1933 Act File No.
1940 Act File No.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933............... X
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Pre-Effective Amendment No. .....................................
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
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Amendment No. .................................................
WCT FUNDS
(Exact name of Registrant as Specified in Charter)
Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779
(Address of Principal Executive Offices)
(412) 288-1900
(Registrant's Telephone Number)
John W. McGonigle, Esq.,
Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering As soon as possible after the
effectiveness of the Registration Statement
Pursuant to the provisions of Rule 24f-2 of the Investment Company Act of 1940,
Registrant hereby elects to register an indefinite number of shares.
Amendment Pursuant to Rule 473
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 on such date as the Commission acting pursuant to said Section 8(a),
may determine.
Copies To:
Matthew G. Maloney, Esquire
Dickstein, Shapiro, Morin & Oshinsky, L.L.P.
2101 L Street, N.W.
Washington, D.C. 20037
<PAGE>
CROSS-REFERENCE SHEET
This Registration Statement of WCT FUNDS consists of one portfolio,
West Coast Equity Fund, and is comprised of the following:
PART A. INFORMATION REQUIRED IN A PROSPECTUS.
Prospectus Heading
(Rule 404(c) Cross Reference)
Item 1. Cover Page...................Cover Page.
Item 2. Synopsis.....................Summary of Fund Expenses.
Item 3. Condensed Financial
Information Performance Information.
Item 4. General Description of
Registrant...................General Information; Investment
Information; Investment Objective;
Investment Policies; Acceptable
Investments; Investment Limitations.
Item 5. Management of the Fund WCT Funds Management; Management of the
WCT Funds; Distribution of Fund Shares;
Administration of the Fund; Expenses of
the Fund.
Item 6. Capital Stock and Other
Securities...................Dividends and Distributions; Shareholder
Information; Voting Rights; Tax
Information; Federal Income Tax; State
and Local Taxes; Effect of
Banking Laws.
Item 7. Purchase of Securities Being
Offered......................Net Asset Value;
Investing in the
Fund; Share
Purchases; Minimum
Investment
Required; What
Shares Cost;
Purchases at Net
Asset Value;
Purchases with
Proceeds from
Redemption of
Unaffiliated
Mutual Fund
Shares; Sales
Charge
Reallowance;
Reducing or
Eliminating the
Sales Charge;
Systematic
Investment
Program;
Retirement Plans;
Confirmations and
Account
Statements;
Exchange
Privilege;
Exchanging Shares.
Item 8. Redemption or Repurchase.....Redeeming Shares; Systematic Withdrawal
Program; Account with Low Balances.
Item 9. Pending Legal Proceedings....None.
<PAGE>
PART B. INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION.
Item 10. Cover Page.....................Cover Page.
Item 11. Table of Contents..............Table of Contents.
Item 12. General Information and
History General Information About
the Fund.
Item 13. Investment Objectives and
Policies.......................Investment Objective and
Policies; Investment
Limitations; Appendix.
Item 14. Management of the Fund WCT Funds Management;
Trustees Compensation.
Item 15. Control Persons and Principal
Holders of Securities Fund Ownership.
Item 16. Investment Advisory and Other
Services......................Investment Advisory Services;
Distribution and Shareholder Services
Plans; Other Services; Fund
Administration; Custodian and Portfolio
Accountant; Transfer Agent, Dividend
Disbursing Agent, and Shareholder
Servicing Agent; Independent Auditors.
Item 17. Brokerage Allocation..........Brokerage Transactions.
Item 18. Capital Stock and Other
Securities Not Applicable.
Item 19. Purchase, Redemption and
Pricing of Securities
Being Offered..................Purchasing Shares; Determining Net
Asset Value; Exchange Privilege;
Redeeming Shares; Redemption in Kind;
Massachusetts Partnership Law.
Item 20. Tax Status.....................Tax Status; The Fund's Tax Status;
Shareholders' Tax Status.
Item 21. Underwriters...................Not Applicable.
Item 22. Calculation of Performance
Data...........................Total Return; Yield; Performance
Comparisons.
Item 23. Financial Statements...........To be filed by amendment.
[IN RED INK ON THE LEFT SIDE PANEL] Information contained herein is subject to
completion or amendment. A registration statement relating to these securities
has been filed with the Securities and Exchange Commission. These securities may
not be sold nor may any offers to buy be accepted prior to the time the
registration statement becomes effective. This Prospectus shall not constitute
an offer to sell or the solicitation of an offer to buy nor shall there be any
sale of these securities in any State in which such offer, solicitation, or sale
would be unlawful prior to registration or qualification under the securities
laws of any such State.
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS
DATED SEPTEMBER 17, 1997
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WCT Equity Fund
(A Portfolio of the WCT Funds)
Prospectus
- --------------------------------------------------------------------------------
The shares of WCT Equity Fund (the "Fund") offered by this prospectus represent
interests in a diversified portfolio in the WCT Funds (the "Trust"), an open-end
management investment company (a mutual fund). The investment objective of the
Fund is to provide long-term capital appreciation. The Fund pursues this
objective by investing primarily in common or preferred stock of large or medium
sized companies with market capitalizations in excess of $1.5 billion.
The shares offered by this prospectus are not deposits or obligations of West
Coast Trust Company, Inc. or its affiliates, are not endorsed or guaranteed by
West Coast Trust Company, Inc. or its affiliates, and are not insured by the
Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in these shares involves investment risks,
including the possible loss of principal.
This prospectus contains the information you should read and know before you
invest in the Fund. Keep this prospectus for future reference.
The Fund has also filed a Statement of Additional Information dated November __,
1997 with the Securities and Exchange Commission. The information contained in
the Statement of Additional Information is incorporated by reference into this
prospectus. You may request a copy of the Statement of Additional Information,
or a paper copy of this prospectus, if you have received your prospectus
electronically, free of charge, obtain other information, or make inquiries
about the Fund by writing to the Fund or by calling the Fund at 1-800-___-____.
The Statement of Additional Information, material incorporated by reference into
this document, and other information regarding the Fund is maintained
electronically with the SEC at Internet Web site (http://www.sec.gov).
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
Prospectus dated November __, 1997
<PAGE>
Table of Contents
To be generated by typesetter
<PAGE>
Summary of Fund Expenses
Shareholder Transaction Expenses
<TABLE>
<CAPTION>
<S> <C>
Maximum Sales Charge Imposed on Purchases (as a percentage of offering
price)............................................................................... 4.50%
Maximum Sales Charge Imposed on Reinvested Dividends (as a percentage
of offering price)................................................................... None
Contingent Deferred Sales Charge (as a percentage of original purchase price or
redemption proceeds, as applicable).................................................. None
Redemption Fees (as a percentage of amount redeemed, if applicable)..................... None
Exchange Fee............................................................................ None
Annual Fund Operating Expenses *
(As a percentage of projected average net assets)
Management Fee(1)....................................................................... 0.70%
12b-1 Fee (2)........................................................................... 0.00%
Total Other Expenses.................................................................... 0.45%
Total Fund Operating Expenses(3)..................................................... 1.15%
</TABLE>
(1) The estimated management fee has been reduced to reflect the anticipated
voluntary waiver of the management fee by the investment adviser. The adviser
can terminate this voluntary waiver at any time at its sole discretion. The
maximum management fee is 0.75%.
(2) As of the date of this prospectus, the Fund is not paying or accruing 12b-1
fees. The Fund will not pay or accrue 12b-1 fees until a separate class of
shares has been created for certain institutional investors. The Fund's
distributor can pay up to 0.25% as a 12b-1 fee which is reimbursed to the
distributor by the Fund. See "Distribution of Fund Shares." Long-term
shareholders may pay more than the economic equivalent of the maximum front-end
sales charges permitted under the rules of the National Association of
Securities Dealers, Inc.
(3) The Total Fund Operating Expenses are estimated to be 1.20% absent the
voluntary waiver described in Note 1 above.
* Expenses in this table are estimated based on average expenses expected to be
incurred during the fiscal year ending October 31, 1998. During the course of
this period, expenses may be more or less than the average amount shown.
The purpose of this table is to assist the investor in understanding the various
costs and expenses that a shareholder in the Fund will bear, either directly or
indirectly. For more complete descriptions of the various costs and expenses,
see "WCT Funds Information" and "Investing in the Fund". Wire-transferred
redemptions may be subject to additional fees.
<PAGE>
EXAMPLE
You would pay the following expenses on a $1,000 investment assuming (1) 5%
annual return; (2) redemption at the end of each time period; and (3) payment of
the maximum sales charge. As noted in the table above, the Fund charges no
contingent deferred sales charge
1 Year................................................... $56
3 Years.................................................. $80
The above example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown. This example
is based on estimated data for the fiscal year ending October 31, 1998.
<PAGE>
General Information
The WCT Funds was established as a Massachusetts business trust under a
Declaration of Trust dated July 1, 1997. The Declaration of Trust permits the
WCT Funds to offer separate series of shares of beneficial interest representing
interests in separate portfolios of securities. This prospectus relates only to
the WCT Funds' equity portfolio, known as WCT Equity Fund. The Fund is for trust
clients of WCT Trust Company, Inc. and its affiliates and individual investors
who desire a convenient means of accumulating an interest in a professionally
managed, diversified portfolio investing primarily in common or preferred stock
of large or medium sized companies with market capitalizations in excess of $1.5
billion. West Coast Trust Company, Inc. is the investment adviser to the Fund,
and Becker Capital Management, Inc. is the Fund's sub-adviser. The minimum
initial investment by a trust customer is $5,000 and $1,000 for individual
investors. Subsequent investments must be in amounts of at least $100.
Fund shares are sold at net asset value plus an applicable sales charge and are
redeemed at net asset value.
Investment Information
Investment Objective
The investment objective of the Fund is to provide long-term capital
appreciation. While there is no assurance that the Fund will achieve its
investment objective, it endeavors to do so by investing in companies believed
to represent good long-term values not currently recognized in the market prices
of their securities and through fundamental analysis, systematic stock valuation
and disciplined portfolio construction. The investment objective cannot be
changed without approval of shareholders. Unless indicated otherwise, the
investment policies described below may be changed by the Board of Trustees (the
"Trustees") without the approval of shareholders. Shareholders will be notified
before any material changes in these policies become effective.
Investment Policies
The Fund pursues its objective by investing primarily in common or preferred
stock of large or medium sized companies with market capitalizations in excess
of $1.5 billion. Occasionally, the Fund will hold small cap issues which satisfy
the adviser's and sub-adviser's valuation discipline. The common and preferred
stocks the Fund invests in are generally characterized as having low price to
earnings ratios, growth and quality characteristics which match or exceed those
companies which comprise the Standard & Poor's 500 Index ("S&P"). As a matter of
investment policy, the Fund will invest so that, under normal circumstances, at
least 80% of its total assets are invested in equity securities.
Acceptable Investments
The securities in which the Fund invests include, but are not limited to:
o common stocks of U.S. companies which are either listed on the New
York or American Stock Exchanges or traded in over-the-counter
markets, preferred stocks of such companies, warrants, and preferred
stocks convertible into common stocks of such companies;
o American Depositary Receipts ("ADRs") of foreign companies traded on
the New York or American Stock Exchanges or in the over-the-counter market;
o obligations of the United States government;
o notes, bonds, and discount notes of U.S. government agencies or
instrumentalities;
o money market instruments rated, at the time of purchase, A-1 or A-2
by Standard & Poor's ("S&P"), Prime-1 or Prime-2 by Moody's
Investors Service, Inc. ("Moody's"), or F-1 or F-2 by Fitch Investor
Services ("Fitch"), or, if not rated, determined by the adviser or
sub-adviser to be of comparable quality; and
o repurchase agreements collateralized by eligible investments.
In addition, the Fund may lend portfolio securities, invest in securities of
other investment companies, and engage in when-issued and delayed delivery
transactions.
The prices of fixed income securities fluctuate inversely to the direction of
interest rates.
Common Stocks. As described above, the Fund invests primarily in common and
preferred stocks. As with other mutual funds that invest primarily in common and
preferred stocks, the Fund is subject to market risks. That is, the possibility
exists that common and preferred stocks will decline over short or even extended
periods of time, and the United States equity market tends to be cyclical,
experiencing both periods when stock prices generally increase and periods when
stock prices generally decrease. The Fund may, from time to time, invest in
issuers with smaller capitalizations. Small capitalization stocks have
historically been more volatile in price than larger capitalization stocks, such
as those included in the S&P 500. This is because, among other things, smaller
companies have a lower degree of liquidity in the equity market and tend to have
a greater sensitivity to changing economic conditions. Further, in addition to
exhibiting greater volatility, these stocks may, to some degree, fluctuate
independently of the stocks of large companies. That is, the stocks of small
capitalization companies may decline in price as the price of large company
stocks rises or vice versa. Therefore, investors should expect that there will
be periods of time when the Fund will exhibit greater volatility than broad
stock market indices such as the S&P 500.
Convertible Securities. Convertible securities are fixed income securities which
may be exchanged or converted into a predetermined number of the issuer's
underlying common stock at the option of the holder during a specified time
period. Convertible securities may take the form of convertible preferred stock
or debentures, units consisting of warrants or a combination of the features of
several of these securities.
Convertible preferred stocks generally retain the investment characteristics of
fixed income securities until they have been converted but also react to
movements in the underlying equity securities. The holder is entitled to receive
the dividend preference of a preferred stock until the holder elects to exercise
the conversion privilege.
Securities of Foreign Issuers. The Fund may invest (up to 20% of its total
assets) in securities of foreign issuers traded on the New York or American
Stock Exchanges or in the over-the-counter market in the form of depositary
receipts. Securities of a foreign issuer may present greater risks in the form
of nationalization, confiscation, domestic marketability, or other national or
international restrictions. As a matter of practice, the Fund will not invest in
the securities of a foreign issuer if any such risk appears to the adviser or
sub-adviser to be substantial.
Other differences between investing in foreign and U.S. companies include:
o less publicly available information about foreign companies;
o the lack of uniform financial accounting standards applicable to
foreign companies;
o less readily available market quotations on foreign companies;
o differences in government regulation and supervision of foreign
securities exchanges, brokers, listed companies, and banks;
o generally lower foreign securities market volume;
o the likelihood that foreign securities may be less liquid or more
volatile;
o generally higher foreign brokerage commissions;
o possible difficulty in enforcing contractual obligations or obtaining
court judgments abroad because of differences in the legal systems;
o unreliable mail service between countries; and
o political or financial changes which adversely affect investments in
some countries.
U.S. Government Obligations. These securities include but are not limited to:
o direct obligations of the U.S. Treasury, such as U.S. Treasury
bills, notes, and bonds; and
o notes, bonds and discount notes of U.S. government agencies or
instrumentalities.
Some of these obligations are backed by the full faith and credit of the U.S.
Treasury. No assurances can be given that the U.S. government will provide
financial support to other agencies or instrumentalities, since it is not
obligated to do so. These agencies and instrumentalities are supported by:
o the issuer's right to borrow an amount limited to a specific line
of credit from the U.S. Treasury;
o the discretionary authority of the U.S. government to purchase
certain obligations of an agency or instrumentality; or
o the credit of the agency or instrumentality.
Investing in Securities of Other Investment Companies. The Fund may invest its
assets in securities of other investment companies as an efficient means of
carrying out its investment policies. It should be noted that investment
companies incur certain expenses, such as management fees, and , therefore, any
investment by the Fund in shares of other investment companies may be subject to
such duplicate expenses.
Temporary Investments. In such proportions as, in the judgment of its adviser
and sub-adviser, prevailing market conditions warrant, the Fund may, for
temporary defensive purposes, invest in:
o commercial paper which matures in 270 days or less so long as at
least two ratings are high quality ratings by nationally
recognized statistical rating organizations;
o time and savings deposits (including certificates of deposit) in
commercial or savings banks whose accounts are insured by the Bank
Insurance Fund ("BIF"), which is administered by the Federal Deposit
Insurance Corporation ("FDIC"), or in institutions whose accounts
are insured by the Savings Association Insurance Fund ("SAIF"),
which is also administered by the FDIC, including certificates of
deposit issued by, and other time deposits in, foreign branches of
BIF-insured banks; and
o bankers' acceptances.
Restricted and Illiquid Securities. The Fund may invest in restricted
securities. Other than Section 4(2) commercial paper, restricted securities are
any securities in which the Fund may otherwise invest pursuant to its investment
objective and policies, but which are subject to restrictions on resale under
federal securities laws. However, the Fund will limit investments in illiquid
securities, including certain restricted securities not determined by the
Trustees to be liquid, non-negotiable time deposits and repurchase agreements
providing for settlement in more than seven days after notice, to 15% of its net
assets.
When-Issued and Delayed Delivery Transactions. The Fund may purchase securities
on a when-issued or delayed delivery basis. These transactions are arrangements
in which the Fund purchases securities with payment and delivery scheduled for a
future time. The seller's failure to complete these transactions may cause the
Fund to miss a price or yield considered to be advantageous. Settlement dates
may be a month or more after entering into these transactions, and the market
values of the securities purchased may vary from the purchase prices.
The Fund may dispose of a commitment prior to settlement if the adviser and
sub-adviser deem it appropriate to do so. In addition, the Fund may enter into
transactions to sell its purchase commitments to third parties at current market
values and simultaneously acquire other commitments to purchase similar
securities at later dates. The Fund may realize short-term profits or losses
upon the sale of such commitments.
Lending of Portfolio Securities. In order to generate additional income, the
Fund may lend portfolio securities on a short-term or long-term basis, or both,
to broker/dealers, banks, or other institutional borrowers of securities. The
Fund will only enter into loan arrangements with broker/dealers, banks, or other
institutions which the investment adviser and sub-adviser have determined are
creditworthy under guidelines established by the Trustees and will receive
collateral in the form of cash or U.S. government securities equal to at least
100% of the value of the securities loaned. There is the risk that when lending
portfolio securities, the securities may not be available to the Fund on a
timely basis and the Fund may, therefore, lose the opportunity to sell the
securities at a desirable price. In addition, in the event that a borrower of
securities would file for bankruptcy or become insolvent, disposition of the
securities may be delayed pending court action.
Repurchase Agreements. The U.S. government securities and other securities in
which the Fund invests may be purchased pursuant to repurchase agreements.
Repurchase agreements are arrangements in which banks, broker/dealers, and other
recognized financial institutions sell U.S. government securities or other
securities to the Fund and agree at the time of sale to repurchase them at a
mutually agreed upon time and price. To the extent that the original seller does
not repurchase the securities from the Fund, the Fund could receive less than
the repurchase price on any sale of such securities.
Portfolio Turnover. Although the Fund does not intend to invest for the purpose
of seeking short-term profits, securities in the Fund's portfolio will be sold
whenever the adviser and sub-adviser believe it is appropriate to do so in light
of the Fund's investment objective, without regard to the length of time a
particular security may have been held. A high portfolio turnover rate may also
result in higher taxes paid by the Fund's shareholders. See "Tax Information" in
this Prospectus.
Investment Limitations
As a matter of fundamental investment policy, which cannot be changed without
shareholder approval, the Fund will not borrow money directly or through reverse
repurchase agreements (arrangements in which the Fund sells a portfolio
instrument for a percentage of its cash value with an arrangement to buy it back
on a set date) or pledge securities except, under certain circumstances, the
Fund may borrow up to one-third of the value of its total assets and pledge up
to 15% of its total assets to secure such borrowings.
Hub and Spoke (R) Option
If the Trustees determine it to be in the best interest of the Fund and its
shareholders, the Fund may in the future seek to achieve its investment
objective by investing all of its assets in another investment company having
the same investment objective and substantially the same investment policies and
restrictions as those applicable to the Fund. It is expected that any such
investment company would be managed in substantially the same manner as the
Fund.
The initial shareholder of the Fund (which is an affiliate of Edgewood Services,
Inc.) voted to vest authority to use this investment structure in the sole
discretion of the Trustees. No further approval of shareholders is required.
Shareholders will receive at least 30 days prior notice of any such investment.
In making its determination, the Trustees will consider, among other things, the
benefits to shareholders and/or the opportunity to reduce costs and achieve
operational efficiencies. Although it is expected that the Trustees will not
approve an arrangement that is likely to result in higher costs, no assurance is
given that costs will remain the same or be materially reduced if this
investment structure is implemented.
WCT Funds Information
Management of the WCT Funds
Board of Trustees. The WCT Funds are managed by a Board of Trustees. The Board
of Trustees is responsible for managing the business affairs of the WCT Funds
and for exercising all of the powers of the WCT Funds except those reserved for
the shareholders. An Executive Committee of the Board of Trustees handles the
Board's responsibilities between meetings of the Board.
Investment Adviser. Pursuant to an investment advisory contract with the WCT
Funds, investment decisions for the Fund are made by West Coast Trust Company,
Inc. (hereinafter referred to as the "Adviser" or "West Coast Trust"), the
Fund's investment adviser, subject to direction by the Trustees. The Adviser, in
consultation with Becker Capital Management, Inc. (the "Sub-Adviser"),
continually conducts investment research and supervision for the Fund and is
responsible for the purchase or sale of portfolio instruments.
Advisory Fees. The Fund's Adviser receives an annual investment advisory fee
equal to 0.75% of the Fund's average daily net assets. The Adviser may voluntary
choose to waive a portion of its fee or reimburse the Fund for certain operating
expenses. The Adviser can terminate this voluntary waiver of its advisory fee at
any time at its sole discretion.
Adviser's Background. The Adviser is a wholly-owned subsidiary of West Coast
Bancorp ("Bancorp"). Organized in 1981, Bancorp held approximately $____ million
in total assets as of December 31, 1996, and is the second largest bank holding
company based in Oregon. Through its subsidiaries - The Commercial Bank, Valley
Commercial Bank, The Bank of Newport, The Bank of Vancouver and West Coast
Trust, Bancorp offers a full range of commercial banking services, including
trust services to individuals, partnerships, corporations, and institutions and
acts as fiduciary of estates and conservatorships, and as a trustee under
various wills, trusts and pension and profit-sharing plans. In addition, Bancorp
and its subsidiaries offer tax-deferred annuities, single-premium whole life
insurance, other insurance investment products and securities products. The
Adviser has not previously served as an investment adviser to a mutual fund.
The Adviser has common and collective funds with assets totaling approximately
$___. Of the Adviser's common and collective funds, the balanced and equity
common and collective funds will be converted into this Fund. The Adviser does
not manage its common and collective funds. The Adviser has managed the WCT
Funds since its inception in October 1997.
As part of their regular banking operations, Bancorp and its subsidiaries 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 lending clients
of Bancorp and its subsidiaries. The lending relationship will not be a factor
in the selection of securities.
Sub-Adviser. Pursuant to the terms of an investment sub-advisory agreement
between the Adviser and Becker Capital Management, Inc., the Sub-Adviser will
make all determinations with respect to the investment of assets of the Fund,
and shall take such steps as may be necessary to implement the same, including
the placement of purchases and sale orders on behalf of the Fund. For the
services provided and the expenses incurred by the Sub-Adviser pursuant to the
sub-advisory agreement, the Sub-Adviser is entitled to receive an annual
sub-advisory fee equal to 0.50% of the daily assets of the Fund payable by the
Adviser from the advisory fees. The Sub-Adviser may elect to waive some or all
of its fee. In no event shall the Fund be responsible for any fees due to the
Sub-Adviser for its services to the Adviser.
Sub-Adviser's Background. The Sub-Adviser is a registered investment advisory
firm founded in 1976 as P.E. Becker Inc. In 1992, the Sub-Adviser changed its
name to Becker Capital Management, Inc. The Sub-Adviser manages assets totaling
approximately $2.0 billion for individuals, corporate pensions and profit
sharing trusts, multi-employer trusts and endowment funds. The Sub-Adviser is a
100% employee owned firm. The Sub-Adviser is currently a sub-adviser for another
mutual fund.
Donald L. Wolcott has been the Fund's portfolio manager since its inception. Mr.
Wolcott is a Vice President and Portfolio Manager of Becker Capital Management,
Inc., and has served in that capacity since 1987. His responsibilities include
the management of portfolios for taxable individuals and charitable foundations
and Mr. Wolcott also participates in strategic asset allocation decisions for
the firm's balanced account portfolios. Mr. Wolcott received a B.A. in business
from the University of Nebraska and is a Chartered Financial Analyst.
Distribution of Fund Shares
Edgewood Services, Inc. is the principal distributor for shares of the Fund. It
is a New York corporation organized on October 26, 1993, and is the principal
distributor for a number of investment companies. Edgewood Services, Inc. is a
subsidiary of Federated Investors.
Distribution and Shareholder Services Plans. Under a distribution plan adopted
in accordance with Investment Company Act Rule 12b-1 (the "Plan"), the Fund may
pay to the distributor an amount computed at an annual rate of .25% of the
average daily net assets of the Fund to finance any activity which is
principally intended to result in the sale of shares subject to the Plan. The
distributor may select financial institutions such as banks, fiduciaries,
custodians for public funds, investment advisers, and broker/dealers ("brokers")
to provide distribution and/or administrative services as agents for their
clients or customers.
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 limitations as
the distributor may, by notice to the Trust, voluntarily declare to be
effective.
The distributor will pay financial institutions a fee based upon the shares
subject to the Plan and 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 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 shares
under the Plan.
Certain trust clients of West Coast Trust will not be affected by the Plan
because the Plan will not be activated unless and until a separate class of
shares of the Fund (which would not have a Rule 12b-1 plan) is created and such
trust clients' investments in the Fund is converted to such class.
In addition, the Fund has adopted a Shareholder Services Plan (the "Services
Plan") with respect to its shares. Under the Services Plan, financial
institutions will enter into shareholder service agreements with the Fund to
provide administrative support services to their customers who, from time to
time, may be owners of record or beneficial owners of the shares. In return for
providing these support services, a financial institution may receive payments
from the Fund at a rate not exceeding .25% of the average daily net assets of
the shares beneficially owned by the financial institution's customers for whom
it is the holder of record or with whom it has a servicing relationship. These
administrative services may include, but are not limited to, the provision of
personal services and maintenance of shareholder accounts.
The Glass-Steagall Act prohibits a depository institution (such as a commercial
bank or savings association) from being an underwriter or distributor of most
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.
Supplemental Payments to Financial Institutions. In addition to payments made
pursuant to the Plan and Services Plan, Edgewood Services, Inc. and Federated
Shareholder Services, from their own assets, may pay financial institutions
supplemental fees for the performance of substantial sales services,
distribution-related support services, or shareholder services. The support may
include sponsoring sales, educational and training seminars for their employees,
providing sales literature, and engineering computer software programs that
emphasize the attributes of the Fund. Such assistance will be predicated upon
the amount of Shares the financial institution sells or may sell, and/or upon
the type and nature of sales or marketing support furnished by the financial
institution. Any payments made by the distributor may be reimbursed by the Fund'
s Adviser or its affiliates.
Administration of the Fund
Administrative Services. Federated Services Company, a subsidiary of Federated
Investors, provides the Fund with the administrative personnel and services
(including certain legal and financial reporting services) necessary to operate
the Fund. Such services include shareholder servicing and certain legal and
accounting services. Federated Services Company provides these at an annual rate
as specified below:
Maximum Average Aggregate
Administrative Fee Daily Net Assets of the Trust
.15% on the first $250 million
.125% on the next $250 million
.10% on the next $250 million
.075% on assets in excess of $750 million
The administrative fee received during any fiscal year shall be at least
$75,000. Federated Services Company may choose voluntarily to waive a portion of
its fee.
Brokerage Transactions
When selecting brokers and dealers to handle the purchase and sale of portfolio
instruments, the Sub-Adviser looks for prompt execution of the order at a
favorable price. In working with dealers, the Sub-Adviser will generally utilize
those who are recognized dealers in specific portfolio instruments, except when
a better price and execution of the order can be obtained elsewhere. In
selecting among firms believed to meet these criteria, the Sub-Adviser may give
consideration to those firms which have sold or are selling shares of the Fund.
The Sub-Adviser makes decisions on portfolio transactions and selects brokers
and dealers subject to review by the Trustees.
Expenses of the Fund
The Fund pays all of its own expenses and its allocable share of Trust expenses.
These expenses include, but are not limited to, the cost of: organizing the
Trust and continuing its existence; registering the Trust and its shares;
Trustees fees; meetings of Trustees and shareholders and proxy solicitations
therefor; auditing, accounting, and legal services; investment advisory and
administrative services; custodians, transfer agents, dividend disbursing
agents, shareholder servicing agents, and registrars; issuing, purchasing,
repurchasing, and redeeming shares; reports to government agencies; preparing,
printing and mailing documents to shareholders such as financial statements,
prospectuses and proxies; taxes and commissions; insurance premiums; association
membership dues; and such non-recurring and extraordinary items as may arise.
Net Asset Value
The Fund's net asset value per share fluctuates. It is determined by dividing
the sum of the market value of all securities and all other assets, less
liabilities, by the number of shares outstanding.
The net asset value is determined as of the close of trading (normally 4:00
p.m., Eastern time) on the New York Stock Exchange, Monday through Friday,
except on: (i) days on which there are not sufficient changes in the value of
the Fund's portfolio securities that its net asset value might be materially
affected; (ii) days during which no shares are tendered for redemption and no
orders to purchase shares are received; and (iii) the following holidays: New
Year's Day, Martin Luther King Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Columbus Day, Veterans' Day, Thanksgiving Day, and
Christmas Day.
Investing in the Fund
Share Purchases
Fund shares are sold on days on which the New York Stock Exchange and the
Federal Reserve Wire System are open for business. In connection with qualified
account relationships with West Coast Trust, Fund shares may be purchased by
telephone through procedures established with West Coast Trust and its
affiliates. Individual investors may place orders to purchase shares either by
telephone or by mail. In connection with the sale of Fund shares, Edgewood
Services, Inc. (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 West Coast Trust. Trust customers placing an order to purchase shares of
the Fund may open an account by calling West Coast Trust at _______________.
Information needed to establish the account will be taken over the telephone.
Individual investors may open an account by completing a new account application
form available from _________ at (address) or by telephoning ____________ at
1-800-___-____. Mail the completed account application along with a check made
payable to the Fund to: __________________________________________.
Payment may be made by check, transfer from an Automated Clearing House ("ACH")
member institution, federal funds or by debiting a customer's account at West
Coast Trust. Purchase orders must be received by 3:00 p.m. (Eastern time)/12:00
Noon (Pacific time) in order for shares to be purchased at that day's price.
Orders by mail are considered received after payment by check is converted into
federal funds. This is generally the next business day after the transfer agent
receives the check.
Purchases By Wire. You may also purchase shares by bank wire. For opening new
accounts in this manner, please call 1-800-___-____ (toll free) before wiring
your funds, and furnish the following information: the account registration and
address, and your taxpayer identification number (for individuals, a Social
Security number). When making additional investments by wire to your existing
account, please provide your account number(s). You must include your name and
telephone number, the amount being wired and the name of the wiring bank with
both new and existing account purchases.
You should instruct your bank to wire Federal funds to: State Street Bank and
Trust Company, ABA number 011000028, Account Number _________, Boston,
Massachusetts 02266, indicating your account number and the account
registration. Shares cannot be purchased on days on which the New York Stock
Exchange is closed or on federal holidays restricting wire transfers. Questions
on wire purchases should be directed to your shareholder representative at the
telephone number listed on your account statement.
Minimum Investment Required
The minimum initial investment in the Fund by a trust customer is $5,000 and
$1,000 for individual investors. Subsequent investments must be in amounts of at
least $100. The Fund may waive the initial minimum investment from time to time.
An institutional investor's minimum investment will be calculated by combining
all accounts it maintains with the Fund.
What Shares Cost
Fund shares are sold at their net asset value next determined after an order is
received, plus a sales charge, as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Sales Charge
Sales Charge as % of Dealer Allowance
as % of Net Amount as % of
Offering Price Invested Offering Price
Less than $100,000................... 4.50% 4.71% 4.00%
$100,000 but less than $250,000...... 3.75% 3.90% 3.50%
$250,000 but less than $500,000...... 2.50% 2.56% 2.75%
$500,000 but less than $750,000...... 2.00% 2.04% 2.25%
$750,000 but less than $1 million.... 1.00% 1.01% 1.25%
$1 million or more................... 0.00% 0.00% 0.00%
</TABLE>
Purchases at Net Asset Value
Shares of the Fund may be purchased at net asset value, without a sales charge,
by West Coast Trust for accounts in which West Coast Trust holds or manages
assets, by trust companies, trust departments of other financial institutions
and by banks and savings and loans for their own accounts. Trustees, emeritus
trustees, employees and retired employees of the Trust, West Coast Trust, West
Coast Bancorp and its subsidiaries, or Edgewood Services, Inc. or their
affiliates, or any bank or investment dealer who has a sales agreement with
Edgewood Services, Inc. with regard to the Fund, and their spouses and children
under 21, may also buy shares at net asset value, without a sales charge. In
addition, customers, employee benefit plans, and employees of Becker Capital
Management, Inc. and their spouses and children under 21 may also buy shares at
net asset value, without a sales charge.
Purchases with Proceeds from Redemptions of Unaffiliated Mutual Fund Shares
Investors may purchase shares of the Fund at net asset value, without a sales
charge, with the proceeds from redemption of shares of a mutual fund which was
sold with a sales charge or commission. The purchase must be made within 60 days
of the redemption, and the distributor must be notified by the investor in
writing, or by his financial institution, at the time the purchase is made. To
provide adequate proof, an investor must provide a statement showing the value
liquidated from the other mutual fund. This offer is not available for the
redemption of mutual fund shares that were or would be subject to a contingent
deferred sales charge upon redemption.
Sales Charge Reallowance
For sales of shares of the Fund, a dealer will normally receive up to 85% of the
applicable sales charge. For shares sold with a sales charge, West Coast Trust
will receive 85% of the applicable sales charge for purchases of Fund shares
made directly through West Coast Trust.
The sales charge for shares sold other than through West Coast Trust or
registered broker/dealers will be retained by the distributor. However, the
distributor will, periodically, uniformly offer to pay to dealers additional
amounts in the form of cash or promotional incentives, such as reimbursement of
certain expenses of qualified employees and their spouses to attend
informational meetings about the Fund or other special events at
recreational-type facilities, or items of material value. Such payments, all or
a portion of which may be paid from the sales charge the distributor normally
retains or any other source available to it, will be predicated upon the amount
of shares of the Fund that are sold by the dealer.
Reducing or Eliminating the Sales Charge
The sales charge can be reduced or eliminated on the purchase of Fund shares
through:
o quantity discounts and accumulated purchases;
o signing a 13-month letter of intent; or
o using the reinvestment privilege.
Quantity Discounts and Accumulated Purchases. As shown in the table under "What
Shares Cost", larger purchases reduce or eliminate the sales charge paid. The
Fund will combine purchases made on the same day by the investor, his spouse,
and his children under age 21 when it calculates the sales charge.
If an additional purchase of Fund shares is made, the Fund will consider the
previous purchases still invested in the Fund. For example, if a shareholder
already owns shares having a current value at the public offering price of
$90,000 and he purchases $10,000 more at the current public offering price, the
sales charge on the additional purchase according to the schedule now in effect
would be 3.75%, not 4.50%.
To receive the sales charge reduction or elimination, West Coast Trust or the
distributor must be notified by the shareholder in writing or by his financial
institution at the time the purchase is made that Fund shares are already owned
or that purchases are being combined. The Fund will reduce the sales charge
after it confirms the purchases.
Letter of Intent. If a shareholder intends to purchase at least $100,000 of
shares in the Fund over the next 13 months, the sales charge may be reduced or
eliminated by signing a letter of intent to that effect. This letter of intent
includes a provision for a sales charge adjustment depending on the amount
actually purchased within the 13-month period and a provision for the custodian
to hold up to 4.50% of the total amount intended to be purchased in escrow (in
shares of the Fund) until such purchase is completed.
The shares held in escrow will be applied to the shareholder's account at the
end of the 13-month period unless the amount specified in the letter of intent
is not purchased. In this event, an appropriate number of escrowed shares may be
redeemed in order to realize the difference in the sales charge.
This letter of intent will not obligate the shareholder to purchase shares, but
if the shareholder does, each purchase during the period will be at the sales
charge applicable to the total amount intended to be purchased. This letter may
be dated as of a prior date to include any purchases made within the past 90
days; however, these previous purchases will not receive the reduced sales
charge.
Reinvestment Privilege. If shares in the Fund have been redeemed, the
shareholder has a one-time right, within 30 days, to reinvest the redemption
proceeds at the next-determined net asset value without any sales charge. West
Coast Trust or the distributor must be notified by the shareholder in writing or
by his financial institution of the reinvestment in order to eliminate a sales
charge. If the shareholder redeems his shares in the Fund, there may be tax
consequences. Shareholders contemplating such transactions should consult their
own tax advisers.
Concurrent Purchases. For purposes of qualifying for a sales charge reduction, a
shareholder has the privilege of combining concurrent purchases of two or more
WCT Funds, when and if created, or two or more Federated Funds (as defined under
"Exchange Privilege"), the purchase price of which includes a sales charge. For
example, if a shareholder concurrently invested $30,000 in a Federated Fund with
a sales charge, and $70,000 in this Fund, the sales charge would be reduced.
To receive this sales charge reduction, the ___________ or the distributor must
be notified by the shareholder in writing at the time the concurrent purchases
are made. The Fund will reduce the sales charge after it confirms the purchases.
Systematic Investment Program
Once a Fund account has been opened, shareholders may add to their investment on
a regular basis in a minimum amount of $100. Under this program, funds may be
automatically withdrawn periodically from the shareholder's checking account at
West Coast Trust and invested in Fund shares at the net asset value next
determined after an order is received by the Fund, plus the applicable sales
charge. A shareholder may apply for participation in this program through West
Coast Trust or through the distributor.
Retirement Plans
Shares of the Fund can be purchased as an investment for retirement plans or for
IRA accounts. For further details, contact ___________________ and consult a tax
adviser.
Confirmations and Account Statements
Shareholders will receive detailed confirmations of transactions (except for
systematic program transactions). In addition, shareholders will receive
periodic statements reporting all account activity, including dividends paid.
The Fund will not issue share certificates.
Dividends and Distributions
Dividends are declared quarterly and paid quarterly to all shareholders invested
in the Fund on the record date. All shareholders on the record date are entitled
to the dividend. If shares are redeemed or exchanged prior to the record date,
or purchased after the record date, those shares are not entitled to that
quarter's dividend.
Distribution of any realized net long-term capital gains will be made at least
once every 12 months. Dividends are automatically reinvested in additional
shares of the Fund on payment dates at the ex-dividend date's net asset value
without a sales charge, unless cash payments are requested by writing to the
Fund or West Coast Trust, as appropriate.
Exchange Privilege
An investor may, exchange shares of the Fund into any other portfolio of the
Trust, when and if created, subject to the minimum initial investment
requirements for the Fund. In addition, shares of the Fund may also be exchanged
for certain other funds administered or distributed by subsidiaries of Federated
Investors that are not advised by West Coast Trust ("Federated Funds"). For
further information on the availability of Federated Funds for exchange, call
__________ at 1-800-___-____.
Exchanging Shares
Shareholders of any Fund in the WCT Funds may exchange shares for the shares of
any other Fund in the WCT Funds, when and if created. Prior to any exchange, the
shareholder must receive a copy of the current prospectus of the fund into which
an exchange is to be effected. Shares may be exchanged at net asset value, plus
the difference between the sales charge (if any) already paid and any sales
charge of the Fund into which shares are to be exchanged, if higher.
When an exchange is made from a fund with a sales charge to a fund with no sales
charge, the shares exchanged and additional shares which have been purchased by
reinvesting dividends on such shares retain the character of the exchanged
shares for purposes of exercising further exchange privileges; thus, an exchange
of such shares for shares of a fund with a sales charge would be at net asset
value.
Upon receipt of proper instructions and all necessary supporting documents,
shares submitted for exchange will be redeemed at the next-determined net asset
value. Written exchange instructions may require a signature guarantee. Exercise
of this privilege is treated as a sale for federal income tax purposes and,
depending on the circumstances, a short or long-term capital gain or loss may be
realized. The exchange privilege may be terminated at any time. Shareholders
will be notified of the termination of the exchange privilege. A shareholder may
obtain further information on the exchange privilege by calling West Coast
Trust. Telephone exchange instructions may be recorded. If reasonable procedures
are not followed by the Fund, it may be liable for losses due to unauthorized or
fraudulent telephone instructions.
Exchange by Telephone
Shareholders may provide instructions for exchanges between participating funds,
when and if created, by telephone to __________________ at 1-800-___-____.
An authorization form permitting the Fund to accept telephone exchange requests
must first be completed. It is recommended that investors request this privilege
at the time of their initial application. If not completed at the time of
initial application, authorization forms and information on this service can be
obtained through a __________________ representative.
Shares may be exchanged by telephone only between fund accounts having identical
shareholder registrations. Telephone exchange instructions may be recorded. If
reasonable procedures are not followed by the Fund, it may be liable for losses
due to unauthorized or fraudulent telephone instructions.
Telephone exchange instructions must be received by ____________________ and
transmitted to ____________________ before _______ p.m. (Eastern time) for
shares to be exchanged the same day. Shareholders who exchange into shares of
the Fund will not receive a dividend from the Fund on the date of the exchange.
Shareholders of the Fund may have difficulty in making exchanges by telephone
through banks or other financial institutions during times of drastic economic
or market changes. If shareholders cannot contact their _______________
representative by telephone, it is recommended that an exchange request be made
in writing and sent by mail for next day delivery.
Written Exchange
A shareholder wishing to make an exchange by written request may do so by
sending it to: _____________________________________________.
Redeeming Shares
The Fund redeems shares at its net asset value next determined after West Coast
Trust 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 when
wire transfers are restricted. Requests for redemption can be made in person or
by telephone for trust customers. Individual investors can make requests for
redemption in person, by telephone or by mail through ________________.
By Telephone. A shareholder who is a trust customer of West Coast Trust may
redeem shares of the Fund by telephoning West Coast Trust at 1-800-___-____. A
shareholder who is an individual investor may redeem shares by telephoning
1-800-___-____. For calls received before 3:00 p.m. (Eastern time)/12:00 Noon
(Pacific time), proceeds will normally be wired the following day to the
shareholder's account at West Coast Trust, transferred through ACH to a member
institution, or a check will be sent to the address of record. In no event will
proceeds be sent more than seven days after a proper request for redemption is
received. An authorization form permitting the Fund to accept telephone requests
must first be completed. Authorization forms and information on this service are
available from _________. Telephone redemption instructions may be recorded. If
reasonable procedures are not followed by the Fund, it may be liable for losses
due to unauthorized or fraudulent telephone instructions.
In the event of drastic economic or market changes, a shareholder may experience
difficulty in redeeming by telephone. If such a case should occur, another
method of redemption should be utilized, such as a written request to Federated
Shareholder Services Company or ______________________.
If at any time, the Fund shall determine it necessary to terminate or modify
this method of redemption, shareholders would be promptly notified.
By Mail. Any shareholder may redeem Fund shares by sending a written request to
West Coast Trust. Telephone West Coast Trust for specific instructions before
redeeming by letter. The shareholder will be asked to provide in the request his
name, the Fund name, his account number, and the share or dollar amount
requested.
Signatures. Shareholders requesting a redemption of any amount to be sent to an
address other than on record with the Fund, or a redemption payable other than
to the shareholder of record must have their signatures guaranteed by:
o a trust company or commercial bank whose deposits are insured by
the Bank Insurance Fund, which is administered by the Federal
Deposit Insurance Corporation ("FDIC");
o a member of the New York, American, Boston, Midwest, or Pacific
Stock Exchange;
o a savings bank or savings association whose deposits are insured by
the Savings Association Insurance Fund, 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 Fund and its transfer agent have adopted standards for accepting signature
guarantees from the above institutions. The Fund may elect in the future to
limit eligible signature guarantors to institutions that are members of a
signature guarantee program. The Fund 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 seven days, after receipt of a proper written redemption
request.
Systematic Withdrawal Program
Shareholders who desire to receive payments of a predetermined amount may take
advantage of the Systematic Withdrawal Program. Under this program, Fund shares
are redeemed to provide for periodic withdrawal payments in an amount directed
by the shareholder. Depending upon the amount of the withdrawal payments, the
amount of dividends paid and capital gains distributions with respect to Fund
shares, and the fluctuation of the net asset value of Fund shares redeemed under
this program, redemptions may reduce, and eventually deplete, the shareholder's
investment in the Fund. For this reason, payments under this program should not
be considered as yield or income on the shareholder's investment in the Fund. To
be eligible to participate in this program, a shareholder must have an account
value of at least $10,000, other than retirement accounts subject to required
minimum distributions. A shareholder may apply for participation in this program
through his financial institution. For shares sold with a sales charge, it is
not advisable for shareholders to be purchasing shares while participating in
this program.
Accounts with Low Balances
Due to the high cost of maintaining accounts with low balances, the Fund may
redeem shares in any account and pay the proceeds to the shareholder if the
account balance falls below the required minimum value of $5,000 due to
shareholder redemptions. This requirement does not apply, however, if the
balance falls below $5,000 because of changes in the Fund's net asset value.
Before shares are redeemed to close an account, the shareholder is notified in
writing and allowed 30 days to purchase additional shares to meet the minimum
requirement.
Shareholder Information
Voting Rights
Each share of the Trust owned by a shareholder gives that shareholder one vote
in Trustee elections and other matters submitted to shareholders for vote. All
shares of each portfolio in the Trust have equal voting rights, except that in
matters affecting only a particular portfolio, only shareholders of that
portfolio Fund are entitled to vote.
The Trust is not required to hold annual shareholder meetings. Shareholder
approval will be sought only for certain changes in the Trust's or the Fund's
operation and for the election of Trustees under certain circumstances.
Trustees may be removed by the Trustees or by shareholders at a special meeting.
A special meeting of the shareholders shall be called by the Trustees upon the
written request of shareholders owning at least 10% of the outstanding shares of
the Trust entitled to vote.
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 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.
Some entities providing services to the Trust are subject to such banking laws
and regulations. They believe that they may perform those services for the Fund
contemplated by any agreement entered into with the Trust without violating
those 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 these entities from continuing to perform all or a part of the
above services. If this happens, the Trustees would consider alternative means
of continuing available investment services. It is not expected that
shareholders would suffer any adverse financial consequences as a result of any
of these occurrences.
Tax Information
Federal Income Tax
The Fund will pay no federal regular income tax because it expects to meet
requirements of the Internal Revenue Code applicable to regulated investment
companies and to receive the special tax treatment afforded to such companies.
The Fund will be treated as a single, separate entity for federal income tax
purposes so that income (including capital gains) and losses realized by the
Trust's other portfolios will not be combined for tax purposes with those
realized by the Fund.
Unless otherwise exempt, shareholders are required to pay federal income tax on
any dividends and other distributions received. This applies whether dividends
and distributions are received in cash or as additional shares. The Fund will
provide detailed tax information for reporting purposes.
State and Local Taxes
Shareholders are urged to consult their own tax advisers regarding the status of
their accounts under state and local tax laws.
Performance Information
From time to time, the Fund advertises its total return and yield.
Total return represents the change, over a specified period of time, in the
value of an investment in the Fund after reinvesting all income and capital
gains distributions. It is calculated by dividing that change by the initial
investment and is expressed as a percentage.
The yield of the Fund is calculated by dividing the net investment income per
share (as defined by the Securities and Exchange Commission) earned by the Fund
over a thirty-day period by the maximum offering price per share of the Fund on
the last day of the period. This number is then annualized using semi-annual
compounding. The yield does not necessarily reflect income actually earned by
the Fund and, therefore, may not correlate to the dividends or other
distributions paid to shareholders.
The performance information reflects the effect of the maximum sales charge
which, if excluded, would increase the total return and yield.
From time to time, advertisements for the Fund may refer to ratings, rankings,
and other information in certain financial publications and/or compare the
Fund's performance to certain indices.
Performance Information for Predecessor Common Investment Fund
The Fund is the successor to the portfolio of a common trust fund managed by the
Sub-Adviser. It is anticipated that, at the Fund's commencement of operations,
the assets from the common trust fund will be transferred to the Fund in
exchange for Fund shares. The Sub-Adviser has represented that the Fund's
investment objective, policies and limitations are in all material respects
identical to those of the common trust fund.
The Fund's average annual compounded total returns for the one-, three-, five-
and ten-year periods ended June 30, 1997, and since inception (August 31, 1985),
reflecting the maximum sales charge (i.e., 4.50%) were 23.04%, 18.94,%, 17.46%
and 12.99%, respectively. The Fund's average annual compounded total returns for
the one-, five- and ten-year periods ended June 30, 1997, and since inception
(August 31, 1985), without reflecting the sales charge were 28.84%, 20.78,%,
18.54% and 13.51%, respectively. The quoted performance data includes the
performance of the common trust fund for periods before the Fund's registration
statement became effective, as adjusted to reflect the Fund's anticipated
expenses as set forth in the "Expenses of the Fund" section of this prospectus.
The common trust fund was not registered under the Investment Company Act of
1940 ("1940 Act") and therefore was not subject to certain investment
restrictions that are imposed by the 1940 Act. If the common trust fund had been
registered under the 1940 Act, the performance may have been adversely affected.
<PAGE>
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<S> <C> <C>
Addresses
WCT Funds
WCT Equity Fund Federated Investors Tower
Pittsburgh, PA 15222-3779
Distributor
Edgewood Services, Inc. Clearing Operations
P.O. Box 897
Pittsburgh, PA 15222-3779
Investment Adviser
West Coast Trust Company, Inc. 1000 Broadway, Suite 1100
Portland, OR 97205
Sub-Adviser
Becker Capital Management, Inc. 1211 SW Fifth Avenue, Ste. 2185
Portland, OR 97204
Custodian
State Street Bank and P.O. Box 1713
Trust Company Boston, MA 02266-8600
Transfer Agent and Dividend Disbursing Agent
Federated Shareholder Services CompanyFederated Investors Tower
Pittsburgh, PA 15222-3779
Independent Public Accountants
Arthur Andersen LLP 2100 One PPG Place
Pittsburgh, Pennsylvania 15222
</TABLE>
<PAGE>
- -------------------------------------------------------------------------------
WCT Equity Fund
- --------------------------------------------------------------------------------
Prospectus
A Portfolio of WCT Funds, an Open-End
Management Investment Company
Prospectus Dated November __, 1997
Edgewood Services, Inc.
Distributor
A subsidiary of Federated Investors
Federated Investors Tower
Pittsburgh, PA 15222-3779
Cusip ______________________
G02161-01(9/97)
[IN RED INK ON THE LEFT SIDE PANEL] Information contained herein is subject to
completion or amendment. A registration statement relating to these securities
has been filed with the Securities and Exchange Commission. These securities may
not be sold nor may any offers to buy be accepted prior to the time the
registration statement becomes effective. This Statement of Additional
Information shall not constitute an offer to sell or the solicitation of an
offer to buy nor shall there be any sale of these securities in any State in
which such offer, solicitation, or sale would be unlawful prior to registration
or qualification under the securities laws of any such State.
SUBJECT TO COMPLETION
PRELIMINARY STATEMENT OF ADDITIONAL INFORMATION
DATED SEPTEMBER 17, 1997
WCT Equity Fund
(A Portfolio of the WCT Funds)
Statement of Additional Information
This Statement of Additional Information should be read with the
prospectus of WCT Equity Fund (the "Fund"), a portfolio of WCT Funds
(the "Trust") dated November __, 1997. This Statement is not a
prospectus. You may request a copy of a prospectus or a paper copy of
this Statement, if you have received it electronically, free of charge
by calling 1-800-___-____.
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
Statement dated November __, 1997
[GRAPHIC OMITTED]
Cusip #########
G02161-02 (9/97)
[GRAPHIC OMITTED]
<PAGE>
- --------------------------------------------------------------------------------
Table of Contents
- --------------------------------------------------------------------------------
General Information About the Fund 1
Investment Objective and Policies 1
Types of Investments 1
Convertible Preferred Stock 1
Warrants 1
Restricted and Illiquid Securities 1
When-Issued and Delayed Delivery Transactions 2
Repurchase Agreements 2
Reverse Repurchase Agreements 2
Lending of Portfolio Securities 2
Portfolio Turnover 2
Investment Limitations 2
WCT Funds Management 4
Trust Ownership 4
Trustees' Compensation 4
Trustee Liability 4
Investment Advisory Services 4
Adviser to the Fund 4
Advisory Fees 5
Sub-Adviser to the Fund 5
Sub-Advisory Fees 5
Brokerage Transactions 5
Other Services 5
Fund Administration 5
Custodian and Portfolio Accountant 5
Transfer Agent, Dividend Disbursing
Agent, and Shareholder Servicing Agent 6
Independent Auditors 6
Purchasing Shares 6
Distribution and Shareholder Services Plans6
Determining Net Asset Value 6
Determining Market Value of Securities 6
Exchange Privilege 7
Requirements for Exchange 7
Making an Exchange 7
Redeeming Shares 7
Redemption in Kind 7
Massachusetts Partnership Law 7
Tax Status 8
The Fund's Tax Status 8
Shareholders' Tax Status 8
Total Return 8
Yield 8
Performance Comparisons 8
Economic and Market Information 9
Appendix 10
<PAGE>
General Information About the Fund
The Fund is a portfolio in the WCT Funds (the "Trust"), which was established as
a Massachusetts business trust under a Declaration of Trust dated July 1, 1997.
Investment Objective and Policies
The Fund's investment objective is to provide long-term capital appreciation.
The investment objective cannot be changed without approval of shareholders.
Unless otherwise indicated, the investment policies described below may be
changed by the Board of Trustees ("Trustees") without shareholder approval.
Shareholders will be notified before any material change in these policies
becomes effective.
Types of Investments
The Fund pursues its objective by investing primarily in common or preferred
stock of large or medium sized companies with market capitalizations in excess
of $1.5 billion. Occasionally, the Fund will hold small cap issues which satisfy
the manager's valuation discipline. The common and preferred stocks the Fund
invests in are generally characterized as having low price to earnings ratios,
growth and quality characteristics which match or exceed those companies which
comprise the S&P 500 Index. As a matter of investment policy, the Fund will
invest so that, under normal circumstances, at least 80% of its total assets are
invested in equity securities.
Convertible Preferred Stock
Convertible preferred stock is senior to common stock, and therefore, has a
claim to assets of the corporation prior to the holders of common stock in the
case of liquidation. However, preferred stock is generally subordinated debt
securities of the same company. The dividends from preferred stock provides a
stable stream of income with generally higher yields than common stocks, but
lower than debt securities.
The Fund will exchange or convert the convertible preferred stock held in its
portfolio into shares of the underlying common stock in instances in which, in
the adviser's and sub-adviser's opinions, the investment characteristics of the
underlying common shares will assist the Fund in achieving its investment
objective. Otherwise, the Fund will hold or trade the convertible preferred
stock. In selecting convertible preferred stock for the Fund, the Fund's adviser
and sub-adviser evaluate the investment characteristics of the convertible
preferred stock as a fixed income instrument, and the investment potential of
the underlying equity security for capital appreciation. In evaluating these
matters with respect to a particular convertible preferred stock, the Fund's
adviser and sub-adviser consider numerous factors, including the economic and
political outlook, the value of the security relative to other investment
alternatives, trends in the determinants of the issuer's profits, and the
issuer's management capability and practices.
Warrants
Warrants are basically options to purchase common stock at a specific price
(usually at a premium above the market value of the optioned common stock at
issuance) valid for a specific period of time. Warrants may have a life ranging
from less than a year to twenty years or may be perpetual. However, most
warrants have expiration dates after which they are worthless. In addition, if
the market price of the common stock does not exceed the warrant's exercise
price during the life of the warrant, the warrant will expire as worthless.
Warrants have no voting rights, pay no dividends, and have no right with respect
to the assets of the corporation issuing them. The percentage increase or
decrease in the market price of the warrant may end to be greater than the
percentage increase or decrease in the market price of the optioned common
stock.
Restricted and Illiquid Securities
The Fund may invest in commercial paper issued in reliance on the exemption from
registration afforded by Section 4(2) of the Securities Act of 1933. Section
4(2) commercial paper is restricted as to disposition under federal securities
law, and is generally sold to institutional investors, such as the Fund, who
agree that they are purchasing the paper for investment purposes and not with a
view to public distribution. Any resale by the purchaser must be in an exempt
transaction. Section 4(2) commercial paper is normally resold to other
institutional investors like the Fund through or with the assistance of the
issuer or investment dealers who make a market in Section 4(2) commercial paper,
thus providing liquidity. The Trust believes that Section 4(2) commercial paper
is quite liquid. The Fund intends, therefore, to treat Section 4(2) commercial
paper as liquid and not subject to the investment limitation applicable to
illiquid securities.
When-Issued and Delayed Delivery Transactions
These transactions are made to secure what is considered to be an advantageous
price and yield for the Fund. No fees or other expenses, other than normal
transaction costs, are incurred. However, liquid assets of the Fund sufficient
to make payment for the securities to be purchased are segregated on the Fund's
records at the trade date. These assets are marked to market daily and are
maintained until the transaction has been settled. The Fund does not intend to
engage in when-issued and delayed delivery transactions to an extent that would
cause the segregation of more than 20% of the total value of its assets.
Repurchase Agreements
The Fund or its custodian will take possession of the securities subject to
repurchase agreements and these securities are marked to market daily. To the
extent that the original seller does not repurchase the securities from the
Fund, the Fund could receive less than the repurchase price on any sale of such
securities. In the event that such a defaulting seller filed for bankruptcy or
became insolvent, disposition of such securities by the Fund might be delayed
pending court action. The Fund believes that, under the regular procedures
normally in effect for custody of the Fund's portfolio securities subject to
repurchase agreements, a court of competent jurisdiction would rule in favor of
the Fund and allow retention or disposition of such securities. The Fund will
only enter into repurchase agreements with banks and other recognized financial
institutions, such as broker/dealers, which are deemed by the Fund's adviser and
sub-adviser to be creditworthy pursuant to guidelines established by the
Trustees.
Reverse Repurchase Agreements
The Fund may also enter into reverse repurchase agreements. These transactions
are similar to borrowing cash. In a reverse repurchase agreement, the Fund
transfers possession of a portfolio instrument to another person, such as a
financial institution, broker, or dealer, in return for a percentage of the
instrument's market value in cash, and agrees that on a stipulated date in the
future the Fund will repurchase the portfolio instrument by remitting the
original consideration plus interest at an agreed upon rate.
When effecting reverse repurchase agreements, liquid assets of the Fund in a
dollar amount sufficient to make payment for the obligations to be purchased are
segregated at the trade date. These securities are marked to market daily and
are maintained until the transaction is settled.
The use of reverse repurchase agreements may enable the Fund to avoid selling
portfolio instruments at a time when a sale may be deemed to be disadvantageous,
but the ability to enter into reverse repurchase agreements does not ensure that
the Fund will be able to avoid selling portfolio instruments at a
disadvantageous time.
Lending of Portfolio Securities
The collateral received when the Fund lends portfolio securities must be valued
daily and, should the market value of the loaned securities increase, the
borrower must furnish additional collateral to the Fund. During the time
portfolio securities are on loan, the borrower pays the Fund any dividends or
interest paid on such securities. Loans are subject to termination at the option
of the Fund or the borrower. The Fund may pay reasonable administrative and
custodial fees in connection with a loan and may pay a negotiated portion of the
interest earned on the cash or equivalent collateral to the borrower or placing
broker.
Portfolio Turnover
The Fund does not intend to invest for the purpose of seeking short-term
profits. Securities in the portfolio will be sold whenever the Adviser and
Sub-Adviser believe it is appropriate to do so in light of the Fund's investment
objective, without regard to the length of time a particular security may have
been held. The Adviser and Sub-Adviser do not anticipate that the Fund's
portfolio turnover rate will exceed 50%.
Investment Limitations
Selling Short and Buying on Margin
The Fund will not sell any securities short or purchase any securities on
margin, but may obtain such short-term credits as may be necessary for clearance
of purchases and sales of portfolio securities.
Issuing Senior Securities and Borrowing Money
The Fund will not issue senior securities except that the Fund may borrow
money directly or through reverse repurchase agreements in amounts up to
one-third of the value of its total assets; provided that, while
borrowings exceed 5% of the Fund's total assets, any such borrowings will
be repaid before any additional investments are made. The Fund will not
borrow money or engage in reverse repurchase agreements for investment
leverage.
Pledging Assets
The Fund will not mortgage, pledge, or hypothecate any assets except to
secure permitted borrowings. In those cases, the Fund may pledge assets
having a market value not exceeding the lesser of the dollar amounts
borrowed or 15% of the total assets at the time of the pledge. For
purposes of this limitation, the purchase of securities on a when-issued
basis will not be deemed to be a pledge.
Investing in Commodities
The Fund will not purchase or sell commodities, commodity contracts, or
commodity futures contracts.
Underwriting
The Fund will not underwrite any issue of securities or participate in the
marketing of securities of other issuers, except as the Fund may be deemed
to be an underwriter under the Securities Act of 1933 in connection with
the sale of securities in accordance with the Fund's investment objective,
policies, and limitations.
Diversification of Investments
With respect to securities comprising 75% of the value of its total
assets, the Fund will not purchase securities of any one issuer (other
than cash, cash items, securities issued or guaranteed by the governmentof
the United States or its agencies or instrumentalities and repurchase
agreements collateralized by such U.S. government securities; and
securities of other investment companies) if, as a result, more than 5% of
the value of the its total assets would be invested in the securities of
that issuer, or it would own more than 10% of the outstanding voting
securities of that issuer.
Concentration of Investments
The Fund will not purchase securities if, as a result of such purchases,
25% or more of the value of its total assets would be invested in any one
industry. The Fund may at times invest 25% or more of the value of its
total assets in securities issued or guaranteed by the U.S. government, its
agencies or instrumentalities.
Lending Cash or Securities
The Fund will not lend any of its assets, except portfolio securities, but
it may purchase or hold corporate or government bonds, notes, bonds
debentures, notes, certificates of indebtedness, or other debt securities
of an issuer, repurchase agreements, or other transactions which are
permitted by the Fund's investment objective and policies, or the Trust's
Declaration of Trust.
The above investment limitations cannot be changed without shareholder approval.
The following limitations, however, may be changed by the Trustees without
shareholder approval [except that no investment limitation of the Fund shall
prevent the Fund from investing substantially all of its assets (except for
assets which are not considered "investment securities" under the Investment
Company Act of 1940, or assets exempted by the Securities and Exchange
Commission) in an open-end investment company with substantially the same
investment objectives]. Shareholders will be notified before any material
changes in these limitations become effective.
Investing in Restricted and Illiquid Securities
The Fund will not invest more than 15% of its net assets in illiquid
securities, including certain restricted securities (except for Section
4(2) commercial paper and certain other restricted securities which
meet the criteria for liquidity as established by the Trustees),
non-negotiable time deposits, and repurchase agreements providing for
settlement in more than seven days after notice.
Purchasing Securities to Exercise Control
The Fund will not purchase securities of a company for purpose of
exercising control or management.
Except with respect to borrowing money, if a percentage limitation is adhered to
at the time of investment, a later increase or decrease in percentage resulting
from any change in value or net assets will not result in a violation of such
restriction.
The Fund does not intend to borrow money or pledge securities in excess of 5% of
the value of its net assets during the coming fiscal year.
For purposes of its policies and limitations, the Fund considers certificates of
deposit and demand and time deposits issued by a U.S. branch of a domestic bank
or savings and loan having capital, surplus, and undivided profits in excess of
$100,000,000 at the time of investment to be "cash items."
WCT Funds Management
Officers and Trustees are listed with their addresses, birthdates, present
positions with WCT Funds, and principal occupations.
TO BE FILED BY AMENDMENT
Trust Ownership
Officers and Trustees as a group own less than 1% of the Fund`s outstanding
shares.
Trustees' Compensation
AGGREGATE
NAME , COMPENSATION
POSITION WITH FROM
TRUST TRUST*#
TO BE FILED BY AMENDMENT
*Information is furnished for the fiscal year ended September 30, 1997.
#The aggregate compensation is provided for the Trust which is comprised of 1
portfolio.
Trustee Liability
The Trust's Declaration of Trust provides that the Trustees are not liable for
errors of judgment or mistakes of fact or law. However, they are not protected
against any liability to which they would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence, or reckless disregard of the
duties involved in the conduct of their office.
Investment Advisory Services
Adviser to the Fund
The Fund's investment adviser is West Coast Trust Company, Inc. (the "Adviser").
The Adviser shall not be liable to the Fund or any shareholder for any losses
that may be sustained in the purchase, holding, lending, or sale of any security
or for anything done or omitted by it, except acts or omissions involving
willful misfeasance, bad faith, gross negligence, or reckless disregard of the
duties imposed upon it by its contract with the Fund.
Because of internal controls maintained by West Coast Trust Company, Inc. to
restrict the flow of non-public information, Fund investments are typically made
without any knowledge of West Coast Trust Company or its affiliates' lending
relationships with an issuer.
Advisory Fees
For its advisory services, the Adviser receives an annual investment advisory
fee as described in the prospectus.
Sub-Adviser to the Fund
The Fund's sub-adviser is Becker Capital Management, Inc. (the "Sub-Adviser").
The Sub-Adviser shall not be liable to the Fund or any shareholder for any
losses that may be sustained in the purchase, holding, lending, or sale of any
security or for anything done or omitted by it, except acts or omissions
involving willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties imposed upon it by its contract with the Adviser.
Because of internal controls maintained by the Sub-Adviser to restrict the flow
of non-public information, Fund investments are typically made without any
knowledge of the Sub-Adviser's lending relationships with an issuer.
Sub-Advisory Fees
For its sub-advisory services, the Sub-Adviser receives an annual sub-advisory
fee as described in the prospectus.
Brokerage Transactions
When selecting brokers and dealers to handle the purchase and sale of portfolio
instruments, the Sub-Adviser looks for prompt execution of the order at a
favorable price. In working with dealers, the Sub-Adviser will generally use
those who are recognized dealers in specific portfolio instruments, except when
a better price and execution of the order can be obtained elsewhere. The
Sub-Adviser makes decisions on portfolio transactions and selects brokers and
dealers subject to guidelines established by the Trustees. The Sub-Adviser may
select brokers and dealers who offer brokerage and research services. These
services may be furnished directly to the Fund or to the Sub-Adviser and may
include: advice as to the advisability of investing in securities; security
analysis and reports; economic studies; industry studies; receipt of quotations
for portfolio evaluations; and similar services. Research services provided by
brokers and dealers may be used by the Sub-Adviser or its affiliates in advising
the Fund and other accounts. To the extent that receipt of these services may
supplant services for which the Sub-Adviser or its affiliates might otherwise
have paid, it would tend to reduce their expenses. The Sub-Adviser and its
affiliates exercise reasonable business judgment in selecting brokers who offer
brokerage and research services to execute securities transactions. They
determine in good faith that commissions charged by such persons are reasonable
in relationship to the value of the brokerage and research services provided.
The Fund has adopted certain procedures incorporating the standards of Rule
17e-1 of the Investment Company Act of 1940, which require that the commissions
paid to affiliated broker-dealers of the Sub-Adviser must be reasonable and fair
compared to the commission, fee, or other remuneration received, or to be
received by other brokers in connection with comparable transactions involving
similar securities during a comparable period of time.
Although investment decisions for the Fund are made independently from those of
the other accounts managed by the Sub-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 Sub-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 Sub-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.
Other Services
Fund Administration
Federated Services Company, a subsidiary of Federated Investors, provides
administrative personnel and services to the Fund for a fee as described in the
prospectus.
Custodian and Portfolio Accountant
State Street Bank and Trust Company, Boston, Massachusetts, is custodian for the
securities and cash of the Fund. Federated Services Company, Pittsburgh,
Pennsylvania, provides certain accounting and recordkeeping services with
respect to the Fund's portfolio investments. The fee paid for this service is
based upon the level of the Fund's average net assets for the period plus
out-of-pocket expenses.
Transfer Agent, Dividend Disbursing Agent, and Shareholder Servicing Agent
Federated Shareholder Services Company, Pittsburgh, Pennsylvania, a subsidiary
of Federated Investors, serves as transfer agent for the shares of the Fund,
dividend disbursing agent for the Fund, and shareholder servicing agent for the
Fund.
Independent Public Accountants
The independent public accountants for the Fund are Arthur Andersen LLP,
Pittsburgh, Pennsylvania.
Purchasing Shares
Shares of the Fund are sold at their net asset value next determined after an
order is received on days the New York Stock Exchange and Federal Reserve Wire
System are open for business. The procedure for purchasing shares is explained
in the prospectus under "Investing in the Fund."
Distribution and Shareholder Services Plans
These arrangements permit the payment of fees to financial institutions, the
distributor, and Federated Shareholder Services, to stimulate distribution
activities and 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:
marketing efforts; 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 dividend options, account designations, and addresses.
By adopting the Distribution Plan, the Board of Trustees expects that the Fund
will be able to achieve a more predictable flow of cash for investment purposes
and to meet redemptions. This will facilitate more efficient portfolio
management and assist the Fund in pursuing its investment objective. By
identifying potential investors whose needs are served by the Fund's objective,
and properly servicing these accounts, it may be possible to curb sharp
fluctuations in rates of redemptions and sales.
Other benefits, which may be realized under either arrangement, may include: (1)
providing personal services to shareholders; (2) investing shareholder assets
with a minimum of delay and administrative detail; and (3) enhancing shareholder
recordkeeping systems; and (4) responding promptly to shareholders' requests and
inquiries concerning their accounts.
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. West Coast Trust Company, Inc.
("West Coast Trust"), as well as Federated Shareholder Services Company, act as
the shareholder's agent in depositing checks and converting them to federal
funds.
Determining Net Asset Value
Net asset value generally changes each day. The days on which net asset value is
calculated by the Fund are described in the prospectus.
Determining Market Value of Securities
Market values of the Fund's securities, other than options, are determined as
follows:
o for equity securities, according to the last sale price in the
market in which they are primarily traded (either national
securities exchange or the OTC market), if available;
o in the absence of recorded sales for equity securities, according
to the mean between the last closing bid and asked prices;
o according to the prices provided by an independent pricing
service if available, or at fair market value as determined in
good faith by the Trustees; or
o for short-term obligations with remaining maturities of 60 days
or less at the time of purchase, at amortized cost, unless the
Trustees determine that particular circumstances of the security
indicate otherwise.
Prices provided by independent pricing services may be determined without
relying exclusively on quoted prices and may consider: institutional trading in
similar groups of securities, yield, quality, coupon rate, maturity, type of
issue, trading characteristics, and other market data.
Exchange Privilege
Requirements for Exchange
Before the exchange, the shareholder must receive a prospectus of the fund for
which the exchange is being made. This privilege is available to shareholders
resident in any state in which the fund shares being acquired may be sold. Upon
receipt of proper instructions and required supporting documents, shares
submitted for exchange are redeemed and the proceeds invested in shares of the
other fund.
Further information on the exchange privilege may be obtained by calling the
Fund.
Making an Exchange
Instructions for exchanges may be given in writing. Written instructions may
require a signature guarantee.
Redeeming Shares
Shares of the Fund are redeemed at the next computed net asset value after the
West Coast Trust receive the redemption request. Redemption procedures are
explained in the prospectus under "Redeeming Shares." Redemption requests cannot
be executed on days on which the New York Stock Exchange is closed or on federal
holidays when wire transfers are restricted. Although State Street Bank does not
charge for telephone redemptions, it reserves the right to charge a fee for the
cost of wire-transferred redemptions of less than $5,000.
Redemption in Kind
Although the Fund intends to redeem shares in cash, it reserves the right under
certain circumstances to pay the redemption price in whole or in part by a
distribution of securities from the Fund's portfolio. Redemption in kind will be
made in conformity with applicable Securities and Exchange Commission rules,
taking such securities at the same value employed in determining net asset value
and selecting the securities in a manner the Trustees determine to be fair and
equitable. The Fund has elected to be governed by Rule 18f-1 of the Investment
Company Act of 1940 under which the Fund is obligated to redeem shares for any
one shareholder in cash only up to the lesser of $250,000 or 1% of the Fund's
net asset value during any 90-day period. Massachusetts Partnership Law
Under certain circumstances, shareholders may be held personally liable as
partners under Massachusetts law for obligations of the Trust. To protect its
shareholders, the Trust has filed legal documents with Massachusetts that
expressly disclaim the liability of its shareholders for acts or obligations of
the Trust. These documents require notice of this disclaimer to be given in each
agreement, obligation, or instrument the Trust or its Trustees enter into or
sign.
In the unlikely event a shareholder is held personally liable for the Trust's
obligations, the Trust is required by the Declaration of Trust to use its
property to protect or compensate the shareholder. On request, the Trust will
defend any claim made and pay any judgment against a shareholder for any act or
obligation of the Trust. Therefore, financial loss resulting from liability as a
shareholder will occur only if the Trust itself cannot meet its obligations to
indemnify shareholders and pay judgments against them.
Tax Status
The Fund's Tax Status
The Fund will pay no federal income tax because it expects to meet the
requirements of Subchapter M of the Internal Revenue Code applicable to
regulated investment companies and to receive the special tax treatment afforded
to such companies. To qualify for this treatment, the Fund must, among other
requirements:
o derive at least 90% of its gross income from dividends, interest, and
gains from the sale of securities; o derive less than 30% of its gross
income from the sale of securities held less than three months; o invest
in securities within certain statutory limits; and o distribute to its
shareholders at least 90% of its net income earned during the year.
Shareholders' Tax Status
Shareholders of the Fund are subject to federal income tax on dividends received
as cash or additional shares. These dividends, and any short-term capital gains,
are taxable as ordinary income. No portion of any income dividend paid by the
Fund is eligible for the dividends received deduction available to corporations.
Total Return
Average annual total return is the average compounded rate of return for a given
period that would equate a $1,000 initial investment to the ending redeemable
value of that investment. The ending redeemable value is computed by multiplying
the number of shares owned at the end of the period by the net asset value per
share at the end of the period. The number of shares owned at the end of the
period is based on the number of shares purchased at the beginning of the period
with $1,000, adjusted over the period by any additional shares, assuming the
monthly reinvestment of all dividends and distributions.
Yield
The yield for the shares of the Fund is determined by dividing the net
investment income per share (as defined by the Securities and Exchange
Commission) earned by shares of the Fund over a thirty-day period by the maximum
offering price per share of the respective class on the last day of the period.
This value is annualized using semi-annual compounding. This means that the
amount of income generated during the thirty-day period is assumed to be
generated each month over a 12-month period and is reinvested every six months.
The yield does not necessarily reflect income actually earned by the Fund
because of certain adjustments required by the Securities and Exchange
Commission and, therefore, may not correlate to the dividends or other
distributions paid to the shareholders.
To the extent that financial institutions and broker/dealers charge fees in
connection with services provided in conjunction with an investment in shares of
the Fund, the performance will be reduced for those shareholders paying those
fees.
Performance Comparisons
Investors may use financial publications and/or indices to obtain a more
complete view of the Fund's performance. When comparing performance, investors
should consider all relevant factors such as the composition of any index used,
prevailing market conditions, portfolio compositions of other funds, and methods
used to value portfolio securities and compute offering price. The financial
publications and/or indices which the Fund uses in advertising may include:
o S&P 500 is an unmanaged capitalization weighted index of 500
stocks designed to measure performance of the broad domestic
economy through changes in the aggregate market value of 500
stocks representing all major industries.
o S&P 400 Mid Cap Index is an unmanaged capitalization weighted
index that measures the performance of the mid-range of the U.S.
stock market.
Advertisements and other sales literature for the Fund may quote total returns
which are calculated on non-standardized base periods. These total returns
represent the historic change in the value of an investment in the Fund based on
monthly reinvestment of dividends over a specified period of time. Advertising
and other promotional literature may include charts, graphs and other
illustrations using the Fund's returns in general, that demonstrate basic
investment concepts such as tax-deferred compounding, dollar-cost averaging and
systematic investment. In addition, the Fund can compare its performance, or
performance for the types of securities in which it invests, to a variety of
other investments, such as bank savings accounts, certificates of deposit, and
Treasury bills.
Advertisements may quote performance information which does not reflect the
effect of the sales load.
Economic and Market Information
Advertising and sales literature for the Fund may include discussions of
economic, financial and political developments and their effect on the
securities market. Such discussions may take the form of commentary on these
developments by Fund portfolio managers and their views and analysis on how such
developments could affect the Fund. In addition, advertising and sales
literature may quote statistics and give general information about the mutual
fund industry, including the growth of the industry, from sources such as the
Investment Company Institute ("ICI"). For example, according to the ICI,
thirty-seven percent of American households are pursuing their financial goals
through mutual funds. These investors, as well as businesses and institutions,
have entrusted over $3.5 trillion to the more than 6,000 funds available.
<PAGE>
Appendix
Standard & Poor's Bond Ratings
AAA--Debt rated "AAA" has the highest rating assigned by S&P. Capacity to pay
interest and repay principal is extremely strong.
AA--Debt rated "AA" has a very strong capacity to pay interest and repay
principal and differs from the higher rated issues only in small degree.
A--Debt rated "A" has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effect of changes in
circumstances and economic conditions than debt in higher rated categories.
BBB--Debt rated "BBB" is regarded as having an adequate capacity to pay interest
and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.
NR--NR indicates that no public rating has been requested, that there is
insufficient information on which to base a rating, or that S&P does not rate a
particular type of obligation as a matter of policy. S&P may apply a plus (+) or
minus (-) to the above rating classifications to show relative standing within
the classifications.
Plus (+) or Minus (-): The ratings from "AA" to "CCC" may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.
Moody's Investors Service, Inc. Bond Ratings
Aaa--Bonds which are rated "Aaa" are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt edged." Interest payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issues.
Aa--Bonds which are rated "Aa" are judged to be of high quality by all
standards. Together with the "Aaa" group, they comprise what are generally known
as high grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in "Aaa" securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long term risks appear somewhat larger than in "Aaa"
securities.
A--Bonds which are rated "A" possess many favorable investment attributes and
are to be considered as upper medium grade obligations. Factors giving security
to principal and interest are considered adequate but elements may be present
which suggest a susceptibility to impairment some time in the future.
Baa--Bonds which are rated "Baa" are considered as medium-grade obligations,
(i.e., they are neither highly protected nor poorly secured). Interest payments
and principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and, in
fact, have speculative characteristics as well.
NR--Not rated by Moody's. Moody's applies numerical modifiers, 1, 2 and 3 in
each generic rating classification from "Aa" through "B" in its corporate bond
rating system. The modifier 1 indicates that the security ranks in the higher
end of its generic rating category; the modifier 2 indicates a mid-range
ranking; and the modifier 3 indicates that the issue ranks in the lower end of
its generic rating category.
Fitch Investors Service, Inc., Long-Term Debt Ratings
AAA--Bonds considered to be investment grade and of the highest credit quality.
The obligor has an exceptionally strong ability to pay interest and repay
principal, which is unlikely to be affected by reasonably foreseeable events.
AA--Bonds considered to be investment grade and of very high credit quality. The
obligor's ability to pay interest and repay principal is very strong, although
not quite as strong as bonds rated "AAA". Because bonds rated in the "AAA" and
"AA" categories are not significantly vulnerable to foreseeable future
developments, short-term debt of these issuers is generally rate "F-1+."
A--Bonds considered to be investment grade and of high credit quality. The
obligor's ability to pay interest and repay principal is considered to be
strong, but may be more vulnerable to adverse changes in economic conditions and
circumstances than bonds with higher ratings.
BBB--Bonds are considered to be investment grade and of satisfactory credit
quality. The obligor's ability to pay interest and repay principal is considered
to be adequate. Adverse changes in economic conditions and circumstances,
however, are more likely to have adverse impact on these bonds, and therefore
impair timely payment.
The likelihood that the ratings of these bonds will fall below investment grade
is higher than for bonds with higher ratings.
NR--NR indicates that Fitch does not rate the specific issue.
Plus (+) or Minus (-): Plus and minus signs are used with a rating symbol to
indicate the relative position of a credit within the rating category, Plus and
minus signs, however, are not used in the "AAA" category.
Standard & Poor's Commercial Paper Ratings
A-1--This highest category indicates that the degree of safety regarding timely
payment is strong. Those issues determined to possess extremely strong safety
characteristics are denoted with a plus sign (+) designation.
A-2--Capacity for timely payment on issues with this designation is
satisfactory. However, the relative degree of safety is not as high as for
issues designated "A-1."
Moody's Investors Service, Inc., Commercial Paper Ratings
PRIME-1--Issuers rated Prime-1 (or related supporting institutions) have a
superior capacity for repayment of short-term promissory obligations. Prime-1
repayment capacity will normally be evidenced by the following characteristics:
leading market positions in well-established industries, high rates of return on
funds employed, conservative capitalization structure with moderate reliance on
debt and ample asset protection; broad margins in earning coverage of fixed
financial charges and high internal cash generation; well-established access to
a range of financial markets and assured sources of alternate liquidity.
PRIME-2--Issuers rated Prime-2 (or related supporting institutions) have a
strong capacity for repayment of short-term promissory obligations. This will
normally be evidenced by many of the characteristics cited above, but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be more
subject to variation. Capitalization characteristics, while still appropriate,
may be more affected by external conditions. Ample alternate liquidity is
maintained.
Fitch Investors Service, Inc., Short-Term Debt Ratings
F-1+--Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.
F-1--Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated
"F-1+."
F-2--Good Credit Quality. Issues carrying this rating have a satisfactory degree
of assurance for timely payment, but the margin of safety is not as great as for
issues assigned "F-1+" and "F-1" ratings.
PART C. OTHER INFORMATION.
Item 24. Financial Statements and Exhibits:
(a) Financial Statements (to be filed by amendment)
(b) Exhibits:
(1) Copy of Declaration of Trust of the Registrant;+
(2) Copy of By-Laws of the Registrant;+
(3) Not applicable;
(4) Not applicable;
(5) (i) Form of Investment Advisory Contract of the Registrant;+
(ii) Form of Sub-Advisory Agreement of the Registrant;+
(6) (i) Form of Distributor's Contract of the Registrant;+
(ii) Form of Administrative Services Agreement of the Registrant;+
(iii) Form of Sales Agreement of the Registrant;+
(7) Not applicable;
(8) Form of Custodian Agreement of the Registrant;+
(9) (i) Form of Transfer Agency and Service Agreement of the
Registrant;+
(ii) Form of Shareholder Services Agreement of the Registrant;+
(iii) Form of Shareholder Services Plan of the Registrant;+
(10) Copy of Opinion and Consent of Counsel as to legality of shares being
registered;(to be filed by amendment)
(11) (i) Copy of Consent of Independent (Public) Accountants;(to be
filed by amendment)
(ii) Not applicable;
(12) Not applicable;
(13) Copy of Initial Capital Understanding;(to be filed by amendment)
(14) Not applicable;
(15) (i) Form of Distribution Plan;+
(ii) Form of 12b-1 Agreement;+
(16) Schedule for Computation of Fund Performance Data;(to be filed
by amendment)
(17) Financial Data Schedule;
(18) Not applicable;
(19) Power of Attorney.+
- -------
+ All exhibits have been filed electronically.
Item 25. Persons Controlled by or Under Common Control with Registrant:
No persons are controlled by the Registrant.
[TO BE FILED BY PRE-EFFECTIVE AMENDMENT]
[As a newly-formed company, all of the outstanding shares of
the Registrant are currently owned by West Coast Trust
Company, Inc.]
<PAGE>
Item 26. Number of Holders of Securities:
Number of Record Holders
Title of Class as of
Shares of
beneficial interest
(no par value)
Item 27. Indemnification:
Indemnification is provided to Officers and Trustees of the
Registrant pursuant to (Section 4 of Article XI of
Registrant's Declaration of Trust. The Investment Advisory
Contract between the Registrant and West Coast Trust Company,
Inc. ("Adviser") provides that, in the absence of willful
misfeasance, bad faith, gross negligence, or reckless
disregard of the obligations or duties under the Investment
Advisory Contract on the part of Adviser, Adviser shall not be
liable to the Registrant or to any shareholder for any act or
omission in the course of or connected in any way with
rendering services or for any losses that may be sustained in
the purchase, holding, or sale of any security. Registrant's
Trustees and Officers are covered by an Investment Trust
Errors and Omissions Policy.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to Trustees, Officers,
and controlling persons of the Registrant by the Registrant
pursuant to the Declaration of Trust or otherwise, the
Registrant is aware that in the opinion of the Securities and
Exchange Commission, such indemnification is against public
policy as expressed in the Act and, therefore, is
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 Trustees, Officers,
or controlling persons of the Registrant in connection with
the successful defense of any act, suit, or proceeding) is
asserted by such Trustees, Officers, or controlling persons in
connection with the shares 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
issues.
Insofar as indemnification for liabilities may be permitted
pursuant to Section 17 of the Investment Company Act of 1940
for Trustees, Officers, and controlling persons of the
Registrant by the Registrant pursuant to the Declaration of
Trust or otherwise, the Registrant is aware of the position of
the Securities and Exchange Commission as set forth in
Investment Company Act Release No. IC-11330. Therefore, the
Registrant undertakes that in addition to complying with the
applicable provisions of the Declaration of Trust or
otherwise, in the absence of a final decision on the merits by
a court or other body before which the proceeding was brought,
that an indemnification payment will not be made unless in the
absence of such a decision, a reasonable determination based
upon factual review has been made (i) by a majority vote of a
quorum of non-party Trustees who are not interested persons of
the Registrant or (ii) by independent legal counsel in a
written opinion that the indemnitee was not liable for an act
of willful misfeasance, bad faith, gross negligence, or
reckless disregard of duties. The Registrant further
undertakes that advancement of expenses incurred in the
defense of a proceeding (upon undertaking for repayment unless
it is ultimately determined that indemnification is
appropriate) against an Officer, Trustee, or controlling
person of the Registrant will not be made absent the
fulfillment of at least one of the following conditions: (i)
the indemnitee provides security for his undertaking; (ii) the
Registrant is insured against losses arising by reason of any
lawful advances; or (iii) a majority of a quorum of
disinterested non-party Trustees or independent legal counsel
in a written opinion makes a factual determination that there
is reason to believe the indemnitee will be entitled to
indemnification.
Item 28. Business and Other Connections of Investment Adviser:
(a) West Coast Trust Company, Inc. ("West Coast Trust") is
a registered investment adviser providing investment
management services to individuals and institutional
clients. West Coast Trust is a wholly-owned subsidiary
of West Coast Bancorp ("Bancorp"). Organized in 1981,
Bancorp is the second largest bank holding company
based in Oregon. through its subsidiaries and
affiliates, Bancorp offers a full range of commercial
banking services, including trust services to
individuals, partnerships, corporations, and
institutions and acts as fiduciary of estates and
conservatorships, and as a trustee under various wills,
trusts and pension and profit-sharing plans. In
addition, Bancorp and its subsidiaries offer
tax-deferred annuities, single-premium whole life
insurance, other insurance investment products and
securities products.
West Coast Trust has common and collective funds with assets
totaling approximately $____. West Coast Trust has managed
the WCT Funds since its inception in October 1997.
The principal executive officers and Directors of West
Coast Trust are set forth in the following table.
Unless otherwise noted, the position listed under Other
Substantial Business, Profession, Vocation or
Employment is with West Coast Trust.
<TABLE>
<CAPTION>
<S> <C> <C>
Other Substantial
Position With Business,Profession,
Name the Adviser Vocation or Employment
Andrew J. Gerlicher President/Director
Marvin C. Abeene Senior Vice President/
Trust Branch Manager
Cheryl Pfenning Assistant Vice President/
Operations Manager and
Compliance Officer
Fred Springsteen Vice President/Newport
Trust Manager
James B. Titus Vice President/Employee
Sales & Administration
<PAGE>
Rick Trout Vice President - Portland/
Vancouver Trust Manager
Dennis B. Munsey Sales Manager
Michael J. Bragg Chairman of the Board/ Attorney-at-law,
DirectorGrenley, Rotenberg,
Evans, Bragg & Bodie, PC
David C. Grove, Sr. Vice Chairman of the President, Grove
Board/Director Securities, Inc.
J. F. Ouderkirk Director Attorney-at-law,
Richardson, Ouderkirk & Hollen
Rodney B. Tibbatts Director Executive Vice President/Director
of Corporate Development, West
Coast Bancorp
Forrest A. Weil Director Personal Investment
Gary D. Putnam Director Executive Vice
President & CFO
Brentwood, Inc.
</TABLE>
(b) Becker Capital Management, Inc. ("Becker") is a registered investment
advisory firm founded in 1976 as P.E. Becker, Inc. Becker manages assets
totaling approximately $2.0 billion for individuals, corporate pensions,
and profit sharing trusts, multi-employer trusts and endowment funds.
Becker is managed by Patrick E. Becker, Chairman and Chief Investment Officer;
Gerald N. Brown, Equity Trader; Warren Hastings III C.F.A., Vice President,
Fixed Income Portfolio Manager; Stephen D. Laveson, Vice President, Director of
Fundamental Analysis; Michael C. Malone, Vice President, Investments; Janeen S.
McAninch, President and Chief Operations Officer; Michael F. McCoy Ph.D., Vice
President, Director of Quantitative Analysis; Michael A. McGarr C.F.A., Senior
Research Analyst; Robert N. Schaeffer, Vice President, Equity Portfolio Manager;
and Donald L. Wolcott C.F.A., Vice President, Portfolio Manager.
Item 29. Principal Underwriters:
(a) Edgewood Services, Inc. the Distributor for shares of the Registrant, acts
as principal underwriter for the following open-end investment companies,
including the Registrant: BT Advisor Funds, BT Pyramid Mutual Funds, BT
Investment Funds, BT Institutional Funds, Excelsior Institutional Trust
(formerly, UST Master Funds, Inc.), Excelsior Tax-Exempt Funds, Inc.
(formerly, UST Master Tax-Exempt Funds, Inc.), Excelsior Institutional
Trust, FTI Funds, FundManager Portfolios, Marketvest Funds, Marketvest
Funds, Inc. and Old Westbury Funds, Inc.
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
(b)
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant
Lawrence Caracciolo Director, President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Arthur L. Cherry Director, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
J. Christopher Donahue Director, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Thomas P. Sholes Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Ronald M. Petnuch Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Thomas P. Schmitt Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Ernest L. Linane Assistant Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
S. Elliott Cohan Secretary, Assistant Secretary
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Thomas J. Ward Assistant Secretary, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Kenneth W. Pegher, Jr. Treasurer, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
</TABLE>
Item 30. Location of Accounts and Records:
All accounts and records required to be maintained by Section
31(a) of the Investment Company Act of 1940 and Rules 31a-1 through 31a-3
promulgated thereunder are maintained at one of the following locations:
WCT Funds Federated Investors Tower
Pittsburgh, PA 15222-3779
Federated Shareholder Services Company P.O. Box 8600
Transfer Agent, Dividend Boston, MA 02266-8600
Disbursing Agent and Shareholder
Servicing Agent
Federated Services Company Federated Investors Tower
Administrator Pittsburgh, PA 15222-3779
West Coast Trust Company, Inc. 1000 Broadway, Suite 1100
Adviser Portland, OR 97205
Becker Capital Management, Inc. 1211 SW Fifth Avenue,
Sub-Adviser Ste. 2185
Portland, OR 97204
State Street Bank and Trust Company P.O. Box 8600
Custodian Boston, MA 02266-8600
Arthur Andersen LLP 2100 One PPG Place
Independent Public Accountants Pittsburgh, PA 15222
Item 31. Management Services: Not applicable.
Item 32. Undertakings:
Registrant hereby undertakes to file a post-effective
amendment, using financial statements which need not be
certified, within four to six months from the effective date
of Registrant's 1933 Act Registration Statement.
Registrant hereby undertakes to comply with the provisions of
Section 16(c) of the 1940 Act with respect to the removal of Trustees and the
calling of special shareholder meetings by shareholders.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant, WCT FUNDS, has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereto
duly authorized, in the City of Pittsburgh and Commonwealth of Pennsylvania, on
the 17th day of September, 1997.
WCT FUNDS
BY: /s/C. Grant Anderson,
C. Grant Anderson
Attorney in Fact for the Trustees
September 17, 1997
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to its Registration Statement has been signed below by the following person in
the capacity and on the date indicated:
NAME TITLE DATE
By: /s/C. Grant Anderson
C. Grant Anderson Attorney In Fact September 17,1997
For the Persons
Listed Below
NAME TITLE
/s/C. Grant Anderson* Chairman and Trustee
C. Grant Anderson (Chief Executive Officer)
/s/C. Christine Thomson* Treasurer and Trustee
C. Christine Thomson (Principal Financial and
Accounting Officer)
/s/Patricia L. Godlewski* Trustee
Patricia L. Godlewski
* By Power of Attorney
1
EXHIBIT 1
WCT FUNDS
DECLARATION OF TRUST
TABLE OF CONTENTS
Page
ARTICLE I. NAMES AND DEFINITIONS ............................................1
Section 1. Name .......................................................1
Section 2. Definitions ................................................1
ARTICLE II. PURPOSE OF TRUST................................................2
ARTICLE III. BENEFICIAL INTEREST.............................................2
Section 1. Shares of Beneficial Interest...............................2
Section 2. Ownership of Shares ........................................2
Section 3. Investment in the Trust ....................................3
Section 4. No Pre-emptive Rights; Action by Shareholder................3
Section 5. Establishment and Designation of Series or Class ...........3
ARTICLE IV. THE TRUSTEES ...................................................5
Section 1. Management of the Trust ....................................5
Section 2. Election of Trustees by Shareholders .......................5
Section 3. Term of Office of Trustees .................................5
Section 4. Termination of Service and Appointment of Trustees .........6
Section 5. Number of Trustees .........................................6
Section 6. Effect of Death, Resignation, etc. of a Trustee ............6
Section 7. Ownership of Assets ........................................6
ARTICLE V. POWERS OF THE TRUSTEES .........................................6
Section 1. Powers .....................................................6
Section 2. Principal Transactions .....................................9
Section 3. Trustees and Officers as Shareholders.......................9
Section 4. Parties to Contract.........................................9
<PAGE>
Page
ARTICLE VI. TRUSTEES' EXPENSES AND COMPENSATION ...........................10
Section 1. Trustee Reimbursement.....................................10
Section 2. Trustee Compensation .....................................10
ARTICLE VII. INVESTMENT ADVISER, ADMINISTRATIVE SERVICES, PRINCIPAL
UNDERWRITER AND TRANSFER AGENT ..............................................11
Section 1. Investment Adviser ........................................11
Section 2. Administrative Services ...................................11
Section 3. Principal Underwriter .....................................11
Section 4. Transfer Agent ............................................12
ARTICLE VIII. SHAREHOLDERS' VOTING POWERS AND MEETINGS .......................12
Section 1. Voting Powers .............................................12
Section 2. Meetings...................................................12
Section 3. Quorum and Required Vote ..................................13
Section 4. Action by Written Consent .................................13
Section 5. Additional Provisions .....................................13
ARTICLE IX. CUSTODIAN ......................................................13
ARTICLE X. DISTRIBUTIONS AND REDEMPTIONS ..................................13
Section 1. Distributions .............................................13
Section 2. Redemptions and Repurchases ...............................14
Section 3. Net Asset Value of Shares..................................15
Section 4. Suspension of the Right of Redemption......................15
Section 5. Trust's Right to Redeem Shares ............................15
ARTICLE XI. LIMITATION OF LIABILITY AND INDEMNIFICATION ....................15
Section 1. Limitation of Personal Liability and Indemnification of
Shareholders ........................................15
Section 2. Limitation of Personal Liability and Indemnification of
Trustees, Officers, Employees or Agents of the Trust 16
Section 3. Express Exculpatory Clauses and Instruments ..............16
<PAGE>
Page
ARTICLE XII. MISCELLANEOUS...................................................17
Section 1. Trust is not a Partnership ....................................17
Section 2. Trustee Action Binding, Expert Advice, No Bond or Surety ......17
Section 3. Establishment of Record Dates .................................17
Section 4. Termination of Trust ..........................................18
Section 5. Offices of the Trust, Filing of Copies, Headings, Counterparts 18
Section 6. Applicable Law ................................................18
Section 7. Amendments -- General .........................................19
Section 8. Amendments -- Series and Classes...............................19
Section 9. Use of Name ...................................................20
<PAGE>
WCT FUNDS
DECLARATION OF TRUST
Dated July 1, 1997
DECLARATION OF TRUST made July 1, 1997 by the undersigned, and by the holders of
shares of beneficial interest to be issued hereunder as hereinafter provided.
WHEREAS, the Trustees desire to establish a trust fund for the investment and
reinvestment of funds contributed thereto;
NOW, THEREFORE, the Trustees declare that all money and property contributed to
the trust fund hereunder shall be held and managed under this Declaration of
Trust IN TRUST as herein set forth below.
ARTICLE I
NAMES AND DEFINITIONS
Section 1. Name. This Trust shall be known as the WCT FUNDS, and the Trustees
may conduct the business of the Trust under that name or any other name as they
may determine from time to time. ----
Section 2. Definitions. Wherever used herein, unless otherwise required by the
context or specifically provided:
(a) The terms "Affiliated Person," "Assignment," "Commission," "Interested
Person," "Majority Shareholder Vote" (the 67% or 50% requirement of Section
2(a)(42) of the 1940 Act, whichever may be applicable) and "Principal
Underwriter" shall have the meanings given them in the 1940 Act, as amended
from time to time;
(b) The "Trust" refers to the Massachusetts Business Trust established by this
Declaration of Trust, as amended from time to time, inclusive of each and
every Series and Class established hereunder;
(c) "Class" refers to a class of Shares established and designated under or in
accordance with the provisions of Article III;
(d) "Series" refers to a series of Shares established and designated under or
in accordance with the provisions of Article III;
(e) "Series Company" refers to the form of a registered open-end investment
company described in Section 18(f)(2) of the 1940 Act or in any successor
statutory provision;
(f) "Shareholder" means a record owner of Shares of any Series or Class;
(g) "Trustees" refer to the individual Trustees in their capacity as Trustees
hereunder of the Trust and their successor or successors for the time being
in office as such Trustees;
(h) "Shares" means the equal proportionate units of interest into which the
beneficial interest in the Trust shall be divided from time to time, or if
more than one Series or Class of Shares is authorized by the Trustees, the
equal proportionate units into which each Series or Class of Shares shall
be divided from time to time and includes fractions of Shares as well as
whole Shares;
(i) The "1940 Act" refers to the Investment Company Act of 1940, and the Rules
and Regulations thereunder, (including any exemptions granted thereunder)
as amended from time to time; and
(j) "Bylaws" shall mean the Bylaws of the Trust as amended from time to time.
ARTICLE II
PURPOSE OF TRUST
The purpose of this Trust is to operate as an investment company, and
provide investors a continuous source of managed investments by
investing primarily in securities, derivative securities, and also in
debt instruments, commodities, commodity contracts and options thereon,
and other property.
ARTICLE III
BENEFICIAL INTEREST
Section 1. Shares of Beneficial Interest. The beneficial interest in the Trust
shall at all times be divided into transferable Shares, without par
value. Subject to the provisions of Section 5 of this Article III, each
Share shall have voting rights as provided in Article VIII hereof, and
holders of the Shares of any Series shall be entitled to receive
dividends, when and as declared with respect thereto in the manner
provided in Article X, Section 1 hereof. The Shares of any Series may
be issued in one or more Classes, as the Trustees may authorize
pursuant to Article XII, Section 8 hereof. Unless the Trustees have
authorized the issuance of Shares of a Series in two or more Classes,
each Share of a Series shall represent an equal proportionate interest
in the assets and liabilities and the income and the expenses of the
Series with each other Share of the same Series, none having priority
or preference over another. If the Trustees have authorized the
issuance of Shares of a Series in two or more Classes, then the Classes
may have such variations as to dividend, redemption, and voting rights,
net asset values, expenses borne by the Classes, and other matters as
the Trustees have authorized provided that each Share of a Class shall
represent an equal proportionate interest in the assets and liabilities
and the income and the expenses of the Class with each other Share of
the same Class, none having priority or preference over another. The
number of Shares authorized shall be unlimited. The Trustees may from
time to time divide or combine the Shares of any Series or Class into a
greater or lesser number without thereby changing the proportionate
beneficial interests in the Series or Class.
Section 2. Ownership of Shares. The ownership of Shares shall be recorded in
the books of the Trust or a transfer agent which books shall be
maintained separately for the Shares of each Series or Class. The
Trustees may make such rules as they consider appropriate for the
transfer of Shares and similar matters. The record books of the Trust
or any transfer agent, as the case may be, shall be conclusive as to
who are the Shareholders of each Series or Class and as to the number
of Shares of each Series or Class held from time to time by each.
Section 3. Investment in the Trust. The Trustees shall accept investments in
the Trust from such persons and on such terms as they may from time to
time authorize. After the date of the initial contribution of capital
(which shall occur prior to the initial public offering of Shares), the
number of Shares to represent the initial contribution shall be
considered as outstanding and the amount received by the Trustees on
account of the contribution shall be treated as an asset of the Trust
to be allocated among any Series or Classes in the manner described in
Section 5(a) of this Article. Subsequent to such initial contribution
of capital, Shares (including Shares which may have been redeemed or
repurchased by the Trust) may be issued or sold at a price which will
net the relevant Series or Class, as the case may be, before paying any
taxes in connection with such issue or sale, not less than the net
asset value (as defined in Article X, Section 3) thereof; provided,
however, that the Trustees may in their discretion impose a sales
charge upon investments in or redemptions from the Trust, and upon
reinvestments of dividends and capital gains in Shares.
Section 4. No Pre-emptive Right; Action by Shareholder. Shareholders shall have
no pre-emptive or other right to subscribe to any additional Shares or
other securities issued by the Trust. No action may be brought by a
Shareholder on behalf of the Trust unless a prior demand regarding such
matter has been made on the Trustees of the Trust.
Section 5. Establishment and Designation of Series or Class. Without limiting
the authority of the Trustees set forth in Article XII, Section 8,
inter alia, to establish and designate any additional Series or Class
or to modify the rights and preferences of any existing Series or
Class, the initial Series shall be, and is established and designated
as, WCT EQUITY FUND
Shares of any Series or Class established in this Section 5 shall have
the following relative rights and preferences:
(a) Assets belonging to Series or Class. All consideration received by the
Trust for the issue 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 from whatever source derived,
including, without limitation, 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, from whatever source derived, including, without
limitation, 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, 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 Assets"), the Trustees shall allocate such
General Assets to, between or 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 Assets 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 or Classes
for all purposes.
(b) Liabilities Belonging to Series or Class. The assets belonging
to each particular Series or Class shall be charged with the
liabilities of the Trust in respect to that Series or Class
and all expenses, costs, charges and reserves attributable to
that Series or Class, and any general liabilities of the Trust
which are not readily identifiable as belonging to any
particular Series or Class shall be allocated and charged by
the Trustees 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 the Trustees in their sole
discretion deem fair and equitable. The liabilities, expenses,
costs, charges and reserves so charged to a Series or Class
are herein referred to as "liabilities belonging to" that
Series or Class. Each allocation of liabilities belonging to a
Series or Class by the Trustees shall be conclusive and
binding upon the Shareholders of all Series or Classes for all
purposes.
(c) Dividends, Distributions, Redemptions, Repurchases and
Indemnification. Notwithstanding any other provisions of this
Declaration of Trust, including, without limitation, Article
X, no dividend or distribution (including, without limitation,
any distribution paid upon termination of the Trust or of any
Series or Class) with respect to, nor any redemption or
repurchase of the Shares of any Series or Class shall be
effected by the Trust other than from the assets belonging to
such Series or Class, nor except as specifically provided in
Section 1 of Article XI hereof, shall any Shareholder of any
particular Series or Class otherwise have any right or claim
against the assets belonging to any other Series or Class
except to the extent that such Shareholder has such a right or
claim hereunder as a Shareholder of such other Series or
Class.
(d) Voting. Notwithstanding any of the other provisions of this
Declaration of Trust, including, without limitation, Section 1
of Article VIII, only Shareholders of a particular Series or
Class shall be entitled to vote on any matters affecting such
Series or Class. Except with respect to matters as to which
any particular Series or Class is affected materially
differently or as otherwise required by applicable law, all of
the Shares of each Series or Class shall, on matters as to
which such Series or Class is entitled to vote, vote with
other Series or Classes so entitled as a single class.
Notwithstanding the foregoing, with respect to matters which
would otherwise be voted on by two or more Series or Classes
as a single class, the Trustees may, in their sole discretion,
submit such matters to the Shareholders of any or all such
Series or Classes, separately.
(e) Fraction. Any fractional Share of a Series or Class shall
carry proportionately all the rights and obligations of a
whole Share of that Series or Class, including rights with
respect to voting, receipt of dividends and distributions,
redemption of Shares and termination of the Trust or of any
Series or Class.
(f) Exchange Privilege. The Trustees shall have the authority to
provide that the holders of Shares of any Series or Class
shall have the right to exchange said Shares for Shares of one
or more other Series or Classes in accordance with such
requirements and procedures as may be established by the
Trustees.
(g) Combination of Series or Classes. The Trustees shall have the
authority, without the approval of the Shareholders of any
Series or Class, unless otherwise required by applicable law,
to combine the assets and liabilities belonging to a single
Series or Class with the assets and liabilities of one or more
other Series or Classes.
(h) Elimination of Series or Classes. The Trustees shall have the
authority, without the approval of Shareholders of any Series
or Class, unless otherwise required by applicable law, to
amend this Declaration of Trust to abolish that Series or
Class and to rescind the establishment and designation
thereof.
ARTICLE IV
THE TRUSTEES
Section 1. Management of the Trust. The business and affairs of the Trust
shall be managed by the Trustees, and they shall have all powers necessary
and desirable to carry out that responsibility. The Trustees who
----------------------- shall serve as Trustees are the undersigned.
Section 2. Election of Trustees by Shareholders. Unless otherwise required by
the 1940 Act or any court or regulatory body of competent jurisdiction,
or unless the Trustees determine otherwise, a Trustee shall be elected
by the Trustees, and Shareholders shall have no right to elect
Trustees.
Section 3. Term of Office of Trustees. The Trustees shall hold office during
the lifetime of this Trust, and until its termination as hereinafter
provided; except (a) that any Trustee may resign his office at any time
by written instrument signed by him and delivered to the other
Trustees, which shall take effect upon such delivery or upon such later
date as is specified therein; (b) that any Trustee may be removed at
any time by written instrument signed by at least two-thirds of the
number of Trustees prior to such removal, specifying the date when such
removal shall become effective; (c) that any Trustee who requests in
writing to be retired or who has become mentally or physically
incapacitated may be retired by written instrument signed by a majority
of the other Trustees, specifying the date of his retirement; and (d) a
Trustee may be removed at any special meeting of Shareholders of the
Trust by a vote of two-thirds of the outstanding Shares. Any removals
shall be effective as to the Trust and each Series and Class hereunder.
Section 4. Termination of Service and Appointment of Trustees. In case of the
death, resignation, retirement, removal or mental or physical
incapacity of any of the Trustees, or in case a vacancy shall, by
reason of an increase in number, or for any other reason, exist, the
remaining Trustees shall fill such vacancy by appointing such other
person as they in their discretion shall see fit. An appointment of a
Trustee may be made by the Trustees then in office in anticipation of a
vacancy to occur by reason of retirement, resignation or increase in
number of Trustees effective at a later date, provided that said
appointment 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 shall have accepted this Trust, the
trust estate shall vest in the new Trustee or Trustees, together with
the continuing Trustees, without any further act or conveyance, and he
shall be deemed a Trustee hereunder. Any appointment authorized by this
Section 4 is subject to the provisions of Section 16(a) of the 1940
Act.
Section 5. Number of Trustees. The number of Trustees, not less than three
(3) nor more than twenty (20) serving hereunder at any time, shall be
determined by the Trustees themselves. ------------------
Whenever a vacancy in the Board of Trustees shall occur, until such
vacancy is filled or while any Trustee is physically or mentally
incapacitated, the other Trustees shall have all the powers hereunder
and the certificate signed by a majority of the other Trustees of such
vacancy, absence or incapacity shall be conclusive, provided, however,
that no vacancy which reduces the number of Trustees below three (3)
shall remain unfilled for a period longer than six calendar months.
Section 6. Effect of Death, Resignation, etc. of a Trustee. The death,
resignation, retirement, removal, or mental or physical incapacity of
the Trustees, or any one or more of them, shall not operate to annul
the Trust or to revoke any existing agency created pursuant to the
terms of this Declaration of Trust.
Section 7. Ownership of Assets. The assets belonging to each Series or Class
shall be held separate and apart from any assets now or hereafter held
in any capacity other than as Trustee hereunder by the Trustees or any
successor Trustee. All of the assets belonging to each Series or Class
or owned by the Trust shall at all times be considered as vested in the
Trustees. No Shareholder shall be deemed to have a severable ownership
interest in any individual asset belonging to any Series or Class or
owned by the Trust or any right of partition or possession thereof, but
each Shareholder shall have a proportionate undivided beneficial
interest in a Series or Class.
ARTICLE V
POWERS OF THE TRUSTEES
Section 1. Powers. The Trustees in all instances shall act as principals, and
are and shall be free from the control of the Shareholders. The
Trustees shall have full power and authority to do any and all acts and
to make and execute any and all contracts and instruments that they may
consider necessary or appropriate in connection with the management of
the Trust or a Series or Class. The Trustees shall not be bound or
limited by present or future laws or customs in regard to trust
investments, but shall have full authority and power to make any and
all investments which they, in their uncontrolled discretion, shall
deem proper to accomplish the purpose of this Trust. Without limiting
the foregoing, the Trustees shall have the following specific powers
and authority, subject to any applicable limitation in the 1940 Act or
in this Declaration of Trust or in the Bylaws of the Trust:
(a) To buy, and invest funds in their hands in securities and
other property, including, but not limited to, common stocks,
preferred stocks, bonds, debentures, warrants and rights to
purchase securities, options, certificates of beneficial
interest, money market instruments, notes or other evidences
of indebtedness issued by any corporation, trust or
association, domestic or foreign, or issued or guaranteed by
the United States of America or any agency or instrumentality
thereof, by the government of any foreign country, by any
State of the United States, or by any political subdivision or
agency or instrumentality of any State or foreign country, or
"when-issued" or "delayed-delivery" contracts for any such
securities, or any repurchase agreement or reverse repurchase
agreement, or debt instruments, commodities, commodity
contracts and options thereon, or to retain assets belonging
to each and every Series or Class in cash, and from time to
time to change the investments of the assets belonging to each
Series or Class;
(b) To adopt Bylaws of the Trust not inconsistent with the Declaration of
Trust providing for the conduct of the business of the Trust and to
amend and repeal them to the extent that they do not reserve that
right to the Shareholders;
(c) To elect and remove such officers of the Trust and appoint and
terminate such agents of the Trust as they consider appropriate;
(d) To appoint or otherwise engage a bank or other entity permitted by the
1940 Act, as custodian of any assets belonging to any Series or Class
subject to any conditions set forth in this Declaration of Trust or in
the Bylaws;
(e) To appoint or otherwise engage transfer agents, dividend
disbursing agents, Shareholder servicing agents, investment
advisers, sub-investment advisers, principal underwriters,
administrative service agents, and such other agents as the
Trustees may from time to time appoint or otherwise engage;
(f) To provide for the distribution of any Shares of any Series or Class
either through a Principal Underwriter in the manner hereinafter
provided for or by the Trust itself, or both;
(g) To set record dates in the manner hereinafter provided for;
(h) To delegate such authority as they consider desirable to a committee
or committees composed of Trustees, including without limitation, an
Executive Committee, or to any officers of the Trust and to any agent,
custodian or underwriter;
(i) To sell or exchange any or all of the assets belonging to one or more
Series or Classes, subject to the provisions of Article XII, Section
4(b) hereof;
(j) To vote or give assent, or exercise any rights of ownership,
with respect to stock or other securities or property; and to
execute and deliver powers of attorney to such person or
persons, including the investment adviser of the Trust as the
Trustees shall deem proper, granting to such person or persons
such power and discretion with relation to securities or
property as the Trustees shall deem proper;
(k) To exercise powers and rights of subscription or otherwise which in
any manner arise out of ownership of securities or other property;
(l) To hold any security or property in a form not indicating any
trust, whether in bearer, unregistered or other negotiable
form; or either in its own name or in the name of a custodian
or a nominee or nominees, subject in either case to proper
safeguards according to the usual business practice of
Massachusetts business trusts or investment companies;
(m) To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or
concern, any security of which belongs to any Series or Class;
to consent to any contract, lease, mortgage, purchase, or sale
of property by such corporation or concern, and to pay calls
or subscriptions with respect to any security which belongs to
any Series or Class;
(n) To engage in and to prosecute, compound, compromise, abandon,
or adjust, by arbitration or otherwise, any actions, suits,
proceedings, disputes, claims, demands, and things relating to
the Trust, and out of the assets belonging to any Series or
Class to pay, or to satisfy, any debts, claims or expenses
incurred in connection therewith, including those of
litigation, upon any evidence that the Trustees may deem
sufficient (such powers shall include without limitation any
actions, suits, proceedings, disputes, claims, demands and
things relating to the Trust wherein any of the Trustees may
be named individually and the subject matter of which arises
by reason of business for or on behalf of the Trust);
(o) To make distributions of income and of capital gains to Shareholders;
(p) To borrow money;
(q) From time to time to issue and sell the Shares of any Series or Class
either for cash or for property whenever and in such amounts as the
Trustees may deem desirable, but subject to the limitation set forth
in Section 3 of Article III.
(r) To purchase insurance of any kind, including, without
limitation, insurance on behalf of any person who is or was a
Trustee, officer, employee or agent of the Trust, or is or was
serving at the request of the Trust as a trustee, director,
officer, agent or employee of another corporation,
partnership, joint venture, trust or other enterprise, against
any liability asserted against him or incurred by him in any
such capacity or arising out of his status as such;
(s) To sell, exchange, lend, pledge, mortgage, hypothecate, lease, or
write options with respect to or otherwise deal in any property rights
relating to any or all of the assets belonging to any Series or Class;
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Trustees, and to adopt, establish and carry out pension, profit-sharing, share
bonus, share purchase, deferred of
The Trustees shall have all of the powers set forth in this Section 1
with respect to all assets and liabilities of each Series and Class.
Section 2. Principal Transactions. The Trustees shall not cause the Trust on
behalf of any Series or Class to buy any securities (other than Shares)
from or sell any securities (other than Shares) to, or lend any assets
belonging to any Series or Class to any Trustee or officer or employee
of the Trust or any firm of which any such Trustee or officer is a
member acting as principal unless permitted by the 1940 Act, but the
Trust may employ any such other party or any such person or firm or
company in which any such person is an interested person in any
capacity not prohibited by the 1940 Act.
Section 3. Trustees and Officers as Shareholders. Any Trustee, officer,
employee or other agent of the Trust may acquire, own and dispose of
Shares of any Series or Class to the same extent as if he were not a
Trustee, officer, employee or agent; and the Trustees may issue and
sell or cause to be issued or sold Shares of any Series or Class to and
buy such Shares from any such person or any firm or company in which he
is an interested person subject only to the general limitations herein
contained as to the sale and purchase of such Shares; and all subject
to any restrictions which may be contained in the Bylaws.
Section 4. Parties to Contract. The Trustees may enter into any contract of the
character described in Article VII or in Article IX hereof or any other
capacity not prohibited by the 1940 Act with any corporation, firm,
partnership, trust or association, although one or more of the
shareholders, Trustees, officers, employees or agents of the Trust or
their affiliates may be an officer, director, trustee, partner,
shareholder or interested person of such other party to the contract,
and no such contract shall be invalidated or rendered voidable by
reason of the existence of any such relationship, nor shall any person
holding such relationship be liable merely by reason of such
relationship for any loss or expense to the Trust or any Series or
Class under or by reason of said contract or accountable for any profit
realized directly or indirectly therefrom, in the absence of actual
fraud. The same person (including a firm, corporation, partnership,
trust or association) may be the other party to contracts entered into
pursuant to Article VII or Article IX or any other capacity not
prohibited by the 1940 Act, and any individual may be financially
interested or otherwise an interested person of persons who are parties
to any or all of the contracts mentioned in this Section 4.
ARTICLE VI
TRUSTEES' EXPENSES AND COMPENSATION
Section 1. Trustee Reimbursement. The Trustees shall be reimbursed from the
assets belonging to each particular Series or Class for all of such
Trustees' expenses as such expenses are allocated to and among any one
or more of the Series or Classes pursuant to Article III, Section 5(b),
including, without limitation, expenses of organizing the Trust or any
Series or Class and continuing its or their existence; fees and
expenses of Trustees and officers of the Trust; fees for investment
advisory services, administrative services and principal underwriting
services provided for in Article VII, Sections 1, 2 and 3; fees and
expenses of preparing and printing Registration Statements under the
Securities Act of 1933 and the 1940 Act and any amendments thereto;
expenses of registering and qualifying the Trust and any Series or
Class and the Shares of any Series or Class under federal and state
laws and regulations; expenses of preparing, printing and distributing
prospectuses and any amendments thereto sent to shareholders,
underwriters, broker-dealers and to investors who may be considering
the purchase of Shares; expenses of registering, licensing or other
authorization of the Trust or any Series or Class as a broker-dealer
and of its or their officers as agents and salesmen under federal and
state laws and regulations; interest expenses, taxes, fees and
commissions of every kind; expenses of issue (including cost of share
certificates), purchases, repurchases and redemptions of Shares,
including expenses attributable to a program of periodic issue; charges
and expenses of custodians, transfer agents, dividend disbursing
agents, Shareholder servicing agents and registrars; printing and
mailing costs; auditing, accounting and legal expenses; reports to
Shareholders and governmental officers and commissions; expenses of
meetings of Shareholders and proxy solicitations therefor; insurance
expenses; association membership dues and nonrecurring items as may
arise, including all losses and liabilities by them incurred in
administering the Trust and any Series or Class, including expenses
incurred in connection with litigation, proceedings and claims and the
obligations of the Trust under Article XI hereof and the Bylaws to
indemnify its Trustees, officers, employees, shareholders and agents,
and any contract obligation to indemnify Principal Underwriters under
Section 3 of Article VII; and for the payment of such expenses,
disbursements, losses and liabilities, the Trustees shall have a lien
on the assets belonging to each Series or Class prior to any rights or
interests of the Shareholders of any Series or Class. This section
shall not preclude the Trust from directly paying any of the
aforementioned fees and expenses.
Section 2. Trustee Compensation. The Trustees shall be entitled to compensation
from the Trust from the assets belonging to any Series or Class for
their respective services as Trustees, to be determined from time to
time by vote of the Trustees, and the Trustees shall also determine the
compensation of all officers, employees, consultants and agents whom
they may elect or appoint. The Trust may pay out of the assets
belonging to any Series or Class any Trustee or any corporation, firm,
partnership, trust or other entity of which a Trustee is an interested
person for services rendered in any capacity not prohibited by the 1940
Act, and such payments shall not be deemed compensation for services as
a Trustee under the first sentence of this Section 2 of Article VI.
ARTICLE VII
INVESTMENT ADVISER, ADMINISTRATIVE SERVICES, PRINCIPAL UNDERWRITER AND
TRANSFER AGENT
Section 1. Investment Adviser. Subject to a Majority Shareholder Vote by the
relevant Series or Class to the extent such vote is required by law,
the Trustees may in their discretion from time to time enter into an
investment advisory contract whereby the other party to such contract
shall undertake to furnish the Trustees investment advisory services
for such Series or Class upon such terms and conditions and for such
compensation as the Trustees may in their discretion determine. Subject
to a Majority Shareholder Vote by the relevant Series or Class to the
extent such vote is required by law, the investment adviser may enter
into a sub-investment advisory contract to receive investment advice
and/or statistical and factual information from the sub-investment
adviser for such Series or Class upon such terms and conditions and for
such compensation as the Trustees, in their discretion, may agree.
Notwithstanding any provisions of this Declaration of Trust, the
Trustees may authorize the investment adviser or sub-investment adviser
or any person furnishing administrative personnel and services as set
forth in Article VII, Section 2 (subject to such general or specific
instructions as the Trustees may from time to time adopt) to effect
purchases, sales or exchanges of portfolio securities belonging to a
Series or Class on behalf of the Trustees or may authorize any officer,
employee or Trustee to effect such purchases, sales, or exchanges
pursuant to recommendations of the investment adviser (and all without
further action by the Trustees). Any such purchases, sales and
exchanges shall be deemed to have been authorized by the Trustees. The
Trustees may also authorize the investment adviser to determine what
firms shall be employed to effect transactions in securities for the
account of a Series or Class and to determine what firms shall
participate in any such transactions or shall share in commissions or
fees charged in connection with such transactions.
Section 2. Administrative Services. The Trustees may in their discretion from
time to time contract for administrative personnel and services whereby
the other party shall agree to provide the Trustees administrative
personnel and services to operate the Trust or a Series or Class on a
daily basis, on such terms and conditions as the Trustees may in their
discretion determine. Such services may be provided by one or more
entities.
Section 3. Principal Underwriter. The Trustees may in their discretion from
time to time enter into an exclusive or nonexclusive contract or
contracts providing for the sale of the Shares of a Series or Class to
net such Series or Class not less than the amount provided in Article
III, Section 3 hereof, whereby a Series or Class may either agree to
sell the Shares to the other party to the contract or appoint such
other party its sales agent for such shares. In either case, the
contract shall be on such terms and conditions (including
indemnification of Principal Underwriters allowable under applicable
law and regulation) as the Trustees may in their discretion determine
not inconsistent with the provisions of this Article VII; and such
contract may also provide for the repurchase or sale of Shares of a
Series or Class by such other party as principal or as agent of the
Trust and may provide that the other party may maintain a market for
shares of a Series or Class.
Section 4. Transfer Agent. The Trustees may in their discretion from time to
time enter into transfer agency and Shareholder services contracts
whereby the other party shall undertake to furnish transfer agency and
Shareholder services. The contracts shall be on such terms and
conditions as the Trustees may in their discretion determine not
inconsistent with the provisions of this Declaration of Trust or of the
Bylaws.
Such services may be provided by one or more entities.
ARTICLE VIII
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 1. Voting Powers. Subject to the provisions set forth in Article III,
Section 5(d), the Shareholders shall have power to vote, (i) for the
election of Trustees as provided in Article IV, Section 2; (ii) for the
removal of Trustees as provided in Article IV, Section 3(d); (iii) with
respect to any investment adviser or sub-investment adviser as provided
in Article VII, Section 1; (iv) with respect to the amendment of this
Declaration of Trust as provided in Article XII, Section 7; and (v)
with respect to such additional matters relating to the Trust as may be
required by law, by this Declaration of Trust, or the Bylaws of the
Trust or any regulation of the Trust or the Securities and Exchange
Commission or any State, or as the Trustees may consider desirable.
Each whole Share shall be entitled to one vote as to any matter on
which it is entitled to vote, and each fractional Share shall be
entitled to a proportionate fractional vote. There shall be no
cumulative voting in the election of Trustees. Shares may be voted in
person or by proxy. 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. At all
meetings of Shareholders, unless inspectors of election have been
appointed, all questions relating to the qualification of votes and the
validity of proxies and the acceptance or rejection of votes shall be
decided by the chairman of the meeting. Unless otherwise specified in
the proxy, the proxy shall apply to all shares of the Trust (or each
Series or Class) owned by the Shareholder. Any proxy may be in written
form, telephonic or electronic form, including facsimile, and all such
forms shall be valid when in conformance with procedures established
and implemented by the officers of the Trust. Until Shares of a Series
or Class are issued, the Trustees may exercise all rights of
Shareholders of such Series or Class with respect to matters affecting
such Series or Class, and may take any action with respect to the Trust
or such Series or Class required or permitted by law, this Declaration
of Trust or any Bylaws of the Trust to be taken by Shareholders.
Section 2. Meetings. A Shareholders' meeting shall be held as specified in
Section 2 of Article IV at the principal office of the Trust or such
other place as the Trustees may designate. Special meetings of the
Shareholders may be called by the Trustees or the Chief Executive
Officer of the Trust and shall be called by the Trustees upon the
written request of Shareholders owning at least one-tenth of the
outstanding Shares of all Series and Classes entitled to vote.
Shareholders shall be entitled to at least fifteen days' notice of any
meeting.
Section 3. Quorum and Required Vote. Except as otherwise provided by law, the
presence in person or by proxy of the holders of (a) one-half of the
Shares of the Trust on all matters requiring a Majority Shareholder
Vote, as defined in the Investment Company Act of 1940, or (b)
one-third of the Shares of the Trust on all other matters permitted by
law, in each case, entitled to vote without regard to Class shall
constitute a quorum at any meeting of the Shareholders, except with
respect to any matter which by law requires the separate approval of
one or more Series or Classes, in which case the presence in person or
by proxy of the holders of one-half or one-third, as set forth above,
of the Shares of each Series or Class entitled to vote separately on
the matter shall constitute a quorum. When any one or more Series or
Class is entitled to vote as a single Series or Class, more than
one-half, or one-third, as appropriate, of the Shares of each such
Series or Class entitled to vote shall constitute a quorum at a
Shareholders' meeting of that Series or Class. If a quorum shall not be
present for the purpose of any vote that may properly come before the
meeting, the Shares present in person or by proxy and entitled to vote
at such meeting on such matter may, by plurality vote, adjourn the
meeting from time to time to such place and time without further notice
than by announcement to be given at the meeting until a quorum entitled
to vote on such matter shall be present, whereupon any such matter may
be voted upon at the meeting as though held when originally convened.
Subject to any applicable requirement of law or of this Declaration of
Trust or the Bylaws, a plurality of the votes cast shall elect a
Trustee, and all other matters shall be decided by a majority of the
votes cast and entitled to vote thereon.
Section 4. 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 larger proportion thereof as shall be required by
applicable law or by any express provision of this Declaration of Trust
or the Bylaws) consents to the action in writing. Such consents shall
be treated for all purposes as a vote taken at a meeting of
Shareholders.
Section 5. Additional Provisions. The Bylaws may include further provisions
for Shareholders' votes and meetings and related matters.
ARTICLE IX
CUSTODIAN
The Trustees may, in their discretion, from time to time enter into
contracts providing for custodial and accounting services to the Trust
or any Series or Class. The contracts shall be on the terms and
conditions as the Trustees may in their discretion determine not
inconsistent with the provisions of this Declaration of Trust or of the
Bylaws. Such services may be provided by one or more entities,
including one or more sub-custodians.
ARTICLE X
DISTRIBUTIONS AND REDEMPTIONS
Section 1. Distributions.
(a) The Trustees may from time to time declare and pay dividends
to the Shareholders of any Series or Class, and the amount of
such dividends and the payment of them shall be wholly in the
discretion of the Trustees. The frequency of dividends and
distributions to Shareholders may be determined by the
Trustees pursuant to a standing resolution, or otherwise. Such
dividends may be accrued and automatically reinvested in
additional Shares (or fractions thereof) of the relevant
Series or Class or another Series or Class, or paid in cash or
additional Shares of the relevant Series or Class, all upon
such terms and conditions as the Trustees may prescribe.
(b) The Trustees may distribute in respect of any fiscal year as
dividends and as capital gains distributions, respectively,
amounts sufficient to enable any Series or Class to qualify as
a regulated investment company and to avoid any liability for
federal income or excise taxes in respect of that year.
c) The decision of the Trustees as to what constitutes income and
what constitutes principal shall be final, and except as
specifically provided herein the decision of the Trustees as
to what expenses and charges of any Series or Class shall be
charged against principal and what against the income shall be
final. Any income not distributed in any year may be permitted
to accumulate and as long as not distributed may be invested
from time to time in the same manner as the principal funds of
any Series or Class.
(d) All dividends and distributions on Shares of a particular
Series or Class shall be distributed pro rata to the holders
of that Series or Class in proportion to the number of Shares
of that Series or Class held by such holders and recorded on
the books of the Trust or its transfer agent at the date and
time of record established for that payment.
Section 2. Redemptions and Repurchases.
(a) In case any Shareholder of record of any Series or Class at
any time desires to dispose of Shares of such Series or Class
recorded in his name, he may deposit a written request (or
such other form of request as the Trustees may from time to
time authorize) requesting that the Trust purchase his Shares,
together with such other instruments or authorizations to
effect the transfer as the Trustees may from time to time
require, at the office of the transfer agent, or as otherwise
provided by the Trustees and the Trust shall purchase his
Shares out of assets belonging to such Series or Class. The
purchase price shall be the net asset value of his shares
reduced by any redemption charge or deferred sales charge as
the Trustees from time to time may determine.
Payment for such Shares shall be made by the Trust to the
Shareholder of record within that time period required under
the 1940 Act after the request (and, if required, such other
instruments or authorizations of transfer) is received,
subject to the right of the Trustees to postpone the date of
payment pursuant to Section 4 of this Article X. If the
redemption is postponed beyond the date on which it would
normally occur by reason of a declaration by the Trustees
suspending the right of redemption pursuant to Section 4 of
this Article X, the right of the Shareholder to have his
Shares purchased by the Trust shall be similarly suspended,
and he may withdraw his request (or such other instruments or
authorizations of transfer) from deposit if he so elects; or,
if he does not so elect, the purchase price shall be the net
asset value of his Shares determined next after termination of
such suspension (reduced by any redemption charge or deferred
sales charge), and payment therefor shall be made within the
time period required under the 1940 Act.
(b) The Trust may purchase Shares of a Series or Class by
agreement with the owner thereof at a purchase price not
exceeding the net asset value per Share (reduced by any
redemption charge or deferred sales charge) determined (1)
next after the purchase or contract of purchase is made or (2)
at some later time.
(c) The Trust may pay the purchase price (reduced by any
redemption charge or deferred sales charge) in whole or in
part by a distribution in kind of securities from the
portfolio of the relevant Series or Class, taking such
securities at the same value employed in determining net asset
value, and selecting the securities in such manner as the
Trustees may deem fair and equitable.
Section 3. Net Asset Value of Shares. The net asset value of each Share of a
Series or Class outstanding shall be determined at such time or times
as may be determined by or on behalf of the Trustees. The power and
duty to determine net asset value may be delegated by the Trustees from
time to time to one or more of the Trustees or officers of the Trust,
to the other party to any contract entered into pursuant to Section 1
or 2 of Article VII or to the custodian or to a transfer agent or other
person designated by the Trustees.
The net asset value of each Share of a Series or Class as of any
particular time shall be the quotient (adjusted to the nearer cent)
obtained by dividing the value, as of such time, of the net assets
belonging to such Series or Class (i.e., the value of the assets
belonging to such Series or Class less the liabilities belonging to
such Series or Class exclusive of capital and surplus) by the total
number of Shares outstanding of the Series or Class at such time in
accordance with the requirements of the 1940 Act and applicable
provisions of the Bylaws of the Trust in conformity with generally
accepted accounting practices and principles.
The Trustees may declare a suspension of the determination of net asset
value for the whole or any part of any period in accordance with the 1940 Act.
Section 4. Suspension of the Right of Redemption. The Trustees may
declare a suspension of the right of redemption or postpone the date
of payment for the whole or any part of any period in accordance with
the 1940 ------------------------------------- Act.
Section 5. Trust's Right to Redeem Shares. The Trust shall have the right to
cause the redemption of Shares of any Series or Class in any
Shareholder's account for their then current net asset value and
promptly make payment to the shareholder (which payment may be reduced
by any applicable redemption charge or deferred sales charge), if (a)
at any time the total investment in the account does not have a minimum
dollar value determined from time to time by the Trustees in their sole
discretion, (b) at any time a Shareholder fails to furnish certified
Social Security or Tax Identification Numbers, or (c) at any time the
Trustees determine in their sole discretion that failure to so redeem
may have materially adverse consequences to the other Shareholders or
the Trust or any Series or Class thereof.
ARTICLE XI
LIMITATION OF LIABILITY AND INDEMNIFICATION
Section 1. Limitation of Personal Liability and Indemnification of
Shareholders. The Trustees, officers, employees or agents of the Trust
shall have no power to bind any Shareholder of any Series or Class
personally or to call upon such Shareholder for the payment of any sum
of money or assessment whatsoever, other than such as the Shareholder
may at any time agree to pay by way of subscription for any Shares or
otherwise.
No Shareholder or former Shareholder of any Series or Class shall be
liable solely by reason of his being or having been a Shareholder for
any debt, claim, action, demand, suit, proceeding, judgment, decree,
liability or obligation of any kind, against or with respect to the
Trust or any Series or Class arising out of any action taken or omitted
for or on behalf of the Trust or such Series or Class, and the Trust or
such Series or Class shall be solely liable therefor and resort shall
be had solely to the property of the relevant Series or Class of the
Trust for the payment or performance thereof.
Each Shareholder or former Shareholder of any Series or Class (or their
heirs, executors, administrators or other legal representatives or, in
case of a corporation or other entity, its corporate or other general
successor) shall be entitled to be held harmless from and indemnified
against to the full extent of such liability and the costs of any
litigation or other proceedings in which such liability shall have been
determined, including, without limitation, the fees and disbursements
of counsel if, contrary to the provisions hereof, such Shareholder or
former Shareholder of such Series or Class shall be held to be
personally liable. Such indemnification shall come exclusively from the
assets of the relevant Series or Class.
The Trust shall, upon request by a Shareholder or former Shareholder,
assume the defense of any claim made against any Shareholder for any
act or obligation of the Trust or any Series or Class and satisfy any
judgment thereon.
Section 2. Limitation of Personal Liability and Indemnification of Trustees,
Officers, Employees or Agents of the Trust. No Trustee, officer,
employee or agent of the Trust shall have the power to bind any other
Trustee, officer, employee or agent of the Trust personally. The
Trustees, officers, employees or agents of the Trust in incurring any
debts, liabilities or obligations, or in taking or omitting any other
actions for or in connection with the Trust, are, and each shall be
deemed to be, acting as Trustee, officer, employee or agent of the
Trust and not in his own individual capacity.
Trustees and officers of the Trust shall be liable for their willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of the office of Trustee or officer, as
the case may be, and for nothing else.
Each person who is or was a Trustee, officer, employee or agent of the
Trust shall be entitled to indemnification out of the assets of the
Trust (or of any Series or Class) to the extent provided in, and
subject to the provisions of, the Bylaws, provided that no
indemnification shall be granted in contravention of the 1940 Act.
Section 3. Express Exculpatory Clauses and Instruments.
(a) All persons extending credit to, contracting with or having
any claim against the Trust or a particular Series or Class
shall only look to the assets of the Trust or the assets of
that particular Series or Class 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 liable
therefor.
(b) The Trustees shall use every reasonable means to assure that all
persons having dealings with the Trust or any Series or Class shall be
informed that the property of the Shareholders and the Trustees,
officers, employees and agents of the Trust or any Series or Class
shall not be subject to claims against or obligations of the Trust or
any other Series or Class to any extent whatsoever. The Trustees shall
cause to be inserted in any written agreement, undertaking or
obligation made or issued on behalf of the Trust or any Series or
Class (including certificates for Shares of any Series or Class) an
appropriate reference to the provisions of this Declaration of Trust,
providing that neither the Shareholders, the Trustees, the officers,
the employees nor any agent of the Trust or any Series or Class shall
be liable thereunder, and that the other parties to such instrument
shall look solely to the assets belonging to the relevant Series or
Class for the payment of any claim thereunder or for the performance
thereof; but the omission of such provisions from any such instrument
shall not render any Shareholder, Trustee, officer, employee or agent
liable, nor shall the Trustee, or any officer, agent or employee of
the Trust or any Series or Class be liable to anyone for such
omission. If, notwithstanding this provision, any Shareholder,
Trustee, officer, employee or agent shall be held liable to any other
person by reason of the omission of such provision from any such
agreement, undertaking or obligation, the Shareholder, Trustee,
officer, employee or agent shall be indemnified and reimbursed by the
Trust.
ARTICLE XII
MISCELLANEOUS
Section 1. Trust is not a Partnership. It is hereby expressly declared that a
trust and not a partnership is created hereby.
Section 2. Trustee Action Binding, Expert Advice, No Bond or Surety. The
exercise by the Trustees of their powers and discretions hereunder
shall be binding upon everyone interested. Subject to the provisions of
Article XI, the Trustees shall not be liable for errors of judgment or
mistakes of fact or law. The Trustees may take advice of counsel or
other experts with respect to the meaning and operation of this
Declaration of Trust, and subject to the provisions of Article XI,
shall be under no liability for any act or omission in accordance with
such advice or for failing to follow such advice. The Trustees shall
not be required to give any bond as such, nor any surety if a bond is
required.
Section 3. Establishment of Record Dates. The Trustees may close the Share
transfer books of the Trust maintained with respect to any Series or
Class for a period not exceeding ninety (90) days preceding the date of
any meeting of Shareholders of the Trust or any Series or Class, or the
date for the payment of any dividend or the making of any distribution
to Shareholders, or the date for the allotment of rights, or the date
when any change or conversion or exchange of Shares of any Series or
Class shall go into effect or the last day on which the consent or
dissent of Shareholders of any Series or Class may be effectively
expressed for any purpose; or in lieu of closing the Share transfer
books as aforesaid, the Trustees may fix in advance a date, not
exceeding ninety (90) days preceding the date of any meeting of
Shareholders of the Trust or any Series or Class, or the date for the
payment of any dividend or the making of any distribution to
Shareholders of any Series or Class, or the date for the allotment of
rights, or the date when any change or conversion or exchange of Shares
of any Series or Class shall go into effect, or the last day on which
the consent or dissent of Shareholders of any Series or Class may be
effectively expressed for any purpose, as a record date for the
determination of the Shareholders entitled to notice of, and, to vote
at, any such meeting and any adjournment thereof, or entitled to
receive payment of any such dividend or distribution, or to any such
allotment of rights, or to exercise the rights in respect of any such
change, conversion or exchange of shares, or to exercise the right to
give such consent or dissent, and in such case such Shareholders and
only such Shareholders as shall be Shareholders of record on the date
so fixed shall be entitled to such notice of, and to vote at, such
meeting, or to receive payment of such dividend or distribution, or to
receive such allotment or rights, or to change, convert or exchange
Shares of any Series or Class, or to exercise such rights, as the case
may be, notwithstanding, after such date fixed aforesaid, any transfer
of any Shares on the books of the Trust maintained with respect to any
Series or Class. Nothing in the foregoing sentence shall be construed
as precluding the Trustees from setting different record dates for
different Series or Classes.
Section 4. Termination of Trust.
(a) This Trust shall continue without limitation of time but subject to
the provisions of paragraphs (b), (c) and (d) of this Section 4.
(b) The Trustees may, by majority action, with the approval of a
Majority Shareholder Vote of each Series or Class entitled to
vote as determined by the Trustees under Section 5(d) of
Article III, sell and convey the assets of the Trust or any
Series or Class to another trust or corporation. Upon making
provision for the payment of all outstanding obligations,
taxes and other liabilities, accrued or contingent, belonging
to each Series or Class, the Trustees shall distribute the
remaining assets belonging to each Series or Class ratably
among the holders of the outstanding Shares of that Series or
Class. The Trustees shall make a good faith determination that
a conveyance of a part of the assets of a Series or Class is
in the best interest of Shareholders of the relevant Series or
Class.
(c) The Trustees may at any time sell and convert into money all
the assets of the Trust or any Series or Class without
Shareholder approval, unless otherwise required by applicable
law. Upon making provision for the payment of all outstanding
obligations, taxes and other liabilities, accrued or
contingent, belonging to each Series or Class, the Trustees
shall distribute the remaining assets belonging to each Series
or Class ratably among the holders of the outstanding Shares
of that Series or Class.
(d) Upon completion of the distribution of the remaining proceeds
of the remaining assets as provided in paragraphs (b) and (c),
the Trust or the applicable Series or Class shall terminate
and the Trustees shall be discharged of any and all further
liabilities and duties hereunder or with respect thereto and
the right, title and interest of all parties shall be canceled
and discharged.
Section 5. Offices of the Trust, Filing of Copies, Headings, Counterparts. The
Trust shall maintain a usual place of business in Massachusetts, which,
initially, shall be c/o Donnelly, Conroy & Gelhaar, One Post Office
Square, Boston, Massachusetts 02109-2105, and shall continue to
maintain an office at such address unless changed by the Trustees to
another location in Massachusetts. The Trust may maintain other offices
as the Trustees may from time to time determine. The original or a copy
of this instrument and of each declaration of trust supplemental 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 supplemental
declaration of trust shall be filed by the Trustees with the
Massachusetts Secretary of State and the Boston City Clerk, as well as
any other governmental office where such filing may from time to time
be required. Headings are placed herein for convenience of reference
only and in case of any conflict, the text of this instrument, rather
than the headings shall control. This instrument may be executed in any
number of counterparts each of which shall be deemed an original.
Section 6. Applicable Law. The Trust set forth in this instrument is created
under and is to be governed by and construed and administered according
to the laws of The Commonwealth of Massachusetts. The Trust shall be of
the type commonly called a Massachusetts business trust, and without
limiting the provisions hereof, the Trust may exercise all powers which
are ordinarily exercised by such a trust.
Section 7. Amendments -- General. 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, so long as such amendment
does not adversely affect the rights of any Shareholder with respect to
which such amendment is or purports to be applicable and so long as
such amendment is not in contravention of applicable law, including the
1940 Act, 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). Any amendment to this Declaration of Trust
that adversely affects the rights of Shareholders may be adopted at any
time by an instrument signed in writing by a majority of the then
Trustees (or by any officer of the Trust pursuant to the vote of a
majority of such Trustees) when authorized to do so by the vote of the
Shareholders holding a majority of the Shares entitled to vote. 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 to the effect that such
amendment has been duly adopted. Copies of the amendment to this
Declaration of Trust shall be filed as specified in Section 5 of this
Article XII. A restated Declaration of Trust, integrating into a single
instrument all of the provisions of the Declaration of Trust which are
then in effect and operative, may be executed from time to time by a
majority of the Trustees and shall be effective upon filing as
specified in Section 5.
Section 8. Amendments -- Series and Classes. The establishment and designation
of any Series or Class of Shares in addition to those established and
designated in Section 5 of Article III hereof shall be effective upon
the execution by a majority of the then Trustees, without the need for
Shareholder approval, of an amendment to this Declaration of Trust,
taking the form of a complete restatement or otherwise, setting forth
such establishment and designation and the relative rights and
preferences of any such Series or Class, or as otherwise provided in
such instrument.
Without limiting the generality of the foregoing, the Declaration of
the Trust may be amended without the need for Shareholder approval to:
(a) create one or more Series or Classes of Shares (in addition to
any Series or Classes already existing or otherwise) with such
rights and preferences and such eligibility requirements for
investment therein as the Trustees shall determine and
reclassify any or all outstanding Shares as Shares of
particular Series or Classes in accordance with such
eligibility requirements;
(b) combine two or more Series or Classes of Shares into a single
Series or Class on such terms and conditions as the Trustees
shall determine;
(c) change or eliminate any eligibility requirements for
investment in Shares of any Series or Class, including without
limitation the power to provide for the issue of Shares of any
Series or Class in connection with any merger or consolidation
of the Trust with another trust or company or any acquisition
by the Trust of part or all of the assets of another trust or
company;
(d) change the designation of any Series or Class of Shares;
(e) change the method of allocating dividends among the various
Series and Classes of Shares;
(f) allocate any specific assets or liabilities of the Trust or
any specific items of income or expense of the Trust to one
or more Series and Classes of Shares; and
(g) specifically allocate assets to any or all Series or Classes
of Shares or create one or more additional Series or Classes
of Shares which are preferred over all other Series or Classes
of Shares in respect of assets specifically allocated thereto
or any dividends paid by the Trust with respect to any net
income, however determined, earned from the investment and
reinvestment of any assets so allocated or otherwise and
provide for any special voting or other rights with respect to
such Series or Classes.
Section 9. Use of Name. The Trust acknowledges that WEST COAST TRUST has
reserved the right to grant the non-exclusive use of the name "WCT
FUNDS" or any derivative thereof to any other investment company,
investment company portfolio, investment adviser, distributor, or other
business enterprise, and to withdraw from the Trust or one or more
Series or Classes any right to the use of the name "WCT FUNDS".
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this instrument as of the day
and year first above written.
/s/C. Grant Anderson /s/Patricia L. Godlewski
- ---------------------------------------------- --------------------------
C. Grant Anderson Patricia L. Godlewski
/s/C. Christine Thomson
- ---------------------------------------
C. Christine Thomson
<PAGE>
COMMONWEALTH OF PENNSYLVANIA )
: ss:
COUNTY OF ALLEGHENY )
I hereby certify that on July 1, 1997, before me, the subscriber, a
Notary Public of the Commonwealth of Pennsylvania, in for the County of
Allegheny, personally appeared C. Grant Anderson, Patricia L. Godlewski
and Christine C. Thomson who acknowledged the foregoing Declaration of
Trust to be their act.
Witness my hand and notarial seal the day and year above written.
/s/Marie M. Hamm
Notary Public
1
Exhibit 2
WCT FUNDS
BYLAWS
TABLE OF CONTENTS
Page
ARTICLE I: OFFICERS AND THEIR ELECTION........................................1
Section 1 Officers......................................................1
Section 2 Election of Officers..........................................1
Section 3 Resignations and Removals and Vacancies.......................1
ARTICLE II: POWERS AND DUTIES OF TRUSTEES AND OFFICERS.........................1
Section 1 Trustees......................................................1
Section 2 Chairman of the Trustees ("Chairman") ........................1
Section 3 President ....................................................1
Section 4 Vice President ...............................................2
Section 5 Secretary ....................................................2
Section 6 Treasurer ....................................................2
Section 7 Assistant Vice President .....................................2
Section 8 Assistant Secretaries and Assistant Treasurers ...............2
Section 9 Salaries .....................................................2
ARTICLE III: POWERS AND DUTIES OF THE EXECUTIVE AND OTHER COMMITTEES..........3
Section 1 Executive and Other Committees ...............................3
Section 2 Vacancies in Executive Committee .............................3
Section 3 Executive Committee to Report to Trustees.....................3
Section 4 Procedure of Executive Committee .............................3
Section 5 Powers of Executive Committee ................................3
Section 6 Compensation .................................................3
Section 7 Action by Consent of the Board of Trustees, Executive
Committee or Other Committee...............................3
ARTICLE IV: SHAREHOLDERS' MEETINGS............................................4
Section 1 Special Meetings .............................................4
Section 2 Notices ......................................................4
Section 3 Place of Meeting .............................................4
Section 4 Action by Consent ............................................4
Section 5 Proxies ......................................................4
<PAGE>
Page
ARTICLE V: TRUSTEES' MEETINGS................................................4
Section 1 Number and Qualifications of Trustees ......................4
Section 2 Special Meetings ...........................................5
Section 3 Regular Meetings ...........................................5
Section 4 Quorum and Vote ............................................5
Section 5 Notices ....................................................5
Section 6 Place of Meeting ...........................................5
Section 7 Teleconference Meetings; Action by Consent .................5
Section 8 Special Action .............................................5
Section 9 Compensation of Trustees ...................................6
ARTICLE VI: SHARES...........................................................6
Section 1 Certificates .................................................6
Section 2 Transfer of Shares ...........................................6
Section 3 Equitable Interest Not Recognized ............................6
Section 4 Lost, Destroyed or Mutilated Certificates.....................6
Section 5 Transfer Agent and Registrar: Regulations.....................7
ARTICLE VII: INSPECTION OF BOOKS..............................................7
ARTICLE VIII: AGREEMENTS, CHECKS, DRAFTS, ENDORSEMENTS, ETC...................7
Section 1 Agreements, Etc. .............................................7
Section 2 Checks, Drafts, Etc. .........................................7
Section 3 Endorsements, Assignments and Transfer of Securities .........7
Section 4 Evidence of Authority ........................................8
ARTICLE IX: INDEMNIFICATION OF TRUSTEES AND OFFICERS..........................8
Section 1 General ......................................................8
Section 2 Compromise Payment ...........................................8
Section 3 Indemnification Not Exclusive; Definitions ...................8
ARTICLE X: SEAL 9
ARTICLE XI: FISCAL YEAR.......................................................9
ARTICLE XII: AMENDMENTS.......................................................9
<PAGE>
Page
ARTICLE XIII: WAIVERS OF NOTICE...............................................9
ARTICLE XIV: REPORT TO SHAREHOLDERS...........................................9
ARTICLE XV: BOOKS AND RECORDS................................................10
ARTICLE XVI: TERMS...........................................................10
<PAGE>
WCT FUNDS
BYLAWS
ARTICLE I
OFFICERS AND THEIR ELECTION
Section 1. Officers. The officers of the Trust shall be elected by the Board of
Trustees, and shall be a President, one or more Vice Presidents, a
Treasurer, a Secretary and such other officers as the Trustees may from
time to time elect. The Board of Trustees, in its discretion, may also
elect a Chairman of the Board of Trustees (who must be a Trustee). It
shall not be necessary for any Trustee or other officer to be a holder
of shares in any Series or Class of the Trust.
Section 2. Election of Officers. The President, Vice President(s), Treasurer
and Secretary shall be elected annually by the Trustees, and serve
until a successor is so elected and qualified, or until earlier
resignation or removal. The Chairman of the Trustees, if there is one,
shall be elected annually by and from the Trustees, and serve until a
successor is so elected and qualified, or until earlier resignation or
removal.
Two or more offices may be held by a single person except the offices
of President and Secretary. The officers shall hold office until their
successors are elected and qualified.
Section 3. Resignations and Removals and Vacancies. Any officer of the Trust
may resign by filing a written resignation with the President (or
Chairman, if there is one) of the Trustees or with the Trustees or with
the Secretary, which shall take effect on being so filed or at such
time as may be therein specified. The Trustees may remove any officer,
with or without cause, by a majority vote of all of the Trustees. The
Trustees may fill any vacancy created in any office whether by
resignation, removal or otherwise, subject to the limitations of the
Investment Company Act of 1940.
ARTICLE II
POWERS AND DUTIES OF TRUSTEES AND OFFICERS
Section 1. Trustees. The business and affairs of the Trust shall be
managed by the Trustees, and they shall have all powers necessary and
desirable to carry out that responsibility. --------
Section 2. Chairman of the Trustees ("Chairman"). The Chairman, if there be a
Chairman, shall preside at the meetings of Shareholders and of the
Board of Trustees. He shall have general supervision over the business
of the Trust and policies of the Trust. He shall employ and define the
duties of all employees of the Trust, shall have power to discharge any
such employees, shall exercise general supervision over the affairs of
the Trust and shall perform such other duties as may be assigned to him
from time to time by the Trustees. The Chairman shall appoint a Trustee
or officer to preside at such meetings in his absence.
Section 3. President. The President shall be the chief executive officer of the
Trust. The President, in the absence of the Chairman, or if there is no
Chairman, shall perform all duties and may exercise any of the powers
of the Chairman subject to the control of the Trustees. He shall
counsel and advise the Chairman and shall perform such other duties as
may be assigned to him from time to time by the Trustees, the Chairman
or the Executive Committee. The President shall have the power to
appoint one or more Assistant Secretaries or other junior officers,
subject to ratification of such appointments by the Board. The
President shall have the power to sign, in the name of and on behalf of
the Trust, powers of attorney, proxies, waivers of notice of meeting,
consents and other instruments relating to securities or other property
owned by the Trust, and may, in the name of and on behalf of the Trust,
take all such action as the President may deem advisable in entering
into agreements to purchase securities or other property in the
ordinary course of business, and to sign representation letters in the
course of buying securities or other property.
Section 4. Vice President. The Vice President (or if more than one, the senior
Vice President) in the absence of the President shall perform all
duties and may exercise any of the powers of the President subject to
the control of the Trustees. Each Vice President shall perform such
other duties as may be assigned to him from time to time by the
Trustees, the Chairman, the President, or the Executive Committee. Each
Vice President shall be authorized to sign documents on behalf of the
Trust. The Vice President shall have the power to sign, in the name of
and on behalf of the Trust and subject to Article VIII, Section 1,
powers of attorney, proxies, waivers of notice of meeting, consents and
other instruments relating to securities or other property owned by the
Trust, and may, in the name of and on behalf of the Trust, take all
such action as the Vice President may deem advisable in entering into
agreements to purchase securities or other property in the ordinary
course of business, and to sign representation letters in the course of
buying securities or other property.
Section 5. Secretary. The Secretary shall keep or cause to be kept in books
provided for that purpose the Minutes of the Meetings of Shareholders
and of the Trustees; shall see that all Notices are duly given in
accordance with the provisions of these Bylaws and as required by law;
shall be custodian of the records and of the Seal of the Trust (if
there be a Seal) and see that the Seal is affixed to all documents, the
execution of which on behalf of the Trust under its Seal is duly
authorized; shall keep directly or through a transfer agent a register
of the post office address of each shareholder of each Series or Class
of the Trust, and make all proper changes in such register, retaining
and filing his authority for such entries; shall see that the books,
reports, statements, certificates and all other documents and records
required by law are properly kept and filed; and in general shall
perform all duties incident to the Office of Secretary and such other
duties as may from time to time be assigned to him by the Trustees,
Chairman, the President, or the Executive Committee.
Section 6. Treasurer. The Treasurer shall be the principal financial and
accounting officer of the Trust responsible for the preparation and
maintenance of the financial books and records of the Trust. He shall
deliver all funds and securities belonging to any Series or Class to
such custodian or sub-custodian as may be employed by the Trust for any
Series or Class. The Treasurer shall perform such duties additional to
the foregoing as the Trustees, Chairman, the President or the Executive
Committee may from time to time designate.
Section 7. Assistant Vice President. The Assistant Vice President or Vice
Presidents of the Trust shall have such authority and perform such
duties as may be assigned to them by the Trustees, the Executive
Committee, the President, or the Chairman.
Section 8. Assistant Secretaries and Assistant Treasurers. The Assistant
Secretary or Secretaries and the Assistant Treasurer or Treasurers
shall perform the duties of the Secretary and of the Treasurer,
respectively, in the absence of those Officers and shall have such
further powers and perform such other duties as may be assigned to them
respectively by the Trustees or the Executive Committee, the President,
or the Chairman.
Section 9. Salaries. The salaries of the Officers shall be fixed from time to
time by the Trustees. No officer shall be prevented from receiving such salary
by reason of the fact that he is also a Trustee. --------
ARTICLE III
POWERS AND DUTIES OF THE EXECUTIVE AND OTHER COMMITTEES
Section 1. Executive and Other Committees. The Trustees may elect from their
own number an Executive Committee to consist of not less than two
members. The Executive Committee shall be elected by a resolution
passed by a vote of at least a majority of the Trustees then in office.
The Trustees may also elect from their own number other committees from
time to time, the number composing such committees and the powers
conferred upon the same to be determined by vote of the Trustees. Any
committee may make rules for the conduct of its business.
Section 2. Vacancies in Executive Committee. Vacancies occurring in the
Executive Committee from any cause shall be filled by the Trustees by a
resolution passed by the vote of at least a majority of the Trustees
- -------------------------------- then in office.
Section 3. Executive Committee to Report to Trustees. All action by the
Executive Committee shall be reported to the Trustees at their meeting next
succeeding such action. -----------------------------------------
Section 4. Procedure of Executive Committee. The Executive Committee shall fix
its own rules of procedure not inconsistent with these Bylaws or with
any directions of the Trustees. It shall meet at such times and places
and upon such notice as shall be provided by such rules or by
resolution of the Trustees. The presence of a majority shall constitute
a quorum for the transaction of business, and in every case an
affirmative vote of a majority of all the members of the Committee
present shall be necessary for the taking of any action.
Section 5. Powers of Executive Committee. During the intervals between the
Meetings of the Trustees, the Executive Committee, except as limited by
the Bylaws of the Trust or by specific directions of the Trustees,
shall possess and may exercise all the powers of the Trustees in the
management and direction of the business and conduct of the affairs of
the Trust in such manner as the Executive Committee shall deem to be in
the best interests of the Trust, and shall have power to authorize the
Seal of the Trust (if there is one) to be affixed to all instruments
and documents requiring same. Notwithstanding the foregoing, the
Executive Committee shall not have the power to elect or remove
Trustees, increase or decrease the number of Trustees, elect or remove
any Officer, declare dividends, issue shares or recommend to
shareholders any action requiring shareholder approval.
Section 6. Compensation. The members of any duly appointed committee shall
receive such compensation and/or fees as from time to time may be fixed by the
Trustees. ------------
Section 7. Action by Consent of the Board of Trustees, Executive Committee or
Other Committee. Subject to Article V, Section 2 of these Bylaws, any
action required or permitted to be taken at any meeting of the
Trustees, Executive Committee or any other duly appointed Committee may
be taken without a meeting if consents in writing setting forth such
action are signed by all members of the Board or such committee and
such consents are filed with the records of the Trust. In the event of
the death, removal, resignation or incapacity of any Board or committee
member prior to that Trustee signing such consent, the remaining Board
or committee members may re-constitute themselves as the entire Board
or committee until such time as the vacancy is filled in order to
fulfill the requirement that such consents be signed by all members of
the Board or committee.
ARTICLE IV
SHAREHOLDERS' MEETINGS
Section 1. Special Meetings. A special meeting of the shareholders of the Trust
or of a particular Series or Class shall be called by the Secretary
whenever ordered by the Trustees, the Chairman or requested in writing
by the holder or holders of at least one-tenth of the outstanding
shares of the Trust or of the relevant Series or Class, entitled to
vote. If the Secretary, when so ordered or requested, refuses or
neglects for more than two days to call such special meeting, the
Trustees, Chairman or the shareholders so requesting may, in the name
of the Secretary, call the meeting by giving notice thereof in the
manner required when notice is given by the Secretary.
Section 2. Notices. Except as above provided, notices of any special meeting of
the shareholders of the Trust or a particular Series or Class, shall be
given by the Secretary by delivering or mailing, postage prepaid, to
each shareholder entitled to vote at said meeting, a written or printed
notification of such meeting, at least seven business days before the
meeting, to such address as may be registered with the Trust by the
shareholder. No notice of any meeting to shareholders need be given to
a shareholder if a written waiver of notice, executed before or after
the meeting by such shareholder or his or her attorney that is duly
authorized, is filed with the records of the meeting. Notice may be
waived as provided in Article XIII of these Bylaws.
Section 3. Place of Meeting. Meetings of the shareholders of the Trust or a
particular Series or Class, shall be held at the principal place of
business of the Trust in Pittsburgh, Pennsylvania, or at such place
within or without The Commonwealth of Massachusetts as fixed from time
to time by resolution of the Trustees.
Section 4. Action by Consent. Any action required or permitted to be taken at
any meeting of shareholders may be taken without a meeting, if a
consent in writing, setting forth such action, is signed by a majority
of the shareholders entitled to vote on the subject matter thereof, and
such consent is filed with the records of the Trust.
Section 5. Proxies. Any shareholder entitled to vote at any meeting of
shareholders may vote either in person, by telephone, by electronic
means including facsimile, or by proxy. Every written proxy shall be
subscribed by the shareholder or his duly authorized attorney and
dated, but need not be sealed, witnessed or acknowledged. All proxies
shall be filed with and verified by the Secretary or an Assistant
Secretary of the Trust or, the person acting as Secretary of the
Meeting.
ARTICLE V
TRUSTEES' MEETINGS
Section 1. Number and Qualifications of Trustees. The number of Trustees can be
changed from time to time by a majority of the Trustees to not less
than three nor more than twenty. The term of office of a Trustee shall
not be affected by any decrease in the number of Trustees made by the
Trustees pursuant to the foregoing authorization. Each Trustee shall
hold office for the life of the Trust, or as otherwise provided in the
Declaration of Trust.
Section 2. Special Meetings. Special meetings of the Trustees shall be called
by the Secretary at the written request of the Chairman, the President,
or any Trustee, and if the Secretary when so requested refuses or fails
for more than twenty-four hours to call such meeting, the Chairman, the
President, or such Trustee may in the name of the Secretary call such
meeting by giving due notice in the manner required when notice is
given by the Secretary.
Section 3. 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 any Trustee who is
absent when such determination is made shall be given notice of the
determination.
Section 4. Quorum and Vote. A majority of the Trustees shall constitute a
quorum for the transaction of business. The act of a majority of the
Trustees present at any meeting at which a quorum is present shall be
the act of the Trustees unless a greater proportion is required by the
Declaration of Trust or these Bylaws or applicable law. In the absence
of a quorum, a majority of the Trustees present may adjourn the meeting
from time to time until a quorum shall be present. Notice of any
adjourned meeting need not be given.
Section 5. Notices. The Secretary or any Assistant Secretary shall give, at
least two days before the meeting, notice of each meeting of the Board
of Trustees, whether Annual, Regular or Special, to each member of the
Board by mail, telegram, telephone or electronic facsimile to his last
known address. It shall not be necessary to state the purpose or
business to be transacted in the notice of any meeting unless otherwise
required by law. Personal attendance at any meeting by a Trustee other
than to protest the validity of said meeting shall constitute a waiver
of the foregoing requirement of notice. In addition, notice of a
meeting need not be given if a written waiver of notice executed by
such Trustee before or after the meeting is filed with the records of
the meeting.
Section 6. Place of Meeting. Meetings of the Trustees shall be held at the
principal place of business of the Trust in Pittsburgh, Pennsylvania,
or at such place within or without The Commonwealth of Massachusetts as
fixed from time to time by resolution of the Trustees, or as the person
or persons requesting said meeting to be called may designate, but any
meeting may adjourn to any other place.
Section 7. Teleconference Meetings; Action by Consent. Except as otherwise
provided herein or from time to time in the 1940 Act or in the
Declaration of Trust, any action to be taken by the Trustees may be
taken by a majority of the Trustees within or without Massachusetts,
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 communicate with each other simultaneously, and
participation by such means shall constitute presence in person at a
meeting. Any action by the Trustees may be taken without a meeting if a
written consent thereto is signed by all the Trustees and filed with
the records of the Trustees' meetings. Such consent shall be treated as
a vote of the Trustees for all purposes. Written consents may be
executed in counterparts, which when taken together, constitute a
validly executed consent of the Trustees.
Section 8. Special Action. When all the Trustees shall be present at any
meeting, however called, or whenever held, or shall assent to the
holding of the meeting without notice, or after the meeting shall sign
a written assent thereto on the record of such meeting, the acts of
such meeting shall be valid as if such meeting had been regularly held.
Section 9. Compensation of Trustees. The Trustees may receive a stated salary
for their services as Trustees, and by resolution of Trustees a fixed
fee and expenses of attendance may be allowed for attendance at each
Meeting. Nothing herein contained shall be construed to preclude any
Trustee from serving the Trust in any other capacity, as an officer,
agent or otherwise, and receiving compensation therefor.
ARTICLE VI
SHARES
Section 1. Certificates. If certificates for shares are issued, all
certificates for shares shall be signed by the Chairman, President or
any Vice President and by the Treasurer or Secretary or any Assistant
Treasurer or Assistant Secretary and sealed with the seal of the Trust,
if the Trust has a seal. The signatures may be either manual or
facsimile signatures and the seal, if there is one, may be either
facsimile or any other form of seal. Certificates for shares for which
the Trust has appointed an independent Transfer Agent and Registrar
shall not be valid unless countersigned by such Transfer Agent and
registered by such Registrar. In case any officer who has signed any
certificate ceases to be an officer of the Trust before the certificate
is issued, the certificate may nevertheless be issued by the Trust with
the same effect as if the officer had not ceased to be such officer as
of the date of its issuance. Share certificates of each Series or Class
shall be in such form not inconsistent with law or the Declaration of
Trust or these bylaws as may be determined by the Trustees.
Section 2. Transfer of Shares. The shares of each Series and Class of the Trust
shall be transferable, so as to affect the rights of the Trust or any
Series or Class, only by transfer recorded on the books of the Trust or
its transfer agent, in person or by attorney.
Section 3. Equitable Interest Not Recognized. The Trust shall be entitled to
treat the holder of record of any share or shares of a Series or Class
as the absolute owner thereof and shall not be bound to recognize any
equitable or other claim or interest in such share or shares of a
Series or Class on the part of any other person except as may be
otherwise expressly provided by law.
Section 4. Lost, Destroyed or Mutilated Certificates. In case any certificate
for shares is lost, mutilated or destroyed, the Trustees may issue a
new certificate in place thereof upon indemnity to the relevant Series
or Class against loss and upon such other terms and conditions as the
Trustees may deem advisable.
Section 5. Transfer Agent and Registrar: Regulations. The Trustees shall have
power and authority to make all such rules and regulations as they may
deem expedient concerning the issuance, transfer and registration of
certificates for shares and may appoint a Transfer Agent and/or
Registrar of certificates for shares of each Series or Class, and may
require all such share certificates to bear the signature of such
Transfer Agent and/or of such Registrar.
ARTICLE VII
INSPECTION OF BOOKS
The Trustees shall from time to time determine whether and to what extent,
and at what times and places, and under what conditions and regulations
the accounts and books of the Trust maintained on behalf of each Series
and Class or any of them shall be open to the inspection of the
shareholders of any Series or Class; and no shareholder shall have any
right of inspecting any account or book or document of the Trust except
that, to the extent such account or book or document relates to the
Series or Class in which he is a Shareholder or the Trust generally,
such Shareholder shall have such right of inspection as conferred by
laws or authorized by the Trustees or by resolution of the Shareholders
of the relevant Series or Class.
ARTICLE VIII
AGREEMENTS, CHECKS, DRAFTS, ENDORSEMENTS, ETC.
Section 1. Agreements, Etc. The Trustees or the Executive Committee may
authorize any Officer or Agent of the Trust to enter into any Agreement
or execute and deliver any instrument in the name of the Trust on
behalf of any Series or Class, and such authority may be general or
confined to specific instances; and, unless so authorized by the
Trustees or by the Executive Committee or by the Declaration of Trust
or these bylaws, no Officer, Agent or Employee shall have any power or
authority to bind the Trust by any Agreement or engagement or to pledge
its credit or to render it liable pecuniarily for any purpose or for
any amount.
Section 2. Checks, Drafts, Etc. All checks, drafts, or orders for the payment
of money, notes and other evidences of indebtedness shall be signed by
such Officers, Employees, or Agents, as shall from time to time be
designated by the Trustees or the Executive Committee, or as may be
specified in or pursuant to the agreement between the Trust on behalf
of any Series or Class and the custodian appointed, pursuant to the
provisions of the Declaration of Trust.
Section 3. Endorsements, Assignments and Transfer of Securities. All
endorsements, assignments, stock powers, other instruments of transfer
or directions for the transfer of portfolio securities or other
property, whether or not registered in nominee form, shall be made by
such Officers, Employees, or Agents as may be authorized by the
Trustees or the Executive Committee.
Section 4. Evidence of Authority. Anyone dealing with the Trust shall be fully
justified in relying on a copy of a resolution of the Trustees or of
any committee thereof empowered to act in the premises which is
certified as true by the Secretary or an Assistant Secretary under the
seal of the Trust.
ARTICLE IX
INDEMNIFICATION OF TRUSTEES AND OFFICERS
Section 1. General. 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 and expenses,
including but not limited to amounts paid in satisfaction of judgments,
in compromise or as fines and penalties, and counsel fees reasonably
incurred by any Covered Person in connection with the defense or
disposition of any action, suit or other proceeding, whether civil,
criminal, administrative, or investigative, and any appeal therefrom,
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 Covered
Person, 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.
Expenses, including counsel fees so incurred by any such Covered Person
(but excluding amounts paid in satisfaction of judgments, in compromise
or as fines or penalties), may be paid from time to time by the Trust
in advance of the final disposition of any such action, suit or
proceeding upon receipt of an undertaking by or on behalf of such
Covered Person to repay amounts so paid to the Trust if it is
ultimately determined that indemnification of such expenses is not
authorized under this Article, provided that (a) such Covered Person
shall provide security for his undertaking, (b) the Trust shall be
insured against losses arising by reason of such Covered Person's
failure to fulfill his undertaking or (c) a majority of the non-party
Trustees who are not interested persons of the Trust (provided that a
majority of such Trustees then in office act on the matter), or
independent legal counsel in a written opinion, shall determine, based
on a review of readily available facts (but not a full trial-type
inquiry), that there is reason to believe such Covered Person
ultimately will be entitled to indemnification.
Section 2. Compromise Payment. As to any matter disposed of (whether by a
compromise payment, pursuant to a consent decree or otherwise) without
an adjudication in a decision on the merits by a court, or by any other
body before which the proceeding was brought, that such Covered Person
is liable to the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such Covered Person's office,
indemnification shall be provided if (a) approved as in the best
interest of the Trust, after notice that it involves such
indemnification, by at least a majority of non-party Trustees who are
not interested persons of the Trust (provided that a majority of such
Trustees then in office act on the matter), upon a determination, based
upon a review of readily available facts (but not a full trial-type
inquiry) that such Covered Person is not liable to the Trust or its
Shareholders by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct
of such Covered Person's office, or (b) there has been obtained an
opinion in writing of independent legal counsel, based upon a review of
readily available facts (but not a full trial-type inquiry) to the
effect that such indemnification would not protect such Covered Person
against any liability to the Trust 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 his office.
Any approval pursuant to this Section shall not prevent the recovery
from any Covered Person of any amount paid to such Covered Person in
accordance with this Section as indemnification if such Covered Person
is subsequently adjudicated by a court of competent jurisdiction to
have been liable to the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such Covered Person's office.
Section 3. Indemnification Not Exclusive; Definitions. The right of
indemnification hereby provided shall not be exclusive of or affect any
other rights to which any such Covered Person may be entitled. As used
in this Article IX, the term "Covered Person" shall include such
person's heirs, executors and administrators. For purposes of this
Article IX, the term "non-party Trustee" is a Trustee against whom none
of the actions, suits or other proceedings in question or another
action, suit or other proceeding on the same or similar grounds is then
or has been pending. Nothing contained in this Article IX 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 such persons.
ARTICLE X
SEAL
The seal of the Trust, if there is one, shall consist either of a
flat-faced die with the word "Massachusetts", together with the name of
the Trust and the year of its organization cut or engraved thereon, or
any other indication that the Trust has a seal that has been approved
by the Trustees, 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 XI
FISCAL YEAR
The fiscal year of the Trust and each Series or Class shall be as designated
from time to time by the Trustees.
ARTICLE XII
AMENDMENTS
These bylaws may be amended by a majority vote of all of the Trustees.
ARTICLE XIII
WAIVERS OF NOTICE
Whenever any notice whatever is required to be given under the provisions of any
statute of The Commonwealth of Massachusetts, or under the provisions
of the Declaration of Trust or these bylaws, a waiver thereof in
writing, signed by the person or persons entitled to said notice,
whether before or after the time stated therein, or presence at a
meeting to which such person was entitled notice of, shall be deemed
equivalent thereto. A notice shall be deemed to have been given if
telegraphed, cabled, or sent by wireless when it has been delivered to
a representative of any telegraph, cable or wireless company with
instructions that it be telegraphed, cabled, or sent by wireless. Any
notice shall be deemed to be given if mailed at the time when the same
shall be deposited in the mail.
ARTICLE XIV
REPORT TO SHAREHOLDERS
The Trustees, so long as required by applicable law, shall at least
semi-annually submit to the shareholders of each Series or Class a
written financial report of the transactions of that Series or Class
including financial statements which shall at least annually be
certified by independent public accountants.
ARTICLE XV
BOOKS AND RECORDS
The books and records of the Trust and any Series or Class, including the
stock ledger or ledgers, may be kept in or outside the Commonwealth of
Massachusetts at such office or agency of the Trust as may from time to
time be determined by the Secretary of the Trust, as set forth in
Article II, Section 5 of these Bylaws.
ARTICLE XVI
TERMS
Terms defined in the Declaration of Trust and not otherwise defined herein are
used herein with the meanings set forth or referred to in the Declaration of
Trust.
WCT Funds September 1, 1997
Exhibit 5(i)
FORM OF
INVESTMENT ADVISORY CONTRACT
This Contract is made this 1st day of September, 1997, between West
Coast Trust Company, Inc., an Oregon corporation having its principal place of
business in Salem, Oregon (the "Adviser"), and WCT Funds, a Massachusetts
business trust having its principal place of business in Pittsburgh,
Pennsylvania (the "Trust").
WHEREAS the Trust is an open-end management investment company as that
term is defined in the Investment Company Act of 1940, as amended, and is
registered as such with the Securities and Exchange Commission; and
WHEREAS Adviser is engaged in the business of rendering investment
advisory and management services.
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. The Trust hereby appoints Adviser as Investment Adviser for each of the
portfolios ("Funds") of the Trust which executes an exhibit to this
Contract, and Adviser accepts the appointments. Subject to the
direction of the Trustees, Adviser shall provide investment research
and supervision of the investments of the Funds and conduct a
continuous program of investment evaluation and of appropriate sale or
other disposition and reinvestment of each Fund's assets.
2. Adviser, in its supervision of the investments of each of the Funds
will be guided by each of the Fund's investment objective and policies
and the provisions and restrictions contained in the Declaration of
Trust and By-Laws of the Trust and as set forth in the Registration
Statements and exhibits as may be on file with the Securities and
Exchange Commission.
3. Each Fund shall pay or cause to be paid all of its own expenses and its
allocable share of Trust expenses, including, without limitation, the
expenses of organizing the Trust and continuing its existence; fees and
expenses of Trustees and officers of the Trust; fees for investment
advisory services and administrative personnel and services; expenses
incurred in the distribution of its shares ("Shares"), including expenses
of administrative support services; fees and expenses of preparing and
printing its Registration Statements under the Securities Act of 1933 and
the Investment Company Act of 1940, as amended, and any amendments thereto;
expenses of registering and qualifying the Trust, the Funds, and Shares of
the Funds under federal and state laws and regulations; expenses of
preparing, printing, and distributing prospectuses (and any amendments
thereto) to shareholders; interest expense, taxes, fees, and commissions of
every kind; expenses of issue (including cost of Share certificates),
purchase, repurchase, and redemption of Shares, including expenses
attributable to a program of periodic issue; charges and expenses of
custodians, transfer agents, dividend disbursing agents, shareholder
servicing agents, and registrars; printing and mailing costs, auditing,
accounting, and legal expenses; reports to shareholders and governmental
officers and commissions; expenses of meetings of Trustees and shareholders
and proxy solicitations therefor; insurance expenses; association
membership dues and such nonrecurring items as may arise, including all
losses and liabilities incurred in administering the Trust and the Funds.
Each Fund will also pay its allocable share of such extraordinary expenses
as may arise including expenses incurred in connection with litigation,
proceedings, and claims and the legal obligations of the Trust to indemnify
its officers and Trustees and agents with respect thereto.
4. Each of the Funds shall pay to Adviser, for all services rendered to each
Fund by Adviser hereunder, the fees set forth in the exhibits attached
hereto.
5. The net asset value of each Fund's Shares as used herein will be calculated
to the nearest 1/10th of one cent.
6. The Adviser may from time to time and for such periods as it deems
appropriate reduce its compensation (and, if appropriate, assume
expenses of one or more of the Funds) to the extent that any Fund's
expenses exceed such lower expense limitation as the Adviser may, by
notice to the Fund, voluntarily declare to be effective.
7. This Contract shall begin for each Fund as of the date of execution of
the applicable exhibit and shall continue in effect with respect to
each Fund presently set forth on an exhibit (and any subsequent Funds
added pursuant to an exhibit during the initial term of this Contract)
for two years from the date of this Contract set forth above and
thereafter for successive periods of one year, subject to the
provisions for termination and all of the other terms and conditions
hereof if: (a) such continuation shall be specifically approved at
least annually by the vote of a majority of the Trustees of the Trust,
including a majority of the Trustees who are not parties to this
Contract or interested persons of any such party cast in person at a
meeting called for that purpose; and (b) Adviser shall not have
notified a Fund in writing at least sixty (60) days prior to the
anniversary date of this Contract in any year thereafter that it does
not desire such continuation with respect to that Fund. If a Fund is
added after the first approval by the Trustees as described above, this
Contract will be effective as to that Fund upon execution of the
applicable exhibit and will continue in effect until the next annual
approval of this Contract by the Trustees and thereafter for successive
periods of one year, subject to approval as described above.
8. Notwithstanding any provision in this Contract, it may be terminated at any
time with respect to any Fund, without the payment of any penalty, by the
Trustees of the Trust or by a vote of the shareholders of that Fund on
sixty (60) days' written notice to Adviser.
9. This Contract may not be assigned by Adviser and shall automatically
terminate in the event of any assignment. Adviser may employ or
contract with such other person, persons, corporation, or corporations
at its own cost and expense as it shall determine in order to assist it
in carrying out this Contract.
10. In the absence of willful misfeasance, bad faith, gross negligence, or
reckless disregard of the obligations or duties under this Contract on
the part of Adviser, Adviser shall not be liable to the Trust or to any
of the Funds or to any shareholder for any act or omission in the
course of or connected in any way with rendering services or for any
losses that may be sustained in the purchase, holding, or sale of any
security.
11. This Contract may be amended at any time by agreement of the parties
provided that the amendment shall be approved both by the vote of a
majority of the Trustees of the Trust including a majority of the
Trustees who are not parties to this Contract or interested persons of
any such party to this Contract (other than as Trustees of the Trust
cast in person at a meeting called for that purpose, and, where
required by Section 15(a)(2) of the Act, on behalf of a Fund by a
majority of the outstanding voting securities of such Fund as defined
in Section 2(a)(42) of the Act.
12. The Adviser acknowledges that all sales literature for investment
companies (such as the Trust) are subject to strict regulatory
oversight. The Adviser agrees to submit any proposed sales literature
for the Trust (or any Fund) or for itself or its affiliates which
mentions the Trust (or any Fund) to the Trust's distributor for review
and filing with the appropriate regulatory authorities prior to the
public release of any such sales literature, provided, however, that
nothing herein shall be construed so as to create any obligation or
duty on the part of the Adviser to produce sales literature for the
Trust (or any Fund). The Trust agrees to cause its distributor to
promptly review all such sales literature to ensure compliance with
relevant requirements, to promptly advise Adviser of any deficiencies
contained in such sales literature, to promptly file complying sales
literature with the relevant authorities, and to cause such sales
literature to be distributed to prospective investors in the Trust.
13. Adviser is hereby expressly put on notice of the limitation of
liability as set forth in Article XI of the Declaration of Trust and
agrees that the obligations pursuant to this Contract of a particular
Fund and of the Trust with respect to that particular Fund be limited
solely to the assets of that particular Fund, and Adviser shall not
seek satisfaction of any such obligation from any other Fund, the
shareholders of any Fund, the Trustees, officers, employees or agents
of the Trust, or any of them.
14. The parties hereto acknowledge that West Coast Trust Company, Inc., has
reserved the right to grant the non-exclusive use of the name "WCT
Funds" or any derivative thereof to any other investment company,
investment company portfolio, investment adviser, distributor or other
business enterprise, and to withdraw from the Trust and one or more of
the Funds the use of the name "WCT Funds". The name "WCT Funds" will
continue to be used by the Trust and each Fund so long as such use is
mutually agreeable to West Coast Trust Company, Inc. and the Trust.
15. This Contract shall be construed in accordance with and governed by the
laws of the Commonwealth of Pennsylvania.
16. This Contract will become binding on the parties hereto upon their
execution of the attached exhibits to this Contract.
<PAGE>
EXHIBIT A
to the
Investment Advisory Contract
WCT FUNDS
WCT Equity Fund
For all services rendered by Adviser hereunder, the above-named Fund of
the WCT Funds shall pay to Adviser and Adviser agrees to accept as full
compensation for all services rendered hereunder, an annual investment advisory
fee equal to .75 of 1% of the average daily net assets of the Fund.
The portion of the fee based upon the average daily net assets of the
Fund shall be accrued daily at the rate of 1/365th of .75 of 1% applied to the
daily net assets of the Fund.
The advisory fee so accrued shall be paid to Adviser daily.
Witness the due execution hereof this 1st day of September, 1997.
Attest: West Coast Trust Company, Inc.
By:
Assistant Secretary Vice President
Attest: WCT Funds
By:
Secretary Executive Vice President
WCT Funds September 1, 1997
Exhibit 5(ii)
FORM OF
WCT Funds
SUB-ADVISORY AGREEMENT
THIS AGREEMENT is made between West Coast Trust Company, Inc., an Oregon
corporation (hereinafter referred to as "Adviser") and Becker Capital
Management, Inc., an Oregon corporation located in Portland, Oregon (hereinfter
referred to as the "Sub-Adviser").
WITNESSETH:
That the parties hereto, intending to be legally bound hereby agree as
follows:
1. Sub-Adviser hereby agrees to furnish to Adviser in its capacity as
investment adviser to the WCT Equity Fund (the "Fund"), a portfolio of
the WCT Funds ("Trust"), such investment advice, statistical and other
factual information, as may from time to time be reasonably requested
by Adviser for the Fund which may be offered in one or more classes of
shares ("Classes").
2. For its services under this Agreement, Sub-Adviser shall receive from
Adviser an annual fee ("the Sub-Advisory Fee"), as set forth in the
exhibits hereto.
Notwithstanding any other provision of this Agreement, the Sub-Adviser
may from time to time and for such periods as it deems appropriate,
reduce its compensation (and, if appropriate, assume expenses of the
Fund or Class of the Fund) to the extent that the Fund's expenses
exceed such lower expense limitation as the Sub-Adviser may, by notice
to the Trust on behalf of the Fund, voluntarily declare to be
effective.
3. This Agreement shall begin for the Fund on the date that the parties
execute an exhibit to this Agreement relating to such Fund and shall
continue in effect for the Fund for two years from the date of its
execution and from year to year thereafter, subject to the provisions
for termination and all of the other terms and conditions hereof if:
(a) such continuation shall be specifically approved at least annually
by the vote of a majority of the Trustees of the Trust, including a
majority of the Trustees who are not parties to this Agreement or
interested persons of any such party (other than as Trustees of the
Trust) cast in person at a meeting called for that purpose; and (b)
Adviser shall not have notified the Trust in writing at least sixty
(60) days prior to the anniversary date of this Agreement in any year
thereafter that it does not desire such continuation with respect to
the Fund.
4. Notwithstanding any provision in this Agreement, it may be terminated
at any time without the payment of any penalty: (a) by the Trustees of
the Trust or by a vote of a majority of the outstanding voting
securities (as defined in Section 2(a)(42) of the Act) of the Fund on
sixty (60) days' written notice to Adviser; or (b) by Sub-Adviser or
Adviser upon 120 days' written notice to the other party to the
Agreement.
5. This Agreement shall automatically terminate:
(a) in the event of its assignment (as defined in the Investment
Company Act of 1940); or
(b) in the event of termination of the Investment Advisory
Contract for any reason whatsoever.
6. So long as both Adviser and Sub-Adviser shall be legally qualified to
act as an investment adviser to the Fund, neither Adviser nor
Sub-Adviser shall act as an investment adviser (as such term is defined
in the Investment Company Act of 1940) to the Fund except as provided
herein and in the Investment Advisory Contract or in such other manner
as may be expressly agreed between Adviser and Sub-Adviser.
Provided, however, that if the Adviser or Sub-Adviser shall resign
prior to the end of any term of this Agreement or for any reason be
unable or unwilling to serve for a successive term which has been
approved by the Trustees of the Trust pursuant to the provisions of
Paragraph 3 of this Agreement or Paragraph 6 of the Investment Advisory
Contract, the remaining party, Sub-Adviser or Adviser as the case may
be, shall not be prohibited from serving as an investment adviser to
such Fund by reason of the provisions of this Paragraph 6.
7. This Agreement may be amended from time to time by agreement of the
parties hereto provided that such amendment shall be approved both by
the vote of a majority of Trustees of the Trust, including a majority
of Trustees who are not parties to this Agreement or interested
persons, as defined in Section 2(a)(19) of the Investment Company Act
of 1940, of any such party at a meeting called for that purpose, and,
where required by Section 15(a)(2) of the Act, by the holders of a
majority of the outstanding voting securities (as defined in Section
2(a)(42) of the Investment Company Act of 1940) of the Fund.
<PAGE>
Exhibit A
WCT Funds
WCT Equity Fund
Sub-Advisory Contract
For all services rendered by Sub-Adviser hereunder, Adviser shall pay
Sub-Adviser a Sub-Advisory Fee equal to .50% of the average daily net assets of
the above-mentioned portfolio. The Sub-Advisory Fee shall be accrued daily, and
paid daily as set forth in the Primary Advisory Contract dated September 1,
1997.
This Exhibit duly incorporates by reference the Sub-Advisory Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on their behalf by their duly authorized officers, and their corporate
seals to be affixed hereto this 1st day of September, 1997.
ATTEST: West Coast Trust Company, Inc.
By:
Secretary Vice President
Becker Capital Management, Inc.
By:
Secretary Vice President
WCT Funds September 1, 1997
Exhibit 6(I)
FORM OF
WCT Funds
DISTRIBUTOR'S CONTRACT
AGREEMENT made this 1st day of September, 1997, by and between WCT
FUNDS (the "Trust"), a Massachusetts business trust, and EDGEWOOD SERVICES, INC.
("ESI"), a Pennsylvania Corporation.
In consideration of the mutual covenants hereinafter contained, it is
hereby agreed by and between the parties hereto as follows:
1. The Trust hereby appoints ESI as its agent to sell and distribute shares of
the Trust which may be offered in one or more series (the "Funds")
consisting of one or more classes (the "Classes") of shares (the "Shares"),
as described and set forth on one or more exhibits to this Agreement, at
the current offering price thereof as described and set forth in the
current Prospectuses of the Trust. ESI hereby accepts such appointment and
agrees to provide such other services for the Trust, if any, and accept
such compensation from the Trust, if any, as set forth in the applicable
exhibits to this Agreement.
2. The sale of any Shares may be suspended without prior notice whenever in
the judgment of the Trust it is in its best interest to do so. In addition,
the Trust and ESI reserve the right to reject any purchase order.
3. Neither ESI nor any other person is authorized by the Trust to give any
information or to make any representation relative to any Shares other than
those contained in the Registration Statement, Prospectuses, or Statements
of Additional Information ("SAIs") filed with the Securities and Exchange
Commission, as the same may be amended from time to time, or in any
supplemental information to said Prospectuses or SAIs approved by the
Trust. ESI agrees that any other information or representations other than
those specified above which it or any dealer or other person who purchases
Shares through ESI may make in connection with the offer or sale of Shares,
shall be made entirely without liability on the part of the Trust. No
person or dealer, other than ESI, is authorized to act as agent for the
Trust for any purpose. ESI agrees that in offering or selling Shares as
agent of the Trust, it will, in all respects, duly conform to all
applicable state and federal laws and the rules and regulations of the
National Association of Securities Dealers, Inc., including its Rules of
Fair Practice. ESI will submit to the Trust copies of all sales literature
before using the same and will not use such sales literature if disapproved
by the Trust.
4. This Agreement is effective with respect to each Class as of the date of
execution of the applicable exhibit and shall continue in effect with
respect to each Class presently set forth on an exhibit and any subsequent
Classes added pursuant to an exhibit during the initial term of this
Agreement for one year from the date set forth above, and thereafter for
successive periods of one year if such continuance is approved at least
annually by the Trustees of the Trust including a majority of the members
of the Board of Trustees of the Trust who are not interested persons of the
Trust and have no direct or indirect financial interest in the operation of
any Distribution Plan relating to the Trust or in any related documents to
such Plan ("Disinterested Trustees") cast in person at a meeting called for
that purpose. If a Class is added after the first annual approval by the
Trustees as described above, this Agreement will be effective as to that
Class upon execution of the applicable exhibit and will continue in effect
until the next annual approval of this Agreement by the Trustees and
thereafter for successive periods of one year, subject to approval as
described above.
5. This Agreement may be terminated with regard to a particular Fund or Class
at any time, without the payment of any penalty, by the vote of a majority
of the Disinterested Trustees or by a majority of the outstanding voting
securities of the particular Fund or Class on not more than sixty (60)
days' written notice to any other party to this Agreement. This Agreement
may be terminated with regard to a particular Fund or Class by ESI on sixty
(60) days' written notice to the Trust.
6. This Agreement may not be assigned by ESI and shall automatically terminate
in the event of an assignment by ESI as defined in the Investment Company
Act of 1940, as amended, provided, however, that ESI may employ such other
person, persons, corporation or corporations as it shall determine in order
to assist it in carrying out its duties under this Agreement.
7. ESI shall not be liable to the Trust for anything done or omitted by it,
except acts or omissions involving willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties imposed by this Agreement.
8. This Agreement may be amended at any time by mutual agreement in writing of
all the parties hereto, provided that such amendment is approved by the
Trustees of the Trust including a majority of the Disinterested Trustees of
the Trust cast in person at a meeting called for that purpose.
9. This Agreement shall be construed in accordance with and governed by the
laws of the Commonwealth of Pennsylvania.
10. (a) Subject to the conditions set forth below, the Trust agrees to
indemnify and hold harmless ESI and each person, if any, who controls
ESI within the meaning of Section 15 of the Securities Act of 1933 and
Section 20 of the Securities Act of 1934, as amended, against any and
all loss, liability, claim, damage and expense whatsoever (including
but not limited to any and all expenses whatsoever reasonably incurred
in investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever) arising out of or
based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, any Prospectuses
or SAIs (as from time to time amended and supplemented) or the omission
or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading,
unless such statement or omission was made in reliance upon and in
conformity with written information furnished to the Trust about ESI by
or on behalf of ESI expressly for use in the Registration Statement,
any Prospectuses and SAIs or any amendment or supplement thereof.
If any action is brought against ESI or any controlling person thereof
with respect to which indemnity may be sought against the Trust
pursuant to the foregoing paragraph, ESI shall promptly notify the
Trust in writing of the institution of such action and the Trust shall
assume the defense of such action, including the employment of counsel
selected by the Trust and payment of expenses. ESI or any such
controlling person thereof shall have the right to employ separate
counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of ESI or such controlling person unless the
employment of such counsel shall have been authorized in writing by the
Trust in connection with the defense of such action or the Trust shall
not have employed counsel to have charge of the defense of such action,
in any of which events such fees and expenses shall be borne by the
Trust. Anything in this paragraph to the contrary notwithstanding, the
Trust shall not be liable for any settlement of any such claim of
action effected without its written consent. The Trust agrees promptly
to notify ESI of the commencement of any litigation or proceedings
against the Trust or any of its officers or Trustees or controlling
persons in connection with the issue and sale of Shares or in
connection with the Registration Statement, Prospectuses, or SAIs.
(b) ESI agrees to indemnify and hold harmless the Trust, each of its
Trustees, each of its officers who have signed the Registration
Statement and each other person, if any, who controls the Trust within
the meaning of Section 15 of the Securities Act of 1933, but only with
respect to statements or omissions, if any, made in the Registration
Statement or any Prospectus, SAI, or any amendment or supplement
thereof in reliance upon, and in conformity with, information furnished
to the Trust about ESI by or on behalf of ESI expressly for use in the
Registration Statement or any Prospectus, SAI, or any amendment or
supplement thereof. In case any action shall be brought against the
Trust or any other person so indemnified based on the Registration
Statement or any Prospectus, SAI, or any amendment or supplement
thereof, and with respect to which indemnity may be sought against ESI,
ESI shall have the rights and duties given to the Trust, and the Trust
and each other person so indemnified shall have the rights and duties
given to ESI by the provisions of subsection (a) above.
(c) Nothing herein contained shall be deemed to protect any person against
liability to the Trust or its shareholders to which such person would
otherwise be subject by reason of willful misfeasance, bad faith or
gross negligence in the performance of the duties of such person or by
reason of the reckless disregard by such person of the obligations and
duties of such person under this Agreement.
(d) Insofar as indemnification for liabilities may be permitted pursuant to
Section 17 of the Investment Company Act of 1940, as amended, for
Trustees, officers, ESI and controlling persons of the Trust by the
Trust pursuant to this Agreement, the Trust is aware of the position of
the Securities and Exchange Commission as set forth in the Investment
Company Act Release No. IC-11330. Therefore, the Trust undertakes that
in addition to complying with the applicable provisions of this
Agreement, in the absence of a final decision on the merits by a court
or other body before which the proceeding was brought, that an
indemnification payment will not be made unless in the absence of such
a decision, a reasonable determination based upon factual review has
been made (i) by a majority vote of a quorum of non-party Disinterested
Trustees, or (ii) by independent legal counsel in a written opinion
that the indemnitee was not liable for an act of willful misfeasance,
bad faith, gross negligence or reckless disregard of duties. The Trust
further undertakes that advancement of expenses incurred in the defense
of a proceeding (upon undertaking for repayment unless it is ultimately
determined that indemnification is appropriate) against an officer,
Trustees, ESI or controlling person of the Trust will not be made
absent the fulfillment of at least one of the following conditions: (i)
the indemnitee provides security for his undertaking; (ii) the Trust is
insured against losses arising by reason of any lawful advances; or
(iii) a majority of a quorum of non-party Disinterested Trustees or
independent legal counsel in a written opinion makes a factual
determination that there is reason to believe the indemnitee will be
entitled to indemnification.
11. ESI is hereby expressly put on notice of the limitation of liability as set
forth in the Declaration of Trust and agrees that the obligations assumed
by the Trust pursuant to this Agreement shall be limited in any case to the
Trust and its assets and ESI shall not seek satisfaction of any such
obligation from the shareholders of the Trust, the Trustees, officers,
employees or agents of the Trust, or any of them.
12. This Agreement will become binding on the parties hereto upon the execution
of the attached exhibits to the Agreement.
<PAGE>
Exhibit A
to the
Distributor's Contract
WCT Funds
WCT Equity Fund
The following provisions are hereby incorporated and made part of the
Distributor's ContraHct dated September 1, 1997, between WCT Funds and
Edgewood Services, Inc. with respect to the Class of the Fund set forth
above:
1. The Trust hereby appoints ESI to select a group of financial institutions
("Financial Institutions") to sell shares of the above-listed series and
Class ("Shares"), at the current offering price thereof as described and
set forth in the prospectuses of the Trust.
2. ESI will enter into separate written agreements with various firms to
provide the services set forth in Paragraph 1 herein. During the term of
this Agreement, the Trust will reimburse ESI for payments made by ESI to
obtain services pursuant to this Agreement, a monthly fee computed at the
annual rate of up to .25% of the average aggregate net asset value of the
Shares held during the month. For the month in which this Agreement becomes
effective or terminates, there shall be an appropriate proration of any fee
payable on the basis of the number of days that the Agreement is in effect
during the month. The fees paid hereunder shall be in an amount equal to
the aggregate amount of periodic fees paid by ESI to Financial Institutions
pursuant to Paragraph 3 herein.
3. ESI, in its sole discretion, may pay Financial Institutions a periodic fee
in respect of Shares owned from time to time by their clients or customers.
The schedules of such fees and the basis upon which such fees will be paid
shall be determined from time to time by the Trust's Board of Trustees.
4. ESI may from time-to-time and for such periods as it deems appropriate
reduce its compensation to the extent any Class' expenses exceed such lower
expense limitation as ESI may, by notice to the Trust, voluntarily declare
to be effective.
5. ESI will prepare reports to the Board of Trustees of the Trust on a
quarterly basis showing amounts paid to the various firms and the purpose
for such payments.
6. In the event any amendment to this Agreement materially increases the fees
set forth in Paragraph 2, such amendment must be approved by a vote of a
majority of the outstanding voting securities of the appropriate Fund or
Class.
In consideration of the mutual covenants set forth in the Distributor's
Contract dated September 1, 1997 between WCT Funds and Edgewood Services, Inc.,
WCT Funds executes and delivers this Exhibit on behalf of WCT Equity Fund, first
set forth in this Exhibit.
Witness the due execution hereof this 1st day of September, 1997.
ATTEST: WCT FUNDS
By:
Secretary President
ATTEST: EDGEWOOD SERVICES, INC.
By:
Secretary Vice President
WCT Funds 1 September 1, 1997
EXHIBIT 6(II)
FORM OF
WCT FUNDS
ADMINISTRATIVE SERVICES AGREEMENT
This Administrative Services Agreement is made as of this 1st day
of September, 1997, between WCT Funds, a Massachusetts business trust
(herein called the "Fund"), and Federated Services Company, a Delaware
business trust (herein called "FSC").
WHEREAS, the Fund is a Massachusetts business trust consisting of
one or more portfolios, which operates as an open-end management
investment company and will so register under the Investment Company
Act of 1940; and
WHEREAS, the Fund desires to retain FSC as its Administrator to
provide it with Administrative Services (as herein defined), and FSC is willing
to render such services;
NOW, THEREFORE, in consideration of the premises and mutual
covenants set forth herein, the parties hereto agree as follows:
1. Appointment of Administrator. The Fund hereby appoints FSC as
Administrator of the Fund on the terms and conditions set forth in
this Agreement; and FSC hereby accepts such appointment and agrees to
perform the services and duties set forth in Section 2 of this
Agreement in consideration of the compensation provided for in
Section 5 hereof.
2. Services and Duties. As Administrator, and subject to the supervision
and control of the Fund's Board of Trustees, FSC will provide
facilities, equipment, and personnel to carry out the following
administrative services for operation of the business and affairs of
the Fund and each of its portfolios:
(a) prepare, file, and maintain the Fund's governing documents and
any amendments thereto, including the Declaration of Trust (which
has already been prepared and filed), the By-laws and minutes of
meetings of Trustees and shareholders;
(b) prepare and file with the Securities and Exchange Commission
and the appropriate state securities authorities the
registration statements for the Fund and the Fund's shares
and all amendments thereto, reports to regulatory
authorities and shareholders, prospectuses, proxy
statements, and such other documents all as may be necessary
to enable the Fund to make a continuous offering of its
shares;
(c) prepare, negotiate, and administer contracts on behalf of
the Fund with, among others, the Fund's investment adviser,
distributor, custodian, and transfer agent;
(d) supervise the Fund's custodian in the maintenance of the
Fund's general ledger and in the preparation of the Fund's
financial statements, including oversight of expense
accruals and payments, of the determination of the net asset
value of the Fund and of the declaration and payment of
dividends and other distributions to shareholders;
(e) calculate performance data of the Fund for dissemination to
information services covering the investment company
industry;
(f) prepare and file the Fund's tax returns;
(g) examine and review the operations of the Fund's custodian
and transfer agent;
(h) coordinate the layout and printing of publicly disseminated
prospectuses and reports;
(i) perform internal audit examinations in accordance with a
charter to be adopted by FSC and the Fund;
(j) assist with the design, development, and operation of the
Fund;
(k) provide individuals reasonably acceptable to the Fund's
Board of Trustees for nomination, appointment, or election
as officers of the Fund, who will be responsible for the
management of certain of the Fund's affairs as determined by
the Fund's Board of Trustees; and
(l) consult with the Fund and its Board of Trustees on matters
concerning the Fund and its affairs.
The foregoing, along with any additional services that FSC shall
agree in writing to perform for the Fund hereunder, shall hereafter
be referred to as "Administrative Services." Administrative Services
shall not include any duties, functions, or services to be performed
for the Fund by the Fund's investment adviser, distributor,
custodian, or transfer agent pursuant to their respective agreements
with the Fund.
3. Records. FSC shall create and maintain all necessary books and
records in accordance with all applicable laws, rules and
regulations, including but not limited to records required by Section
31(a) of the Investment Company act of 1940 and the rules thereunder,
as the same may be amended from time to time, pertaining to the
Administrative Services performed by it and not otherwise created and
maintained by another party pursuant to contract with the Fund. Where
applicable, such records shall be maintained by FSC for the periods
and in the places required by Rule 31a-2 under the 1940 Act. The
books and records pertaining to the Trust which are in the possession
of FSC shall be the property of the Fund. The Fund, or the Fund's
authorized representatives, shall have access to such books and
records at all times during FSC's normal business hours. Upon the
reasonable request of the Fund, copies of any such books and records
shall be provided promptly by FSC to the Fund or the Fund's
authorized representatives.
4. Expenses. FSC shall be responsible for expenses incurred in providing
office space, equipment, and personnel as may be necessary or
convenient to provide the Administrative Services to the Fund,
including the compensation of FSC employees who serve as Trustees or
officers of the Fund. The Fund shall be responsible for all other
expenses incurred by FSC on behalf of the Fund, including without
limitation postage and courier expenses, printing expenses, travel
expenses, registration fees, filing fees, fees of outside counsel and
independent auditors, insurance premiums, fees payable to Trustees
who are not FSC employees, and trade association dues.
5. Compensation. For the Administrative Services provided, the
Fund hereby agrees to pay and FSC hereby agrees to accept as
full compensation for its services rendered hereunder an
administrative fee at an annual ------------ rate per
portfolio of the Fund's shares, payable daily, as specified
below:
<PAGE>
Max. Admin. Average Daily Net Assets
Fee of the Fund
.15% on the first $250 million
.125% on the next $250 million
.100% on the next $250 million
.075% on assets in excess of $750 million
However, in no event shall the administrative fee received during
any year of this Agreement be less than, or be paid at a rate less than would
aggregate $75,000, per portfolio.
6. Responsibility of Administrator.
(a) FSC shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Fund in connection
with the matters to which this Agreement relates, except a
loss resulting from willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties or
from reckless disregard by it of its obligations and duties
under this Agreement. FSC shall be entitled to rely on and
may act upon advice of counsel (who may be counsel for the
Fund) on all matters, and shall be without liability for any
action reasonably taken or omitted pursuant to such advice.
Any person, even though also an officer, trustee, partner,
employee or agent of FSC, who may be or become an officer,
Trustee, employee or agent of the Fund, shall be deemed,
when rendering services to the Fund or acting on any
business of the Fund (other than services or business in
connection with the duties of FSC hereunder) to be rendering
such services to or acting solely for the Fund and not as an
officer, trustee, partner, employee or agent or one under
the control or direction of FSC even though paid by FSC.
(b) FSC shall be kept indemnified by the Fund and be without
liability for any action taken or thing done by it in
performing the Administrative Services in accordance with
the above standards. In order that the indemnification
provisions contained in this Section 6 shall apply, however,
it is understood that if in any case the Fund may be asked
to indemnify or save FSC harmless, the Fund shall be fully
and promptly advised of all pertinent facts concerning the
situation in question, and it is further understood that FSC
will use all reasonable care to identify and notify the Fund
promptly concerning any situation which presents or appears
likely to present the probability of such a claim for
indemnification against the Fund. The Fund shall have the
option to defend FSC against any claim which may be the
subject of this indemnification. In the event that the Fund
so elects, it will so notify FSC and thereupon the Fund
shall take over complete defense of the claim, and FSC shall
in such situation initiate no further legal or other
expenses for which it shall seek indemnification under this
Section. FSC shall in no case confess any claim or make any
compromise in any case in which the Fund will be asked to
indemnify FSC except with the Fund's written consent.
7. Duration and Termination.
(a) The initial term of this Agreement shall commence on the
date hereof, and extend for a period of three years
following the first date upon which the Fund's initial
portfolio has sufficient average daily net assets, such that
FSC will begin to earn a sum not less than its minimum
("annualized") administrative fee per portfolio, pursuant to
Section 5 of this Agreement ("Initial Term").
(b) During any term of this Agreement, each time the Fund adds a
new portfolio, an additional term shall commence on the
first date upon which the new portfolio has sufficient
average daily net assets such that FSC will begin to earn a
sum not less than its minimum ("annualized") administrative
fee in connection with the New Portfolio pursuant to Section
5 of this Agreement ("Additional Term"). Such Additional
Term shall extend to the later to occur of (i) the third
anniversary of the commencement of the Additional Term, or
(ii) the expiration of the Initial Term.
(c) During any term of this Agreement, each time the Fund adds a
class of shares to any portfolio, an additional term shall
commence on the later to occur of (i) the first date upon
which the relevant portfolio has sufficient average daily
net assets such that FSC will begin to earn a sum not less
than its minimum ("annualized") administrative fee pursuant
to Section 5 of this Agreement, or (ii) the effective date
of the registration statement or post-effective amendment
registering the new class of shares ("Class Term"). Such
Class Term shall extend to the later to occur of (i) the
third anniversary of the commencement of the Class Term, or
(ii) the expiration of the Initial Term.
(d) Upon the expiration of any term, this Agreement shall be
automatically renewed each year for an additional term of
one year, unless notice of termination has been delivered by
either party to the other no less than one year before the
beginning of any such additional term.
8. Amendment. No provision of this Agreement may be changed,
waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against which an
enforcement of the change, waiver, --------- discharge or
termination is sought.
9. Limitations of Liability of Trustees or Officers, Employees, Agents
and Shareholders of the Fund. FSC is expressly put on notice of the
limitation of liability as set forth in the Fund's Declaration of
Trust and agrees that the obligations assumed by the Fund pursuant to
this Agreement shall be limited in any case to the Fund and its
assets and that FSC shall not seek satisfaction of any such
obligations from the shareholders of the Fund, the Trustees,
Officers, Employees or Agents of the Fund, or any of them.
10. Limitations of Liability of Trustees and Shareholders of FSC. The
execution and delivery of this Agreement have been authorized by the
Trustees of FSC and signed by an authorized officer of FSC, acting as
such, and neither such authorization by such Trustees nor such
execution and delivery by such officer shall be deemed to have been
made by any of them individually or to impose any liability on any of
them personally, and the obligations of this Agreement are not
binding upon any of the Trustees or shareholders of FSC, but bind
only the trust property of FSC as provided in the Declaration of
Trust of FSC.
11. Notices. Notices of any kind to be given hereunder shall be in writing
(including facsimile communication) and shall be duly given if
delivered to the Fund, to its investment adviser and to FSC at the
following addresses: WCT Funds (Fund), Federated Investors Tower,
Pittsburgh, PA 15222-3779, Attention: President, and, West Coast Trust
Company, Inc. (Adviser), 1000 Broadway, Suite 1100, Portland, Oregon
97205, Attention: President; and if delivered to FSC at Federated
Investors Tower, Pittsburgh, PA 15222-3779, Attention: President.
12. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of
the provisions hereof or otherwise affect their construction or
effect. If any provision of this Agreement shall be held or made
invalid by a court or regulatory agency decision, statute, rule or
otherwise, the remainder of this Agreement shall not be affected
thereby. Subject to the provisions of Section 6, hereof, this
Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and shall be governed
by Pennsylvania law; provided, however, that nothing herein shall be
construed in a manner inconsistent with the Investment Company Act of
1940 or any rule or regulation promulgated by the Securities and
Exchange Commission thereunder.
13. Counterparts. This Agreement may be executed by different parties on
separate counterparts, each of which, when so executed and delivered,
shall be an original, and all such counterparts shall together
------------- constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed by their officers designated below as of the day and year first
above written.
WCT FUNDS
By:
[Title]
Attest:
Secretary
FEDERATED SERVICES COMPANY
By:
[Title]
Attest:
Secretary
WCT Funds September 1, 1997
Exhibit 6(iii)
FORM OF
SALES AGREEMENT WITH EDGEWOOD SERVICES, INC.
This Agreement is entered into between the financial institution
executing this Agreement ("Financial Institution") and Edgewood Services, Inc.
("ESI") for WCT Funds (the "Trust"), which may be offered in one or more series
(the "Funds") and classes (the "Classes") of shares ("Shares"), for which ESI
serves as Distributor of shares of beneficial interest or capital stock. The
Funds or Classes to which this Agreement applies are set forth in Schedule A
hereto.
1. Status of Financial Institution as "Bank" or Registered Broker-Dealer.
The Financial Institution represents and warrants to ESI that:
(a) It is either a "bank" as that term is defined in Section 3(a)(6) of
the Securities Exchange Act of 1934 ("Exchange Act") or a
broker-dealer registered with the Securities and Exchange Commission.
(b) If the Financial Institution is a "bank", it is a duly organized
and validly existing bank in good standing under the laws of the
jurisdiction in which it is organized. The Financial Institution
agrees to give written notice to ESI promptly in the event that it
shall cease to be a "bank" as defined in Section 3(a)(6) of the
Exchange Act. In that event, this Agreement shall be automatically
terminated upon such written notice.
(c) If the Financial Institution is a registered broker-dealer, it is
a member of the NASD and it agrees to abide by all of the rules
and regulations of the NASD including, without limitation, the
NASD Rules of Fair Practice. The Financial Institution agrees to
notify ESI immediately in the event of (1) its expulsion or
suspension from the NASD, or (2) its being found to have violated
any applicable federal or state law, rule or regulation arising
out of its activities as a broker-dealer or in connection with
this Agreement, or which may otherwise affect in any material way
its ability to act in accordance with the terms of this Agreement.
The Financial Institution's expulsion from the NASD will
automatically terminate this Agreement immediately without notice.
Suspension of the Financial Institution from the NASD for
violation of any applicable federal or state law, rule or
regulation will terminate this Agreement effective immediately
upon ESI's written notice of termination to the Financial
Institution.
2. Financial Institution Acts as Agent for its Customers.
The parties agree that in each transaction in the Shares of the Trust:
(a) the Financial Institution is acting as agent for the customer; (b) each
transaction is initiated solely upon the order of the customer; (c) as between
the Financial Institution and its customer, the customer will have full
beneficial ownership of all Shares of the Trust to which this Agreement applies;
(d) each transaction shall be for the account of the customer and not for the
Financial Institution's account; and (e) each transaction shall be without
recourse to the Financial Institution provided that the Financial Institution
acts in accordance with the terms of this Agreement. The Financial Institution
shall not have any authority in any transaction to act as ESI's agent or as
agent for the Trust.
<PAGE>
3. Execution of Orders for Purchase and Redemption of Shares.
(a) All orders for the purchase of any Shares shall be executed at the
then current public offering price per share (i.e., the net asset
value per share plus the applicable sales load, if any) and all
orders for the redemption of any Shares shall be executed at the
net asset value per share, plus any applicable redemption charge,
in each case as described in the prospectus of the Fund or Class.
ESI and the Trust reserve the right to reject any purchase request
at their sole discretion. If required by law, each transaction
shall be confirmed in writing on a fully disclosed basis and, if
confirmed by ESI, a copy of each confirmation shall be sent
simultaneously to the Financial Institution if the Financial
Institution so requests.
(b) The procedures relating to all orders and the handling of them will be
subject to the terms of the prospectus of each Fund or Class and ESI's
written instructions to the Financial Institution from time to time.
(c) Payments for Shares shall be made as specified in the applicable
Fund or Class prospectus. If payment for any purchase order is not
received in accordance with the terms of the applicable Fund or
Class prospectus, ESI reserves the right, without notice, to
cancel the sale and to hold the Financial Institution responsible
for any loss sustained as a result thereof.
(d) The Financial Institution agrees to provide such security as is
necessary to prevent any unauthorized use of the Trust's
recordkeeping system, accessed via any computer hardware or
software provided to the Financial Institution by ESI.
4. Fees Payable to the Financial Institution from Sales Loads.
(a) On each order accepted by ESI, in exchange for the performance of
sales and/or administrative services, the Financial Institution
will be entitled to receive from the amount paid by the Financial
Institution's customer the applicable percentage of the sales
load, if any, as established by ESI. The sales loads for any Fund
or Class shall be those set forth in its prospectus. The portion
of the sales load payable to the Financial Institution may be
changed at any time at ESI's sole discretion upon thirty (30)
days' written notice to the Financial Institution.
(b) Transactions may be settled by the Financial Institution: (1) by
payment of the full purchase price to ESI less an amount equal to
the Financial Institution's applicable percentage of the sales
load, or (2) by payment of the full purchase price to ESI, in
which case ESI shall pay to the Financial Institution, not less
frequently than monthly, the aggregate fees due it on orders
received and settled.
5. Payment of Rule 12b-1 Fees to the Financial Institution.
Subject to and in accordance with the terms of each Fund or Class
prospectus and the Rule 12b-1 Plan, if any, adopted by resolution of the Board
of Trustees, and the shareholders of any Fund or Class pursuant to Rule 12b-1
under the Investment Company Act of 1940, ESI may pay fees for sales and/or
administrative support services to certain financial institutions (such as banks
and securities dealers). The Financial Institution may serve as an
Administrator, in accordance with the terms of the form of Rule 12b-1 Agreement
attached as Appendix A, for all of its customers who purchase Shares of any
Funds or Classes whose prospectuses provide for the use of Administrators.
6. Delivery of Prospectuses to Customers.
The Financial Institution will deliver or cause to be delivered to each
customer, at or prior to the time of any purchase of Shares, a copy of the
prospectus of the Fund or Class. The Financial Institution shall not make any
representations concerning any Shares other than those contained in the
prospectus of the Fund or Class or in any promotional materials or sales
literature furnished to the Financial Institution by ESI or the Fund or Class.
7. Indemnification.
(a) The Financial Institution shall indemnify and hold harmless ESI,
the Trust, the transfer agents of the Trust, and their respective
subsidiaries, affiliates, officers, directors, agents and
employees from all direct or indirect liabilities, losses or costs
(including attorneys fees) arising from, related to or otherwise
connected with: (1) any breach by the Financial Institution of any
provision of this Agreement; or (2) any actions or omissions of
ESI, the Trust, the transfer agents of the Trust, and their
subsidiaries, affiliates, officers, directors, agents and
employees in reliance upon any oral, written or computer or
electronically transmitted instructions believed to be genuine and
to have been given by or on behalf of the Financial Institution.
(b) ESI shall indemnify and hold harmless the Financial Institution
and its subsidiaries, affiliates, officers, directors, agents and
employees from and against any and all direct or indirect
liabilities, losses or costs (including attorneys fees) arising
from, related to or otherwise connected with: (1) any breach by
ESI of any provision of this Agreement; or (2) any alleged untrue
statement of a material fact contained in the Trust's Registration
Statement or Prospectuses, or as a result of or based upon any
alleged omission to state a material fact required to be stated,
or necessary to make the statements not misleading.
(c) The agreement of the parties in this Paragraph to indemnify each other
is conditioned upon the party entitled to indemnification (Indemnified
Party) giving notice to the party required to provide indemnification
(Indemnifying Party) promptly after the summons or other first legal
process for any claim as to which indemnity may be sought is served on
the Indemnified Party. The Indemnified Party shall permit the
Indemnifying Party to assume the defense of any such claim or any
litigation resulting from it, provided that counsel for the
Indemnifying Party who shall conduct the defense of such claim or
litigation shall be approved by the Indemnified Party (which approval
shall not unreasonably be withheld), and that the Indemnified Party
may participate in such defense at its expense. The failure of the
Indemnified Party to give notice as provided in this subparagraph (c)
shall not relieve the Indemnifying Party from any liability other than
its indemnity obligation under this Paragraph. No Indemnifying Party,
in the defense of any such claim or litigation, shall, without the
consent of the Indemnified Party, consent to entry of any judgment or
enter into any settlement that does not include as an unconditional
term the giving by the claimant or plaintiff to the Indemnified Party
of a release from all liability in respect to such claim or
litigation.
(d) The provisions of this Paragraph 7 shall survive the termination of
this Agreement.
8. Customer Names Proprietary to the Financial Institution.
(a) The names of the Financial Institution's customers are and shall
remain the Financial Institution's sole property and shall not be
used by ESI or its affiliates for any purpose except the
performance of its duties and responsibilities under this
Agreement and except for servicing and informational mailings
relating to the Trust. Notwithstanding the foregoing, this
Paragraph 8 shall not prohibit ESI or any of its affiliates from
utilizing the names of the Financial Institution's customers for
any purpose if the names are obtained in any manner other than
from the Financial Institution pursuant to this Agreement.
(b) Neither party shall use the name of the other party in any manner
without the other party's written consent, except as required by
any applicable federal or state law, rule or regulation, and
except pursuant to any mutually agreed upon promotional programs.
(c) The provisions of this Paragraph 8 shall survive the termination of
this Agreement.
9. Solicitation of Proxies.
The Financial Institution agrees not to solicit or cause to be
solicited directly, or indirectly, at any time in the future, any proxies from
the shareholders of the Trust in opposition to proxies solicited by management
of the Trust, unless a court of competent jurisdiction shall have determined
that the conduct of a majority of the Board of Trustees of the Trust constitutes
willful misfeasance, bad faith, gross negligence or reckless disregard of their
duties. This Paragraph 9 will survive the term of this Agreement.
10. Certification of Customers' Taxpayer Identification Numbers.
The Financial Institution agrees to obtain any taxpayer identification
number certification from its customers required under Section 3406 of the
Internal Revenue Code, and any applicable Treasury regulations, and to provide
ESI or its designee with timely written notice of any failure to obtain such
taxpayer identification number certification in order to enable the
implementation of any required backup withholding.
11. Notices.
Except as otherwise specifically provided in this Agreement, all
notices required or permitted to be given pursuant to this Agreement shall be
given in writing and delivered by personal delivery or by postage prepaid,
registered or certified United States first class mail, return receipt
requested, or by telex, telegram or similar means of same day delivery (with a
confirming copy by mail as provided herein). Unless otherwise notified in
writing, all notices to ESI shall be given or sent to ESI at its offices located
at Federated Investors Tower, Pittsburgh, PA 15222-3779, and all notices to the
Financial Institution shall be given or sent to it at its address shown below.
12. Termination and Amendment.
(a) This Agreement shall become effective in this form as of the date set
forth below and may be terminated at any time by either party upon
thirty (30) days' prior notice to the other party. This Agreement
supersedes any prior sales agreements between the parties.
(b) This Agreement may be amended by ESI from time to time by the
following procedure. ESI will mail a coy of the amendment to the
Financial Institution's address, as shown below. If the Financial
Institution does not object to the amendment within thirty (30)
days after its receipt, the amendment will become part of the
Agreement. The Financial Institution's objection must be in
writing and be received by ESI within such thirty (30) days.
<PAGE>
13. Governing Law.
This Agreement shall be construed in accordance with the laws of
the Commonwealth of Pennsylvania.
[Financial Institution Name]
(Please Print or Type)
Address
City State Zip Code
Dated: By:
Authorized Signature
Title
Print Name or Type Name
EDGEWOOD SERVICES, INC.
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
By:
<PAGE>
APPENDIX A
RULE 12b-1 AGREEMENT
This Agreement is made between the Financial Institution executing this
Agreement ("Administrator") and Edgewood Services, Inc. ("ESI") for the mutual
funds (referred to individually as the "Fund" and collectively as the "Funds")
for which ESI serves as Distributor of shares of beneficial interest or capital
stock ("Shares") and which have adopted a Rule 12b-1 Plan ("Plan") and approved
this form of agreement pursuant to Rule 12b-1 under the Investment Company Act
of 1940. In consideration of the mutual covenants hereinafter contained, it is
hereby agreed by and between the parties hereto as follows:
1. ESI hereby appoints Administrator to render or cause to be rendered
sales and administrative support services to the Funds and their shareholders.
2. The services to be provided under Paragraph 1 may include, but are
not limited to advertising, compensation of sales personnel, mailing of
prospectuses, providing assistance and review in designing materials to send to
potential customers, and such other services as are primarily intended to result
in sales of Shares by the Funds.
3. During the term of this Agreement, ESI will pay the Administrator
fees for each Fund as set forth in a written schedule delivered to the
Administrator pursuant to this Agreement. ESI's fee schedule for Administrator
may be changed by ESI sending a new fee schedule to Administrator pursuant to
Paragraph 12 of this Agreement. For the payment period in which this Agreement
becomes effective or terminates, there shall be an appropriate proration of the
fee on the basis of the number of days that the Rule 12b-1 Agreement is in
effect during the quarter.
4. The Administrator will not perform or provide any duties which would
cause it to be a fiduciary under Section 4975 of the Internal Revenue Code, as
amended. For purposes of that Section, the Administrator understands that any
person who exercises any discretionary authority or discretionary control with
respect to any individual retirement account or its assets, or who renders
investment advice for a fee, or has any authority or responsibility to do so, or
has any discretionary authority or discretionary responsibility in the
administration of such an account, is a fiduciary.
5. The Administrator understands that the Department of Labor views
ERISA as prohibiting fiduciaries of discretionary ERISA assets from receiving
administrative service fees or other compensation from funds in which the
fiduciary's discretionary ERISA assets are invested. To date, the Department of
Labor has not issued any exemptive order or advisory opinion that would exempt
fiduciaries from this interpretation. Without specific authorization from the
Department of Labor, fiduciaries should carefully avoid investing discretionary
assets in any fund pursuant to an arrangement where the fiduciary is to be
compensated by the fund for such investment. Receipt of such compensation could
violate ERISA provisions against fiduciary self-dealing and conflict of interest
and could subject the fiduciary to substantial penalties.
6. The Administrator agrees not to solicit or cause to be solicited
directly, or indirectly at any time in the future, any proxies from the
shareholders of any or all of the Funds in opposition to proxies solicited by
management of the Fund or Funds, unless a court of competent jurisdiction shall
have determined that the conduct of a majority of the Board of Directors or
Trustees of the Fund or Funds constitutes willful misfeasance, bad faith, gross
negligence or reckless disregard of their duties. This paragraph 6 will survive
the term of this Agreement.
7. With respect to each Fund, this Agreement shall continue in effect
for one year from the date of its execution, and thereafter for successive
periods of one year if the form of this Agreement is approved at least annually
by the Directors or Trustees of the Fund, including a majority of the members of
the Board of Directors or Trustees of the Fund who are not interested persons of
the Fund and have no direct or indirect financial interest in the operation of
the Fund's Plan or in any related documents to the Plan ("Disinterested
Directors or Trustees") cast in person at a meeting called for that purpose.
8. Notwithstanding paragraph 7, this Agreement may be terminated as
follows:
(a)at any time, without the payment of any penalty, by the vote of a
majority of the Disinterested Directors or Trustees of the Fund or
by a vote of a majority of the outstanding voting securities of the
Fund as defined in the Investment Company Act of 1940 on not more
than sixty (60) days' written notice to the parties to this
Agreement;
(b)automatically in the event of the Agreement's assignment as defined
in the Investment Company Act of 1940 or upon the termination of the
"Administrative Support and Distributor's Contract" or
"Distributor's Contract" between the Fund and ESI; and
(c) by either party to the Agreement without cause by giving the other
party at least sixty (60) days' written notice of its intention to terminate.
9. The termination of this Agreement with respect to any one Fund will
not cause the Agreement's termination with respect to any other Fund.
10. The Administrator agrees to obtain any taxpayer identification
number certification from its customers required under Section 3406 of the
Internal Revenue Code, and any applicable Treasury regulations, and to provide
ESI or its designee with timely written notice of any failure to obtain such
taxpayer identification number certification in order to enable the
implementation of any required backup withholding.
11. This Agreement supersedes any prior service agreements between the
parties for the Funds.
12. This Agreement may be amended by ESI from time to time by the
following procedure. ESI will mail a copy of the amendment to the
Administrator's address, as shown below. If the Administrator does not object to
the amendment within thirty (30) days after its receipt, the amendment will
become part of the Agreement. The Administrator's objection must be in writing
and be received by ESI within such thirty days.
<PAGE>
13. This Agreement shall be construed in accordance with the Laws of
the Commonwealth of Pennsylvania.
Administrator
Address
CityState Zip Code
Dated: By:
Authorized Signature
Title
Print Name of Authorized Signature
EDGEWOOD SERVICES, INC.
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
By:
WCT Funds Page 1 September 1, 1997
Exhibit 8
FORM OF
CUSTODIAN CONTRACT
Between
WCT FUNDS
and
STATE STREET BANK AND TRUST COMPANY
and
FEDERATED SERVICES COMPANY
<PAGE>
TABLE OF CONTENTS
Page
1. Employment of Custodian and Property to be Held by It................1
2. Duties of the Custodian With Respect to Property of the
Funds Held by the Custodian....................................2
2.1 Holding Securities..............................................2
2.2 Delivery of Securities..........................................2
2.3 Registration of Securities......................................5
2.4 Bank Accounts...................................................6
2.5 Payments for Shares.............................................7
2.6 Availability of Federal Funds...................................7
2.7 Collection of Income............................................7
2.8 Payment of Fund Moneys..........................................8
2.9 Liability for Payment in Advance of Receipt of
Securities Purchased............................................9
2.10 Payments for Repurchases or Redemptions of Shares of a
Fund..........................................................9
2.11 Appointment of Agents...........................................10
2.12 Deposit of Fund Assets in Securities System.....................10
2.13 Segregated Account..............................................12
2.14 Joint Repurchase Agreements.....................................13
2.15 Ownership Certificates for Tax Purposes.........................13
2.16 Proxies 13
2.17 Communications Relating to Fund Portfolio Securities............13
2.18 Proper Instructions.............................................14
2.19 Actions Permitted Without Express Authority.....................14
2.20 Evidence of Authority...........................................15
2.21 Notice to Trust by Custodian Regarding Cash Movement............15
3. Duties of Custodian With Respect to the Books of Account and
Calculation of Net Asset Value and Net Income........................15
4. Records 16
5. Opinion of Funds' Independent Public Accountants/Auditors............16
6. Reports to Trust by Independent Public Accountants/Auditors..........17
7. Compensation of Custodian............................................17
8. Responsibility of Custodian..........................................17
9. Effective Period, Termination and Amendment..........................19
10. Successor Custodian..................................................20
11. Interpretive and Additional Provisions...............................21
12. Massachusetts Law to Apply...........................................22
13. Notices..............................................................22
14. Counterparts 22
15. Limitations of Liability.............................................22
<PAGE>
CUSTODIAN CONTRACT
This Contract between WCT FUNDS, (the "Trust"), which is a Massachusetts
business trust, on behalf of the portfolios (hereinafter collectively called the
"Funds" and individually referred to as a "Fund") of the Trust, having its
principal place of business at Federated Investors Tower, Pittsburgh,
Pennsylvania, 15222-3779, and STATE STREET BANK AND TRUST COMPANY, a
Massachusetts trust company, having its principal place of business at 225
Franklin Street, Boston, Massachusetts, 02110, hereinafter called the
"Custodian", and FEDERATED SERVICES COMPANY, a Delaware business trust company,
having its principal place of business at Federated Investors Tower, Pittsburgh,
Pennsylvania, 15222-3779, hereinafter called ("Company").
WITNESSETH: That in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
1. Employment of Custodian and Property to be Held by It
The Trust hereby employs the Custodian as the custodian of the assets
of each of the Funds of the Trust. Except as otherwise expressly
provided herein, the securities and other assets of each of the Funds
shall be segregated from the assets of each of the other Funds and from
all other persons and entities. The Trust will deliver to the Custodian
all securities and cash owned by the Funds and all payments of income,
payments of principal or capital distributions received by them with
respect to all securities owned by the Funds from time to time, and the
cash consideration received by them for shares ("Shares") of beneficial
interest/capital stock of the Funds as may be issued or sold from time
to time. The Custodian shall not be responsible for any property of the
Funds held or received by the Funds and not delivered to the Custodian.
Upon receipt of "Proper Instructions" (within the meaning of Section
2.18), the Custodian shall from time to time employ one or more
sub-custodians upon the terms specified in the Proper Instructions,
provided that the Custodian shall have no more or less responsibility
or liability to the Trust or any of the Funds on account of any actions
or omissions of any sub-custodian so employed than any such
sub-custodian has to the Custodian.
2. Duties of the Custodian With Respect to Property of the Funds
Held by the Custodian
2.1 Holding Securities. The Custodian shall hold and physically
segregate for the account of each Fund all non-cash property,
including all securities owned by each Fund, other than
securities which are maintained pursuant to Section 2.12 in a
clearing agency which acts as a securities depository or in a
book-entry system authorized by the U.S. Department of the
Treasury, collectively referred to herein as "Securities
System", or securities which are subject to a joint repurchase
agreement with affiliated funds pursuant to Section 2.14. The
Custodian shall maintain records of all receipts, deliveries and
locations of such securities, together with a current inventory
thereof, and shall conduct periodic physical inspections of
certificates representing stocks, bonds and other securities
held by it under this Contract in such manner as the Custodian
shall determine from time to time to be advisable in order to
verify the accuracy of such inventory. With respect to
securities held by any agent appointed pursuant to Section 2.11
hereof, and with respect to securities held by any sub-custodian
appointed pursuant to Section 1 hereof, the Custodian may rely
upon certificates from such agent as to the holdings of such
agent and from such sub-custodian as to the holdings of such
sub-custodian, it being understood that such reliance in no way
relieves the Custodian of its responsibilities under this
Contract. The Custodian will promptly report to the Trust the
results of such inspections, indicating any shortages or
discrepancies uncovered thereby, and take appropriate action to
remedy any such shortages or discrepancies.
2.2 Delivery of Securities. The Custodian shall release and deliver
securities owned by a Fund held by the Custodian or in a
Securities System account of the Custodian only upon receipt of
Proper Instructions, which may be continuing instructions when
deemed appropriate by the parties, and only in the following
cases:
(1) Upon sale of such securities for the account of a Fund and
receipt of payment therefor;
(2) Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Trust;
(3) In the case of a sale effected through a Securities System, in
accordance with the provisions of Section 2.12 hereof;
(4) To the depository agent in connection with tender or other
similar offers for portfolio securities of a Fund, in accordance
with the provisions of Section 2.17 hereof;
(5) To the issuer thereof or its agent when such securities are
called, redeemed, retired or otherwise become payable; provided
that, in any such case, the cash or other consideration is to be
delivered to the Custodian;
(6) To the issuer thereof, or its agent, for transfer into the
name of a Fund or into the name of any nominee or nominees
of the Custodian or into the name or nominee name of any
agent appointed pursuant to Section 2.11 or into the name
or nominee name of any sub-custodian appointed pursuant to
Section 1; or for exchange for a different number of
bonds, certificates or other evidence representing the
same aggregate face amount or number of units; provided
that, in any such case, the new securities are to be
delivered to the Custodian;
(7) Upon the sale of such securities for the account of a
Fund, to the broker or its clearing agent, against a
receipt, for examination in accordance with "street
delivery custom"; provided that in any such case, the
Custodian shall have no responsibility or liability for
any loss arising from the delivery of such securities
prior to receiving payment for such securities except as
may arise from the Custodian's own failure to act in
accordance with the standard of reasonable care or any
higher standard of care imposed upon the Custodian by any
applicable law or regulation if such above-stated standard
of reasonable care were not part of this Contract;
(8) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or
readjustment of the securities of the issuer of such
securities, or pursuant to provisions for conversion
contained in such securities, or pursuant to any deposit
agreement; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the
Custodian;
(9) In the case of warrants, rights or similar securities, the
surrender thereof in the exercise of such warrants, rights
or similar securities or the surrender of interim receipts
or temporary securities for definitive securities;
provided that, in any such case, the new securities and
cash, if any, are to be delivered to the Custodian;
(10) For delivery in connection with any loans of portfolio
securities of a Fund, but only against receipt of adequate
collateral in the form of (a) cash, in an amount specified
by the Trust, (b) certificated securities of a description
specified by the Trust, registered in the name of the Fund
or in the name of a nominee of the Custodian referred to
in Section 2.3 hereof or in proper form for transfer, or
(c) securities of a description specified by the Trust,
transferred through a Securities System in accordance with
Section 2.12 hereof;
(11) For delivery as security in connection with any borrowings
requiring a pledge of assets by a Fund, but only against
receipt of amounts borrowed, except that in cases where
additional collateral is required to secure a borrowing
already made, further securities may be released for the
purpose;
(12) For delivery in accordance with the provisions of any
agreement among the Trust or a Fund, the Custodian and a
broker-dealer registered under the Securities Exchange Act
of 1934, as amended, (the "Exchange Act") and a member of
The National Association of Securities Dealers, Inc.
("NASD"), relating to compliance with the rules of The
Options Clearing Corporation and of any registered
national securities exchange, or of any similar
organization or organizations, regarding escrow or other
arrangements in connection with transactions for a Fund;
(13) For delivery in accordance with the provisions of any
agreement among the Trust or a Fund, the Custodian, and a
Futures Commission Merchant registered under the Commodity
Exchange Act, relating to compliance with the rules of the
Commodity Futures Trading Commission and/or any Contract
Market, or any similar organization or organizations,
regarding account deposits in connection with transaction
for a Fund;
(14) Upon receipt of instructions from the transfer agent ("Transfer
Agent") for a Fund, for delivery to such Transfer Agent or to the
holders of shares in connection with distributions in kind, in
satisfaction of requests by holders of Shares for repurchase or
redemption; and
(15) For any other proper corporate purpose, but only upon
receipt of, in addition to Proper Instructions, a
certified copy of a resolution of the Executive Committee
of the Trust on behalf of a Fund signed by an officer of
the Trust and certified by its Secretary or an Assistant
Secretary, specifying the securities to be delivered,
setting forth the purpose for which such delivery is to be
made, declaring such purpose to be a proper corporate
purpose, and naming the person or persons to whom delivery
of such securities shall be made.
2.3 Registration of Securities. Securities held by the Custodian
(other than bearer securities) shall be registered in the name
of a particular Fund or in the name of any nominee of the Fund
or of any nominee of the Custodian which nominee shall be
assigned exclusively to the Fund, unless the Trust has
authorized in writing the appointment of a nominee to be used in
common with other registered investment companies affiliated
with the Fund, or in the name or nominee name of any agent
appointed pursuant to Section 2.11 or in the name or nominee
name of any sub-custodian appointed pursuant to Section 1. All
securities accepted by the Custodian on behalf of a Fund under
the terms of this Contract shall be in "street name" or other
good delivery form.
2.4 Bank Accounts. The Custodian shall open and maintain a separate
bank account or accounts in the name of each Fund, subject only
to draft or order by the Custodian acting pursuant to the terms
of this Contract, and shall hold in such account or accounts,
subject to the provisions hereof, all cash received by it from
or for the account of each Fund, other than cash maintained in a
joint repurchase account with other affiliated funds pursuant to
Section 2.14 of this Contract or by a particular Fund in a bank
account established and used in accordance with Rule 17f-3 under
the Investment Company Act of 1940, as amended, (the "1940
Act"). Funds held by the Custodian for a Fund may be deposited
by it to its credit as Custodian in the Banking Department of
the Custodian or in such other banks or trust companies as it
may in its discretion deem necessary or desirable; provided,
however, that every such bank or trust company shall be
qualified to act as a custodian under the 1940 Act and that each
such bank or trust company and the funds to be deposited with
each such bank or trust company shall be approved by vote of a
majority of the Board of Trustees/Directors ("Board") of the
Trust. Such funds shall be deposited by the Custodian in its
capacity as Custodian for the Fund and shall be withdrawable by
the Custodian only in that capacity. If requested by the Trust,
the Custodian shall furnish the Trust, not later than twenty
(20) days after the last business day of each month, an internal
reconciliation of the closing balance as of that day in all
accounts described in this section to the balance shown on the
daily cash report for that day rendered to the Trust.
2.5 Payments for Shares. The Custodian shall make such arrangements
with the Transfer Agent of each Fund, as will enable the
Custodian to receive the cash consideration due to each Fund and
will deposit into each Fund's account such payments as are
received from the Transfer Agent. The Custodian will provide
timely notification to the Trust and the Transfer Agent of any
receipt by it of payments for Shares of the respective Fund.
2.6 Availability of Federal Funds. Upon mutual agreement between the
Trust and the Custodian, the Custodian shall make federal funds
available to the Funds as of specified times agreed upon from
time to time by the Trust and the Custodian in the amount of
checks, clearing house funds, and other non-federal funds
received in payment for Shares of the Funds which are deposited
into the Funds' accounts.
2.7 Collection of Income.
(1) The Custodian shall collect on a timely basis all income
and other payments with respect to registered securities
held hereunder to which each Fund shall be entitled either
by law or pursuant to custom in the securities business,
and shall collect on a timely basis all income and other
payments with respect to bearer securities if, on the date
of payment by the issuer, such securities are held by the
Custodian or its agent thereof and shall credit such
income, as collected, to each Fund's custodian account.
Without limiting the generality of the foregoing, the
Custodian shall detach and present for payment all coupons
and other income items requiring presentation as and when
they become due and shall collect interest when due on
securities held hereunder. The collection of income due
the Funds on securities loaned pursuant to the provisions
of Section 2.2 (10) shall be the responsibility of the
Trust. The Custodian will have no duty or responsibility
in connection therewith, other than to provide the Trust
with such information or data as may be necessary to
assist the Trust in arranging for the timely delivery to
the Custodian of the income to which each Fund is properly
entitled.
(2) The Custodian shall promptly notify the Trust whenever income due
on securities is not collected in due course and will provide the
Trust with monthly reports of the status of past due income
unless the parties otherwise agree.
2.8 Payment of Fund Moneys. Upon receipt of Proper Instructions,
which may be continuing instructions when deemed appropriate by
the parties, the Custodian shall pay out moneys of each Fund
---------------------- in the following cases only:
(1) Upon the purchase of securities, futures contracts or
options on futures contracts for the account of a Fund but
only (a) against the delivery of such securities, or
evidence of title to futures contracts, to the Custodian
(or any bank, banking firm or trust company doing business
in the United States or abroad which is qualified under
the 1940 Act to act as a custodian and has been designated
by the Custodian as its agent for this purpose) registered
in the name of the Fund or in the name of a nominee of the
Custodian referred to in Section 2.3 hereof or in proper
form for transfer, (b) in the case of a purchase effected
through a Securities System, in accordance with the
conditions set forth in Section 2.12 hereof or (c) in the
case of repurchase agreements entered into between the
Trust and any other party, (i) against delivery of the
securities either in certificate form or through an entry
crediting the Custodian's account at the Federal Reserve
Bank with such securities or (ii) against delivery of the
receipt evidencing purchase for the account of the Fund of
securities owned by the Custodian along with written
evidence of the agreement by the Custodian to repurchase
such securities from the Fund;
(2) In connection with conversion, exchange or surrender of
securities owned by a Fund as set forth in Section 2.2 hereof;
(3) For the redemption or repurchase of Shares of a Fund issued by
the Trust as set forth in Section 2.10 hereof;
(4) For the payment of any expense or liability incurred by a
Fund, including but not limited to the following payments
for the account of the Fund: interest; taxes; management,
accounting, transfer agent and legal fees; and operating
expenses of the Fund, whether or not such expenses are to
be in whole or part capitalized or treated as deferred
expenses;
(5) For the payment of any dividends on Shares of a Fund declared
pursuant to the governing documents of the Trust;
(6) For payment of the amount of dividends received in respect of
securities sold short;
(7) For any other proper purpose, but only upon receipt of, in
addition to Proper Instructions, a certified copy of a
resolution of the Executive Committee of the Trust on
behalf of a Fund signed by an officer of the Trust and
certified by its Secretary or an Assistant Secretary,
specifying the amount of such payment, setting forth the
purpose for which such payment is to be made, declaring
such purpose to be a proper purpose, and naming the person
or persons to whom such payment is to be made.
2.9 Liability for Payment in Advance of Receipt of Securities
Purchased. In any and every case where payment for purchase of
securities for the account of a Fund is made by the Custodian in
advance of receipt of the securities purchased, in the absence
of specific written instructions from the Trust to so pay in
advance, the Custodian shall be absolutely liable to the Fund
for such securities to the same extent as if the securities had
been received by the Custodian.
2.10 Payments for Repurchases or Redemptions of Shares of a Fund.
From such funds as may be available for the purpose of
repurchasing or redeeming Shares of a Fund, but subject to the
limitations of the Declaration of Trust/Articles of
Incorporation and any applicable votes of the Board of the Trust
pursuant thereto, the Custodian shall, upon receipt of
instructions from the Transfer Agent, make funds available for
payment to holders of shares of such Fund who have delivered to
the Transfer Agent a request for redemption or repurchase of
their shares including without limitation through bank drafts,
automated clearinghouse facilities, or by other means. In
connection with the redemption or repurchase of Shares of the
Funds, the Custodian is authorized upon receipt of instructions
from the Transfer Agent to wire funds to or through a commercial
bank designated by the redeeming shareholders.
2.11 Appointment of Agents. The Custodian may at any time or times in
its discretion appoint (and may at any time remove) any other
bank or trust company which is itself qualified under the 1940
Act and any applicable state law or regulation, to act as a
custodian, as its agent to carry out such of the provisions of
this Section 2 as the Custodian may from time to time direct;
provided, however, that the appointment of any agent shall not
relieve the Custodian of its responsibilities or liabilities
hereunder.
2.12 Deposit of Fund Assets in Securities System. The Custodian may
deposit and/or maintain securities owned by the Funds in a
clearing agency registered with the Securities and Exchange
Commission ("SEC") under Section 17A of the Exchange Act, which
acts as a securities depository, or in the book-entry system
authorized by the U.S. Department of the Treasury and certain
federal agencies, collectively referred to herein as "Securities
System" in accordance with applicable Federal Reserve Board and
SEC rules and regulations, if any, and subject to the following
provisions:
(1) The Custodian may keep securities of each Fund in a
Securities System provided that such securities are
represented in an account ("Account") of the Custodian in
the Securities System which shall not include any assets
of the Custodian other than assets held as a fiduciary,
custodian or otherwise for customers;
(2) The records of the Custodian with respect to securities of the
Funds which are maintained in a Securities System shall identify
by book-entry those securities belonging to each Fund;
(3) The Custodian shall pay for securities purchased for the
account of each Fund upon (i) receipt of advice from the
Securities System that such securities have been
transferred to the Account, and (ii) the making of an
entry on the records of the Custodian to reflect such
payment and transfer for the account of the Fund. The
Custodian shall transfer securities sold for the account
of a Fund upon (i) receipt of advice from the Securities
System that payment for such securities has been
transferred to the Account, and (ii) the making of an
entry on the records of the Custodian to reflect such
transfer and payment for the account of the Fund. Copies
of all advices from the Securities System of transfers of
securities for the account of a Fund shall identify the
Fund, be maintained for the Fund by the Custodian and be
provided to the Trust at its request. Upon request, the
Custodian shall furnish the Trust confirmation of each
transfer to or from the account of a Fund in the form of a
written advice or notice and shall furnish to the Trust
copies of daily transaction sheets reflecting each day's
transactions in the Securities System for the account of a
Fund.
(4) The Custodian shall provide the Trust with any report obtained by
the Custodian on the Securities System's accounting system,
internal accounting control and procedures for safeguarding
securities deposited in the Securities System;
(5) The Custodian shall have received the initial certificate,
required by Section 9 hereof;
(6) Anything to the contrary in this Contract notwithstanding,
the Custodian shall be liable to the Trust for any loss or
damage to a Fund resulting from use of the Securities
System by reason of any negligence, misfeasance or
misconduct of the Custodian or any of its agents or of any
of its or their employees or from failure of the Custodian
or any such agent to enforce effectively such rights as it
may have against the Securities System; at the election of
the Trust, it shall be entitled to be subrogated to the
rights of the Custodian with respect to any claim against
the Securities System or any other person which the
Custodian may have as a consequence of any such loss or
damage if and to the extent that a Fund has not been made
whole for any such loss or damage.
(7) The authorization contained in this Section 2.12 shall not
relieve the Custodian from using reasonable care and diligence in
making use of any Securities System. 2.13 Segregated Account. The
Custodian shall upon receipt of Proper Instructions establish and
maintain a segregated account or accounts for and on behalf of each
Fund, into which account or
accounts may be transferred cash and/or securities, including
securities maintained in an account by the Custodian pursuant to
Section 2.12 hereof, (i) in accordance with the provisions of
any agreement among the Trust, the Custodian and a broker-dealer
registered under the Exchange Act and a member of the NASD (or
any futures commission merchant registered under the Commodity
Exchange Act), relating to compliance with the rules of The
Options Clearing Corporation and of any registered national
securities exchange (or the Commodity Futures Trading Commission
or any registered contract market), or of any similar
organization or organizations, regarding escrow or other
arrangements in connection with transactions for a Fund, (ii)
for purpose of segregating cash or government securities in
connection with options purchased, sold or written for a Fund or
commodity futures contracts or options thereon purchased or sold
for a Fund, (iii) for the purpose of compliance by the Trust or
a Fund with the procedures required by any release or releases
of the SEC relating to the maintenance of segregated accounts by
registered investment companies and (iv) for other proper
corporate purposes, but only, in the case of clause (iv), upon
receipt of, in addition to Proper Instructions, a certified copy
of a resolution of the Board or of the Executive Committee
signed by an officer of the Trust and certified by the Secretary
or an Assistant Secretary, setting forth the purpose or purposes
of such segregated account and declaring such purposes to be
proper corporate purposes.
2.14 Joint Repurchase Agreements. Upon the receipt of Proper
Instructions, the Custodian shall deposit and/or maintain any
assets of a Fund and any affiliated funds which are subject to
joint repurchase transactions in an account established solely
for such transactions for the Fund and its affiliated funds. For
purposes of this Section 2.14, "affiliated funds" shall include
all investment companies and their portfolios for which
subsidiaries or affiliates of Federated Investors serve as
investment advisers, distributors or administrators in
accordance with applicable exemptive orders from the SEC. The
requirements of segregation set forth in Section 2.1 shall be
deemed to be waived with respect to such assets.
2.15 Ownership Certificates for Tax Purposes. The Custodian shall
execute ownership and other certificates and affidavits for all
federal and state tax purposes in connection with receipt of
--------------------------------------- income or other payments
with respect to securities of a Fund held by it and in connection
with transfers of securities.
2.16 Proxies. The Custodian shall, with respect to the securities
held hereunder, cause to be promptly executed by the registered
holder of such securities, if the securities are registered
otherwise than in the name of a Fund or a nominee of a Fund, all
proxies, without indication of the manner in which such proxies
are to be voted, and shall promptly deliver to the Trust such
proxies, all proxy soliciting materials and all notices relating
to such securities.
2.17 Communications Relating to Fund Portfolio Securities. The
Custodian shall transmit promptly to the Trust all written
information (including, without limitation, pendency of calls
and maturities of securities and expirations of rights in
connection therewith and notices of exercise of call and put
options written by the Fund and the maturity of futures
contracts purchased or sold by the Fund) received by the
Custodian from issuers of the securities being held for the
Fund. With respect to tender or exchange offers, the Custodian
shall transmit promptly to the Trust all written information
received by the Custodian from issuers of the securities whose
tender or exchange is sought and from the party (or his agents)
making the tender or exchange offer. If the Trust desires to
take action with respect to any tender offer, exchange offer or
any other similar transaction, the Trust shall notify the
Custodian in writing at least three business days prior to the
date on which the Custodian is to take such action. However, the
Custodian shall nevertheless exercise its best efforts to take
such action in the event that notification is received three
business days or less prior to the date on which action is
required.
2.18 Proper Instructions. Proper Instructions as used throughout this
Section 2 means a writing signed or initialed by one or more
person or persons as the Board shall have from time to time
authorized. Each such writing shall set forth the specific
transaction or type of transaction involved. Oral instructions
will be deemed to be Proper Instructions if (a) the Custodian
reasonably believes them to have been given by a person
previously authorized in Proper Instructions to give such
instructions with respect to the transaction involved, and (b)
the Trust promptly causes such oral instructions to be confirmed
in writing. Upon receipt of a certificate of the Secretary or an
Assistant Secretary as to the authorization by the Board of the
Trust accompanied by a detailed description of procedures
approved by the Board, Proper Instructions may include
communications effected directly between electro-mechanical or
electronic devices provided that the Board and the Custodian are
satisfied that such procedures afford adequate safeguards for a
Fund's assets.
2.19 Actions Permitted Without Express Authority. The Custodian may in
its discretion, without express authority from the Trust:
-------------------------------------------
(1) make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under
this Contract, provided that all such payments shall -------- be
accounted for to the Trust in such form that it may be allocated
to the affected Fund;
(2) surrender securities in temporary form for securities in
definitive form;
(3) endorse for collection, in the name of a Fund, checks, drafts and
other negotiable instruments; and
(4) in general, attend to all non-discretionary details in connection
with the sale, exchange, substitution, purchase, transfer and
other dealings with the securities and property of each Fund
except as otherwise directed by the Trust.
2.20 Evidence of Authority. The Custodian shall be protected in
acting upon any instructions, notice, request, consent,
certificate or other instrument or paper reasonably believed by
it to be genuine and to have been properly executed on behalf of
a Fund. The Custodian may receive and accept a certified copy of
a vote of the Board of the Trust as conclusive evidence (a) of
the authority of any person to act in accordance with such vote
or (b) of any determination of or any action by the Board
pursuant to the Declaration of Trust/Articles of Incorporation
as described in such vote, and such vote may be considered as in
full force and effect until receipt by the Custodian of written
notice to the contrary.
2.21 Notice to Trust by Custodian Regarding Cash Movement. The
Custodian will provide timely notification to the Trust of any
receipt of cash, income or payments to the Trust and the release
---------------------------------------------------- of cash or
payment by the Trust.
3. Duties of Custodian With Respect to the Books of Account and
Calculation of Net Asset Value and Net Income.
The Custodian shall cooperate with and supply necessary information to
the entity or entities appointed by the Board of the Trust to keep the
books of account of each Fund and/or compute the net asset value per
share of the outstanding Shares of each Fund or, if directed in writing
to do so by the Trust, shall itself keep such books of account and/or
compute such net asset value per share. If so directed, the Custodian
shall also calculate daily the net income of a Fund as described in the
Fund's currently effective prospectus and Statement of Additional
Information ("Prospectus") and shall advise the Trust and the Transfer
Agent daily of the total amounts of such net income and, if instructed
in writing by an officer of the Trust to do so, shall advise the
Transfer Agent periodically of the division of such net income among
its various components. The calculations of the net asset value per
share and the daily income of a Fund shall be made at the time or times
described from time to time in the Fund's currently effective
Prospectus.
4. Records.
The Custodian shall create and maintain all records relating to its
activities and obligations under this Contract in such manner as will
meet the obligations of the Trust and the Funds under the 1940 Act,
with particular attention to Section 31 thereof and Rules 31a-1 and
31a-2 thereunder, and specifically including identified cost records
used for tax purposes. All such records shall be the property of the
Trust and shall at all times during the regular business hours of the
Custodian be open for inspection by duly authorized officers, employees
or agents of the Trust and employees and agents of the SEC. In the
event of termination of this Contract, the Custodian will deliver all
such records to the Trust, to a successor Custodian, or to such other
person as the Trust may direct. The Custodian shall supply daily to the
Trust a tabulation of securities owned by a Fund and held by the
Custodian and shall, when requested to do so by the Trust and for such
compensation as shall be agreed upon between the Trust and the
Custodian, include certificate numbers in such tabulations.
5. Opinion of Funds' Independent Public Accountants/Auditors.
The Custodian shall take all reasonable action, as the Trust may from
time to time request, to obtain from year to year favorable opinions
from each Fund's independent public accountants/auditors with respect
to its activities hereunder in connection with the preparation of the
Fund's registration statement, periodic reports, or any other reports
to the SEC and with respect to any other requirements of such
Commission.
6. Reports to Trust by Independent Public Accountants/Auditors.
The Custodian shall provide the Trust, at such times as the Trust may
reasonably require, with reports by independent public
accountants/auditors for each Fund on the accounting system, internal
accounting control and procedures for safeguarding securities, futures
contracts and options on futures contracts, including securities
deposited and/or maintained in a Securities System, relating to the
services provided by the Custodian for the Fund under this Contract;
such reports shall be of sufficient scope and in sufficient detail, as
may reasonably be required by the Trust, to provide reasonable
assurance that any material inadequacies would be disclosed by such
examination and, if there are no such inadequacies, the reports shall
so state.
7. Compensation of Custodian.
The Custodian shall be entitled to reasonable compensation for its
services and expenses as Custodian, as agreed upon from time to time between
Company and the Custodian.
8. Responsibility of Custodian.
The Custodian shall be held to a standard of reasonable care in
carrying out the provisions of this Contract; provided, however, that
the Custodian shall be held to any higher standard of care which would
be imposed upon the Custodian by any applicable law or regulation if
such above stated standard of reasonable care was not part of this
Contract. The Custodian shall be entitled to rely on and may act upon
advice of counsel (who may be counsel for the Trust) on all matters,
and shall be without liability for any action reasonably taken or
omitted pursuant to such advice, provided that such action is not in
violation of applicable federal or state laws or regulations, and is in
good faith and without negligence. Subject to the limitations set forth
in Section 15 hereof, the Custodian shall be kept indemnified by the
Trust but only from the assets of the Fund involved in the issue at
hand and be without liability for any action taken or thing done by it
in carrying out the terms and provisions of this Contract in accordance
with the above standards.
In order that the indemnification provisions contained in this Section
8 shall apply, however, it is understood that if in any case the Trust
may be asked to indemnify or save the Custodian harmless, the Trust
shall be fully and promptly advised of all pertinent facts concerning
the situation in question, and it is further understood that the
Custodian will use all reasonable care to identify and notify the Trust
promptly concerning any situation which presents or appears likely to
present the probability of such a claim for indemnification. The Trust
shall have the option to defend the Custodian against any claim which
may be the subject of this indemnification, and in the event that the
Trust so elects it will so notify the Custodian and thereupon the Trust
shall take over complete defense of the claim, and the Custodian shall
in such situation initiate no further legal or other expenses for which
it shall seek indemnification under this Section. The Custodian shall
in no case confess any claim or make any compromise in any case in
which the Trust will be asked to indemnify the Custodian except with
the Trust's prior written consent.
Notwithstanding the foregoing, the responsibility of the Custodian with
respect to redemptions effected by check shall be in accordance with a
separate Agreement entered into between the Custodian and the Trust.
If the Trust requires the Custodian to take any action with respect to
securities, which action involves the payment of money or which action
may, in the reasonable opinion of the Custodian, result in the
Custodian or its nominee assigned to a Fund being liable for the
payment of money or incurring liability of some other form, the
Custodian may request the Trust, as a prerequisite to requiring the
Custodian to take such action, to provide indemnity to the Custodian in
an amount and form satisfactory to the Custodian.
Subject to the limitations set forth in Section 15 hereof, the Trust
agrees to indemnify and hold harmless the Custodian and its nominee
from and against all taxes, charges, expenses, assessments, claims and
liabilities (including counsel fees) (referred to herein as authorized
charges) incurred or assessed against it or its nominee in connection
with the performance of this Contract, except such as may arise from it
or its nominee's own failure to act in accordance with the standard of
reasonable care or any higher standard of care which would be imposed
upon the Custodian by any applicable law or regulation if such
above-stated standard of reasonable care were not part of this
Contract. To secure any authorized charges and any advances of cash or
securities made by the Custodian to or for the benefit of a Fund for
any purpose which results in the Fund incurring an overdraft at the end
of any business day or for extraordinary or emergency purposes during
any business day, the Trust hereby grants to the Custodian a security
interest in and pledges to the Custodian securities held for the Fund
by the Custodian, in an amount not to exceed 10 percent of the Fund's
gross assets, the specific securities to be designated in writing from
time to time by the Trust or the Fund's investment adviser. Should the
Trust fail to make such designation, or should it instruct the
Custodian to make advances exceeding the percentage amount set forth
above and should the Custodian do so, the Trust hereby agrees that the
Custodian shall have a security interest in all securities or other
property purchased for a Fund with the advances by the Custodian, which
securities or property shall be deemed to be pledged to the Custodian,
and the written instructions of the Trust instructing their purchase
shall be considered the requisite description and designation of the
property so pledged for purposes of the requirements of the Uniform
Commercial Code. Should the Trust fail to cause a Fund to repay
promptly any authorized charges or advances of cash or securities,
subject to the provision of the second paragraph of this Section 8
regarding indemnification, the Custodian shall be entitled to use
available cash and to dispose of pledged securities and property as is
necessary to repay any such advances.
9. Effective Period, Termination and Amendment.
This Contract shall become effective as of its execution, shall
continue in full force and effect until terminated as hereinafter
provided, may be amended at any time by mutual agreement of the parties
hereto and may be terminated by either party by an instrument in
writing delivered or mailed, postage prepaid to the other party, such
termination to take effect not sooner than sixty (60) days after the
date of such delivery or mailing; provided, however that the Custodian
shall not act under Section 2.12 hereof in the absence of receipt of an
initial certificate of the Secretary or an Assistant Secretary that the
Board of the Trust has approved the initial use of a particular
Securities System as required in each case by Rule 17f-4 under the 1940
Act; provided further, however, that the Trust shall not amend or
terminate this Contract in contravention of any applicable federal or
state regulations, or any provision of the Declaration of
Trust/Articles of Incorporation, and further provided, that the Trust
may at any time by action of its Board (i) substitute another bank or
trust company for the Custodian by giving notice as described above to
the Custodian, or (ii) immediately terminate this Contract in the event
of the appointment of a conservator or receiver for the Custodian by
the appropriate banking regulatory agency or upon the happening of a
like event at the direction of an appropriate regulatory agency or
court of competent jurisdiction.
Upon termination of the Contract, the Trust shall pay to the Custodian
such compensation as may be due as of the date of such termination and
shall likewise reimburse the Custodian for its costs, expenses and
disbursements.
10. Successor Custodian.
If a successor custodian shall be appointed by the Board of the Trust,
the Custodian shall, upon termination, deliver to such successor
custodian at the office of the Custodian, duly endorsed and in the form
for transfer, all securities then held by it hereunder for each Fund
and shall transfer to separate accounts of the successor custodian all
of each Fund's securities held in a Securities System.
If no such successor custodian shall be appointed, the Custodian shall,
in like manner, upon receipt of a certified copy of a vote of the Board
of the Trust, deliver at the office of the Custodian and transfer such
securities, funds and other properties in accordance with such vote.
In the event that no written order designating a successor custodian or
certified copy of a vote of the Board shall have been delivered to the
Custodian on or before the date when such termination shall become
effective, then the Custodian shall have the right to deliver to a bank
or trust company, which is a "bank" as defined in the 1940 Act, doing
business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its last
published report, of not less than $100,000,000, all securities, funds
and other properties held by the Custodian and all instruments held by
the Custodian relative thereto and all other property held by it under
this Contract for each Fund and to transfer to separate accounts of
such successor custodian all of each Fund's securities held in any
Securities System. Thereafter, such bank or trust company shall be the
successor of the Custodian under this Contract.
In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing
to failure of the Trust to procure the certified copy of the vote
referred to or of the Board to appoint a successor custodian, the
Custodian shall be entitled to fair compensation for its services
during such period as the Custodian retains possession of such
securities, funds and other properties and the provisions of this
Contract relating to the duties and obligations of the Custodian shall
remain in full force and effect.
11. Interpretive and Additional Provisions.
In connection with the operation of this Contract, the Custodian and
the Trust may from time to time agree on such provisions interpretive
of or in addition to the provisions of this Contract as may in their
joint opinion be consistent with the general tenor of this Contract.
Any such interpretive or additional provisions shall be in a writing
signed by both parties and shall be annexed hereto, provided that no
such interpretive or additional provisions shall contravene any
applicable federal or state regulations or any provision of the
Declaration of Trust/Articles of Incorporation. No interpretive or
additional provisions made as provided in the preceding sentence shall
be deemed to be an amendment of this Contract.
12. Massachusetts Law to Apply.
This Contract shall be construed and the provisions thereof interpreted
under and in accordance with laws of The Commonwealth of Massachusetts.
13. Notices.
Except as otherwise specifically provided herein, Notices and other
writings delivered or mailed postage prepaid to the Trust at Federated
Investors Tower, Pittsburgh, Pennsylvania, 15222-3779, or to the
Custodian at address for SSBT only: 225 Franklin Street, Boston,
Massachusetts, 02110, or to such other address as the Trust or the
Custodian may hereafter specify, shall be deemed to have been properly
delivered or given hereunder to the respective address.
14. Counterparts.
This Contract may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original.
15. Limitations of Liability.
The Custodian is expressly put on notice of the limitation of liability
as set forth in Article XI of the Declaration of Trust of those Trusts
which are business trusts and agrees that the obligations and
liabilities assumed by the Trust and any Fund pursuant to this
Contract, including, without limitation, any obligation or liability to
indemnify the Custodian pursuant to Section 8 hereof, shall be limited
in any case to the relevant Fund and its assets and that the Custodian
shall not seek satisfaction of any such obligation from the
shareholders of the relevant Fund, from any other Fund or its
shareholders or from the Trustees, Officers, employees or agents of the
Trust, or any of them. In addition, in connection with the discharge
and satisfaction of any claim made by the Custodian against the Trust,
for whatever reasons, involving more than one Fund, the Trust shall
have the exclusive right to determine the appropriate allocations of
liability for any such claim between or among the Funds.
<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed effective as of the 1st day of September, 1997.
ATTEST: WCT FUNDS
By
ATTEST: STATE STREET BANK AND TRUST
COMPANY
By
ATTEST: FEDERATED SERVICES COMPANY
By
<PAGE>
EXHIBIT 1
CONTRACT
DATE FUND NAMES
September 1, 1997 WCT Funds
WCT Equity Fund
<PAGE>
STATE STREET
DOMESTIC CUSTODY
FEE SCHEDULE
I. Custody Services
Maintain custody of fund assets. Settle portfolio purchases and sales.
Report buy and sell fails. Determine and collect portfolio income. Make
cash disbursements and report cash transactions. Monitor corporate
actions.
ANNUAL FEES
ASSET
Per Fund .25 Basis Points
Wire Fees $3.00 per wire
Settlements:
oEach DTC Transaction $5.00
oEach Federal Reserve Book Entry Transaction $3.75
oEach Repo Transaction (All Repo) $3.75
oEach Physical Transaction (NY/Boston, Private Placement) 15.00
oEach Option Written/Exercised/Expired 18.75
Each Book Entry Muni (Sub-custody) Transaction 15.00
oGovernment Paydowns $5.00
oMaturity Collections $8.00
oPTC Transactions $6.00
II. Special Services
Fees for activities of a non-recurring nature such as fund consolidation
or reorganization, extraordinary security shipments and the preparation of
special reports will be subject to negotiation.
<PAGE>
III. Balance Credit
Municipal Funds
A balance credit equal to 75% of the average demand deposit account balance
in the custodian account for the month billed times the 30 day T-Bill Rate
on the last Monday of the month billed, will be applied against the month's
custodian bill.
Transfer Agent A balance credit equal to 100% of the average balance in the
transfer agent demand deposit accounts, less the reserve requirement and
applicable related expenses, times 75% of the 30 average Fed Funds Rate.
IV. Payment
The above fees will be charged against the funds' custodian checking
account thirty (30) days after the invoice is mailed to the funds' offices.
V. Term of Contract
The parties agree that this fee schedule shall become effective
September 1, 1997.
WCT FUNDS STATE STREET BANK
BY: BY:
TITLE: TITLE:
DATE: DATE:
WCT Funds Page 1 September 1, 1997
Exhibit 9(i)
FORM OF
AGREEMENT
for
FUND ACCOUNTING,
SHAREHOLDER RECORDKEEPING,
and
CUSTODY SERVICES PROCUREMENT
AGREEMENT made as of September 1, 1997, by and between WCT FUNDS, having
their principal office and place of business at Federated Investors Tower,
Pittsburgh, PA 15222-3779 (the "Trust"), on behalf of the portfolios listed on
Exhibit 1 (individually referred to herein as a "Fund" and collectively as
"Funds") of the Trust, and FEDERATED SERVICES COMPANY, a Delaware business
trust, having its principal office and place of business at Federated Investors
Tower, Pittsburgh, Pennsylvania 15222-3779 (the "Company").
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
with authorized and issued shares of capital stock or beneficial interest
("Shares"); and
WHEREAS, the Trust may desire to retain the Company to provide certain
pricing, accounting and recordkeeping services for each of the Funds, including
any classes of shares issued by any Fund ("Classes") if so indicated on Exhibit
1, and the Company is willing to furnish such services; and
WHEREAS, the Trust may desire to appoint the Company as its transfer agent,
dividend disbursing agent if so indicated on Exhibit 1, and agent in connection
with certain other activities, and the Company desires to accept such
appointment; and
WHEREAS, the Trust may desire to appoint the Company as its agent to
select, negotiate and subcontract for custodian services from an approved list
of qualified banks if so indicated on Exhibit 1, and the Company desires to
accept such appointment; and
WHEREAS, from time to time the Trust may desire and may instruct the
Company to subcontract for the performance of certain of its duties and
responsibilities hereunder to State Street Bank and Trust Company or another
agent (the "Agent"); and
WHEREAS, the words Trust and Fund may be used interchangeably for those
investment companies consisting of only one portfolio;
NOW THEREFORE, in consideration of the premises and mutual covenants herein
contained, and intending to be legally bound hereby, the parties hereto agree as
follows:
SECTION ONE: Fund Accounting.
Article 1. Appointment.
The Trust hereby appoints the Company to provide certain pricing and
accounting services to the Funds, and/or the Classes, for the period and on the
terms set forth in this Agreement. The Company accepts such appointment and
agrees to furnish the services herein set forth in return for the compensation
as provided in Article 3 of this Section.
Article 2. The Company's Duties.
Subject to the supervision and control of the Trust's Board of Trustees or
Directors ("Board"), the Company will assist the Trust with regard to fund
accounting for the Trust, and/or the Funds, and/or the Classes, and in
connection therewith undertakes to perform the following specific services;
A. Value the assets of the Funds using: primarily, market
quotations, including the use of matrix pricing, supplied by the
independent pricing services selected by the Company in
consultation with the adviser, or sources selected by the
adviser, and reviewed by the board; secondarily, if a designated
pricing service does not provide a price for a security which the
Company believes should be available by market quotation, the
Company may obtain a price by calling brokers designated by the
investment adviser of the fund holding the security, or if the
adviser does not supply the names of such brokers, the Company
will attempt on its own to find brokers to price those
securities; thirdly, for securities for which no market price is
available, the Pricing Committee of the Board will determine a
fair value in good faith. Consistent with Rule 2a-4 of the 40
Act, estimates may be used where necessary or appropriate. The
Company's obligations with regard to the prices received from
outside pricing services and designated brokers or other outside
sources, is to exercise reasonable care in the supervision of the
pricing agent. The Company is not the guarantor of the securities
prices received from such agents and the Company is not liable to
the Fund for potential errors in valuing a Fund's assets or
calculating the net asset value per share of such Fund or Class
when the calculations are based upon such prices. All of the
above sources of prices used as described are deemed by the
Company to be authorized sources of security prices. The Company
provides daily to the adviser the securities prices used in
calculating the net asset value of the fund, for its use in
preparing exception reports for those prices on which the adviser
has comment. Further, upon receipt of the exception reports
generated by the adviser, the Company diligently pursues
communication regarding exception reports with the designated
pricing agents.
B. Determine the net asset value per share of each Fund and/or
Class, at the time and in the manner from time to time determined
by the Board and as set forth in the Prospectus and Statement of
Additional Information ("Prospectus") of each Fund;
C. Calculate the net income of each of the Funds, if any;
D. Calculate capital gains or losses of each of the Funds resulting
from sale or disposition of assets, if any;
E. Maintain the general ledger and other accounts, books and
financial records of the Trust, including for each Fund, and/or
Class, as required under Section 31(a) of the 1940 Act and the
Rules thereunder in connection with the services provided by the
Company;
F. Preserve for the periods prescribed by Rule 31a-2 under the 1940 Act
the records to be maintained by Rule 31a-1 under the 1940 Act in
connection with the services provided by the Company. The Company
further agrees that all such records it maintains for the Trust are
the property of the Trust and further agrees to surrender promptly to
the Trust such records upon the Trust's request;
G. At the request of the Trust, prepare various reports or other
financial documents required by federal, state and other
applicable laws and regulations; and
H. Performing the following accounting functions on a daily basis:
(1) Journalizing each Portfolio's investment, capital share and
income and expense activities;
(2) Reconciling cash and investment balances of each Portfolio with
the Custodian;
(3) Maintaining individual ledgers for investment securities;
(4) Maintaining historical tax lots for each investment security;
(5) Calculating various contractual expenses (e.g., advisory transfer
agency, administrative, portfolio accounting fees);
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I. Preparing semi-annual financial statements, to include the
following items:
Schedule of Investments
Statement of Assets and Liabilities
Statement of Operations
Statement of Changes in Net Assets
Cash Statement
Schedule of Capital Gains and Losses
J. Preparing monthly purchase and sales journal;
K. Preparing semi-annual broker security transactions summaries;
L. At the request of the Trust, preparing or assisting with the
preparation of various reports or other financial documents required
by federal, state and other applicable laws and regulations,
including but not limited to providing financial data required in
connection with the Trust's semi-annual reports on Form N-SAR, annual
and semi-annual shareholder reports, proxy statements and
registration statements; and
M. Such other similar services as may be reasonably requested by the Trust.
Article 3. Compensation and Allocation of Expenses.
A. The Funds will compensate the Company for its services rendered
pursuant to Section One of this Agreement in accordance with the fees
agreed upon from time to time between the parties hereto. Such fees
do not include out-of-pocket disbursements of the Company for which
the Funds shall reimburse the Company upon receipt of a separate
invoice. Out-of-pocket disbursements shall include, but shall not be
limited to, the items agreed upon between the parties from time to
time.
B. The Fund and/or the Class, and not the Company, shall bear the cost
of: custodial expenses; membership dues in the Investment Company
Institute or any similar organization; transfer agency expenses;
investment advisory expenses; costs of printing and mailing stock
certificates, Prospectuses, reports and notices; administrative
expenses; interest on borrowed money; brokerage commissions; taxes
and fees payable to federal, state and other governmental agencies;
fees of Trustees or Directors of the Trust; independent auditors
expenses; Federated Administrative Services and/or Federated
Administrative Services, Inc. legal and audit department expenses
billed to Federated Services Company for work performed related to
the Trust, the Funds, or the Classes; law firm expenses; or other
expenses not specified in this Article 3 which may be properly
payable by the Funds and/or classes.
C. The compensation and out-of-pocket expenses shall be accrued by the
Fund and shall be paid to the Company no less frequently than
monthly, and shall be paid daily upon request of the Company. The
Company will maintain detailed information about the compensation and
out-of-pocket expenses by Fund and Class.
D. Any schedule of compensation agreed to hereunder, as may be
adjusted from time to time, shall be dated and signed by a duly
authorized officer of the Trust and/or the Funds and a duly
authorized officer of the Company.
E. The fee for the period from the effective date of this Agreement with
respect to a Fund or a Class to the end of the initial month shall be
prorated according to the proportion that such period bears to the
full month period. Upon any termination of this Agreement before the
end of any month, the fee for such period shall be prorated according
to the proportion which such period bears to the full month period.
For purposes of determining fees payable to the Company, the value of
the Fund's net assets shall be computed at the time and in the manner
specified in the Fund's Prospectus.
F. The Company, in its sole discretion, may from time to time
subcontract to, employ or associate with itself such person or
persons as the Company may believe to be particularly suited to
assist it in performing services under this Section One. Such person
or persons may be third-party service providers, or they may be
officers and employees who are employed by both the Company and the
Funds. The compensation of such person or persons shall be paid by
the Company and no obligation shall be incurred on behalf of the
Trust, the Funds, or the Classes in such respect.
SECTION TWO: Shareholder Recordkeeping.
Article 4. Terms of Appointment.
Subject to the terms and conditions set forth in this Agreement, the Trust
hereby appoints the Company to act as, and the Company agrees to act as,
transfer agent and dividend disbursing agent for each Fund's Shares, and agent
in connection with any accumulation, open-account or similar plans provided to
the shareholders of any Fund ("Shareholder(s)"), including without limitation
any periodic investment plan or periodic withdrawal program.
As used throughout this Agreement, a "Proper Instruction" means a writing
signed or initialed by one or more person or persons as the Board shall have
from time to time authorized. Each such writing shall set forth the specific
transaction or type of transaction involved. Oral instructions will be deemed to
be Proper Instructions if (a) the Company reasonably believes them to have been
given by a person previously authorized in Proper Instructions to give such
instructions with respect to the transaction involved, and (b) the Trust, or the
Fund, and the Company promptly cause such oral instructions to be confirmed in
writing. Proper Instructions may include communications effected directly
between electro-mechanical or electronic devices provided that the Trust, or the
Fund, and the Company are satisfied that such procedures afford adequate
safeguards for the Fund's assets. Proper Instructions may only be amended in
writing.
Article 5. Duties of the Company.
The Company shall perform the following services in accordance with Proper
Instructions as may be provided from time to time by the Trust as to any Fund:
A. Purchases
(1) The Company shall receive orders and payment for the
purchase of shares and promptly deliver payment and
appropriate documentation therefor to the custodian of the
relevant Fund, (the "Custodian"). The Company shall notify
the Fund and the Custodian on a daily basis of the total
amount of orders and payments so delivered.
(2) Pursuant to purchase orders and in accordance with the Fund's
current Prospectus, the Company shall compute and issue the
appropriate number of Shares of each Fund and/or Class and hold
such Shares in the appropriate Shareholder accounts.
(3) For certificated Funds and/or Classes, if a Shareholder or
its agent requests a certificate, the Company, as Transfer
Agent, shall countersign and mail by first class mail, a
certificate to the Shareholder at its address as set forth
on the transfer books of the Funds, and/or Classes, subject
to any Proper Instructions regarding the delivery of
certificates.
(4) In the event that any check or other order for the purchase
of Shares of the Fund and/or Class is returned unpaid for
any reason, the Company shall debit the Share account of the
Shareholder by the number of Shares that had been credited
to its account upon receipt of the check or other order,
promptly mail a debit advice to the Shareholder, and notify
the Fund and/or Class of its action. In the event that the
amount paid for such Shares exceeds proceeds of the
redemption of such Shares plus the amount of any dividends
paid with respect to such Shares, the Fund and/the Class or
its distributor will reimburse the Company on the amount of
such excess.
B. Distribution
(1) Upon notification by the Funds of the declaration of any
distribution to Shareholders, the Company shall act as
Dividend Disbursing Agent for the Funds in accordance with
the provisions of its governing document and the
then-current Prospectus of the Fund. The Company shall
prepare and mail or credit income, capital gain, or any
other payments to Shareholders. As the Dividend Disbursing
Agent, the Company shall, on or before the payment date of
any such distribution, notify the Custodian of the estimated
amount required to pay any portion of said distribution
which is payable in cash and request the Custodian to make
available sufficient funds for the cash amount to be paid
out. The Company shall reconcile the amounts so requested
and the amounts actually received with the Custodian on a
daily basis. If a Shareholder is entitled to receive
additional Shares by virtue of any such distribution or
dividend, appropriate credits shall be made to the
Shareholder's account, for certificated Funds and/or
Classes, delivered where requested; and
(2) The Company shall maintain records of account for each Fund and
Class and advise the Trust, each Fund and Class and its
Shareholders as to the foregoing.
C. Redemptions and Transfers
(1) The Company shall receive redemption requests and redemption
directions and, if such redemption requests comply with the
procedures as may be described in the Fund Prospectus or set
forth in Proper Instructions, deliver the appropriate
instructions therefor to the Custodian. The Company shall
notify the Funds on a daily basis of the total amount of
redemption requests processed and monies paid to the Company
by the Custodian for redemptions.
(2) At the appropriate time upon receiving redemption proceeds
from the Custodian with respect to any redemption, the
Company shall pay or cause to be paid the redemption
proceeds in the manner instructed by the redeeming
Shareholders, pursuant to procedures described in the
then-current Prospectus of the Fund.
(3) If any certificate returned for redemption or other request
for redemption does not comply with the procedures for
redemption approved by the Fund, the Company shall promptly
notify the Shareholder of such fact, together with the
reason therefor, and shall effect such redemption at the
price applicable to the date and time of receipt of
documents complying with said procedures.
(4) The Company shall effect transfers of Shares by the registered
owners thereof.
(5) The Company shall identify and process abandoned accounts and
uncashed checks for state escheat requirements on an annual basis
and report such actions to the Fund.
D. Recordkeeping
(1) The Company shall record the issuance of Shares of each
Fund, and/or Class, and maintain pursuant to applicable
rules of the Securities and Exchange Commission ("SEC") a
record of the total number of Shares of the Fund and/or
Class which are authorized, based upon data provided to it
by the Fund, and issued and outstanding. The Company shall
also provide the Fund on a regular basis or upon reasonable
request with the total number of Shares which are authorized
and issued and outstanding, but shall have no obligation
when recording the issuance of Shares, except as otherwise
set forth herein, to monitor the issuance of such Shares or
to take cognizance of any laws relating to the issue or sale
of such Shares, which functions shall be the sole
responsibility of the Funds.
(2) The Company shall establish and maintain records pursuant to
applicable rules of the SEC relating to the services to be
performed hereunder in the form and manner as agreed to by the
Trust or the Fund to include a record for each Shareholder's
account of the following:
(a) Name, address and tax identification number (and whether such
number has been certified);
(b) Number of Shares held;
(c) Historical information regarding the account, including dividends
paid and date and price for all transactions;
(d) Any stop or restraining order placed against the account;
(e) Information with respect to withholding in the case of a foreign
account or an account for which withholding is required by the
Internal Revenue Code;
(f) Any dividend reinvestment order, plan application, dividend
address and correspondence relating to the current maintenance of
the account;
(g) Certificate numbers and denominations for any Shareholder holding
certificates;
(h) Any information required in order for the Company to perform the
calculations contemplated or required by this Agreement.
(3) The Company shall preserve any such records required to be
maintained pursuant to the rules of the SEC for the periods
prescribed in said rules as specifically noted below. Such record
retention shall be at the expense of the Company, and such
records may be inspected by the Fund at reasonable times. The
Company may, at its option at any time, and shall forthwith upon
the Fund's demand, turn over to the Fund and cease to retain in
the Company's files, records and documents created and maintained
by the Company pursuant to this Agreement, which are no longer
needed by the Company in performance of its services or for its
protection. If not so turned over to the Fund, such records and
documents will be retained by the Company for six years from the
year of creation, during the first two of which such documents
will be in readily accessible form. At the end of the six year
period, such records and documents will either be turned over to
the Fund or destroyed in accordance with Proper Instructions.
E. Confirmations/Reports
(1) The Company shall furnish to the Fund, and the Fund's Investment
Adviser, periodically the following information:
(a) A copy of the transaction register;
(b) Dividend and reinvestment blotters;
(c) The total number of Shares issued and outstanding in each state
for "blue sky" purposes as determined according to Proper
Instructions delivered from time to time by the Fund to the
Company;
(d) Shareholder lists and statistical information;
(e) Payments to third parties relating to distribution agreements,
allocations of sales loads, redemption fees, or other
transaction- or sales-related payments;
(f) Such other information as may be agreed upon from time to time.
(2) The Company shall prepare in the appropriate form, file with
the Internal Revenue Service and appropriate state agencies,
and, if required, mail to Shareholders, such notices for
reporting dividends and distributions paid as are required
to be so filed and mailed and shall withhold such sums as
are required to be withheld under applicable federal and
state income tax laws, rules and regulations.
(3) In addition to and not in lieu of the services set forth above,
the Company shall:
(a) Perform all of the customary services of a transfer
agent, dividend disbursing agent and, as relevant,
agent in connection with accumulation, open-account
or similar plans (including without limitation any
periodic investment plan or periodic withdrawal
program), including but not limited to: maintaining
all Shareholder accounts, mailing Shareholder
reports and Prospectuses to current Shareholders,
withholding taxes on accounts subject to back-up or
other withholding (including non-resident alien
accounts), preparing and filing reports on U.S.
Treasury Department Form 1099 and other appropriate
forms required with respect to dividends and
distributions by federal authorities for all
Shareholders, preparing and mailing confirmation
forms and statements of account to Shareholders for
all purchases and redemptions of Shares and other
conformable transactions in Shareholder accounts,
preparing and mailing activity statements for
Shareholders, and providing Shareholder account
information; and
(b) provide a system which will enable the Fund to
monitor the total number of Shares of each Fund
and/or Class sold in each state ("blue sky
reporting"). The Fund shall by Proper Instructions
(i) identify to the Company those transactions and
assets to be treated as exempt from the blue sky
reporting for each state and (ii) verify the
classification of transactions for each state on
the system prior to activation and thereafter
monitor the daily activity for each state. The
responsibility of the Company for each Fund's
and/or Class's state blue sky registration status
is limited solely to the recording of the initial
classification of transactions or accounts with
regard to blue sky compliance and the reporting of
such transactions and accounts to the Fund as
provided above.
F. Other Duties
(1) The Company shall answer correspondence from Shareholders
relating to their Share accounts and such other correspondence as
may from time to time be addressed to the Company;
(2) The Company shall prepare Shareholder meeting lists, mail proxy
cards and other material supplied to it by the Fund in connection
with Shareholder Meetings of each Fund; receive, examine and
tabulate returned proxies, and certify the vote of the
Shareholders;
(3) The Company shall establish and maintain facilities and
procedures for safekeeping of stock certificates, check forms and
facsimile signature imprinting devices, if any; and for the
preparation or use, and for keeping account of, such
certificates, forms and devices.
Article 6. Duties of the Trust.
A. Compliance
The Trust or Fund assume full responsibility for the preparation,
contents and distribution of their own and/or their classes'
Prospectus and for complying with all applicable requirements of the
Securities Act of 1933, as amended (the "1933 Act"), the 1940 Act and
any laws, rules and regulations of government authorities having
jurisdiction.
B. Share Certificates
The Trust shall supply the Company with a sufficient supply of blank
Share certificates and from time to time shall renew such supply upon
request of the Company. Such blank Share certificates shall be
properly signed, manually or by facsimile, if authorized by the Trust
and shall bear the seal of the Trust or facsimile thereof; and
notwithstanding the death, resignation or removal of any officer of
the Trust authorized to sign certificates, the Company may continue
to countersign certificates which bear the manual or facsimile
signature of such officer until otherwise directed by the Trust.
C. Distributions
The Fund shall promptly inform the Company of the declaration of any
dividend or distribution on account of any Fund's shares.
Article 7. Compensation and Expenses.
A. Annual Fee
For performance by the Company pursuant to Section Two of this
Agreement, the Trust and/or the Fund agree to pay the Company an
annual maintenance fee for each Shareholder account as agreed upon
between the parties and as may be added to or amended from time to
time. Such fees may be changed from time to time subject to written
agreement between the Trust and the Company. Pursuant to information
in the Fund Prospectus or other information or instructions from the
Fund, the Company may sub-divide any Fund into Classes or other
sub-components for recordkeeping purposes. The Company will charge
the Fund the same fees for each such Class or sub-component the same
as if each were a Fund.
B. Reimbursements
In addition to the fee paid under Article 7A above, the Trust and/or
Fund agree to reimburse the Company for out-of-pocket expenses or
advances incurred by the Company for the items agreed upon between
the parties, as may be added to or amended from time to time. In
addition, any other expenses incurred by the Company at the request
or with the consent of the Trust and/or the Fund, will be reimbursed
by the appropriate Fund.
C. Payment
The compensation and out-of-pocket expenses shall be accrued by the
Fund and shall be paid to the Company no less frequently than
monthly, and shall be paid daily upon request of the Company. The
Company will maintain detailed information about the compensation and
out-of-pocket expenses by Fund and Class.
D. Any schedule of compensation agreed to hereunder, as may be
adjusted from time to time, shall be dated and signed by a duly
authorized officer of the Trust and/or the Funds and a duly
authorized officer of the Company.
Article 8. Assignment of Shareholder Recordkeeping.
Except as provided below, no right or obligation under this Section Two may
be assigned by either party without the written consent of the other party.
A. This Agreement shall inure to the benefit of and be binding upon
the parties and their respective permitted successors and
assigns.
B. The Company may without further consent on the part of the Trust
subcontract for the performance hereof with (A) State Street Bank and
its subsidiary, Boston Financial Data Services, Inc., a Massachusetts
Trust ("BFDS"), which is duly registered as a transfer agent pursuant
to Section 17A(c)(1) of the Securities Exchange Act of 1934, as
amended, or any succeeding statute ("Section 17A(c)(1)"), or (B) a
BFDS subsidiary duly registered as a transfer agent pursuant to
Section 17A(c)(1), or (C) a BFDS affiliate, or (D) such other
provider of services duly registered as a transfer agent under
Section 17A(c)(1) as Company shall select; provided, however, that
the Company shall be as fully responsible to the Trust for the acts
and omissions of any subcontractor as it is for its own acts and
omissions; or
C. The Company shall upon instruction from the Trust subcontract for the
performance hereof with an Agent selected by the Trust, other than
BFDS or a provider of services selected by Company, as described in
(2) above; provided, however, that the Company shall in no way be
responsible to the Trust for the acts and omissions of the Agent.
SECTION THREE: Custody Services Procurement.
Article 9. Appointment.
The Trust hereby appoints Company as its agent to evaluate and obtain
custody services from a financial institution that (i) meets the criteria
established in Section 17(f) of the 1940 Act and (ii) has been approved by the
Board as eligible for selection by the Company as a custodian (the "Eligible
Custodian"). The Company accepts such appointment.
Article 10. The Company and Its Duties.
Subject to the review, supervision and control of the Board, the Company
shall:
A. evaluate the nature and the quality of the custodial services
provided by the Eligible Custodian;
B. employ the Eligible Custodian to serve on behalf of the Trust as
Custodian of the Trust's assets substantially on the terms set
forth as the form of agreement in Exhibit 2;
C. negotiate and enter into agreements with the Custodians for the
benefit of the Trust, with the Trust as a party to each such
agreement. The Company shall not be a party to any agreement with
any such Custodian;
D. establish procedures to monitor the nature and the quality of the
services provided by the Custodians;
E. continuously monitor the nature and the quality of services
provided by the Custodians; and
F. periodically provide to the Trust (i) written reports on the
activities and services of the Custodians; (ii) the nature and amount
of disbursement made on account of the Trust with respect to each
custodial agreement; and (iii) such other information as the Board
shall reasonably request to enable it to fulfill its duties and
obligations under Sections 17(f) and 36(b) of the 1940 Act and other
duties and obligations thereof.
Article 11. Fees and Expenses.
A. Annual Fee
For the performance by the Company pursuant to Section Three of this
Agreement, the Trust and/or the Fund agree to pay the Company an annual fee as
agreed upon between the parties.
B. Reimbursements
In addition to the fee paid under Section 11A above, the Trust and/or
Fund agree to reimburse the Company for out-of-pocket expenses or
advances incurred by the Company for the items agreed upon between
the parties, as may be added to or amended from time to time. In
addition, any other expenses incurred by the Company at the request
or with the consent of the Trust and/or the Fund, will be reimbursed
by the appropriate Fund.
C. Payment
The compensation and out-of-pocket expenses shall be accrued by the
Fund and shall be paid to the Company no less frequently than
monthly, and shall be paid daily upon request of the Company. The
Company will maintain detailed information about the compensation and
out-of-pocket expenses by Fund.
D. Any schedule of compensation agreed to hereunder, as may be
adjusted from time to time, shall be dated and signed by a duly
authorized officer of the Trust and/or the Funds and a duly
authorized officer of the Company.
Article 12. Representations.
The Company represents and warrants that it has obtained all required
approvals from all government or regulatory authorities necessary to enter into
this arrangement and to provide the services contemplated in Section Three of
this Agreement.
SECTION FOUR: General Provisions.
Article 13. Documents. A. In connection with the appointment of the
Company under this Agreement, the Trust shall file with the
Company the following documents:
(1) A copy of the Charter and By-Laws of the Trust and all amendments
thereto;
(2) A copy of the resolution of the Board of the Trust authorizing
this Agreement;
(3) Specimens of all forms of outstanding Share certificates of the
Trust or the Funds in the forms approved by the Board of the
Trust with a certificate of the Secretary of the Trust as to such
approval;
(4) All account application forms and other documents relating to
Shareholders accounts; and
(5) A copy of the current Prospectus for each Fund.
B. The Fund will also furnish from time to time the following documents:
(1) Each resolution of the Board of the Trust authorizing the
original issuance of each Fund's, and/or Class's Shares;
(2) Each Registration Statement filed with the SEC and amendments
thereof and orders relating thereto in effect with respect to the
sale of Shares of any Fund, and/or Class;
(3) A certified copy of each amendment to the governing document and
the By-Laws of the Trust;
(4) Certified copies of each vote of the Board authorizing officers
to give Proper Instructions to the Custodian and agents for fund
accountant, custody services procurement, and shareholder
recordkeeping or transfer agency services;
(5) Specimens of all new Share certificates representing Shares of
any Fund, accompanied by Board resolutions approving such forms;
(6) Such other certificates, documents or opinions which the Company
may, in its discretion, deem necessary or appropriate in the
proper performance of its duties; and
(7) Revisions to the Prospectus of each Fund.
Article 14. Representations and Warranties.
A. Representations and Warranties of the Company
The Company represents and warrants to the Trust that:
(1) It is a business trust duly organized and existing and in good
standing under the laws of the State of Delaware.
(2) It is duly qualified to carry on its business in the State of
Delaware.
(3) It is empowered under applicable laws and by its charter and
by-laws to enter into and perform this Agreement.
(4) All requisite corporate proceedings have been taken to authorize
it to enter into and perform its obligations under this
Agreement.
(5) It has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and
obligations under this Agreement.
(6) It is in compliance with federal securities law requirements and
in good standing as a transfer agent.
(7) It is duly registered as a transfer agent pursuant to Section
17A(c) of the Securities Exchange Act of 1934, as amended.
B. Representations and Warranties of the Trust
The Trust represents and warrants to the Company that:
(1) It is an investment company duly organized and existing and in
good standing under the laws of its state of organization;
(2) It is empowered under applicable laws and by its Charter and
By-Laws to enter into and perform its obligations under this
Agreement;
(3) All corporate proceedings required by said Charter and By-Laws
have been taken to authorize it to enter into and perform its
obligations under this Agreement;
(4) The Trust is an open-end investment company registered under the
1940 Act; and
(5) A registration statement under the 1933 Act will be effective,
and appropriate state securities law filings have been made and
will continue to be made, with respect to all Shares of each Fund
being offered for sale.
Article 15. Standard of Care and Indemnification.
A. Standard of Care
The Company shall be held to a standard of reasonable care in
carrying out the provisions of this Contract. The Company shall be
entitled to rely on and may act upon advice of counsel (who may be
counsel for the Trust) on all matters, and shall be without liability
for any action reasonably taken or omitted pursuant to such advice,
provided that such action is not in violation of applicable federal
or state laws or regulations, and is in good faith and without
negligence.
<PAGE>
B. Indemnification by Trust
The Company shall not be responsible for and the Trust or Fund shall
indemnify and hold the Company, including its officers, directors,
shareholders and their agents employees and affiliates, harmless
against any and all losses, damages, costs, charges, counsel fees,
payments, expenses and liabilities arising out of or attributable to:
(1) The acts or omissions of any Custodian, Adviser, Sub-adviser or
other party (other than the Company) contracted by or approved by
the Trust or Fund,
(2) The reliance on or use by the Company or its agents or
subcontractors of information, records and documents in proper
form which
(a) are received by the Company or its agents or
subcontractors and furnished to it by or on behalf
of the Fund, its Shareholders or investors
regarding the purchase, redemption or transfer of
Shares and Shareholder account information;
(b) are received by the Company from independent pricing services or
sources for use in valuing the assets of the Funds; or
(c) are received by the Company or its agents or
subcontractors from Advisers, Sub-advisers or other
third parties contracted by or approved by the
Trust of Fund for use in the performance of
services under this Agreement;
(d) have been prepared and/or maintained by the Fund or its
affiliates or any other person or firm on behalf of the Trust.
(3) The reliance on, or the carrying out by the Company or its agents
or subcontractors of Proper Instructions of the Trust or the
Fund.
(4) The offer or sale of Shares in violation of any requirement
under the federal securities laws or regulations or the
securities laws or regulations of any state that such Shares
be registered in such state or in violation of any stop
order or other determination or ruling by any federal agency
or any state with respect to the offer or sale of such
Shares in such state.
Provided, however, that the Company shall not be protected
by this Article 15.B. from liability for any act or omission
resulting from the Company's willful misfeasance, bad faith,
negligence or reckless disregard of its duties of failure to
meet the standard of care set forth in 15.A. above.
C. Reliance
At any time the Company may apply to any officer of the Trust or Fund
for instructions, and may consult with legal counsel with respect to
any matter arising in connection with the services to be performed by
the Company under this Agreement, and the Company and its agents or
subcontractors shall not be liable and shall be indemnified by the
Trust or the appropriate Fund for any action reasonably taken or
omitted by it in reliance upon such instructions or upon the opinion
of such counsel provided such action is not in violation of
applicable federal or state laws or regulations. The Company, its
agents and subcontractors shall be protected and indemnified in
recognizing stock certificates which are reasonably believed to bear
the proper manual or facsimile signatures of the officers of the
Trust or the Fund, and the proper countersignature of any former
transfer agent or registrar, or of a co-transfer agent or
co-registrar.
D. Notification
In order that the indemnification provisions contained in this
Article 15 shall apply, upon the assertion of a claim for which
either party may be required to indemnify the other, the party
seeking indemnification shall promptly notify the other party of such
assertion, and shall keep the other party advised with respect to all
developments concerning such claim. The party who may be required to
indemnify shall have the option to participate with the party seeking
indemnification in the defense of such claim. The party seeking
indemnification shall in no case confess any claim or make any
compromise in any case in which the other party may be required to
indemnify it except with the other party's prior written consent.
Article 16. Termination of Agreement.
This Agreement may be terminated by either party upon one hundred twenty
(120) days written notice to the other. Should the Trust exercise its rights to
terminate, all out-of-pocket expenses associated with the movement of records
and materials will be borne by the Trust or the appropriate Fund. Additionally,
the Company reserves the right to charge for any other reasonable expenses
associated with such termination. The provisions of Article 15 shall survive the
termination of this Agreement.
Article 17. Amendment.
This Agreement may be amended or modified by a written agreement executed
by both parties.
Article 18. Interpretive and Additional Provisions.
In connection with the operation of this Agreement, the Company and the
Trust may from time to time agree on such provisions interpretive of or in
addition to the provisions of this Agreement as may in their joint opinion be
consistent with the general tenor of this Agreement. Any such interpretive or
additional provisions shall be in a writing signed by both parties and shall be
annexed hereto, provided that no such interpretive or additional provisions
shall contravene any applicable federal or state regulations or any provision of
the Charter. No interpretive or additional provisions made as provided in the
preceding sentence shall be deemed to be an amendment of this Agreement.
Article 19. Governing Law.
This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of the State of New York.
Article 20. Notices.
Except as otherwise specifically provided herein, Notices and other
writings delivered or mailed postage prepaid to the Trust at Federated Investors
Tower, Pittsburgh, Pennsylvania, 15222-3779, or to the Company at Federated
Investors Tower, Pittsburgh, Pennsylvania, 15222-3779, or to such other address
as the Trust or the Company may hereafter specify, shall be deemed to have been
properly delivered or given hereunder to the respective address.
Article 21. Counterparts.
This Agreement may be executed simultaneously in two or more counterparts,
each of which shall be deemed an original.
Article 22. Limitations of Liability of Trustees and Shareholders of the Trust.
The execution and delivery of this Agreement have been authorized by the
Trustees of the Trust and signed by an authorized officer of the Trust, acting
as such, and neither such authorization by such Trustees nor such execution and
delivery by such officer shall be deemed to have been made by any of them
individually or to impose any liability on any of them personally, and the
obligations of this Agreement are not binding upon any of the Trustees or
Shareholders of the Trust, but bind only the appropriate property of the Fund,
or Class, as provided in the Declaration of Trust.
Article 23. Limitations of Liability of Trustees and Shareholders of the
Company.
The execution and delivery of this Agreement have been authorized by the
Trustees of the Company and signed by an authorized officer of the Company,
acting as such, and neither such authorization by such Trustees nor such
execution and delivery by such officer shall be deemed to have been made by any
of them individually or to impose any liability on any of them personally, and
the obligations of this Agreement are not binding upon any of the Trustees or
Shareholders of the Company, but bind only the property of the Company as
provided in the Declaration of Trust.
Article 24. Merger of Agreement.
This Agreement constitutes the entire agreement between the parties hereto
and supersedes any prior agreement with respect to the subject hereof whether
oral or written.
Article 25. Successor Agent.
If a successor agent for the Trust shall be appointed by the Trust, the
Company shall upon termination of this Agreement deliver to such successor agent
at the office of the Company all properties of the Trust held by it hereunder.
If no such successor agent shall be appointed, the Company shall at its office
upon receipt of Proper Instructions deliver such properties in accordance with
such instructions.
In the event that no written order designating a successor agent or Proper
Instructions shall have been delivered to the Company on or before the date when
such termination shall become effective, then the Company shall have the right
to deliver to a bank or trust company, which is a "bank" as defined in the 1940
Act, of its own selection, having an aggregate capital, surplus, and undivided
profits, as shown by its last published report, of not less than $2,000,000, all
properties held by the Company under this Agreement. Thereafter, such bank or
trust company shall be the successor of the Company under this Agreement.
Article 26. Force Majeure.
The Company shall have no liability for cessation of services hereunder or
any damages resulting therefrom to the Fund as a result of work stoppage, power
or other mechanical failure reasonably beyond its control, natural disaster,
governmental action, communication disruption or other impossibility of
performance.
Article 27. Assignment; Successors.
This Agreement shall not be assigned by either party without the prior
written consent of the other party, except that either party may assign to a
successor all of or a substantial portion of its business, or to a party
controlling, controlled by, or under common control with such party. Nothing in
this Article 28 shall prevent the Company from delegating its responsibilities
to another entity to the extent provided herein.
Article 28. Severability.
In the event any provision of this Agreement is held illegal, void or
unenforceable, the balance shall remain in effect.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused Sections One, Two and
Four of this Agreement to be executed in their names and on their behalf under
their seals by and through their duly authorized officers, as of the day and
year first above written.
ATTEST: WCT FUNDS
By:
Name: Name:
Title: Title:
ATTEST: FEDERATED SERVICES COMPANY
By:
Name: Name:
Title: Title:
<PAGE>
EXHIBIT 1
CONTRACT
DATE INVESTMENT COMPANY
Portfolios
Classes
9/1/97 WCT FUNDS
WCT Equity Fund
<PAGE>
SCHEDULE A
STANDARD DOMESTIC FUNDS
Fund Accounting
Fee Schedule
I. Annual Fees for Portfolio Record Keeping/Fund Accounting Services
First $100 Million 3.0 Basis Points
$100 Million - $300 Million 2.0 Basis Points
$300 Million - $500 Million 1.0 Basis Points
Over $500 Million 0.5 Basis Points
Fund Minimum $39,000
Additional Class of Shares $12,000
(Plus pricing charges and other out-of-pocket expenses)
II. Pricing Charges
Monthly Base Pricing Charge: $375 per month/fund
In addition, each Fund shall reimburse the Company for third-party
pricing service charges.
III. Out-of-Pocket Expenses
Out-of-pocket expenses include, but are not limited to, the following:
SAS 70 audit reports, postage (including overnight courier service), telephones,
telecommunication charges (including FAX), travel made at the client's request,
duplicating, forms, supplies, micorfiche, computer access charges for client
specific system enhancements ,access to the shareholder recordkeeping system,
security pricing services, variable rate change notification services, paydown
factor notification services. The Company shall provide documentation supporting
out-of-pocket expenses upon the Trust's request.
IV. Cost of Living Increase
The minimum fee set forth in this Schedule may increase annually upon
each September 1 anniversary of this Agreement over the minimum fee during the
prior 12 months, as calculated under this Schedule, in an amount equal to the
increase in Pennsylvania Consumer Price Index (not to exceed 6% annually) as
last reported by the U.S. Bureau of Labor Statistics for the twelve months
immediately preceding such anniversary.
<PAGE>
V. Payment
Payment is due thirty days after the date of the invoice.
V. Term of Schedule
The parties agree that this fee schedule shall become effective September 1,
1997 and will remain in effect until it is revised as a result of negotiations
initiated by either party.
WCT FUNDS FEDERATED SERVICES COMPANY
By: By:
Name: Name:
Title: Title:
<PAGE>
Transfer Agency Agreement
between
Federated Services Company
and
WCT Funds
Base Fee* Annual fee per fund, class or other subdivision. $24,000
- ---------
Account Fee* Annual account charge( includes system access
and funds control and reconcilement)
Daily dividend fund $16.00
Non-daily dividend fund $10.00
Other Account Fees* Services or features not covered above.
Account Activity Processing( includes account
establishment, transaction and maintenance processing) $ 3.50
Account Servicing(includes shareholder servicing and
correspondence) $ 4.50
Contingent deferred sales charge( monthly and quarterly
funds only) $ 5.00
Cost of Living Increase
The fees and expenses set forth in this Schedule may increase annually upon each
September 1 anniversary of this Agreement over the fees and expenses during the
prior 12 months, as calculated under this Schedule, in an amount equal to the
annual percentage increase of the Pennsylvania Consumer Price Index (not to
exceed 6% annually) as last reported by the U.S. Bureau of Labor Statistics for
the twelve months immediately preceding such anniversary."
*All fees are annualized and will be prorated on a monthly basis for billing
purposes. Out of pocket expenses are not covered by these fees.
<PAGE>
Transfer Agency Agreement
between
Federated Services Company
and
WCT Funds
Out-of-Pocket Expenses Schedule
Out-of-Pocket Expenses include, but are not limited to, the following:
Postage (including overnight courier service)
Statement Stock
Envelopes
Telephones
Telecommunication Charges (including FAX and Dedicated Line Charges)
VRU Application
Closed account Charges
12b-1 Processing Fees
Third Party Expenses (ie; NSCC fees)
Fiduciary Subaccounting Fee
Travel
Duplicating
Forms
Supplies
Microfiche
Computer Access Charges
Customized Programming and Reporting
Disaster Recovery
Other as Incurred
WCT FUNDS FEDERATED SERVICES COMPANY
By: By:
Name: Name:
Title: Title:
WCT Funds 4 September 1, 1997
Exhibit 9(ii)
FORM OF
SHAREHOLDER SERVICES AGREEMENT
THIS AGREEMENT, as of the first day of September, 1997, by and between
WCT Funds, having its principal office and place of business at Federated
Investors Tower, Pittsburgh, PA 15222-3779 and who have approved this form of
Agreement on behalf of the portfolios listed on Exhibit 1 (individually referred
to herein as a "Fund" and collectively as "Funds") and Federated Shareholder
Services, a Delaware business trust, having its principal office and place of
business at Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779
("FSS").
1. The Funds hereby appoint FSS to render or cause to be rendered personal
services to shareholders of the Funds and/or the maintenance of
accounts of shareholders of the Funds ("Services"). In addition to
providing Services directly to shareholders of the Funds, FSS is hereby
appointed the Funds' agent to select, negotiate and subcontract for the
performance of Services. FSS hereby accepts such appointments. FSS
agrees to provide or cause to be provided Services which, in its best
judgment (subject to supervision and control of the Funds' Boards of
Trustees, as applicable), are necessary or desirable for shareholders
of the Funds. FSS further agrees to provide the Funds, upon request, a
written description of the Services which FSS is providing hereunder.
2. During the term of this Agreement, each Fund will pay FSS and FSS agrees to
accept as full compensation for its services rendered hereunder a fee at an
annual rate, calculated daily and payable monthly, up to 0.25% of 1% of
average net assets of each Fund.
For the payment period in which this Agreement becomes effective or
terminates with respect to any Fund, there shall be an appropriate
proration of the monthly fee on the basis of the number of days that
this Agreement is in effect with respect to such Fund during the month.
3. This Agreement shall continue in effect for one year from the date of
its execution, and thereafter for successive periods of one year only
if the form of this Agreement is approved at least annually by the
Board of each Fund, including a majority of the members of the Board of
the Fund who are not interested persons of the Fund ("Independent Board
Members") cast in person at a meeting called for that purpose.
4. Notwithstanding paragraph 3, this Agreement may be terminated as
follows:
(a) at any time, without the payment of any penalty, by the vote of
a majority of the Independent Board Members of any Fund or by a
vote of a majority of the outstanding voting securities of any
Fund as defined in the Investment Company Act of 1940 on sixty
(60) days' written notice to the parties to this Agreement;
(b) automatically in the event of the Agreement's assignment as defined in
the Investment Company Act of 1940; and
(c) by any party to the Agreement without cause by giving the other party
at least sixty (60) days' written notice of its intention to
terminate.
5. FSS agrees to obtain any taxpayer identification number certification
from each shareholder of the Funds to which it provides Services that
is required under Section 3406 of the Internal Revenue Code, and any
applicable Treasury regulations, and to provide each Fund or its
designee with timely written notice of any failure to obtain such
taxpayer identification number certification in order to enable the
implementation of any required backup withholding.
6. FSS shall not be liable for any error of judgment or mistake of law or
for any loss suffered by any Fund in connection with the matters to
which this Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the
performance of its duties or from reckless disregard by it of its
obligations and duties under this Agreement. FSS shall be entitled to
rely on and may act upon advice of counsel (who may be counsel for such
Fund) on all matters, and shall be without liability for any action
reasonably taken or omitted pursuant to such advice. Any person, even
though also an officer, trustee, partner, employee or agent of FSS, who
may be or become a member of such Fund's Board, officer, employee or
agent of any Fund, shall be deemed, when rendering services to such
Fund or acting on any business of such Fund (other than services or
business in connection with the duties of FSS hereunder) to be
rendering such services to or acting solely for such Fund and not as an
officer, trustee, partner, employee or agent or one under the control
or direction of FSS even though paid by FSS.
This Section 6 shall survive termination of this Agreement.
7. No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against which an enforcement of the change, waiver, discharge or
termination is sought.
8. FSS is expressly put on notice of the limitation of liability as set
forth in the Declaration of Trust of each Fund that is a Massachusetts
business trust and agrees that the obligations assumed by each such
Fund pursuant to this Agreement shall be limited in any case to such
Fund and its assets and that FSS shall not seek satisfaction of any
such obligations from the shareholders of such Fund, the Trustees,
Officers, Employees or Agents of such Fund, or any of them.
9. The execution and delivery of this Agreement have been authorized by
the Trustees of FSS and signed by an authorized officer of FSS, acting
as such, and neither such authorization by such Trustees nor such
execution and delivery by such officer shall be deemed to have been
made by any of them individually or to impose any liability on any of
them personally, and the obligations of this Agreement are not binding
upon any of the Trustees or shareholders of FSS, but bind only the
trust property of FSS as provided in the Declaration of Trust of FSS.
10. Notices of any kind to be given hereunder shall be in writing (including
facsimile communication) and shall be duly given if delivered to any Fund
and to such Fund at the following address: Federated Investors Tower,
Pittsburgh, PA 15222-3779, Attention: President and if delivered to FSS at
Federated Investors Tower, Pittsburgh, PA 15222-3779, Attention: President.
11. This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject
hereof whether oral or written. If any provision of this Agreement
shall be held or made invalid by a court or regulatory agency decision,
statute, rule or otherwise, the remainder of this Agreement shall not
be affected thereby. Subject to the provisions of Sections 3 and 4,
hereof, this Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and shall
be governed by Pennsylvania law; provided, however, that nothing herein
shall be construed in a manner inconsistent with the Investment Company
Act of 1940 or any rule or regulation promulgated by the Securities and
Exchange Commission thereunder.
12. This Agreement may be executed by different parties on separate
counterparts, each of which, when so executed and delivered, shall be an
original, and all such counterparts shall together constitute one and the
same instrument.
13. This Agreement shall not be assigned by any party without the prior
written consent of FSS in the case of assignment by any Fund, or of the
Funds in the case of assignment by FSS, except that any party may
assign to a successor all of or a substantial portion of its business
to a party controlling, controlled by, or under common control with
such party. Nothing in this Section 14 shall prevent FSS from
delegating its responsibilities to another entity to the extent
provided herein.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
WCT Funds
Attest: By:
Federated Shareholder Services
Attest: By:
Secretary President
<PAGE>
Exhibit 1
September 1, 1997 WCT Funds
WCT Equity Fund
WCT Funds 3 September 1, 1997
Exhibit 9(iii)
FORM OF
WCT FUNDS
SHAREHOLDER SERVICES PLAN
This Shareholder Services Plan ("Plan") is adopted as of this 1st day
of September, by the Board of Trustees of WCT Funds (the "Fund"), a
Massachusetts business trust with respect to certain classes of shares
("Classes") of the portfolios of the Trust ("the Portfolios") set forth in
exhibits hereto.
1. This Plan is adopted to allow the Fund to make payments as
contemplated herein to obtain certain personal services for
shareholders and/or the maintenance of shareholder accounts
("Services").
2. This Plan is designed to compensate broker/dealers and other
participating financial institutions and other persons ("Providers") for
providing services to the Fund and its shareholders. The Plan will be
administered by Federated Administrative Services, ("FAS"). In compensation for
the services provided pursuant to this Plan, Providers will be paid a monthly
fee computed at the annual rate not to exceed .25 of 1% of the average aggregate
net asset value of the shares of the Fund held during the month.
3. Any payments made by the Portfolios to any Provider pursuant to this
Plan will be made pursuant to the "Shareholder Services Agreement" entered into
by FAS on behalf of the Fund and the Provider. Providers which have previously
entered into "Administrative Agreements" or "Rule 12b-1 Agreements" with
Edgewood Services, Inc.. may be compensated under this Plan for Services
performed pursuant to those Agreements until the Providers have executed a
"Shareholder Services Agreement" hereunder.
4. The Fund has the right (i) to select, in its sole discretion, the
Providers to participate in the Plan and (ii) to terminate without cause and in
its sole discretion any Shareholder Services Agreement.
5. Quarterly in each year that this Plan remains in effect, FAS shall
prepare and furnish to the Board of Trustees of the Fund, and the Board of
Trustees shall review, a written report of the amounts expended under the Plan.
6. This Plan shall become effective (i) after approval by majority
votes of: (a) the Fund's Board of Trustees; and (b) the members of the Board of
the Trust who are not interested persons of the Trust and have no direct or
indirect financial interest in the operation of the Trust's Plan or in any
related documents to the Plan ("Disinterested Trustees"), cast in person at a
meeting called for the purpose of voting on the Plan; and (ii) upon execution of
an exhibit adopting this Plan.
7. This Plan shall remain in effect with respect to each Class
presently set forth on an exhibit and any subsequent Classes added pursuant to
an exhibit during the initial year of this Plan for the period of one year from
the date set forth above and may be continued thereafter if this Plan is
approved with respect to each Class at least annually by a majority of the
Trust's Board of Trustees and a majority of the Disinterested Trustees, cast in
person at a meeting called for the purpose of voting on such Plan. If this Plan
is adopted with respect to a class after the first annual approval by the
Trustees as described above, this Plan will be effective as to that Class upon
execution of the applicable exhibit pursuant to the provisions of paragraph
6(ii) above and will continue in effect until the next annual approval of this
Plan by the Trustees and thereafter for successive periods of one year subject
to approval as described above.
8. All material amendments to this Plan must be approved by a vote of the
Board of Trustees of the Fund and of the Disinterested Trustees, cast
in person at a meeting called for the purpose of voting on it.
9. This Plan may be terminated at any time by: (a) a majority vote of the
Disinterested Trustees; or (b) a vote of a majority of the outstanding
voting securities of the Fund as defined in Section 2(a)(42) of the
Act.
10. While this Plan shall be in effect, the selection and nomination of
Disinterested Trustees of the Fund shall be committed to the
discretion of the Disinterested Trustees then in office.
11. All agreements with any person relating to the implementation of
this Plan shall be in writing and any agreement related to this Plan shall be
subject to termination, without penalty, pursuant to the provisions of Paragraph
9 herein.
12. This Plan shall be construed in accordance with and governed by the
laws of the Commonwealth of Pennsylvania.
Witness the due execution hereof this 1st day of September, 1997.
WCT FUNDS
By:
President
<PAGE>
EXHIBIT A
to the
Shareholder Services Plan
WCT FUNDS
WCT Equity Fund
This Plan is adopted by WCT Funds with respect to the Class of Shares
of the portfolio of the Trust set forth above.
In compensation for the services provided pursuant to this Plan,
Providers will be paid a monthly fee computed at the annual rate of 0.25 of 1%
of the average aggregate net asset value of the WCT Equity Fund held during the
month.
Witness the due execution hereof this 1st day of September, 1997.
WCT FUNDS
By:
President
WCT Funds September 1, 1997
Exhibit 15(i)
FORM OF
WCT Funds
DISTRIBUTION PLAN
This Distribution Plan ("Plan") is adopted as of August , 1997, by
the Board of Trustees of between WCT Funds (the "Trust"), a
Massachusetts business trust with respect to certain classes of shares
("Classes") of the portfolios of the Trust (the "Funds") set forth in
exhibits hereto.
1. This Plan is adopted pursuant to Rule 12b-1 under the Investment
Company Act of 1940, as amended ("Act"), so as to allow the Trust to
make payments as contemplated herein, in conjunction with the
distribution of Classes of the Funds ("Shares").
2. This Plan is designed to finance activities of Edgewood Services,
Inc. ("ESI") principally intended to result in the sale of Shares to
include: (a) providing incentives to financial institutions
("Financial Institutions") to sell Shares; (b) advertising and
marketing of Shares to include preparing, printing and distributing
prospectuses and sales literature to prospective shareholders and
with Financial Institutions; and (c) implementing and operating the
Plan. In compensation for services provided pursuant to this Plan,
ESI will be paid a fee in respect of the following Classes set forth
on the applicable exhibit.
3. Any payment to ESI in accordance with this Plan will be made pursuant
to the "Distributor's Contract" entered into by the Trust and ESI.
Any payments made by ESI to Financial Institutions with funds
received as compensation under this Plan will be made pursuant to the
"Financial Institution Agreement" entered into by ESI and the
Institution.
4. ESI has the right (i) to select, in its sole discretion, the Financial
Institutions to participate in the Plan and (ii) to terminate without
cause and in its sole discretion any Financial Institution Agreement.
5. Quarterly in each year that this Plan remains in effect, ESI shall
prepare and furnish to the Board of Trustees of the Trust, and the
Board of Trustees shall review, a written report of the amounts
expended under the Plan and the purpose for which such expenditures
were made.
6. This Plan shall become effective with respect to each Class (i) after
approval as required by Rule 12b-1 under the Act as in effect on the
date of the execution hereof; and (ii) upon execution of an exhibit
adopting this Plan with respect to such Class.
7. This Plan shall remain in effect with respect to each Class presently
set forth on an exhibit and any subsequent Classes added pursuant to
an exhibit during the initial year of this Plan for the period of one
year from the date set forth above and may be continued thereafter if
this Plan is approved with respect to each Class at least annually by
a majority of the TrustBoard of Trustees and a majority of the
Disinterested Trustees, cast in person at a meeting called for the
purpose of voting on such Plan. If this Plan is adopted with respect
to a Class after the first annual approval by the Trustees as
described above, this Plan will be effective as to that Class upon
execution of the applicable exhibit pursuant to the provisions of
paragraph 6(ii) above and will continue in effect until the next
annual approval of this Plan by the Trustees and thereafter for
successive periods of one year subject to approval as described
above.
8. All material amendments to this Plan must be approved by a vote of the
Board of Trustees of the Trust and of the Disinterested Trustees, cast
in person at a meeting called for the purpose of voting on it.
9. This Plan may not be amended in order to increase materially the
costs which the Classes may bear for distribution pursuant to the
Plan without being approved by a majority vote of the outstanding
voting securities of the Classes as defined in Section 2(a)(42) of
the Act.
10. This Plan may be terminated with respect to a particular Class at any
time by: (a) a majority vote of the Disinterested Trustees; or (b) a
vote of a majority of the outstanding voting securities of the
particular Class as defined in Section 2(a)(42) of the Act; or (c) by
ESI on 60 days' notice to the Trust.
11. While this Plan shall be in effect, the selection and nomination of
Disinterested Trusteesof the Trust shall be committed to the
discretion of the Disinterested Trustees then in office.
12. All agreements with any person relating to the implementation of this
Plan shall be in writing and any agreement related to this Plan shall
be subject to termination, without penalty, pursuant to the provisions
of Paragraph 10 herein.
13. This Plan shall be construed in accordance with and governed by the
laws of the Commonwealth of Pennsylvania.
<PAGE>
EXHIBIT A
to the
Distribution Plan
WCT Funds
WCT Equity Fund
This Distribution Plan is adopted by between WCT Funds with
respect to the WCT Equity Fund set forth above.
In compensation for the services provided pursuant to this Plan,
ESI will be paid a monthly fee computed at the annual rate of .25% of
the average aggregate net asset value of the WCT Equity Fund held
during the month.
Witness the due execution hereof this 1st day of September, 1997.
WCT Funds
By:
President
WCT Funds September 1, 1997
Exhibit 15 (ii)
FORM OF
RULE 12b-1 AGREEMENT
This Agreement is made between the Financial Institution executing this
Agreement ("Administrator") and Edgewood Services, Inc. ("ESI") for the mutual
funds (referred to individually as the "Fund" and collectively as the "Funds")
for which ESI serves as Distributor of shares of beneficial interest or capital
stock ("Shares") and which have adopted a Rule 12b-1 Plan ("Plan") and approved
this form of agreement pursuant to Rule 12b-1 under the Investment Company Act
of 1940. In consideration of the mutual covenants hereinafter contained, it is
hereby agreed by and between the parties hereto as follows:
1. ESI hereby appoints Administrator to render or cause to be rendered
sales and administrative support services to the Funds and their shareholders.
2. The services to be provided under Paragraph 1 may include, but are
not limited to advertising, compensation of sales personnel, mailing of
prospectuses, providing assistance and review in designing materials to send to
potential customers, and such other services as are primarily intended to result
in sales of Shares by the Funds.
3. During the term of this Agreement, ESI will pay the Administrator
fees for each Fund as set forth in a written schedule delivered to the
Administrator pursuant to this Agreement. ESI's fee schedule for Administrator
may be changed by ESI sending a new fee schedule to Administrator pursuant to
Paragraph 12 of this Agreement. For the payment period in which this Agreement
becomes effective or terminates, there shall be an appropriate proration of the
fee on the basis of the number of days that the Rule 12b-1 Agreement is in
effect during the quarter.
4. The Administrator will not perform or provide any duties which would
cause it to be a fiduciary under Section 4975 of the Internal Revenue Code, as
amended. For purposes of that Section, the Administrator understands that any
person who exercises any discretionary authority or discretionary control with
respect to any individual retirement account or its assets, or who renders
investment advice for a fee, or has any authority or responsibility to do so, or
has any discretionary authority or discretionary responsibility in the
administration of such an account, is a fiduciary.
5. The Administrator understands that the Department of Labor views
ERISA as prohibiting fiduciaries of discretionary ERISA assets from receiving
administrative service fees or other compensation from funds in which the
fiduciary's discretionary ERISA assets are invested. To date, the Department of
Labor has not issued any exemptive order or advisory opinion that would exempt
fiduciaries from this interpretation. Without specific authorization from the
Department of Labor, fiduciaries should carefully avoid investing discretionary
assets in any fund pursuant to an arrangement where the fiduciary is to be
compensated by the fund for such investment. Receipt of such compensation could
violate ERISA provisions against fiduciary self-dealing and conflict of interest
and could subject the fiduciary to substantial penalties.
6. The Administrator agrees not to solicit or cause to be solicited
directly, or indirectly at any time in the future, any proxies from the
shareholders of any or all of the Funds in opposition to proxies solicited by
management of the Fund or Funds, unless a court of competent jurisdiction shall
have determined that the conduct of a majority of the Board of Directors or
Trustees of the Fund or Funds constitutes willful misfeasance, bad faith, gross
negligence or reckless disregard of their duties. This paragraph 6 will survive
the term of this Agreement.
7. With respect to each Fund, this Agreement shall continue in effect
for one year from the date of its execution, and thereafter for successive
periods of one year if the form of this Agreement is approved at least annually
by the Directors or Trustees of the Fund, including a majority of the members of
the Board of Directors or Trustees of the Fund who are not interested persons of
the Fund and have no direct or indirect financial interest in the operation of
the Fund's Plan or in any related documents to the Plan ("Disinterested
Directors or Trustees") cast in person at a meeting called for that purpose.
8. Notwithstanding paragraph 7, this Agreement may be terminated as follows:
(a) at any time, without the payment of any penalty, by the vote
of a majority of the Disinterested Directors or Trustees of
the Fund or by a vote of a majority of the outstanding voting
securities of the Fund as defined in the Investment Company
Act of 1940 on not more than sixty (60) days' written notice
to the parties to this Agreement;
(b) automatically in the event of the Agreement's assignment as
defined in the Investment Company Act of 1940 or upon the
termination of the "Administrative Support and Distributor's
Contract" or "Distributor's Contract" between the Fund and ESI;
and
(c) by either party to the Agreement without cause by giving the
other party at least sixty (60) days' written notice of its
intention to terminate.
9. The termination of this Agreement with respect to any one Fund
will not cause the Agreement's termination with respect to any
other Fund.
10. The Administrator agrees to obtain any taxpayer identification
number certification from its customers required under Section 3406 of the
Internal Revenue Code, and any applicable Treasury regulations, and to provide
ESI or its designee with timely written notice of any failure to obtain such
taxpayer identification number certification in order to enable the
implementation of any required backup withholding.
11. This Agreement supersedes any prior service agreements between
the parties for the Funds.
12. This Agreement may be amended by ESI from time to time by the
following procedure. ESI will mail a copy of the amendment to the
Administrator's address, as shown below. If the Administrator does not object to
the amendment within thirty (30) days after its receipt, the amendment will
become part of the Agreement. The Administrator's objection must be in writing
and be received by ESI within such thirty days.
<PAGE>
13. This Agreement shall be construed in accordance with the Laws of
the Commonwealth of Pennsylvania.
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Administrator
---------------------------------
Address
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City State Zip Code
Dated:_______________________
By:______________________________
Authorized Signature
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Title
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Print Name of Authorized Signature
EDGEWOOD SERVICES, INC.
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
By:_________________________________
<PAGE>
WCT FUNDS
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EXHIBIT A to 12b-1 Agreement with
Edgewood Services, Inc. ("ESI")
Portfolios
ESI will pay Administrator fees for the following portfolios (the
"Funds") effective as of the dates set forth below:
Name Date
WCT Equity Fund September 1, 1997
Administrative Fees
1. During the term of this Agreement, ESI will pay Administrator a
quarterly fee in respect of each Fund. This fee will be computed at the annual
rate of .25% of the average net asset value of Shares held during the quarter in
accounts for which the Administrator provides services under this Agreement, so
long as the average net asset value of Shares in each Fund during the quarter
equals or exceeds such minimum amount as ESI shall from time to time determine
and communicate in writing to the Administrator.
2. For the quarterly period in which the Administrative Agreement
becomes effective or terminates, there shall be an appropriate proration of any
fee payable on the basis of the number of days that the Agreement is in effect
during the quarter.
Exhibit 19
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and
appoints the Secretary and Assistant Secretary of WCT FUNDS and the Deputy
General Counsel of Federated Investors, and each of them, their true and lawful
attorneys-in-fact and agents, with full power of substitution and resubstitution
for them and in their names, place and stead, in any and all capacities, to sign
any and all documents to be filed with the Securities and Exchange Commission
pursuant to the Securities Act of 1933, the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, by means of the Securities and Exchange
Commission's electronic disclosure system known as EDGAR; and to file the same,
with all exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to sign and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as each of them might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue thereof.
SIGNATURES TITLE DATE
/s/C. Grant Anderson Chairman and Trustee August 7, 1997
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C. Grant Anderson (Chief Executive Officer)
/s/C. Christine Thomson Treasurer and Trustee
C. Christine Thomson (Principal Financial and
Accounting Officer)
/s/Patricia L. Godlewski Trustee
Patricia L. Godlewski
Sworn to and subscribed before me this 7th day of August, 1997
/s/Marie M. Hamm
