expenses incurred by a Covered Person in defending a proceeding to
the full extent permitted by the Securities Act of 1933, as amended, the 1940
Act, and Ohio Revised Code Chapter 1707, as amended. In the event any of these
laws conflict with Ohio Revised Code Section 1701.13(E), as amended, these laws,
and not Ohio Revised Code Section 1701.13(E), shall govern.
Section 6.6 Indemnification Not Exclusive, etc. The right of
indemnification provided by this Article VI shall not be exclusive of or affect
any other rights to which any such Covered Person may be entitled. As used in
this Article VI, "Covered Person" shall include such person's heirs, executors
and administrators. Nothing contained in this article shall affect any rights to
indemnification to which personnel of the Trust, other than Trustees and
officers, and other persons may be entitled by contract or otherwise under law,
nor the power of the Trust to purchase and maintain liability insurance on
behalf of any such person.
Section 6.7 Liability of Third Persons Dealing with Trustees. No
person dealing with the Trustees shall be bound to make any inquiry concerning
the validity of any transaction made or to be made by the Trustees or to see to
the application of any payments made or property transferred to the Trust or
upon its order.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Duration and Termination of Trust. Unless terminated as
provided herein, the Trust shall continue without limitation of time. The Trust
may be terminated at any time by a majority of the Trustees then in office
subject to a favorable vote of a majority of the outstanding voting Shares, as
defined in the 1940 Act, of each Series voting separately by Series.
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<PAGE>
Upon termination, after paying or otherwise providing for all charges,
taxes, expenses and liabilities, whether due or accrued or anticipated as may be
determined by the Trustees, the Trust shall in accordance with such procedures
as the Trustees consider appropriate reduce the remaining assets to
distributable form in cash, securities or other property, or any combination
thereof, and distribute the proceeds to the Shareholders, in conformity with the
provisions of subsection (d) of Section 4.2.
Section 7.2 Reorganization. The Trustees may sell, convey and transfer
the assets of the Trust, or the assets belonging to any one or more Series, to
another trust, partnership, association or corporation organized under the laws
of any state of the United States, or to the Trust to be held as assets
belonging to another Series of the Trust, in exchange for cash, shares or other
securities (including, in the case of a transfer to another Series of the Trust,
Shares of such other Series) with such transfer being made subject to, or with
the assumption by the transferee of, the liabilities belonging to each Series
the assets of which are so transferred; provided, however, that if shareholder
approval is required by the 1940 Act, no assets belonging to any particular
Series shall be so transferred unless the terms of such transfer shall have
first been approved at a meeting called for the purpose by the affirmative vote
of the holders of a majority of the outstanding voting Shares, as defined in the
1940 Act, of that Series. Following such transfer, the Trustees shall distribute
such cash, shares or other securities (giving due effect to the assets and
liabilities belonging to and any other differences among the various Series the
assets belonging to which have so been transferred) among the Shareholders of
the Series the assets belonging to which have been so transferred; and if all of
the assets of the Trust have been so transferred, the Trust shall be terminated.
Section 7.3 Amendments. All rights granted to the Shareholders under
this Declaration of Trust are granted subject to the reservation of the right to
amend this Declaration of Trust as herein provided, except that no amendment
shall repeal the limitations on personal liability of any Shareholder or Trustee
or repeal the prohibition of assessment upon the Shareholders without the
express consent of each Shareholder or Trustee involved. Subject to the
foregoing, the provisions of this Declaration of Trust (whether or not related
to the rights of Shareholders) may be amended at any time by an instrument in
writing signed by a majority of the then Trustees (or by an officer of the Trust
pursuant to the vote of a majority of such Trustees), when authorized so to do
by the vote in accordance with subsection (e) of Section 4.2 of Shareholders
holding a majority of the Shares entitled to vote, except that amendments either
(a) establishing and designating any new Series of Shares not established and
designated in Section 4.2, or any Class or (b) having the purpose of changing
the name of the Trust or the name of any Shares theretofore established and
designated or of supplying any omission, curing any ambiguity or curing,
correcting or supplementing any provision hereof which is internally
inconsistent with any other provision hereof or which is defective or
inconsistent with the 1940 Act or with the requirements of the Internal Revenue
Code and applicable regulations for the Trust's obtaining the most favorable
treatment thereunder available to regulated investment companies, shall not
require authorization by Shareholder vote. If Shares have been issued in Series
or Classes and such amendment would not affect Shares of all Series or Classes
equally, no such amendment may be made except with the vote or consent of the
holders of a majority of the Shares of each Series or Class affected by such
amendment. Subject to the foregoing, any such amendment shall be effective as
provided in the instrument containing the terms of such amendment or, if there
is no provision therein with respect to effectiveness, upon the execution of
such instrument and of a certificate (which may be a part of such instrument)
executed by a Trustee or officer of the Trust to the effect that such amendment
has been duly adopted.
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<PAGE>
Section 7.4 Filing of Copies; References; Headings. The original or a
copy of this instrument and of each amendment hereto shall be kept at the office
of the Trust where it may be inspected by any Shareholder. A copy of this
instrument and of each amendment hereto shall be filed by the Trust with the
Secretary of the State of Ohio, as well as any other governmental office where
such filing may from time to time be required, but the failure to make any such
filing shall not impair the effectiveness of this instrument or any such
amendment. Anyone dealing with the Trust may rely on a certificate by an officer
of the Trust as to whether or not any such amendments have been made, as to the
identities of the Trustees and officers, and as to any matters in connection
with the Trust hereunder; and, with the same effect as if it were the original,
may rely on a copy certified by an officer of the Trust to be a copy of this
instrument or of any such amendments. In this instrument and in any such
amendment, references to this instrument, and all expressions like "herein",
"hereof" and "hereunder" shall be deemed to refer to this instrument as a whole
as the same may be amended or affected by any such amendments. The masculine
gender shall include the feminine and neuter genders. Headings are placed herein
for convenience of reference only and shall not be taken as a part hereof or
control or affect the meaning, construction or effect of this instrument. This
instrument may be executed in any number of counterparts each of which shall be
deemed an original.
Section 7.5 Applicable Law. This Declaration of Trust is made in the
State of Ohio, and it is created under and is to be governed by and construed
and administered according to the laws of said State, including the Ohio General
Corporation Law as the same may be amended from time to time, but the reference
to said Corporation Law is not intended to give the Trust, the Trustees, the
Shareholders or any other person any right, power, authority or responsibility
available only to or in connection with an entity organized in corporate form.
The Trust shall be of the type referred to in Section 1746.01 of the Ohio
Revised Code, and without limiting the provisions hereof, the Trust may exercise
all powers which are ordinarily exercised by such a trust.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand in
Indianapolis, Indiana for himself and his assigns, as of the day and year first
above written.
/s/ Timothy L. Ashburn
----------------------
TIMOTHY L. ASHBURN
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<PAGE>
STATE OF KENTUCKY )
) ss:
COUNTY OF FAYETTE )
Before me, a Notary Public in and for said county and state, personally
appeared the above named Timothy L. Ashburn, who acknowledged that he did sign
the foregoing instrument and that the same is his free act and deed.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal on this 28th day of February, 1997.
/s/ Michele Kay Vogt
--------------------
Notary Public
My Commission Expires: March 18, 1997
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<PAGE>
ACCEPTANCE OF TRUST
As contemplated in Section 3.1 of the Agreement and Declaration of
Trust of Star Select Funds, the undersigned accepts his designation as a Trustee
of said Trust and agrees to the provisions of said Agreement and Declaration of
Trust.
IN WITNESS WHEREOF, the undersigned has set his hand on the date set
opposite his signature.
Date: February 28, 1997 /s/ Timothy L. Ashburn
----------------------
TIMOTHY L. ASHBURN
STATE OF KENTUCKY )
) ss:
COUNTY OF FAYETTE )
Before me, a Notary Public in and for said county and state, personally
appeared the above named Timothy L. Ashburn, who acknowledged that he did sign
the foregoing instrument and that the same is his free act and deed.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal on this 28th day of February, 1997.
/s/ Michele Kay Vogt
--------------------
Notary Public
My Commission Expires: March 18, 1997
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By-Laws
of
Star Select Funds
ARTICLE 1
Agreement and Declaration of Trust and Offices
1.1 Agreement and Declaration of Trust. These By-Laws shall be subject
to the Agreement and Declaration of Trust, as from time to time in effect (the
"Declaration of Trust"), of Star Select Funds, the Ohio business trust
established by the Declaration of Trust (the "Trust").
1.2 Offices. The Trust may maintain one or more other offices,
including its principal office, in or outside of Ohio, in such cities as the
Trustees may determine from time to time. Unless the Trustees otherwise
determine, the principal office of the Trust shall be located in Indianapolis,
Indiana.
ARTICLE 2
Meetings of Trustees
2.1 Regular Meetings. Regular meetings of the Trustees may be held
without call or notice at such places and at such times as the Trustees may from
time to time determine, provided that notice of the first regular meeting
following any such determination shall be given to absent Trustees. A regular
meeting of the Trustees may be held without call or notice immediately after and
at the same place as any meeting of the shareholders.
2.2 Special Meetings. Special meetings of the Trustees may be held at
any time and at any place designated in the call of the meeting when called by
the President or the Treasurer or by two or more Trustees, sufficient notice
thereof being given to each Trustee by the Secretary or an Assistant Secretary
or by the officer or the Trustees calling the meeting.
2.3 Notice. It shall be sufficient notice to a Trustee of a special
meeting to send notice by mail at least forty-eight hours or by telegram at
least twenty-four hours before the meeting addressed to the Trustee at his or
her usual or last known business or residence address or to give notice to him
or her in person or by telephone at least twenty-four hours before the meeting.
Notice of a meeting need not be given to any Trustee if a written waiver of
notice, executed by him or her before or after the meeting, is filed with the
records of the meeting, or to any Trustee who attends the meeting without
protesting prior thereto or at its commencement the lack of notice to him or
her. Neither notice of a meeting nor a waiver of a notice need specify the
purposes of the meeting.
<PAGE>
2.4 Quorum. At any meeting of the Trustees a majority of the Trustees
then in office shall constitute a quorum. Any meeting may be adjourned from time
to time by a majority of the votes cast upon the question, whether or not a
quorum is present, and the meeting may be held as adjourned without further
notice.
2.5 Participation by Telephone. One or more of the Trustees or of any
committee of the Trustees may participate in a meeting thereof by means of a
conference telephone or similar communications equipment allowing all persons
participating in the meeting to hear each other at the same time. Participation
by such means shall constitute presence in person at a meeting except as
otherwise provided by the Investment Company Act of 1940.
2.6 Action by Consent. Any action required or permitted to be taken at
any meeting of the Trustees or any committee thereof may be taken without a
meeting, if a written consent of such action is signed by a majority of the
Trustees then in office or a majority of the members of such committee, as the
case may be, and such written consent is filed with the minutes of the
proceedings of the Trustees or such committee.
ARTICLE 3
Officers
3.1 Enumeration and Qualification. The officers of the Trust shall be a
President, a Treasurer, a Secretary and such other officers, including Vice
Presidents, if any, as the Trustees from time to time may in their discretion
elect. The Trust may also have such agents as the Trustees from time to time may
in their discretion appoint. Any officer may be but none need be a Trustee or
shareholder. Any two or more offices may be held by the same person.
3.2 Election. The President, the Treasurer and the Secretary shall be
elected annually by the Trustees. Other officers, if any, may be elected or
appointed by the Trustees at any time. Vacancies in any office may be filled at
any time.
3.3 Tenure. The President, the Treasurer and the Secretary shall hold
office for one year and until their respective successors are chosen and
qualified, or in each case until he or she sooner dies, resigns, is removed or
becomes disqualified. Each other officer shall hold office and each agent shall
retain authority at the pleasure of the Trustees.
3.4 Powers. Subject to the other provisions of these By-Laws, each
officer shall have, in addition to the duties and powers herein and in the
Declaration of Trust set forth, such duties and powers as are commonly incident
to the office occupied by him or her as if the Trust were organized as an Ohio
business corporation and such other duties and powers as the Trustees may from
time to time designate.
3.5 President. Unless the Trustees otherwise provide, the President, or
in the absence of the President, any Trustee chosen by the Trustees, shall
preside at all meetings of the shareholders and of the Trustees. The President
shall be the chief executive officer.
<PAGE>
3.6 Treasurer. The Treasurer shall be the chief financial and
accounting officer of the Trust, and shall, subject to the provisions of the
Declaration of Trust and to any arrangement made by the Trustees with a
custodian, investment adviser or manager, or transfer, shareholder servicing or
similar agent, be in charge of the valuable papers, books of account and
accounting records of the Trust, and shall have such other duties and powers as
may be designated from time to time by the Trustees or by the President.
3.7 Secretary. The Secretary shall record all proceedings of the
shareholders and the Trustees in books to be kept therefor, which books or a
copy thereof shall be kept at the principal office of the Trust. In the absence
of the Secretary from any meeting of the shareholders or Trustees, an assistant
secretary, or if there be none or if he or she is absent, a temporary secretary
chosen at such meeting shall record the proceedings thereof in the aforesaid
books.
3.8 Resignations and Removals. Any Trustee or officer may resign at any
time by written instrument signed by him or her and delivered to the President
or the Secretary or to a meeting of the Trustees. Such resignation shall be
effective upon receipt unless specified to be effective at some other time. The
Trustees may remove any officer elected by them with or without cause. Except to
the extent expressly provided in a written agreement with the Trust, no Trustee
or officer resigning and no officer removed shall have any right to any
compensation for any period following his or her resignation or removal, or any
right to damages on account of such removal.
ARTICLE 4
Committees
4.1 General. The Trustees, by vote of a majority of the Trustees then
in office, may elect from their number an Executive Committee or other
committees and may delegate thereto some or all of their powers except those
which by law, by the Declaration of Trust, or by these By-Laws may not be
delegated. Except as the Trustees may otherwise determine, any such committee
may make rules for the conduct of its business, but unless otherwise provided by
the Trustees or in such rules, its business shall be conducted so far as
possible in the same manner as is provided by these By-Laws for the Trustees
themselves. All members of such committees shall hold such offices at the
pleasure of the Trustees. The Trustees may abolish any such committee at any
time. Any committee to which the Trustees delegate any of their powers or duties
shall keep records of its meetings and shall report its action to the Trustees.
The Trustees shall have power to rescind any action of any committee, but no
such rescission shall have retroactive effect.
ARTICLE 5
Reports
5.1 General. The Trustees and officers shall render reports at the time
and in the manner required by the Declaration of Trust or any applicable law.
Officers and Committees shall render such additional reports as they may deem
desirable or as may from time to time be required by the Trustees.
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ARTICLE 6
Fiscal Year
6.1 General. The fiscal year of the Trust shall be fixed by, and shall
be subject to change by, the Trustees.
ARTICLE 7
Seal
7.1 General. If required by applicable law, the seal of the Trust shall
consist of a flat-faced die with the word "Ohio", together with the name of the
Trust and the year of its organization cut or engraved thereon, but, unless
otherwise required by the Trustees, the seal shall not be necessary to be placed
on, and its absence shall not impair the validity of, any document, instrument
or other paper executed and delivered by or on behalf of the Trust.
ARTICLE 8
Execution of Papers
8.1 General. Except as the Trustees may generally or in particular
cases authorize the execution thereof in some other manner, all deeds, leases,
contracts, notes and other obligations made by the Trustees shall be signed by
the President, any Vice President, or by the Treasurer and need not bear the
seal of the Trust, but shall state the substance of or make reference to the
provisions of Section 7.1 of the Declaration of Trust.
ARTICLE 9
Issuance of Share Certificates
9.1 Share Certificates. In lieu of issuing certificates for shares, the
Trustees or the transfer agent may either issue receipts therefor or may keep
accounts upon the books of the Trust for the record holders of such shares, who
shall in either case be deemed, for all purposes hereunder, to be the holders of
certificates for such shares as if they had accepted such certificates and shall
be held to have expressly assented and agreed to the terms hereof.
The Trustees may at any time authorize the issuance of share
certificates. In that event, each shareholder shall be entitled to a certificate
stating the number of shares owned by him, in such form as shall be prescribed
from time to time by the Trustees. Such certificate shall be signed by the
President or a Vice-President and by the Treasurer or Assistant Treasurer. Such
signatures may be facsimiles if the certificate is signed by a transfer agent,
or by a registrar, other than a Trustee, officer or employee of the Trust. In
case any officer who has signed or whose facsimile signature has been placed on
such certificate shall cease to be such officer before such certificate is
issued, it may be issued by the Trust with the same effect as if he were such
officer at the time of its issue.
9.2 Loss of Certificates. In case of the alleged loss or destruction or
the mutilation of a share certificate, a duplicate certificate may be issued in
place thereof, upon such terms as the Trustees shall prescribe.
<PAGE>
9.3 Issuance of New Certificate to Pledgee. In the event certificates
have been issued, a pledgee of shares transferred as collateral security shall
be entitled to a new certificate if the instrument of transfer substantially
describes the debt or duty that is intended to be secured thereby. Such new
certificate shall express on its face that it is held as collateral security,
and the name of the pledgor shall be stated thereon, who alone shall be liable
as a shareholder, and entitled to vote thereon.
9.4 Discontinuance of Issuance of Certificates. The Trustees may at any
time discontinue the issuance of share certificates and may, by written notice
to each shareholder, require the surrender of share certificates to the Trust
for cancellation. Such surrender and cancellation shall not affect the ownership
of shares in the Trust.
ARTICLE 10
Custodian
10.1 General. The Trust shall at all times employ a bank or trust
company having a capital, surplus and undivided profits of at least Five Hundred
Thousand ($500,000) Dollars as Custodian of the capital assets of the Trust. The
Custodian shall be compensated for its services by the Trust and upon such basis
as shall be agreed upon from time to time between the Trust and the Custodian.
ARTICLE 11
Dealings with Trustees and Officers
11.1 General. Any Trustee, officer or other agent of the Trust may
acquire, own and dispose of shares of the Trust to the same extent as if he were
not a Trustee, officer or agent; and the Trustees may accept subscriptions to
shares or repurchase shares from any firm or company in which he is interested.
ARTICLE 12
Shareholders
12.1 Meetings. A meeting of the shareholders of the Trust shall be held
whenever called by the Trustees, whenever election of a Trustee or Trustees by
shareholders is required by the provisions of Section 16(a) of the Investment
Company Act of 1940 for that purpose or whenever otherwise required pursuant to
the Declaration of Trust. Any meeting shall be held on such day and at such time
as the President or the Trustees may fix in the notice of the meeting.
12.2 Record Dates. For the purpose of determining the shareholders who
are entitled to vote or act at any meeting or any adjournment thereof, or who
are entitled to receive payment of any dividend or of any other distribution,
the Trustees may from time to time fix a time, which shall be not more than 60
days before the date of any meeting of shareholders or the date for the payment
of any dividend or of any other distribution, as the record date for determining
the shareholders having the right to notice of and to vote at such meeting and
any adjournment thereof or the right to receive such dividend or distribution,
and in such case only shareholders
<PAGE>
of record on such record date shall have such right, notwithstanding any
transfer of shares on the books of the Trust after the record date; or without
fixing such record date the Trustees may for any such purposes close the
register or transfer books for all or any part of such period.
ARTICLE 13
Amendments to the By-Laws
13.1 General. These By-Laws may be amended or repealed, in whole or in
part, by a majority of the Trustees then in office at any meeting of the
Trustees, or by one or more writings signed by such a majority.
March 25, 1997
Star Select Funds
429 North Pennsylvania Street
Indianapolis, Indiana 46204
Gentlemen:
This letter is in response to your request for our opinion in
connection with the filing of the Registration Statement of Star Select Funds.
We have examined a copy of the Trust's Agreement and Declaration of
Trust, the Trust's By-Laws, the Trust's record of the various actions by the
Trustees thereof, and all such agreements, certificates of public officials,
certificates of officers and representatives of the Trust and others, and such
other documents, papers, statutes and authorities as we deem necessary to form
the basis of the opinion hereinafter expressed. We have assumed the genuineness
of the signatures and the conformity to original documents of the copies of such
documents supplied to us as original or photostat copies.
Based upon the foregoing, we are of the opinion that, after
registration is effective for purposes of federal and applicable state
securities laws, the shares of each series of the Trust, if issued in accordance
with the then current Prospectus and Statement of Additional Information of the
Trust, will be legally issued, fully paid and non-assessable.
We herewith give you our permission to file this opinion with the
Securities and Exchange Commission as an exhibit to the Registration Statement.
Very truly yours,
BROWN, CUMMINS & BROWN CO., L.P.A.
BCB:tms
