UNITED STATES
Securities and Exchange Commission
Washington, DC. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
X
and
THE INVESTMENT COMPANY ACT OF 1940
X
Molter Series Funds, Inc. (Exact Name of Registrant as
Specified in Charter)
6720 East Camino Principal, Suite 100, Tucson AZ. 85715
(Address of Principal Executive Offices)
520-298-7000 (Registrants
Telephone Number)
Daniel A Molter 6720 East Camino Principal, Suite 100,
Tucson AZ. 85715
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering: As soon as
practicable after the
effective date of this registration.
It is proposed that this filing will become effective
[x] 60 days after filing pursuant to paragraph (a)
Calculation of Registration Fee Under the Securities Act of 1933
Title of Securities Amount Being Proposed Max Proposed
Max Amount of
being Registered Registered Offering Aggregate
Registration
Price Offering
Price Fee
Investment Series Funds, Inc. *
Common Stock $.01 1,500,000 $5.00
$7,500,000 $2,586.20
par value
* Estimated for the purpose of determining the amount of the
registration fee.
This is the actual Net Asset value per share as of the
starting date.
The Registrant hereby amends this Registration Statement on
such date or dates
that 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 this Registration
Statement shall become
effective on such date as the Commission acting to section 8(A)
may determine.
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<PAGE>
Cross Reference Sheet
INFORMATION REQUIRED CAPTIONS IN FILING
Part A: IN A PROSPECTUS
Item 1. Cover Page Cover Page
Item 2. Synopsis Fund Expenses
Item 3. Condensed Financial Information Fund Expenses
Item 4. General Description of Registrant The Fund
Item 5. Management of the Fund Management of the
Fund
Item 6. Capital Stock and other Securities Capitalization
Item 7. Purchase of Securities being Offered Purchase of
Shares- Reinvestment
Item 8. Redemption or Repurchase Redemption of
Shares
Item 9. Legal Proceedings Litigation
Part B: STATEMENT OF ADDITIONAL INFORMATION
Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History The Fund
Item 13. Investment Objectives and Policies Objectives and
Policies
Item 14. Management of the Registrant Officers &
Directors of the Fund
Item 15. Control Persons & Principal Holders Not Applicable
of Securities
Item 16. Investment Advisory and Other Services
- - Investment Adviser
Item 17. Brokerage Allocation Brokerage
Item 18. Capital Stock & Other Securities Capitalization
Item 19. Purchase, Redemption & Pricing of Purchase of Shares
Securities Being Offered
Item 19. Purchase, Redemption & Pricing of Redemption of
Shares
Securities Being Offered
Item 19. Purchase, Redemption & Pricing of Pricing of Shares
Securities Being Offered
Item 20. Tax Status Tax Status
Item 21. Underwriters Not Applicable
Item 22. Calculation of Yield Quotations of Not Applicable
Money Market Funds
Item 23. Financial Statements Financial
Statements
Part C: OTHER INFORMATION
Item 24. Financial Statements & Exhibits To be Supplied
Item 25. Persons Controlled by/or under Control Persons
Common Control
Item 26. Number of Holders of Securities Number of
Shareholders
Item 27. Indemnifications Indemnification
Item 28. Business & Other Connections of Activities of
Investment Advisor
Advisor
Item 29 Principal Underwriters Principal
Underwriter
Item 30. Location of Accounts & Records Location of
Accounts & Records
Item 31. Management Services Not Applicable
Item 32. Undertakings Not Applicable
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<PAGE>
MOLTER SERIES FUNDS, INC.
TUCSON, AZ. 85715
520-298-7000
PROSPECTUS
XXXXXX XX, 1997
The Fund & Investment Objective
Investment Series Funds, Inc. ("the Fund") is an open-end
non-diversified management in-
vestment company that seeks capital appreciation through
investment in the com-
mon stocks and/or securities convertible into common stocks.
Criteria used by
the Adviser will be based on the Business Economics, Management
Quality, Finan-
cial Condition and Stock Price of each business. Current
income from these in-
vestments will be a subordinate consideration.
Fund Share Purchase
Capital shares of the Fund may only be purchased directly from
the Fund at net
asset value as next determined after receipt of order. The
Board of Directors
has established $2,000 as the minimum initial purchase and
$500 for subsequent
purchases.
Additional Information
This Prospectus, which should be held for future reference, is
designed to set
forth concisely the information that you should know before
you invest. A
"Statement of Additional Information" containing more
information about the Fund
has been filed with the Securities and Exchange Commission.
Such Statement is
dated XXXXX XX, 1997 and has been incorporated by reference into
the Prospectus.
A copy of the Statement may be obtained without charge, by
writing to the Fund
or by calling the telephone number shown above.
THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION, NOR HAS
THE
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY
IS A CRIMINAL OFFENSE.
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<PAGE>
FUND EXPENSES
The following illustrates all expenses and fees that a
shareholder of the
Investment Series Funds, Inc. Fund will incur. The expenses
and fees set forth below are for the
1997 fiscal year.
Shareholder Transaction Expenses:
Sales Load Imposed on Purchases
None
Sales Load Imposed on Reinvested Dividends
None
Redemption Fees
None
Exchange Fees
None
IRA Trustee Fees
None
Annualized Fund Operating Expenses:
Management Fees
1.0%
12b-1 Fees
None
Other Expenses
1.0%
Total Operating Expenses
2.0%
The following table is given to assist investors in
understanding the various
costs and expenses that an investor in the Fund will bear
directly and in-
directly. It illustrates the expenses paid on a $1,000
investment over vari-
ous time periods assuming a) 5% annual rate of return and b)
redemption at the
end of each time period. This example should not be considered
a representa-
tion of past or future expenses or performance. Actual expenses
may be greater
or less than those shown.
1 Year 3 Years 5 Years 10 Years
$20 $63 $111 $252
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<PAGE>
THE FUND MOLTER SERIES FUNDS, INC. (also referred to as the
"Fund") was incorporated in
Arizona on June 25, 1997. The Fund's registered office is in
Tucson, AZ: mail
may be addressed to 6720 East Camino Principal, Suite 100,
Tucson AZ. 85715
OBJECTIVES AND POLICIES
Objective: Molter Series Funds, Inc. ("the Fund") is an
open-end, non-diversified
management investment company that seeks capital appreciation
through investment
in the common stocks and/or securities convertible into common
stocks. Crite-
ria used by the Adviser will be based on the Business Economics,
Management Qua-
lity, Financial Condition and Stock Price of each business.
Current income from
these investments will be a subordinate consideration.
Risk Assessment: Risks associated with the Fund's performance
will be those due
to broad market declines and business risks from difficulties
which occur to
particular companies while in the Fund's portfolio. It must be
realized, as is
true of almost all securities, there can be no assurance that
the Fund will ob-
tain its ongoing objective of capital appreciation.
Security Selection Criteria: Criteria used by the Adviser in
recommending pur-
chases of securities will be based on the Business Economics,
Management Quali-
ty, Financial Condition and Security Price of each business.
Portfolio Turnover Policy: The Fund does not propose to
purchase securities for
short term trading in the ordinary course of operations.
Accordingly, it is ex-
pected that the annual turnover rate will not exceed 50%,
wherein turnover is
computed by dividing the lesser of the Fund's total purchases or
sales of secu-
rities within the period by the average monthly portfolio value
of the Fund dur-
ing such period. There may be times when management deems it
advisable to sub-
stantially alter the composition of the portfolio, in which
event, the portfolio
turnover rate might substantially exceed 50%; this would only
result from spe-
cial circumstances and not from the Fund's normal operations.
Non-diversification Policy: The Fund is classified as being
non-diversified
which means that it may invest a relatively high percentage of
its assets in the
obligations of a limited number of issues. The Fund,
therefore, may be more
susceptible than a more widely diversified fund to any single
economic, politi-
cal, or regulatory occurrence. The policy of the Fund, in the
hope of achiev-
ing its objective as stated above, is, therefore, one of
selective investments
rather than broad diversification. The Fund seeks only enough
diversification
for adequate representation among what it considers to be the
best performing
securities and to maintain its federal non-taxable status under
Sub-Chapter M of
the Internal Revenue Code (see next paragraph).
TAX STATUS
Under the provisions of Sub-Chapter M of the Internal Revenue
Code of 1954 as
amended, the Fund, intends to pay out substantially all of its
investment income
and realized capital gains, and intends to be relieved of
federal income tax on
the amounts distributed to shareholders. In order to qualify
as a "regulated
investment company" under Sub-Chapter M, at least 90% of the
Fund's income must
be derived from dividends, interest, and gains from securities
transactions, no
more than 30% of the Fund's profits may be derived from
securities held less
than three months, and no more than 50% of the Fund assets may
be held in secur-
ity holdings that exceed 5% of the total assets of the Fund at
time of purchase.
Distribution of any net long term capital gains realized by
the Fund in 1997
will be taxable to the shareholder as long term capital gains,
regardless of the
length of time Fund shares have been held by the investor. All
income realized
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<PAGE>
by the Fund, including short term capital gains, will be
taxable to the share-
holder as ordinary income. Dividends from net income will be
made annually or
more frequently at the discretion of the Fund's Board of
Directors. Dividends
received shortly after purchase of shares by an investor will
have the effect of
reducing the per share net asset value of his shares by the
amount of such divi-
dends or distributions and, although in effect a return of
capital, are subject
to federal income taxes.
The Fund is required by federal law to withhold 31% of
reportable payments
(which may include dividends, capital gains, distributions and
redemption) paid
to shareholders who have not complied with IRS regulations. In
order to avoid
this withholding requirement, you must certify on a W-9 tax
form supplied by
the Fund that your Social Security or Taxpayer Identification
Number provided is
correct and that you are not currently subject to back-up
withholding, or that
you are exempt from back-up withholding.
INVESTMENT RESTRICTIONS
By-laws of the Fund provide the following fundamental
investment restrictions;
The Fund may not, except by the approval of a majority of
the outstanding
shares; i.e. 1) 67% or more of the voting securities present
at a duly called
meeting, if the holders of more than 50% of the outstanding
voting securities
are present or represented by proxy, or 2) of more than 50% of
the outstanding
voting securities, whichever is less:
(a) Act as underwriter for securities of other issuers except
insofar as the
Fund may be deemed an underwriter in selling its own
portfolio securities.
(b) Borrow money or purchase securities on margin, but may
obtain such short
term credit as may be necessary for clearance of purchases
and sales of se-
curities for temporary or emergency purposes in an amount
not exceeding 5%
of the value of its total assets.
(c) Sell securities short.
(d) Invest in securities of other investment companies except as
part of a mer-
ger, consolidation , or purchase of assets approved by
the Fund's share-
holders.
(e) Invest over 25% of its assets at the time of purchase in any
one industry.
(f) Make investments in commodities, commodity contracts or real
estate although
the Fund may purchase and sell securities of companies
which deal in real
estate or interests therein.
(g) Make loans. The purchase of a portion of a readily
marketable issue of pub-
licly distributed bonds, debentures or other debt
securities will not be
considered the making of a loan.
(h) Acquire more than 10% of the securities of any class of
another issuer,
treating all preferred securities of an issuer as a
single class and all
debt securities as a single class, or acquire more than
10% of the voting
securities of another issuer.
(i) Invest in companies for the purpose of acquiring control.
(j) The Fund may not purchase or retain securities of any
issuer if those offi-
cers and directors of the Fund or its Investment Adviser
owning individual-
ly more than 1/2 of 1% of any class of security or
collectively own more
than 5% of such class of securities of such issuer.
(k) Pledge, mortgage or hypothecate any of its assets.
(l) Invest in securities which may be subject to registration
under the Securi-
ties Act of 1933 prior to sale to the public or which are
not at the time of
purchase readily salable.
(m) Invest more than 5% of the total Fund assets, taken at
market value at the
time of purchase, in securities of companies with less
than three years'
continuous operation, including the operations of any
predecessor.
(n) Issue senior securities.
- 4 -
<PAGE>
INVESTMENT ADVISER
Investment Research Associates, Inc.is an Arizona corporation
that acts as an
Investment Adviser, to the Fund. Mr. Daniel A. Molter and
Hester Molter established the company in April 1992. Mr.
Molter has an M.B.A. from the Wharton Graduate School of
Business and a C.P.A. Mr. Molter has held staff and management
positions with Mobil Oil, Union Pacific, and was the Chief
Financial Officer of Botany 500 McGegor Sportswear. On June 25,
1997 shareholders of the Fund approved a management and
Advisory contract with Investment Research Associates, Inc.,
which was unanimously approved by the Board of Directors June
25, 1997. This Agreement will continue on a year to year
basis
provided that approval is voted at least annually by specific
approval of
the Board of Directors of the Fund or by vote of the holders of
a majority
of the outstanding voting securities of the Fund, but, in either
event,
it must also be approved by a majority of the directors of the
Fund who are nei-
ther parties to the agreement nor interested persons as
defined in the Invest-
ment Company Act of 1940 at a meeting called for the purpose
of voting on such
approval. Under the Agreement, Investment Research Associates,
Inc. will furnish
investment advice to the Directors of the Fund on the basis of
a continuous re-
view of the portfolio and recommend to the Fund when & to what
extent securities
should be purchased or disposed. The Agreement may be
terminated at any time,
without the payment of any penalty, by the Board of Directors
or by vote of a
majority of the outstanding voting securities of the Fund on
not more than 60
days written notice to Investment Research Associates, Inc.
In the event of its
assignment, the Agreement will terminate automatically.
Ultimate decisions as
to the investment policy and as to individual purchases and
sales of securities
are made by the Fund's officers and directors. For these
services the Fund has
agreed to pay to Investment Research Associates, Inc. a fee of
1% per year on the net as-
sets of the Fund. All fees are computed on the average daily
closing net asset
value of the Fund and are payable monthly. The fee is higher
than the fee paid
by most other funds. Not withstanding, the Investment Adviser
would forgo suf-
ficient fees to hold the total expenses of the Fund to less
than 2.0% of the
first $10 million in averaged assets and 1.5% of the next $20
million. These ra-
tios were selected by the Board of Directors because they are
believed to meet
the most restrictive state requirements.
Pursuant to its contract with the Fund, the Investment
Adviser is required to
render research, statistical and advisory services to the Fund;
to make specific
recommendations based on the Fund's investment requirements; and
to pay salaries
of the Funds' employees who may be officers or directors or
employees of the In-
vestment Adviser. Excepting these items, the Fund pays all
other fees and ex-
penses incurred in conducting its business affairs. The
Investment Adviser has
paid the initial organizational costs of the Fund and will
reimburse the Fund
for any and all losses incurred because of purchase reneges.
OFFICERS AND DIRECTORS OF THE FUND
Officers and Directors of the Fund, together with their
addresses, age, princi-
pal occupations and percent of shares outstanding held during
the past five
years are:
Occupation
Percent
Name and Address Age Position Past 5 Years
of Class
Daniel A. Molter* 56 President Investment
Advisor 100.00%
6720 E Camino Principal Interested Investment
Research
Suite 100, Director Associates, Inc.
Tucson, AZ
- 5 -
<PAGE>
Occupation
Percent
Name and Address Age Position Past 5 Years
of Class
Hester Molter* 45 Secretary Self-Proprietor
6720 E Camino Principal Interested
Suite 100 Director
Tucson, AZ Wife of President
Jane Justus Non-Interested
Investor 0.00%
Tucson AZ 85718 Director
Cliff Altfeld 40 Non-Interested Attorney at Law
0.00%
6273 La Yerba Director Tucson, AZ
Tucson, AZ 85750
Marianne Finley 55 Non-Interested Self-Proprietor
0.00%
325 Pine Street Director
Denver, CO
* Directors of the Fund who are considered "Interested
Directors" as defined by
the Investment Company act of 1940. Mr. Molter is President
and joint owner of
the Fund and Mrs. Molter is secretary and joint owner of the
Fund.
The Fund does not compensate its officers and directors
affiliated with the In-
vestment Adviser except as they may benefit through payment of
the Advisory fee.
The Fund does not intend to compensate its officers and
directors until assets
exceed $2,500,000 although they will be reimbursed for their
expenses.
CAPITALIZATION
Description of Common Stock: The authorized capitalization of
the Fund consists
of 10,000,000 shares of common stock of $0.01 par value per
share. Each share
has equal dividend, distribution and liquidation rights with
no conversion or
pre-emptive rights. All shares issued are fully paid and
non-accessible.
Voting Rights: Each shareholder has one vote for each
share held. Voting
rights are non-cumulative, which means that holders of a
majority of shares can
elect all directors of the Fund if they so choose.
Major Shareholders: Daniel and Hester Molter, as of the date
of this Prospectus, own
all outstanding shares of the Fund.
PURCHASE OF SHARES -REINVESTMENTS
The offering price of the shares offered by the Fund is at the
net asset value
per share next determined after receipt of the purchase order by
the Fund and is
computed in the manner described under the caption "PRICING OF
SHARES" in this
Prospectus. The Fund reserves the right at its sole discretion
to terminate the
offering of its shares made by this Prospectus at any time
and to reject pur-
- 6 -
<PAGE>
chase applications when, in the judgment of management such
termination or re-
jection is in the best interests of the Fund.
Initial Investments: Initial purchase of shares of the Fund may
be made only by
application submitted to the Fund. For the convenience of
investors, a Share
Purchase Application form is provided with this Prospectus. The
minimum initial
purchase of shares is $2,000 which is due and payable 3
business days after the
purchase date. Less may be accepted under especial
circumstances. The Fund
will be initially registered in Arizona and therefore
restricted to Arizona
residents at the time of purchase. There will be no
solicitation of
out of the state of Arizona potential shareholders until
registration under
the Blue Sky laws of the state of residence have been met.
Subsequent Purchases: Subsequent purchases may be made by mail
or by phone and
are due and payable five business days after the purchase date.
The minimum is
$500, but less may be accepted under special circumstances.
Reinvestments: The Fund will automatically retain and reinvest
dividends & cap-
ital gains distributions and use same for the purchase of
additional shares for
the shareholder at net asset value as of the close of business
on the distribu-
tion date. A Shareholder may at any time by letter or forms
supplied by the
Fund direct the Fund to pay dividends and/or capital gains
distributions, if
any, to such shareholder in cash.
Fractional Shares: Shares will be issued to three decimal
places as purchased
from the fund. The fund will maintain an account for each
shareholder of shares
for which no certificates have been issued.
RETIREMENT PLANS
Individual Retirement Account: Persons who earn compensation
and are not active
participants (and who do not have a spouse who is an active
participant) in an
employee maintained retirement plan may establish Individual
Retirement Accounts
(IRA) using Fund shares. Annual contributions, limited to the
lesser of $2,000
or 100% of compensation, are tax deductible from gross income.
This IRA deduc-
tion is also retained for individual taxpayers and married
couples with adjusted
gross incomes within certain specified limits. All individuals
may make nonde-
ductible IRA contributions to separate accounts to the extent
that they are not
eligible for a deductible contribution.
Earnings under the IRA are reinvested and are tax-deferred until
withdrawals be-
gin. The maximum annual contribution may be increased to
$4,000 if you have a
spouse during the taxable year. A separate and independent
Spousal IRA must
be maintained.
You may begin to make non-penalty withdrawals as early as age
59 1/2 or as late
as age 70 1/2. In the event of death or disability, withdrawals
may be made be-
fore age 59 1/2 without penalty.
A Disclosure Statement is required by U.S. Treasury Regulations.
This Statement
describes the general provisions of the IRA and is forwarded to
all prospective
IRA's. There is no charge to open and maintain a Investment
Series Fund,
Inc. Fund IRA. This policy may be changed by the Board of
Directors if they
deem it to be in the best interests of all shareholders. All
IRA's may be
revoked within 7 days of their establishment with no penalty.
PRICING OF SHARES
The net asset value of the Fund's shares is determined as of
the close of busi-
ness of the New York Stock Exchange on each business day of
which that Exchange
- 7 -
<PAGE>
is open (presently 4:00 p.m.) Monday through Friday exclusive
of Washington's
Birthday, Good Friday, Memorial Day, July 4th, Labor Day,
Thanksgiving, Christ-
mas & New Year's Day. The price is determined by dividing the
value of its se-
curities, plus any cash and other assets less all liabilities,
excluding capital
surplus, by the number of shares outstanding. The market
value of securities
listed on a national exchange is determined to be the last
recent sales price on
such exchange. Listed securities that have not recently
traded and over-the-
counter securities are valued at the last bid price in such
market.
Short term paper (debt obligations that mature in less than 60
days) are valued
at amortized cost which approximates market value. Other
assets are valued at
fair market value. Other assets are valued at fair value as
determined in good
faith by the Board of Directors.
REDEMPTION OF SHARES
The Fund will redeem all or any part of the shares of any
shareholder who ten-
ders a request for redemption (if certificates have not been
issued) or certifi-
cates with respect to shares for which certificates have been
issued. In either
case, proper endorsements guaranteed either by a national bank
or a member firm
of the New York Stock Exchange will be required unless the
shareholder is known
to management. The redemption price is the net asset value
per share next de-
termined after notice is received by the Fund for redemption
of shares. The
proceeds received by the shareholder may be more or less than
his cost of such
shares, depending upon the net asset value per share at the
time of redemption
and the difference should be treated by the shareholder as a
capital gain or
loss for federal income tax purposes.
Payment by the Fund will ordinarily be made within three
business days after
tender. The Fund may suspend the right of redemption or
postpone the date of
payment if: The New York Stock Exchange is closed for other than
customary week-
end or holiday closings, or when trading on the New York Stock
Exchange is re-
stricted as determined by the Securities and Exchange
Commission or when the
Securities and Exchange Commission has determined that an
emergency exists, mak-
ing disposal of fund securities or valuation of net assets not
reasonably prac-
ticable. The Fund intends to make payments in cash, however,
the Fund reserves
the right to make payments in kind.
BROKERAGE
The Fund requires all brokers to effect transactions in
portfolio securities in
such a manner as to get prompt execution of the orders at the
most favorable
price. The Fund will place all orders for purchases and sales
of its portfolio
securities through the Fund's President who is answerable to the
Fund's Board of
Directors. In accordance with rule 17e-1 of the Investment
Company Act of 1940,
If the Fund's President is also a registered representative of
a New York Stock
Exchange or NASDAQ Member Firm he may place orders through his
concern at as low
commission rates as possible & never to exceed rates that are
higher than would
be available through any other national brokerage firm. The
Directors will re-
view each transaction at least quarterly made with affiliated
firms to determine
the reasonableness of commissions paid. Any unreasonable charge
will be deduct-
ed from the fees paid to the Adviser. The Fund's President
may select other
brokers who meet the primary requirements of execution and
price, and also have
furnished statistical or other factual information and
services which appear
helpful or necessary to the Fund's normal operations. No effort
will be made in
any given circumstance to determine the value of these
services or the amount
they might have reduced Adviser expenses.
Other than as set forth above, the Fund has no fixed policy,
formula, method or
criteria which it uses in allocating brokerage business to
firms furnishing
- 8 -
<PAGE>
these materials and services. The Board of Directors will
evaluate and review
the reasonableness of brokerage commissions paid to brokers not
affiliated with
Fund officers or the Adviser on a monthly basis initially and,
after the first
year of operation at least semiannually.
MANAGEMENT OF THE FUND
Shareholders meet annually to elect all members of the Board
of Directors, se-
lect an independent auditor, and vote on any other items deemed
pertinent by the
incumbent Board. The Directors are in turn responsible for
determining that the
Fund operates in accordance with its stated objectives,
policies, and investment
restrictions. The Board appoints officers to run the Fund
and selects an In-
vestment Adviser to provide investment advice. (See Investment
Adviser, pg. 5).
It meets four times a year to review Fund progress and
status. In addition, a
non-interested Director performs an independent audit whenever
requested by the
Board.
CUSTODIAN & TRANSFER AGENT
The Fund acts as its own custodian and transfer agent.
REPORTS TO SHAREHOLDERS
The Fund sends all shareholders annual reports containing
certified financial
statements and other periodic reports, at least semiannually,
containing unau-
dited financial statements.
AUDITORS
Landsburg, Platt, Reschiatore & Dalton, Certified Public
Accountants, Philadel-
phia, PA. have been selected as the independent accountant and
auditor of the
Fund. Landsburg, Platt, Reschiatore and Dalton has no direct or
indirect finan-
cial interest in the Fund or the Adviser.
LITIGATION
As of the date of this prospectus, there was no pending or
threatened litigation
involving the Fund in any capacity whatsoever.
ADDITIONAL INFORMATION
This Prospectus omits certain information contained in the
registration state-
ment on file with the Securities & Exchange Commission. The
registration state-
ment may be inspected without charge at the principal office
of the Commission
in Washington, D.C. and copies of all or part thereof may be
obtained upon pay-
ment of the fee prescribed by the Commission. Shareholders may
also direct in-
quiries to the Fund by phone or at the address given on pg 1 of
this Prospectus.
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<PAGE>
SHARE PURCHASE APPLICATION
A) Please fill out one of the following four types of accounts:
1) ** Individual Accounts **
______________________ __ _____________________
______________________
First Name MI Last Name Social
Security Number
2) ** Joint Accounts **
______________________ __ _____________________
______________________
First Name MI Last Name Social
Security Number
______________________ __ _____________________
______________________
First Name MI Last Name Social
Security Number
3) ** Custodial Accounts **
______________________ __ ______________________
Custodian's First Name MI Custodian's Last Name
______________________ __ ______________________
______________________
Minor's First Name MI Minor's Last Name
Minor's Social Sec Num
4) ** All Other Accounts **
__________________________________________________
______________________
Name of Account Tax
Identification Num
__________________________________________________
(Use this second line if you need it)
B) Biographical and other information about the new account:
Number & Street
_____________________________________________________________
City_______________________________ St_____
Zip__________________________
Citizen of__________________ Home Phone____________ Bus
Phone____________
Dividend Direction: Reinvest all distributions_________ Pay
in Cash__________
Signature of Owner, Trustee or Custodian:
___________________________________
Signature of Joint Owner (if joint account):
___________________________________
Please make check payable to: INVESTMENT SERIES
FUNDS, INC.
Amount of Investment Attached $______________ (Minimum initial
purchase $1,000)
All applications are accepted in Arizona and under Arizona
laws.
- 10 -
<PAGE>
FORM W-9
(March 1994)
Department of Treasury
Internal Revenue Service
PAYER'S REQUEST FOR TAXPAYER
IDENTIFICATION NUMBER
Name as shown on account (if joint account, give name
corresponding to TIN)
_________________________________________________
Street Address
_________________________________________________
City, State & Zip Code
_________________________________________________
Part 1.- Taxpayer Identification Number Part 2.
Backup Withholding
Social Security Number ______________________ Check if you
are NOT subject
to backup
withholding under
or the
provisions of section
3406(a) (1)
(C) of the In-
Employer ID Number ______________________ ternal
Revenue Code ________
Certification - Under the penalty of perjury, I certify that
the information
provided on this form is true, correct and
complete.
Signature ___________________________________ Date
_______________________
- 11 -
<PAGE>
INVESTMENT ADVISER
PROSPECTUS
INVESTMENT RESEARCH ASSOCIATES, INC. MOLTER SERIES
FUNDS, INC.
6720 E CAMINO PRINCIPAL, SUITE 100 6720 E CAMINO
PRINCIPAL, SUITE 100
Tucson, AZ. 85715
Tucson, AZ. 85715
520-298-7000
XXXXXXX
XX, 1997
TABLE OF CONTENTS
Fund Expenses ...................... 2 The Fund seeks
capital appreciation
The Fund ........................... 3 through investment
in common stocks
Objective & Policies ............... 3 & securities
convertible into com-
Objective ........................ 3 mon stocks in the
pursuit of capi-
Risk Assessment .................. 3 tal gains. Current
income from in-
Security Selection Criteria ...... 3 vestments is a
subordinate consi-
Portfolio Turnover Policy ........ 3 deration.
Nondiversification Policy ........ 3
Tax Status ......................... 3
Investment Restrictions ............ 4
Investment Adviser ................. 5
Officers & Directors of the FUND ... 5
Capitalization ..................... 6
Description of Common Stock ...... 6
Voting Rights .................... 6
Major Shareholders ............... 6
Purchase of Shares - Reinvestments . 6
Initial Investments .............. 7
Subsequent Purchases ............. 7
Reinvestments .................... 7
Fractional Shares ................ 7
Retirement Plans ................... 7
IRA .............................. 7
Pricing of Shares .................. 7
Redemption of Shares ............... 8
Brokerage .......................... 8
Management of the Fund ............. 9
Custodian & Transfer Agent ......... 9
Reports to Shareholders ............ 9
Auditors ........................... 9
Litigation ......................... 9
Additional Information ............. 9
Share Purchase Application ........ 10
W-9 Application Form .............. 11
- 12 -
<PAGE>
MOLTER SERIES FUNDS, INC.
6720 E Camino Principal, Suite 100
Tucson, AZ 85715
520-298-7000
Part B
STATEMENT OF ADDITIONAL INFORMATION
____________________, 1997
This Statement is not a prospectus, but should be read in
conjunction with the
Fund's current prospectus dated , 1997. To obtain
the Prospectus,
please write the Fund or call either of the telephone numbers
that are shown
above.
TABLE OF CONTENTS
The Fund ................................ 2
Objectives & Policies ................... 2
Objectives ......................... 2
Security Selection Criteria ........ 2
Portfolio Turnover Policy .......... 2
Nondiversification Policy .......... 2
Tax Status .............................. 2
Investment Restrictions ................. 3
Investment Adviser ...................... 4
Officers and Directors of the Fund ...... 4
Capitalization .......................... 5
Description of Common Stock ........ 5
Voting Rights ...................... 5
Major Shareholders ................. 5
Purchase of Shares - Reinvestment ....... 5
Initial Investments ................ 6
Subsequent Purchases ............... 6
Reinvestments ...................... 6
Fractional Shares .................. 6
Retirement Plans ........................ 6
IRA ................................ 6
Redemption of Shares .................... 6
Brokerage ............................... 7
Auditor's Report ........................ 8
Statement of Assets & Liabilities ....... 9
Statement of Investments in Securities .. 9
Statement of Operations .................10
Statement of Changes in Net Assets ......10
Notes to Financial Statements ...........10
Supplemental Data .......................12
- 1 -
<PAGE>
THE FUND
MOLTER SERIES FUNDS, INC. (also referred to as the "Fund") was
incorporated in
Arizona on June 25, 1997. The Fund's registered office is in
Tucson, AZ: mail
may be addressed to 6720 E Camino Principal, Suite 100, Tucson
AZ.
OBJECTIVES AND POLICIES
Objective: Molter Series Funds, Inc. ("the Fund") is an
open-end, non-
diversified management investment company that seeks capital
appreciation
through investment in the common stocks and/or securities
convertible into
common stocks. Criteria used by the Adviser will be based on
the Business
Economics, Management Quality, Financial Condition and Stock
Price of each
business. Current income from these investments will be a
subordinate
consideration.
Risk Assessment: Risks associated with the Fund's performance
will be those due
to broad market declines and business risks from difficulties
which occur to
particular companies while in the Fund's portfolio. It must be
realized, as is
true of almost all securities, there can be no assurance that
the Fund will ob-
tain its ongoing objective of capital appreciation.
Security Selection Criteria: Criteria used by the Adviser in
recommending pur-
chases of securities will be based on the Business Economics,
Management Quali-
ty, Financial Condition and Security Price of each business.
Portfolio Turnover Policy: The Fund does not propose to
purchase securities for
short term trading in the ordinary course of operations.
Accordingly, it is ex-
pected that the annual turnover rate will not exceed 50%,
wherein turnover is
computed by dividing the lesser of the Fund's total purchases or
sales of secu-
rities within the period by the average monthly portfolio value
of the Fund dur-
ing such period. There may be times when management deems it
advisable to sub-
stantially alter the composition of the portfolio, in which
event, the portfolio
turnover rate might substantially exceed 50%; this would only
result from spe-
cial circumstances and not from the Fund's normal operations.
Non-diversification Policy: The Fund is classified as being
non-diversified
which means that it may invest a relatively high percentage of
its assets in the
obligations of a limited number of issues. The Fund,
therefore, may be more
susceptible than a more widely diversified fund to any single
economic, politi-
cal, or regulatory occurrence. The policy of the Fund, in the
hope of achiev-
ing its objective as stated above, is, therefore, one of
selective investments
rather than broad diversification. The Fund seeks only enough
diversification
for adequate representation among what it considers to be the
best performing
securities and to maintain its federal non-taxable status under
Sub-Chapter M of
the Internal Revenue Code (see next paragraph).
TAX STATUS
Under the provisions of Sub-Chapter M of the Internal Revenue
Code of 1954 as
amended, the Fund, intends to pay out substantially all of its
investment income
and realized capital gains, and intends to be relieved of
federal income tax on
the amounts distributed to shareholders. In order to qualify
as a "regulated
investment company" under Sub-Chapter M, at least 90% of the
Fund's income must
be derived from dividends, interest, and gains from securities
transactions, no
more than 30% of the Fund's profits may be derived from
securities held less
than three months, and no more than 50% of the Fund assets may
be held in secur-
ity holdings that exceed 5% of the total assets of the Fund at
time of purchase.
Distribution of any net long term capital gains realized by
the Fund in 1997
will be taxable to the shareholder as long term capital gains,
regardless of the
length of time Fund shares have been held by the investor. All
income realized
- 2 -
<PAGE>
by the Fund, including short term capital gains, will be
taxable to the share-
holder as ordinary income. Dividends from net income will be
made annually or
more frequently at the discretion of the Fund's Board of
Directors. Dividends
received shortly after purchase of shares by an investor will
have the effect of
reducing the per share net asset value of his shares by the
amount of such divi-
dends or distributions and, although in effect a return of
capital, are subject
to federal income taxes.
The Fund is required by federal law to withhold 31% of
reportable payments
(which may include dividends, capital gains, distributions and
redemptions) paid
to shareholders who have not complied with IRS regulations. In
order to avoid
this withholding requirement, you must certify on a W-9 tax
form supplied by
the Fund that your Social Security or Taxpayer Identification
Number provided is
correct and that you are not currently subject to back-up
withholding, or that
you are exempt from back-up withholding.
INVESTMENT RESTRICTIONS
By-laws of the Fund provide the following fundamental
investment restrictions;
The Fund may not, except by the approval of a majority of
the outstanding
shares; i.e. a) 67% or more of the voting securities present
at a duly called
meeting, if the holders of more than 50% of the outstanding
voting securities
are present or represented by proxy, or b) of more than 50% of
the outstanding
voting securities, whichever is less:
(a) Act as underwriter for securities of other issuers except
insofar as the
Fund may be deemed an underwriter in selling its own
portfolio securities.
(b) Borrow money or purchase securities on margin, but may
obtain such short
term credit as may be necessary for clearance of purchases
and sales of se-
curities for temporary or emergency purposes in an amount
not exceeding 5%
of the value of its total assets.
(c) Sell securities short.
(d) Invest in securities of other investment companies except as
part of a mer-
ger, consolidation , or purchase of assets approved by
the Fund's share-
holders.
(e) Invest over 25% of its assets at the time of purchase in any
one industry.
(f) Make investments in commodities, commodity contracts or real
estate although
the Fund may purchase and sell securities of companies
which deal in real
estate or interests therein.
(g) Make loans. The purchase of a portion of a readily
marketable issue of pub-
licly distributed bonds, debentures or other debt
securities will not be
considered the making of a loan.
(h) Acquire more than 10% of the securities of any class of
another issuer,
treating all preferred securities of an issuer as a
single class and all
debt securities as a single class, or acquire more than
10% of the voting
securities of another issuer.
(i) Invest in companies for the purpose of acquiring control.
(j) The Fund may not purchase or retain securities of any
issuer if those offi-
cers and directors of the Fund or its Investment Adviser
owning individual-
ly more than 1/2 of 1% of any class of security or
collectively own more
than 5% of such class of securities of such issuer.
(k) Pledge, mortgage or hypothecate any of its assets.
(l) Invest in securities which may be subject to registration
under the Securi-
ties Act of 1933 prior to sale to the public or which are
not at the time of
purchase readily salable.
(m) Invest more than 5% of the total Fund assets, taken at
market value at the
time of purchase, in securities of companies with less
than three years'
continuous operation, including the operations of any
predecessor.
(n) Issue senior securities.
- 3 -
<PAGE>
INVESTMENT ADVISER
Investment Research Associates, Inc. is an Arizona corporation
that acts as
an Investment Adviser, to the Fund. Daniel A. and Hester
Molter established the company
in April 1997 and are the sole owners, directors and officers of
the Investment
Adviser of the Fund. Mr. Molter has an M.B.A. from the Wharton
Graduate School of Business and a C.P.A. Mr. Molter has held
staff and management positions with Mobil Oil, and worked his
way up to being Chief Financial Officer of Botany 500 McGregor
Sportswear.
On June 25, 1997 shareholders of the Fund approved a management
and Advisory
contract with the Investment Research Associates, Inc., which
was unanimously
approved by the Board of Directors June 25, 1997. This
Agreement will continue
on a year to year basis provided that approval is voted at
least annually by
specific approval of the Board of Directors of the Fund or by
vote of the
holders of a majority of the outstanding voting securities of
the Fund, but, in either event,
it must also be approved by a majority of the directors of the
Fund who are
neither parties to the agreement nor interested persons as
defined in the
Investment Company Act of 1940 at a meeting called for the
purpose of voting
on such approval. Under the Agreement, Investment Research
Associates, Inc.
will furnish investment advice to the Directors of the Fund on
the basis of
a continuous review of the portfolio and recommend to the Fund
when & to what
extent securities should be purchased or disposed. The
Agreement may be
terminated at any time, without the payment of any penalty,
by the Board
of Directors or by vote of a majority of the outstanding voting
securities of
the Fund on not more than 60 days written notice to
Investment Research
Associates, Inc. In the event of its assignment, the
Agreement will
terminate automatically. Ultimate decisions as to the
investment policy and
as to individual purchases and sales of securities are made by
the Fund's
officers and directors. For these services the Fund has agreed
to pay to
Investment Research Associates, Inc. a fee of 1% per year on
the net as-
sets of the Fund. All fees are computed on the average daily
closing net asset
value of the Fund and are payable monthly. The fee is higher
than the fee paid
by most other funds. Not withstanding, the Investment Adviser
would forgo suf-
ficient fees to hold the total expenses of the Fund to less
than 2.0% of the
first 10 million in averaged assets and 1.5% of the next 20
million. These ra-
tios were selected by the Board of Directors because they are
believed to meet
the most restrictive state requirements.
Pursuant to its contract with the Fund, the Investment
Adviser is required to
render research, statistical and advisory services to the Fund;
to make specific
recommendations based on the Fund's investment requirements; and
to pay salaries
of the Funds employees who may be officers or directors or
employees of the In-
vestment Adviser. Excepting these items, the Fund pays all
other fees and ex-
penses incurred in conducting its business affairs. The
Investment Adviser has
paid the initial organizational costs of the Fund and will
reimburse the Fund
for any and all losses incurred because of purchase reneges.
OFFICERS AND DIRECTORS OF THE FUND
Officers and Directors of the Fund, together with their
addresses, age, princi-
pal occupations and percent of shares outstanding held during
the past five
years are:
Occupation
Percent
Name and Address Age Position Past 5 Years
of Class
Daniel A. Molter* 56 President Investment
Advisor 100.00%
6720 E Camino Principal Interested Investment
Research
Suite 100 Director Associates, Inc.
Tucson, AZ 85715
- 4 -
<PAGE>
Occupation
Percent
Name and Address Age Position Past 5 Years
of Class
Hester Molter* 45 Secretary Self-Proprietor
6720 E Camino Principal Interested
Suite 100 Director
Tucson, AZ 85715 Wife of President
Lane Justus Non-interested
Investor 0.00%
Tucson, AZ 85718 Director
Cliff Altfeld 40 Non-Interested Attorney at Law
0.00%
6273 La Yerba Director Tucson, AZ
Tucson, AZ 85750
Maranne Finley 55 Non-Interested Self-Proprietor
0.00%
325 Pine Street Director
Denver, CO
* Directors of the Fund who are considered "Interested
Directors" as defined
by the Investment Company act of 1940. Mr. Molter is President
and joint owner
of the Fund and Mrs. Molter is secretary and joint owner of the
Fund.
The Fund does not compensate its officers and directors
affiliated with the In-
vestment Adviser except as they may benefit through payment of
the Advisory fee.
The Fund does not intend to compensate its officers and
directors until assets
exceed $2,500,000 although they will be reimbursed for their
expenses.
CAPITALIZATION
Description of Common Stock: The authorized capitalization of
the Fund consists
of 10,000,000 shares of common stock of $0.01 par value per
share. Each share
has equal dividend, distribution and liquidation rights with
no conversion or
pre-emptive rights. All shares issued are fully paid and
non-accessible.
Voting Rights: Each shareholder has one vote for each
share held. Voting
rights are non-cumulative, which means that holders of a
majority of shares can
elect all directors of the Fund if they so choose.
Major Shareholders: Dan Molter, as of the date of this
Prospectus, owns
all outstanding shares of the Fund.
PURCHASE OF SHARES -REINVESTMENTS
The offering price of the shares offered by the Fund is at the
net asset value
per share next determined after receipt of the purchase order by
the Fund and is
computed in the manner described under the caption "PRICING OF
SHARES" in this
Prospectus. The Fund reserves the right at its sole descretion
to terminate the
offering of its shares made by this Prospectus at any time
and to reject pur-
- 5 -
<PAGE>
chase applications when, in the judgment of management such
termination or re-
jection is in the best interests of the Fund.
Initial Investments: Initial purchase of shares of the Fund may
be made only by
application submitted to the Fund. For the convenience of
investors, a Share
Purchase Application form is provided with this Prospectus. The
minimum initial
purchase of shares is $1,000 which is due and payable 3
business days after the
purchase date. Less may be accepted under especial
circumstances. The Fund
will be initially registered in Arizona and therefore
restricted to Arizona
residents at the time of purchase. There will be no
solicitation of
out of the state of Arizona potential shareholders until
registration under
the Blue Sky laws of the state of residence have been met.
Subsequent Purchases: Subsequent purchases may be made by mail
or by phone and
are due and payable five business days after the purchase date.
The minimum is
$100, but less may be accepted under especial circumstances.
Reinvestments: The Fund will automatically retain and reinvest
dividends & cap-
ital gains distributions and use same for the purchase of
additional shares for
the shareholder at net asset value as of the close of business
on the distribu-
tion date. A Shareholder may at any time by letter or forms
supplied by the
Fund direct the Fund to pay dividends and/or capital gains
distributions, if
any, to such shareholder in cash.
Fractional Shares: Shares will be issued to three decimal
places as purchased
from the fund. The fund will maintain an account for each
shareholder of shares
for which no certificates have been issued.
RETIREMENT PLANS
Individual Retirement Account: Persons who earn compensation
and are not active
participants (and who do not have a spouse who is an active
participant) in an
employee maintained retirement plan may establish Individual
Retirement Accounts
(IRA) using Fund shares. Annual contributions, limited to the
lesser of $2,000
or 100% of compensation, are tax deductible from gross income.
This IRA deduc-
tion is also retained for individual taxpayers and married
couples with adjusted
gross incomes within certain specified limits. All individuals
may make nonde-
ductible IRA contributions to separate accounts to the extent
that they are not
eligible for a deductible contribution.
Earnings under the IRA are reinvested and are tax-deferred until
withdrawals be-
gin. The maximum annual contribution may be increased to
$4,000 if you have a
spouse during the taxable year. A separate and independent
Spousal IRA must
be maintained.
You may begin to make non-penalty withdrawals as early as age
59 1/2 or as late
as age 70 1/2. In the event of death or disability, withdrawals
may be made be-
fore age 59 1/2 without penalty.
A Disclosure Statement is required by U.S. Treasury Regulations.
This Statement
describes the general provisions of the IRA and is forwarded to
all prospective
IRA's. There is no charge to open and maintain a Investment
Series Funds,
Inc. IRA. This policy may be changed by the Board of
Directors if they deem it to be in the
best interests of all shareholders. All IRA's may be revoked
within 7 days of
their establishment with no penalty.
REDEMPTION OF SHARES
The Fund will redeem all or any part of the shares of any
shareholder who ten-
ders a request for redemption (if certificates have not been
issued) or certifi-
- 6 -
<PAGE>
cates with respect to shares for which certificates have been
issued. In either
case, proper endorsements guaranteed either by a national bank
or a member firm
of the New York Stock Exchange will be required unless the
shareholder is known
to management. The redemption price is the net asset value
per share next de-
termined after notice is received by the Fund for redemption
of shares. The
proceeds received by the shareholder may be more or less than
his cost of such
shares, depending upon the net asset value per share at the
time of redemption
and the difference should be treated by the shareholder as a
capital gain or
loss for federal income tax purposes.
Payment by the Fund will ordinarily be made within three
business days after
tender. The Fund may suspend the right of redemption or
postpone the date of
payment if: The New York Stock Exchange is closed for other than
customary week-
end or holiday closings, or when trading on the New York Stock
Exchange is re-
stricted as determined by the Securities and Exchange
Commission or when the
Securities and Exchange Commission has determined that an
emergency exists, mak-
ing disposal of fund securities or valuation of net assets not
reasonably prac-
ticable. The Fund intends to make payments in cash, however,
the Fund reserves
the right to make payments in kind.
BROKERAGE
The Fund requires all brokers to effect transactions in
portfolio securities in
such a manner as to get prompt execution of the orders at the
most favorable
price. The Fund will place all orders for purchases and sales
of its portfolio
securities through the Fund's President who is answerable to the
Fund's Board of
Directors. In accordance with rule 17e-1 of the Investment
Company Act of 1940,
If the Fund's President is also a registered representative of
a New York Stock
Exchange or NASDAQ Member Firm he may place orders through his
concern at as low
commission rates as possible & never to exceed rates that are
higher than would
be available through any other national brokerage firm. The
Directors will re-
view each transaction at least quarterly made with affiliated
firms to determine
the reasonableness of commissions paid. Any unreasonable charge
will be deduct-
ed from the fees paid to the Adviser. The Fund's President
may select other
brokers who meet the primary requirements of execution and
price, and also have
furnished statistical or other factual information and
services which appear
helpful or necessary to the Fund's normal operations. No effort
will be made in
any given circumstance to determine the value of these
services or the amount
they might have reduced Adviser expenses.
Other than as set forth above, the Fund has no fixed policy,
formula, method or
criteria which it uses in allocating brokerage business to
firms furnishing
these materials and services. The Board of Directors will
evaluate and review
the reasonableness of brokerage commissions paid to brokers not
affiliated with
Fund officers or the Adviser on a monthly basis initially and,
after the first
year of operation at least semiannually.
- 7 -
<PAGE>
Independent Auditor's Report To Be Supplied
- 8 -
<PAGE>
Financial Statements to be supplied with audit
- 9 -
<PAGE>
The financial statements will be supplied with audit.
Organization: Molter Series Funds, Inc. (the "Fund") was
incorporated on
June 25, 1997 and commenced operations on XXXXXX, 1997. The
Fund has no
operations prior to the commencement of operations other than
matters relating
to its
- 10 -
<PAGE>
organization and registration as an open-end non-diversified
management
investment company under the Investment Company Act of 1940
and its securities
under the Securities Act of 1933, the sale and issuance of
20,000 shares of
common stock ("initial shares") to its initial investors on
XXXXXX, 1997.
Significant Accounting Policies: Accounting policies
consistently followed by
the Fund in the preparation of its financial statements are in
conformity with
generally accepted accounting principles and include:
Security valuations - The Fund values investment securities,
where market quo-
tations are available, at market value based on the last
recorded sales prices
as reported by the principal securities exchange on which
the security is
traded, or if the security is not traded on an exchange,
market value is based
on the latest bid price. Short term investments are valued at
cost, approximat-
ing market value.
Federal income taxes - The Fund's policy is to comply with
the requirements
of the Internal Revenue Code that are applicable to
regulated investment
companies and to distribute all its taxable income to
its shareholders.
Therefore, no federal income tax provision is required.
Distribution to shareholders - The Fund intends to distribute
to shareholders
substantially all of its net investment income, if any, and
net realized capi-
tal gains, if any, at year end.
Organizational costs and Registration fees - Organizational
costs and Regis-
tration fees were all borne by the Fund's Investment Advisor.
Other - The Fund records security transactions on the trade
date. Specific
identification is used for determining gains or losses for
financial state-
ments & income tax purposes. Dividend income is recorded on
the ex-dividend
date and interest income is recorded on an accrual basis.
NOTE 2 INVESTMENT ADVISORY AGREEMENT & OTHER RELATED
TRANSACTIONS: The Fund has an investment advisory agreement
with Investment Research Associates, Inc., whereby Investment
Research Associates, Inc. receives a fee of 1% per year on
the net assets of the Fund. All fees are computed on the
average daily closing net asset value of the Fund and are
payable monthly. In accordance with State Regulations,
Investment Research Associates, Inc. has agreed to reimburse the
Fund to hold the Fund's aggregate annual operating expenses to
2.0% of the first $10,000,000 and 1.5% of the average net assets
over
$10,000,000. Mr. Daniel Molter is the President and joint owner
of the Fund and Mrs. Hester Molter is the secretary and joint
owner of the Fund.
NOTE 3 INVESTMENTS: Not Applicable
NOTE 4 CAPITAL SHARE TRANSACTIONS: As of August 1, 1997 there
were 1,000,000
shares of $.10 par value capital stock authorized and capital
paid in aggregating $100,000.
- 11 -
<PAGE>
- 12 -
<PAGE>
FORM N-1A
PART C - OTHER INFORMATION
Contents Page #
1. Financial Statements & Exhibits 1
2. Control Persons 1
3. Number of Shareholders 1
4. Indemnification 1
5. Activities of Investment Adviser 1
6. Principal Underwriters 1
7. Location of Accounts & Records 2
8. Management Services 2
9. Distribution Expenses 2
10. Undertakings 2
11. Auditor's Consent 3
12. Signatures 4
Exhibits
Articles of Incorporation 3 i
By-Laws 3 ii
Investment Advisory Contract 10 i
Reimbursement Agreements - Officers/Directors 10 ii
Opinion of Counsel Concerning Fund Securities 99.1
- i -
<PAGE>
1. a. Financial Statements - Will be supplied with audit.
A post-effective amendment containing reasonably current
financial statements
which will not be certified will be filed with the
Securities and Exchange
Commission within 4 to 6 months of the effective date of this
filing.
b. Exhibits - All exhibits believed to be applicable to this
filing include:
(3.i) Articles of Incorporation
(3.ii) By-Laws
(10.1) Investment Advisory Contract
(10.2) Reimbursement Agreements with Officers and/or
Directors
(99.1) Opinion of Counsel Concerning Fund Securities
2. Control Persons - Not applicable
3. Number of Shareholders - There is 1 shareholder of the
Investment
Series Funds, Inc. Fund, as of this filing.
4. Indemnification - Insofar as indemnification for
liability arising under
the Securities Act of 1933 may be permitted to
directors, officers and
controlling persons of the registrant, the registrant
has been advised
that, in the opinion of the Securities and Exchange
Commission, such in-
demnification is against public policy as expressed in
the Act and is,
therefore, unenforceable. In the event that a claim for
indemnification
against such liabilities (other than the payment by the
registrant of ex-
penses incurred or paid by a director, officer or
controlling person of
the registrant in the successful defense of any action,
suit or proceed-
ing) is asserted by such director, officer or
controlling person in con-
nection with the securities being registered, the
registrant will, unless
in the opinion of its counsel the matter has been settled
by controlling
precedent, submit to a court of appropriate jurisdiction
the question whe-
ther such indemnification by it is against public policy
as expressed in
the Act and will be governed by the final adjudication of
such issue.
5. Activities of Investment Adviser - The Molter Series
Funds, Inc.'s
activity at the present time is performance on its
Investment
Advisory Contract currently effective with Investment
Research Associates,
Inc. Mr. Dan Molter, owner, officer and director of
Investment Research
Associates, Inc., is also President of the Bookkeeper
Corporation.
6. Principal Underwriter - The Fund acts as its own
underwriter.
7. Location of Accounts & Records - All fund records are
held at corporate
headquarters - 6720 E Camino Principal, Suite 100, Tucson
AZ 85715
- with the exception of security certifications which are
in a safe
deposit box at the Bank of America, 7077 E. Tanque Verde
Rd.,
Tucson, AZ. 85750
8. Not applicable
9. Distribution Expenses - The fund currently bears no
distribution expenses.
10. Not applicable
- 2 -
<PAGE>
CONSENT OF INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS
TO BE SUPPLIED
- 3 -
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933
and the Invest-
ment Company Act o f 1940, the MOLTER SERIES FUNDS, INC.
certifies
that it meets all of the requirements for effectiveness of
this
Registration Statement and has duly caused this amendment
to the
Registration Statement to be signed on its behalf by the
undersigned,
thereunto duly authorized, in the City of Tucson and State
of Arizona,
on the 1st day of August 1997.
MOLTER SERIES
FUNDS, INC.
Dan Molter
President
Pursuant to the requirements of the Securities Act of 1933,
this Amendment to
the Registration Statement has been signed below by the
following persons in the
capacities and on the dates indicated.
Signatures Title
Date
Dan Molter President, CEO and Director
XXXXXX
Hester Molter Secretary and Director
XXXXXXX
- 4 -
<PAGE>
EXHIBIT - 3 i
Filed with the Arizona Corporation
Commission on June 25, 1997
ARTICLES OF INCORPORATION-
OF
MOLTER SERIES FUNDS, INC.
A Business-stock Corporation
DSCB:15-1306/2102/2303/2702/2903/3101/7102A(Rev 91)
1. Name: The name of the corporation (hereafter called
Corporation) shall be: Molter Series Funds, Inc.
2. Purpose: The purpose for which this Corporation is organized
are the transaction of any and all lawful business for which
corporations may be incorporated under the laws of the State of
Arizona, as they may be amended from time to time, and
specifically but in limitation thereof, the purpose of acting as
an open-ended non diversified investment company.
3. Business: The corporation initially intends to conduct the
business of acting as an open-end non diversified investment
company.
4. Authorized Capital: The authorized capital of the
Corporation shall be One Hundred Thousand Dollars ($100,000)
divided into One Million (1,000,000) shares of the par value of
Ten Cents ($0.10) each. The stock shall be issued when paid for
in cash services or property and shall be issued as fully paid
and shall be forever nonassessable. The judgment of the Board
of Directors as to the value of property taken or services
rendered in exchange for stock shall be conclusive in absence of
fraud
5. Statutory Agent: The name and business address of initial
statutory agent of the Corporation is:
Nathalie Watsek, Treasurer
Investment Research Associates, Inc.
6720 East Camino Principal, suite 100
Tucson, AZ 85715
6. Known Place of Business: The known place of business of the
Corporation shall be: 6720 East Camino Principal, Tucson Arizona
85715, but a different and other offices and places for
conducting business, both within and without the State of
Arizona, may be established from time to time by the Board of
Directors.
7. Board of Directors: The initial Board of Directors shall
consist of two (2) directors. The persons who are to serve as
directors until the first annual meeting of shareholders or
until their successors are elected and qualified are:
Daniel Alan Molter
6720 East Camino Principal, Suite 100
Tucson, Arizona 85715
Hester Molter
6720 East Camino Principal, Suite 100
Tucson, Arizona 85715
Otherwise, the number of persons to serve on the Board of
Directors shall be fixed by the Bylaws of the Corporation.
8. Quorum: A quorum at the meeting of the Board of Directors
shall consist of two-thirds of the number of directors then
serving; provided that when a Board comprised of one member is
authorized, the one director shall constitute a quorum.
9. Incorporators: The names and addresses of the incorporators
of the Corporation are:
Daniel Alan Molter
6720 East Camino Principal, Suite 100
Tucson, Arizona 85715
Hester Molter
6720 East Camino Principal, Suite 100
Tucson, Arizona 85715
all powers, duties and responsibilities of the incorporators
shall cease at the time of delivery of these Articles of
Incorporation to the Arizona Corporation Commission for filing.
10. Distribution From Capital Surplus: The Board of Directors of
the Corporation may, from time to time, distribute on a pro rata
basis to its shareholders out of the capital surplus of the
Corporation a portion of its assets, in cash or in property.
11. Indemnification of Officers, Directors, Employees and
Agents: Subject to the further provisions hereof, the
Corporation shall indemnify any and all of its existing and
former directors, officers, employees, and agents against all
expenses incurred by them and each of them, including but not
limited to legal fees, judgment, penalties and amounts paid in
settlement or compromise, which may arise or be incurred,
rendered, or levied in any legal action brought or threatened
against any of them for or on account or omission alleged to
have been committed while acting within the scope of employment
as director, officer, employee, or agent of the Corporation,
whether or not any action is or has been filed against them and
whether or not any settlement or compromise is approved by a
court. No such indemnification shall be available with respect
to liabilities under the Securities Act of 1933, and the
Corporation shall have the right to refuse indemnification in
any instance in which the person to whom indemnification would
otherwise have been applicable shall have unreasonably refused
to permit the Corporation, at its own expense through counsel of
its own choosing, to defend him or her in the action.
12. Repurchase Of Shares: the Board of Directors of the
Corporation may, from time to time, cause the Corporation to
purchase its own shares to the extent of the unreserved and
unrestricted earned and capital surplus of the Corporation.
IN TESTIMONY WHEREOF the incorporator has signed these
Articles of Incorpora-
tion this 1st day of August, 1997.
Daniel
Molter Hester Molter
_______________
Signature
Signature
<PAGE>
EXHIBIT 3 ii
MOLTER SERIES FUNDS, INC. BY-LAWS
ARTICLE I - OFFICES
Section I. The principal office of the Corporation shall be
in the City of
Tucson, County of Pima, State of Arizona. The Corporation
shall also
have offices at such other places as the Board of Directors
may from time to
time determine and the business of the Corporation may require.
ARTICLE II - STOCKHOLDERS AND STOCK CERTIFICATES
Section 1. Every stockholder of record shall be entitled to a
stock certificate
representing the shares owned by him. Stock certificates shall
be in such form
as may be required by law and as the Board of Directors shall
prescribe. Every
stock certificate shall be signed by the President or a Vice
President and by
the Treasurer or an Assistant Treasurer, or the Secretary or an
Assistant Secre-
tary, and sealed with the corporate seal, which may be a
facsimile, either en-
graved or printed. Whenever permitted by law, the Board of
Directors may au-
thorize the issuance of stock certificates bearing the
facsimile signatures of
the officers authorized to sign such certificates.
Section 2. Shares of the capital stock of the Corporation shall
be transferable
only on the books of the Corporation by the person in whose name
such shares are
registered, or by his duly authorized transfer agent. In case
of transfers by
executors, administrators, guardians or other legal
representatives, duly au-
thenticated evidence of their authority shall be produced, and
may be required
to be deposited and remain with the corporation or its duly
authorized transfer
agent. No transfer shall be made unless and until the
certificate issued to the
transferor shall be delivered to the Corporation, or its duly
authorized trans-
fer agent, properly endorsed.
Section 3. Any person desiring a certificate for shares of
the capital stock
of the Corporation to be issued in lieu of one lost or
destroyed shall make an
affidavit or affirmation setting forth the loss or
destruction of such stock
certificate, and shall advertise such loss or destruction in
such manner as the
Board of Directors may require, and shall, if the Board of
Directors shall so
require, give the Corporation a bond of indemnity, in such
form and with such
security as may be satisfactory to the Board, indemnifying
the Corporation a-
gainst any loss that may result upon the issuance of a new
stock certificate.
Upon receipt of such affidavit and proof of publication of the
advertisement of
such loss or destruction, and the bond, if any, required by the
Board of Direct-
ors, a new stock certificate may be issued of the same tenor
and for the same
number of shares as the one alleged to have been lost or
destroyed.
Section 4. The Corporation shall be entitled to treat the
holder of record any
share or shares of its capital stock as the owner thereof, &
accordingly, shall
not be bound to recognize any equitable or other claim to or
interest in such
share or shares on the part of any other person, whether or not
the Corporation
shall have express or other notice thereof, except as otherwise
provided by the
laws of the State of Arizona.
- 1 -
<PAGE>
ARTICLE III - MEETING OF STOCKHOLDERS
Section 1. The annual meeting of the stockholders of the
Corporation for the
election of directors and for the transaction of general
business shall be held
at the principal office of the Corporation, or at such other
place within or
without the State of Arizona as the Board of Directors may
from time to
time prescribe, on the third Tuesday in November at 8:00 PM in
each year, unless
that day shall be duly designated as a legal holiday, in which
event the annual
meeting of the stockholders shall be held on the first day
following which is
not a holiday. The place of the annual meeting of the
stockholders of the Corp-
oration shall not be changed within sixty days next before the
day on which such
meeting is to be held. A notice of any change in the place of
the annual meet-
ing shall be given to each stockholder twenty days before the
election is held.
Section 2. Special meetings of the stockholders may be called
at any time by
the President, and shall be called at any time by the
President, or by the Sec-
retary, upon the written request of a majority of the members
of the Board of
Directors, or upon the written request of the holders of a
majority of the
shares of the capital stock of the Corporation issued and
outstanding and en-
titled to vote at such meeting. Upon receipt of a written
request from any per-
son or persons entitled to call a special meeting, which shall
state the object
of the meeting, it shall be the duty of the President; or, in
his absence, the
Secretary, to call such meeting to be held not less than ten
days nor more than
sixty days after the receipt of such request. Special
meetings of the stock-
holders shall be held at the principal office of the
Corporation, or at such
other place within or without the State of Arizona as the Board
of Direct-
ors may from time to time direct, or at such place within or
without the State
of Arizona as shall be specified in the notice of such meeting.
Section 3. Notice of the time and place of the annual or any
special meeting of
the stockholders shall be given to each stockholder entitled
to notice of such
meeting at least ten days prior to the date of such
meeting. In the case of
special meetings of the stockholders, the notice shall specify
the object or ob-
jects of such meeting, and no business shall be transacted at
such meeting other
than that mentioned in the call.
Section 4. The Board of Directors may close the stock
transfer books of the
corporation for a period not exceeding sixty days preceding
the date of any
meeting of stockholders, or the date for payment of any
dividends, or the date
for the allotment of rights, or the date when any change or
conversion or ex-
change of capital stock shall go into effect, or for a period
of not exceeding
sixty days in connection with the obtaining of the consent of
stockholders for
any purpose; provided, however, that in lieu of closing the
stock transfer books
as aforesaid, the Board of Directors may fix in advance a
date, not exceeding
sixty days preceding the date of any meeting of stockholders,
or the date for
the payment of any dividend, or the date for the allotment of
rights of the date
when any change or conversion or exchange of capital stock shall
go into effect,
or a date in connection with obtaining such consent, as a
record date for the
determination of the stockholders entitled to notice of, and
to vote at, such
meeting and any adjournment thereof, or to receive payment of
such dividend, or
to receive such allotment of rights, or to exercise such rights,
or to give such
consent, as the case may be, notwithstanding any transfer of
any stock on the
books of the Corporation after any such record date as aforesaid.
Section 5. At least ten days before every election of
directors of the Corpor-
ation, the Secretary shall prepare and file in the office where
the election is
to be held a complete list of the stockholders entitled to
vote at the ensuing
election, arranged in alphabetical order, with the residence of
each stockholder
and the number of voting shares held by him, and such list
shall at all times,
during the usual hours for business and during the whole time
of said election,
- 2 -
<PAGE>
be open to the examination of any stockholder.
Section 6. At all meetings of the stockholders, a quorum shall
consist of the
persons representing a majority of the outstanding shares of
the capital stock
of the Corporation entitled to vote at such meeting. In the
absence of a quorum
no business shall be transacted except that the stockholders
present in person
or by proxy and entitled to vote at such meeting shall have
power to adjourn the
meeting from time to time without notice other than
announcement at the meeting
until a quorum shall be present. At any such adjourned meeting
at which a quor-
um shall be present, any business may be transacted which might
have been trans-
acted at the meeting on the date specified in the original
notice. If a quorum
is present at any meeting the holders of the majority of the
shares of the Corp-
oration issued and outstanding and entitled to vote at the
meeting who shall be
present in person or by proxy at the meeting shall have power
to act upon all
matters properly before the meeting, and shall also have power
to adjourn the
meeting to any specific time or times, and no notice of any such
adjourned meet-
ing need be given to stockholders absent or otherwise.
Section 7. At all meetings of the stockholders the following
order of business
shall be substantially observed, as far as it is consistent
with the purpose of
the meeting:
Election of Directors
Ratification of Elections of Auditors
New Business
Section 8. At any meeting of the stockholders of the
Corporation every stock
holder having the right to vote shall be entitled in person or
by proxy appoint-
ed by an instrument in writing subscribed by such stockholder
and bearing a date
not more than three years prior to said meeting unless such
instrument provides
for a longer period, to one vote for each share of stock having
voting power re-
gistered in his name on the books of the corporation.
ARTICLE IV - DIRECTORS
Section 1. The Board of Directors shall consist of not less
than three nor more
than twelve members, who may be any persons, whether or not they
hold any shares
of the capital stock of the corporation.
Section 2. The directors shall be elected annually by the
stockholders of the
Corporation at their annual meeting, and shall hold office for
the term of one
year and until their successors shall be duly elected and shall
qualify.
Section 3. The Board of Directors shall have the control and
management of the
business of the Corporation, and in addition to the powers
and authority by
these by-laws expressly conferred upon them, may, subject to
the provisions of
the laws of the State of Pennsylvania and of the Certificate
of Incorporation,
exercise all such powers of the Corporation and do all such
acts and things as
are not required by law or by the Certificate of Incorporation
to be exercised
or done by the stockholders.
Section 4. If the office of any director becomes or is
vacant by reason of
death, resignation, removal, disqualification or otherwise,
the remaining di-
rectors may by vote of a majority of said directors choose a
successor or suc-
cessors who shall hold office for the unexpired term; provided
that vacancies on
the Board of Directors may be so filled only if, after the
filling of the same,
at least two-thirds of the directors then holding office
would be directors
elected to such office by the stockholders at a meeting or
meetings called for
the purpose. In the event that at any time less than a
majority of the direct-
ors were so elected promptly as possible and in any event within
sixty days for
- 3 -
<PAGE>
the purpose of electing directors to fill any vacancy which has
not been filled
by the directors in office. Any other vacancies in the Board
of Directors not
filled by the directors may also be filled for an unexpired
term by the stock-
holders at a meeting called for that purpose.
Section 5. The Board of Directors shall have power to appoint,
and at its dis-
cretion to remove or suspend, any officer, officers, managers,
superintendents,
subordinates, assistants, clerks, agents & employees,
permanently or temporari-
ly, as the Board may think fit, and to determine their duties
and to fix, & from
time to time change, their salaries or emoluments, & to require
security in such
instances and in such amounts as it may deem proper. No
contract of employment
for services to be rendered to the Corporation shall be of
longer duration than
two weeks, unless such contract of employment shall be in
writing, signed by the
officers of the Corporation and approved by the Board of
Directors.
Section 6. In case of the absence of an officer of the
Corporation, or for any
other reason which may seem sufficient to the Board of
Directors, the Board may
delegate his powers and duties for the time being to any
other officer of the
Corporation or to any director.
Section 7. The Board of Directors may, be resolution or
resolutions passed by a
majority of the whole Board, designate one or more committees,
each committee to
consist of two or more of the directors of the Corporation,
which to the extent
provided in such resolution or resolutions, shall have and may
exercise the pow-
ers of the Board of Directors in the management of the business
and affairs of
the Corporation, and may have power to authorize the seal of
the Corporation to
be affixed to all papers which may require it. Such
committee or committees
shall have such name or names as may be determined from time to
time by resolu-
tion adopted by the Board of Directors. Any such committee
shall keep regular
minutes of its proceedings, and shall report the same to the
Board when requir-
ed.
Section 8. The Board of Directors may hold their meetings and
keep the books of
the Corporation, except the original or duplicate stock
ledger, outside of the
State of Arizona at such place or places as they may from time
to time de-
termine.
Section 9. The Board of Directors shall have power to fix,
and from time to
time to change the compensation, if any, of the directors of the
Corporation.
Section 10. The Board of Directors shall present at each annual
meeting of the
shareholders, and, when called for by vote of the stockholders,
at any special
meeting of the stockholders, a full and clear statement of the
business and con-
condition of the Corporation.
ARTICLE V - DIRECTORS MEETINGS
Section 1. Regular meetings of the Board of Directors shall be
held without no-
tice at such times and places as may be free from time to time
prescribed by the
Board.
Section 2. Special meetings of the Board of Directors may be
called at any time
by the President, and shall be called by the President upon the
written request
of a majority of the members of the Board of Directors. Unless
notice is waived
by all the members of the Board of Directors, notice of any
special meeting
shall be sent to each director at least twenty-four hours
prior to the date of
such meeting, and such notice shall state the time, place and
object or objects
of such special meeting.
- 4 -
<PAGE>
Section 3. Three member of the Board of Directors shall
constitute a quorum for
the transaction of business at any meeting. The act of a
majority of the di-
rectors present at any meeting where there is a quorum shall be
the act of the
Board of Directors, except as may be otherwise specifically
provided by statue
or by the Certificate of Incorporation or by these by-laws.
Section 4. The order of business at meetings of the Board of
Directors shall be
described from time to time by the Board.
ARTICLE VI - OFFICERS AND AGENTS
Section 1. At the first meeting of the Board of Directors after
the election of
directors in each year, the Board shall elect a President, a
Secretary and a
Treasurer, and may elect or appoint one or more Vice
Presidents, Assistant Sec-
retaries, Assistant Treasurers, and such other officers and
agents as the Board
may deem necessary and as the business of the Corporation may
require.
Section 2. The President and the Chairman of the Board shall
be elected from
the membership of the Board of Directors, but other officers
need not be members
of the Board of Directors. Any two or more offices may be held
by the same per-
son. All officers of the Corporation shall serve for one year
and until their
successors shall have been duly elected and shall have
qualified; provided, how-
ever, that any officer may be removed at any time, either with
or without cause,
by action of the Board of Directors.
Section 3. The salaries of all officers and agents of the
Corporation shall be
fixed by the Board of Directors.
ARTICLE VII - DUTIES OF OFFICERS
PRESIDENT
Section 1. The President shall be the Chief Executive Officer
and head of the
Corporation, and in the recess of the Board of Directors shall
have the general
control and management of its business and affairs, subject,
however, to the re-
gulations of the Board of Directors. He shall preside at all
meetings of the
stockholders and shall be a member exofficio of all standing
committees.
Section 2. The President shall call all special or other
meetings of the stock-
holders and Board of Directors. In case the President shall at
any time neglect
or refuse to call a special meeting of the stockholders when
requested so to do
by a majority of the directors, or by the stockholder
representing a majority of
the stock of the Corporation, as is elsewhere in these by-laws
provided, then
and in such case, such special meeting shall be called by the
Secretary, or in
the event of his neglect or refusal to call such meeting, may be
called by a ma-
jority of the directors or by the stockholders representing a
majority of the
stock of the Corporation, who desire such special meeting, as
the case may be,
upon notice as hereinbefore provided. In case the President
shall at any time
neglect or refuse to call a special meeting of the Board of
Directors when re-
quested to do so by a majority of the Directors, as is
elsewhere in these
by-laws provided, then and in such case, such special meeting
may be called by
the majority of the directors desiring such special meeting,
upon notice as
hereinbefore provided.
VICE PRESIDENTS
Section 3. In case of the absence of the President, the Vice
President, or, if
there be more than one Vice President, then the Vice
Presidents, according to
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<PAGE>
their seniority, shall preside at the meetings of the
stockholders of the Corp-
oration. In the event of the absence, resignation, disability
or death of the
President, such Vice President shall exercise all the powers and
perform all the
duties of the President until the return of the President or
until such disabil-
ity shall have been removed or until a new President shall have
been elected.
THE SECRETARY AND ASSISTANT SECRETARIES
Section 4. The Secretary shall attend all meetings of the
stockholders and
shall record all the proceedings thereof in a book to be kept
for that purpose
and he shall record all the proceedings thereof in a book to
be kept for that
purpose and he shall be the custodian of the corporate seal of
the Corporation.
In the absence of the Secretary, an Assistant Secretary or
any other person
appointed or elected by the Board of Directors, as is elsewhere
in these by-laws
provided, may exercise the rights and perform the duties of the
Secretary.
Section 5. The Assistant Secretary, or, if there be more
than one Assistant
Secretary, then the Assistant Secretaries in the order of their
seniority shall,
in the absence or disability of the Secretary, perform the
duties and exercise
the powers of the Secretary. Any Assistant Secretary elected by
the Board shall
also perform such other duties and exercise such other powers
as the Board of
Directors shall from time to time prescribe.
THE TREASURER AND ASSISTANT TREASURERS
Section 6. The Treasurer shall keep full and correct accounts
of the receipts
and expenditures of the Corporation in books belonging to the
Corporation, and
shall deposit all moneys and valuable effects in the name and
to the credit of
the Corporation and in such depositories as may be designated
by the Board of
Directors, and shall, if the Board shall so direct, give bond
with sufficient
security and in such amount as may be required by the Board of
Directors for the
faithful performance of his duties. He shall disburse funds of
the Corporation
as may be ordered by the Board of Directors, taking proper
vouchers for such
disbursements, and shall render to the President and Board of
Directors at the
regular meetings of the Board, or whenever they may require
it, an account of
all his transactions as the chief fiscal officer of the
corporation, and of the
financial condition of the Corporation.
Section 7. The Assistant Treasurer, or if there be more
than one Assistant
Treasurer, then the Assistant Treasurers in the order of their
seniority, shall,
in the absence or disability of the Treasurer, perform the
duties and exercise
the powers of the Treasurer. Any Assistant Treasurer elected by
the Board shall
also perform such duties and exercise such powers as the
Board of Directors
shall from time to time prescribe.
ARTICLE VIII - CHECKS, DRAFTS, NOTES, ETC.
Section 1. All checks shall bear the signature of such person
or persons as the
Board of Directors may from time to time direct.
Section 2. All notes and other similar obligations and
acceptances of drafts by
the Corporation shall be signed by such person or persons as
the Board of Di-
rectors may from time to time direct.
Section 3. Any officer of the Corporation or any other employee,
as the Board of
Directors may from time to time direct, shall have full power
to endorse for
deposit all checks and all negotiable paper drawn payable to
his or their order
or to the order of the Corporation.
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<PAGE>
ARTICLE IX - CORPORATE SEAL
Section 1. The corporate seal of the Corporation shall have
inscribed thereon
the name of the Corporation, the year of its organization, and
the words Corpor-
ate Seal, Arizona. Such seal may be used by causing it or a
facsimile
thereof to be impressed or affixed or reproduced or otherwise.
ARTICLE X - DIVIDENDS
Section 1. Dividends upon the shares of the capital stock of
the Corporation
may, subject to the provisions of the Certificate of
Incorporation, if any, be
declared by the Board of Directors at any regular or special
meeting, pursuant
to law. Dividends may be paid in cash, in property, or in
shares of the capital
stock of the Corporation.
Section 2. Before payment of any dividend there may be set
aside out of any
funds of the Corporation available for dividends such sum or
sums as the Board
of Directors may, from time to time, in their absolute
discretion, think proper
as a reserve fund to meet contingencies, or for equalizing
dividends, or for re-
pairing or maintaining any property of the Corporation, or for
such other pur-
pose as the Board of Directors shall deem to be for the best
interests of the
Corporation, and the Board of Directors may abolish any such
reserve in the man-
ner in which it was created.
ARTICLE XI - FISCAL YEAR
Section 1. The fiscal year of the Corporation shall begin on
January 1 of each
year, and end on December 31 of each year.
ARTICLE XII - NOTICES
Section 1. Whenever under the provisions of these by-laws
notice is required to
be given to any director or stockholder, it shall not be
construed to mean per-
sonal notice, and such notice may be given in writing, by
mail, by depositing
the same in the post office or letter box, in a postpaid
sealed wrapper, add-
ressed to such director or stockholder at such address as
shall appear on the
books of the Corporation, or, if the address of such director
or stockholder
does not appear on the books of the Corporation, to such
director or stockholder
at the General Post Office in the City of Tucson, Arizona and
such notice
shall be deemed to be given at the time it shall be so
deposited in the post
office or letter box. In the case of directors, such notice
may also be given
by telephone, telegraph or cable.
Section 2. Any notice required to be given under these by-laws
may be waived in
writing, signed by the person or persons entitled to such
notice, whether before
or after the time stated therein.
Section 3. Each director and officer (and his heirs,
executors, and adminis-
trators) shall be indemnified by the Corporation against
reasonable costs and
expenses incurred by him in connection with any action, suit
or proceeding to
which he may be made a party by reason of his being or having
been a director or
officer of the Corporation, except in relation to any action,
suits or proceed-
ings in which he has been adjudged liable because of willful
misfeasance, bad
faith, gross negligence or reckless disregard of the duties
involved in the con-
duct of his office. In the absence of any adjudication which
expressly finds
that the director or officer is so liable or which expressly
absolves him of
liability for willful misfeasance, bad faith, gross negligence
or reckless dis-
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<PAGE>
regard of the duties involved in the conduct of his office, or
in the event of a
settlement, each director and officer (and his heirs, executors
and administrat-
ors) shall be indemnified by the Corporation against payments
made, including
reasonable costs determination by a written opinion of
independent counsel.
Amounts paid in settlement shall not exceed costs, fees and
expenses which would
have been reasonably incurred if the action, suit or
proceeding had been liti-
gated to a conclusion. Such a determination by independent
counsel, and the
payments of amounts by the Corporation on the basis thereof
shall not prevent a
stockholder from challenging such indemnification by
appropriate legal proceed-
ings on the grounds that the person indemnified was liable to
the Corporation or
its security holders by reason of the conduct as used herein.
The foregoing
provisions shall be exclusive of any other rights of
indemnification to which
the officers and directors might otherwise be entitled.
ARTICLE XIII - AMENDMENTS
Section 1. These by-laws may be amended, altered, repealed or
added to at the
annual meeting of the stockholders of the Corporation or of the
Board of Direct-
ors, or at any special meeting of the stockholders or of the
Board of Directors
called for that purpose, by the affirmative vote of the holders
of a majority of
the shares of capital stock of the Corporation then issued and
outstanding and
entitled to vote, or by a majority of the Whole Board of
Directors, as the case
may be.
ARTICLE XIV - INVESTMENT RESTRICTIONS
The by-laws of the Fund provide the following fundamental
investment restric-
tions; the Fund may not, except by approval of a majority of
the voting securi-
ties present at a duly called meeting, if the holders of more
than 50% of the
outstanding voting securities are present or represented by
proxy, or (b) of
more than 50% of the outstanding voting securities, whichever is
less:
(a) Act as underwriter for securities of other issuers.
(b) Borrow money or purchase securities on margin, but may
obtain such short
term credit as may be necessary for clearance of purchases
and sales of se-
curities for temporary or emergency purposes in an amount
not exceeding 5%
of the value of its total assets.
(c) Sell securities short.
(d) Invest in securities of other investment companies except
as part of a mer-
ger, consolidation, or purchase of assets approved
by the Funds
shareholders or by purchases with no more than 10% of the
Fund's assets in
the open market involving only customary broker's
commissions.
(e) Invest more than 25% of its assets at the time of purchase
in any one ind-
ustry.
(f) Make investments in commodities, commodity contracts or
real estate al-
though the Fund may purchase and sell securities of
companies which deal in
real estate or interests therein.
(g) Make loans. The purchase of a portion of a readily
marketable issue of
publicly distributed bonds, debentures or other debt
securities will not be
considered the making of a loan.
(h) Acquire more than 10% of the securities of any class of
another issue,
treating all preferred securities of an issuer as a
single class and all
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<PAGE>
debt securities as a single class, or acquire more than
10% of the voting
securities of another issuer.
(I) Invest in companies for the purpose of acquiring control.
(j) The fund may not purchase or retain securities of any
issuer if those off-
icers and directors of the Fund or its Investment
Adviser owning
individually more than 1/2 of 1% of any class of security
collectively own
more than 5% of such class of securities of such issuer.
(k) Pledge, mortgage or hypothecate any of its assets.
(l) Invest in securities which may be subject to registration
under the Securi-
ties Act of 1933 prior to sale to the public or which are
not at the time
of purchase readily saleable.
(m) Invest more than 5% of the total Fund assets, taken at
market value at the
time of purchase, in securities of companies with less
than three year's
continuing operation, including the operation of any
predecessor.
(n) Issue senior securities.
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<PAGE>
Exhibit - 10 i
INVESTMENT ADVISORY CONTRACT
AGREEMENT, made by and between Molter Series Funds, Inc., an
Arizona
Corporation, (hereinafter called "Fund") and Investment Research
Associates,
Inc., an Arizona Corporation (hereinafter called "Investment
Adviser")
WITNESSETH: WHEREAS, Fund engages in the business of investing
and reinvesting
its assets and property in various stocks and securities and
Investment Adviser
engages in the business of providing investment advisory
services.
1. The Fund hereby employs the Investment Adviser, for the
period set forth
in Paragraph 6 hereof, and on the terms set forth herein,
to render invest-
ment advisory services to the Fund, subject to the
supervision and direction
of the Board of Directors of the Fund. The Investment
Adviser hereby ac-
cepts such employment and agrees, during such period, to
render the services
and assume the obligations herein set forth, for the
compensation provided.
The Investment Adviser shall, for all purposes herein, be
deemed to be an
independent contractor, and shall, unless otherwise
expressly provided and
authorized, have no authority to act for or represent the
Fund in any way,
or in any way be deemed an agent of the Fund.
2. As a compensation for the services to be rendered to the
Fund by the Invest-
ment Adviser under the provisions of this Agreement, the
Fund shall pay to
the Investment Adviser monthly a fee equal to one-twelfth of
one percent per
month, (the equivalent of 1% per annum) of the daily
average net assets of
the Fund during the month. The first payment of fee
hereunder shall be
prorated on a daily basis from the date this Agreement takes
effect.
3. It is expressly understood and agreed that the services to
be rendered by
the Investment Adviser to the Fund under the provisions of
this Agreement
are not to be deemed to be exclusive, and the Investment
Adviser shall be
free to render similar or different services to others so
long as its abil-
ity to render the services provided for in this Agreement
shall not be im-
paired thereby.
4. It is understood and agreed that directors, officers,
employees, agents and
shareholders of the Fund may be interested in the Investment
Adviser as dir-
ectors, officers, employees, agents and shareholders, and
that directors,
officers, employees, agents and shareholders of the
Investment Adviser may
be interested in the Fund, as directors, officers,
employees, agents and
shareholders or otherwise, and that the investment Adviser,
itself, may be
interested in the Fund as a shareholder or otherwise,
specifically, it is
understood and agreed that directors, officers, employees,
agents and share-
holders of the Investment Adviser may continue as
directors, officers, emp-
loyees, agents and shareholders of the Fund; that the
Investment Adviser,
its directors, officers, employees, agents and
shareholders may engage in
other business, may render investment advisory services to
other investment
companies, or to any other corporation, association, firm or
individual, may
render underwriting services to the Fund, or to any other
investment compa-
ny, corporation, association, form or individual. The
Fund shall bear ex-
penses and salaries necessary and incidental to the conduct
of its business,
including but not in limitation of the foregoing, the costs
incurred in the
maintenance of its own books, records, and procedures;
dealing with its own
- 1 -
<PAGE>
shareholders; the payment of dividends; transfers of stock
(including issu-
ance & redemption of shares); reports and notices to
shareholders; expenses
of annual stockholders; meetings; miscellaneous office
expenses; brokerage
commissions; taxes; and custodian, legal, accounting and
registration fees.
Employees, officers and agents of the Investment Adviser
who are, or may in
the future be, directors and/or senior officers of the Fund
shall receive no
remuneration from the Fund or acting in such capacities
for the Fund. In
the conduct of the respective businesses of the parties
hereto and in the
performance of this agreement, the Fund & Investment Adviser
may share com-
mon facilities and personnel common to each, with
appropriate proration of
expenses.
5. Investment Adviser shall give the Fund the benefit of its
best judgment and
efforts in rendering these services, and Fund agrees as an
inducement to the
undertaking of these services that Investment Adviser shall
not be liable
hereunder for any mistake of judgment or any event
whatsoever, provided that
nothing herein shall be deemed to protect, or purport to
protect, Investment
Adviser against any liability to Fund or to its security
holders to which
Investment Adviser would otherwise be subject by reason of
willful misfeas-
ance, bad faith or gross negligence in the performance of
duties hereunder,
or by reason of reckless disregard of obligations and duties
hereunder.
6. This agreement shall continue in effect until December 31,
1998, and, there-
after, only so long as such continuance is approved at
least annually by
votes of the Fund's Board of Directors, cast in person at a
meeting called
for the purpose of voting on such approval, including the
votes of a majori-
ty of the Directors who are not parties to such agreement or
interested per-
sons of any such party. This agreement may be terminated
at any time upon
60 days prior written notice, without the payment of any
penalty, by the
Fund's Board of Directors or by vote of a majority of the
outstanding voting
securities of the Fund. The contract will automatically
terminate in the
event of its assignment by the Investment Adviser (within
the meaning of the
Investment Company Act of 1940), which shall be deemed to
include a transfer
of control of the Investment Adviser. Upon the
termination of this agree-
ment, the obligations of all the parties hereunder shall
cease and terminate
as of the date of such termination, except for any
obligation to respond for
a breach of this Agreement committed prior to such
termination and except
for the obligation of the Fund to pay to the Investment
Adviser the fee pro-
vided in Paragraph 2 hereof, prorated to the date of
termination.
7. This Agreement shall not be assigned by the Fund without
prior written con-
sent thereto of the Investment Adviser. This Agreement
shall terminate au-
tomatically in the event of its assignment by the
Investment Adviser unless
an exemption from such automatic termination is granted by
order or rule of
the Securities and Exchange Commission.
IN WITNESS WHEREOF, the parties hereto have caused their
corporate seals to
be affixed and duly attested and their presence to be
signed by their duly
authorized officers this 1st day of XXXXXXXXt, 1997.
Molter Series Funds, Inc. By
_____________________________
Dan Molter,
President
Attest: ________________
Hester Molter, Secretary
Investment Research Associates, Inc. By
____________________________
Dan Molter,
President
Attest: ________________
Hester Molter
- 2 -
<PAGE>
Exhibit - 10 ii
Reimbursement Agreements
The Fund will reimburse officers and directors not affiliated
with the Invest-
ment Adviser to compensate for travel expenses associated with
performance of
their duties.
The Fund has no plans to, compensate officers and directors who
are affiliated
with the Investment Adviser except indirectly through payment
of the management
fee.
- 1 -
<PAGE>
Exhibit - 99.1
XXXXXXXXXXXXXXX
Attorneys at Law
107 S.
Church St.
West
Chester, PA 19382
Molter Series Funds, Inc.
Gentlemen:
I have been asked to provide this opinion in connection with
the registration
under the Securities Act of 1933 ("Securities Act") of
1,500,000 shares of the
Common Capital Stock (par value $0.01 per share) of Molter
Series
Funds, Inc.("Fund").
I have examined the Articles of Incorporation of the Fund; the
By-Laws of the
Fund; various pertinent corporate proceedings; and such other
items considered
to be material to determine the legality of the authorized but
unissued shares
of the Fund's common stock.
Based upon the foregoing, it is my opinion that upon
effectiveness of the Secur-
ties Act Registration Statement of the Fund, filed pursuant
to the provisions
of Section 24(e) of the Investment Company Act of 1940, to
register 1,500,000
shares of the Fund's common stock ($0.01 per share par value)
and during such
time as such Registration Statement continues to be in effect,
the Fund will be
authorized to solicit, and cause to be solicited share
purchase orders and to
issue its shares for a cash consideration, as described in the
Fund's proposed
Prospectus and Statement of Additional Information, which
shares so issued will
be validly issued, fully paid and non-assessable.
I offer no opinion with respect to the offer and sales of the
Fund's securities
under the security laws of the several states, the District
of Columbia, any
territory of the United States or any foreign country.
I consent to the inclusion of this opinion as an exhibit to the
Securities Act
Registration Statement of the Fund and to the reference in the
Fund's Prospectus
and/or Statement of Additional Information to the fact that
this opinion con-
cerning the legality of the issue on behalf of the Fund, as
issuer, has been
rendered by me.
Very
Truly Yours;
__________________
XXXXXXXXXXXXX
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<PAGE>
