Securities Act File No. 333-47415
Investment Company Act File No. 811-8685
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. 1
Post-Effective Amendment No.
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 1
(Check appropriate box or boxes)
ROCHDALE INVESTMENT TRUST
(Exact Name of Registrant as Specified in Charter)
570 Lexington Ave.
New York, NY 10022-6837
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code:
(212) 702-3500
Julie Allecta, Esq.
Paul, Hastings, Janofsky & Walker
345 California St.
San Francisco, CA, 94104
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering: As soon as practicable after the
date of effectiveness of this Registration Statement.
Title of Securities Being Registered: Shares of Beneficial Interest, no par
value.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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CROSS REFERENCE SHEET
(as required by Rule 495)
N-1A Item No. Location
Part A
Item 1. Cover Page........................... Cover Page
Item 2. Synopsis............................. Expense
Table
Item 3. Financial Highlights................. N/A
Item 4. General Description of Registrant.... Investment
Objective,
Policies and
Risks
Item 5. Management of the Fund............... Management
and Administration
Item 5A Management's Discussion of Fund See Annual
Performance Reports to
Shareholders
Item 6. Capital Stock and Other Securities. . . Distributions
and Taxes
How the
Fund's Per
Share Value
is Determined
Item 7. Purchase of Securities Being Offered . . How to Invest
in the Fund
How the
Fund's Per
Share Value
is Determined
Item 8. Redemption or Repurchase. . . . . . . . How to Redeem
an Investment
in the Fund
Item 9. Pending Legal Proceedings . . . . . . . N/A
Part B
Item 10. Cover Page ............................. Cover Page
Item 11. Table of Contents....................... Table of
Contents
Item 12. General Information and History . . . . The Trust
General
Information
Item 13 Investment Objectives and Policies .... Investment
Objective and
Policies
Investment
Restrictions
Item 14. Management of the Fund................... The Fund's
Investment
Advisor
Item 15. Control Persons and Principal Holders
of Securities............................ The Fund's
Investment
Advisor
Item 16. Investment Advisory and Other Services.... The Fund's
Investment
Advisor The
Fund's
Administrator
Item 17. Brokerage Allocation...................... Execution of
Portfolio
Transactions
Item 18. Capital Stock and Other Securities........ General
Information
Item 19. Purchase, Redemption and Pricing of
Shares Being Offered.............. Additional
Purchase &
Redemption
Information
The Fund's
Distributor
Item 20. Tax Status.............................. Distributions
& Tax Infor-
mation
Item 21. Underwriters............................ The Fund's
Distributor
Item 22. Performance Information.................. Performance
Information
Item 23. Financial Statements.................... N/A
Part C
Information required to be included in Part C is set forth under the appropriate
Item, so numbered, in Part C to this Registration Statement
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PRELIMINARY PROSPECTUS
SUBJECT TO COMPLETION
A registration statement relating to these securities has been filed with the
Securities and Exchange Commission but has not yet become effective. Information
contained herein is subject to completion or amendment. These securities may not
be sold nor may offers to buy be accepted prior to the time the registration
statement becomes effective. This prospectus shall not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be any sale of these
securities in any jurisdiction in which such offer, solicitation or sale would
be unlawful prior to registration or qualification under the securities laws of
any such jurisdiction.
ROCHDALE FOUNDATION FUND
ROCHDALE INTERNATIONAL OPPORTUNITY FUND
570 Lexington Avenue
New York, NY 10022-6837
(212) 702-3500
(800) ___-____
The Rochdale Foundation Fund (the "Fund") is a mutual fund which invests
primarily in large companies, as measured by market capitalization ,
incorporated in the United States. The Fund seeks to achieve its investment
objective of long-term capital appreciation by investing in securities of
companies that meet the fundamental criteria incorporated in the proprietary
methodology of Rochdale Investment Management ("Rochdale" or the "Advisor"),
including various valuation and financial attributes.
The Rochdale International Opportunity Fund is a mutual fund with the investment
objective of seeking long-term capital appreciation through investment primarily
in companies incorporated in countries outside of the United States. The Fund
seeks to achieve its objective by investing in the most attractive developed and
emerging markets as identified through Rochdale's proprietary methodology
incorporating valuation, financial and economic attributes.
There can be no assurance that either Fund will achieve its investment
objective. This Prospectus sets forth basic
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information about the Funds that prospective investors should know before
investing. It should be read and retained for future reference. A Statement of
Additional Information dated June __, 1998 as may be amended from time to time,
has been filed with the Securities and Exchange Commission and is incorporated
herein by reference. The Statement of Additional Information is available
without charge upon written request to the Funds at the address given above.
TABLE OF CONTENTS
Expense Table....................................................
Investment Objective, Policies and Risks......... . . . . . . .
Management and Administration.............................
How to Invest in the Funds.......................................
How to Redeem an Investment in the Funds.........................
Services Available to the Funds' Shareholders....................
How the Funds' Per Share Value is Determined.....................
Distributions and Taxes..........................................
General Information..............................................
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
Prospectus dated June __, 1998
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FEES AND EXPENSES OF THE FUNDS
Expenses are one of several factors to consider when investing in the Funds. The
purpose of the following fee table is to provide an understanding of the various
costs and expenses which may be borne directly or indirectly by an investment in
the Funds. Actual expenses may vary from those shown; however, Rochdale will
reduce its fees and may absorb or reimburse the Funds for certain expenses to
the extent necessary to limit total annual fund operating expenses to the
amounts indicated in the table. Shares will be redeemed at net asset value per
share.
BOTH FUNDS
Shareholder Transaction Expenses
Maximum Sales Load Imposed on Purchases None
Maximum Sales Load Imposed on
Reinvested Dividends None
Deferred Sales Load None
Redemption Fees 2.00%*
Annual Fund Operating International
Expenses (As a percentage of Foundation Opportunity
average net assets) Fund Fund
Advisory Fees 1.00% 1.00%
12b-1 Expenses 0.25%** 0.25%**
Other Expenses 1.25%** 1.50**
after reduction)
Total Fund Operating Expenses 2.50%** 2.75%**
(after reduction)
*A fee of 2% of the amount redeemed is charged on redemptions of
shares held for eighteen months or less. The fee is payable to
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the Funds and is intended to benefit the remaining investors.
**Rochdale has undertaken to reduce its fees or make payments of fund expenses
to assure that the annual ratios of operating expenses to average net assets
will not exceed 2.50% for the Foundation Fund and 2.75% for the International
Opportunity Fund. Without Rochdale's undertaking, it is estimated that "Other
Expenses" in the above table would be 1.75% for the Foundation Fund and 2.00%
for the International Opportunity Fund and "Total Operating Expenses" would be
3.00% for the Foundation Fund and 3.25% for the International Opportunity Fund.
If Rochdale does waive fees or pay Fund expenses, the Funds may reimburse
Rochdale within the following three years. See "Management and Administration."
Each Fund has adopted a Distribution Plan under which it may pay Rochdale a fee
at an annual rate of up to 0.25% of the Fund's net assets for distribution
expenses and services. Over an extended period of time, a long-term shareholder
may pay more, directly and indirectly, in sales charges and such fees than the
maximum sales charge permitted under the rules of the National Association of
Securities Dealers, Inc. ("NASD"). This is recognized and permitted by the NASD.
Example of Fund Expenses
This table illustrates the net transaction and operating expenses that would be
incurred for an investment in each Fund over different time periods assuming a
$1,000 investment, a 5% annual return, and redemption at the end of each time
period.
International
Foundation Opportunity
Fund Fund
With Without With Without
Redemption Redemption Redemption Redemption
One Year $46 $25 $48 $28
Three Years $78 $78 $85 $85
The Example shown above should not be considered a representation of past or
future expenses and actual expenses may be greater or less than shown. In
addition, federal regulations require the Example to assume a 5% annual return,
but a Fund's actual return
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may be higher or lower. See "Management of the Funds."
The Funds are diversified series of Rochdale Investment Trust (the "Trust"),an
open-end management investment company. They are "mutual funds" offering
redeemable shares of beneficial interest. Shares of the Funds may be purchased
at their net asset value per share. The minimum initial investment in each Fund
is US $10,000 with subsequent investments of US $2,500 or more. Shares will be
redeemed at net asset value (less a redemption fee of 2% on shares redeemed that
have been held for eighteen months or less).
Investment Objective, Policies and Risks
ROCHDALE FOUNDATION FUND
Investment Objective. The Fund's investment objective is to seek long-term
capital appreciation. Although not an objective of the Fund, it seeks capital
appreciation in excess of the broad market, as defined by the Standard & Poor's
500 ("S & P 500"). The Fund seeks to invest in equity securities of companies
that meet the fundamental criteria incorporated in Rochdale's proprietary
methodology, including various valuation and financial attributes. Investments
in common stocks are emphasized, but the Fund also may buy other types of equity
securities, including preferred stocks, convertible securities or warrants.
The Fund selects securities priced at attractive levels relative to securities
of industry peers and of the broad market. Rochdale's company selection process
focuses on companies whose securities are trading at reasonable levels relative
to their anticipated growth rates and which are the beneficiaries of favorable
long-term conditions in the business cycles. Our investment style of seeking
well-managed companies at attractive relative valuations is best described as
"GARP" or Growth at a Reasonable Price.
Under normal conditions, the Fund seeks to achieve its objective by investing at
least 65% of its total assets in equity
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securities, primarily common stocks of domestic large-capitalization companies,
defined as those incorporated within the United States and with a market
capitalization in excess of $1 billion. The Fund generally invests the remaining
35% in a similar manner, but may also invest in depository receipts and
securities convertible into equity securities such as warrants, convertible
bonds, debentures or convertible preferred stock) of publicly traded companies
of any size worldwide.
The Fund may invest up to 25% of its total assets in securities of companies in
foreign developed markets and up to 15% of its total assets in securities of
companies in emerging markets. See "Foreign Securities and Emerging Markets"
below.
While not an objective, the Fund uses the S & P 500 Index as the benchmark for
the broad market against which the performance of the Fund is measured. Like all
mutual funds, there can be no assurance that the Fund's investment objective
will be attained.
Investment Policies. The Fund is designed for individuals and institutions who
can benefit from investing in growth companies at reasonable prices for their
large-capitalization domestic equity allocation. It is the policy of the Fund to
invest primarily in securities that are listed on a securities exchange or have
an established over-the-counter market.
In connection with the Fund's focus on long-term capital appreciation, Rochdale
employs "tax-sensitive" strategies, such as tax-lot accounting and lower
turnover, to manage the Fund with timing of sales so as to minimize the impact
to shareholders of short-term capital gains. However, the Fund will dispose of a
security, regardless of the time it has been held, to avoid anticipated
reduction of value, or to reduce or eliminate a position in a security which is
no longer believed to offer the potential for suitable gains.
Portfolio turnover is not expected to exceed an annual rate of 50% under normal
market conditions. Rochdale attempts to keep turnover to a minimum in order to
reduce trading and brokerage costs which the Fund must pay. Higher rates of
portfolio turnover may result in additional brokerage commissions or expenses to
the Fund, as well as a reduction in investors' after-tax returns.
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Investment Strategy. In managing the Fund, Rochdale draws a distinction between
stocks which are efficiently valued by the marketplace and those which are not.
Rochdale seeks to add value through a consistent, disciplined, and quantitative
application of an investment methodology to identify reasonably priced companies
with attractive long-term growth characteristics. We seek to identify excellent
companies which are temporarily out of favor but possess strong growth prospects
over the long-term as demonstrated by fundamental factors including earning
power, profit margins, revenue growth, asset growth, and cash flows.
In managing the Fund, Rochdale employs a quantitative approach. We apply a
multi-factor process and proprietary measures of valuation to identify
securities that are attractively valued. Quantitative criteria are used in
evaluating a company's potential as a prospective investment opportunity.
Rochdale has developed a proprietary methodology that identifies attractively
valued companies according to its proprietary multi-factor valuation
methodology. The multi-factor methodology is used to evaluate companies based on
their fundamentals, including earnings, revenues, cash flows, and valuation, and
is designed to identify those stocks which satisfy the Fund's long-term goal of
growth at a reasonable price. In evaluating companies, the multi- factor
methodology incorporates a number of fundamental factors including the
following:
-Price
-Revenue Growth
-Profit Margin
-Franchise Margin
-Valuation Metrics
--Discounted Cash Flow
--Price to Earnings Growth Rate
--Price to Sales Ratio
The most attractive companies as determined by the multi-factor methodology are
selected for or retained in the portfolio. A stock is sold because (a) the
fundamental factors have become unattractive, (b)the valuation exceeds our
reasonable price parameters, (c) the position exceed our diversification
parameters, or (d) it is displaced by a more attractive stock.
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Companies are evaluated within their respective industries as well as within the
overall investment universe. The Fund can invest in any industry, will hold a
broadly diversified portfolio across several industries, and will not
concentrate 25% or more of total assets in any single industry as an ongoing
policy. Under normal market conditions, the Fund expects to hold a minimum of 50
positions, with no maximum number. The Fund does not expect to hold more than
5%, at cost, of its total assets in the securities of any one issuer.
ROCHDALE INTERNATIONAL OPPORTUNITY FUND
Investment Objective. The Fund's investment objective is long-term capital
appreciation, which it seeks by investing in compaie within those countries
which Rochdale has identified as the most attractive among foreign developed and
emerging markets. A country's relative attractiveness is based on valuation
measures and financial and economic attributes incorporated in Rochdale's
proprietary methodology. The Fund seeks capital appreciation in excess of an
appropriately weighted benchmark measuring the performance of developed and
emerging market countries in Rochdale's investment universe. The Morgan Stanley
Capital International World-ex U.S. Index ("MSCI") is used as the benchmark for
the broad market against which the performance of the Fund is measured.
The Fund invests in securities of issuers in foreign countries, both developed
and emerging. For a discussion of various risks associated with investing in
foreign and emerging market securities, see "Foreign Securities and Emerging
Markets" at page __.
The Fund maintains investments in at least five markets, except during defensive
periods. For the foreign developed markets, the country universe from which the
Fund selects securities includes Canada plus those countries included in the
MSCI Europe, Australasia, and Far East Index ("MSCI EAFE"), except Malaysia and
Portugal, which the Fund considers emerging markets. There may be additional
developed countries included in the Fund that may not be classified by MSCI
EAFE. For emerging markets , the Fund will generally select securities of
companies in countries that are considered to be emerging by the United Nations
or the International Finance Corporation ("IFC"), or are
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otherwise regarded by their authorities s emerging. as well as countries that
are classified by the United Nations or otherwise regarded by their authorities
as emerging. Currently, the countries included in the Fund's emerging market
universe include Argentina, Brazil, Chile, Greece, India, Indonesia, Israel,
Malaysia, Mexico, the Philippines, Portugal, South Africa, South Korea, Taiwan,
Thailand and Turkey. In the future, the Fund may invest in other emerging market
countries.
Under normal conditions, the Fund seeks to achieve its objective by investing at
least 65% of its total assets in equity securities of foreign-domiciled,
publicly traded companies worldwide. Equity securities include common stocks,
sponsored or unsponsored American Depository Receipts ("ADRs"), European
Depository Receipts ("EDRs"), and Global Depository Receipts ("GDRs")
(collectively "depository receipts"), warrants, convertible bonds, debentures
and convertible preferred stocks. The Fund generally invests the remaining 35%
in a similar manner, but may invest those assets in equity or debt securities of
companies in countries worldwide. The Fund invests a minimum of 40% in developed
market securities and may invest up to 60% in emerging market securities, as
deemed appropriate by Rochdale. It is expected that the majority of companies
whose securities are held by the Fund will have a market capitalization of $200
million or more.
The Fund seeks to benefit from economic and other developments in foreign
countries or regions as well as relative valuation differences among foreign
markets. The objective of the Fund reflects our belief that investment
opportunities result from evolving long-term international trends favoring more
market-oriented economies, especially markets considered emerging. This trend
may be facilitated by local or international political, economic, or financial
developments that could benefit the capital markets of such countries. Certain
of these countries, which may be in the process of developing more
market-oriented economies, may experience relatively high rates of economic
growth. Other countries, although having relatively mature markets, may also be
in a position to benefit from local or international developments encouraging
greater market orientation and diminishing governmental intervention in economic
affairs.
Investment Policies.
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The Fund is designed for individuals and institutions who can benefit from
allocating a portion of their portfolio to a broader investment universe
comprised of securities in foreign developed and emerging markets. These markets
offer the opportunity to invest in countries at levels of economic development
different than the United States, or whose economies may be uncorrelated with
the United States. The companies and countries in which the Fund invests may
experience more potential for rapid growth than those in the United States. In
addition, these companies, when combined with an investors other investments,
may broaden portfolio representation in a manner that could lead to lower
overall portfolio volatility. Rochdale believes that the portion of an
investor's portfolio allocated to foreign investing should be made with an
investment horizon of five or more years.
Rochdale will change the composition of the portfolio as the relative
attractiveness of countries shifts. This may at times cause the fund to undergo
changes as a result of conditions in the financial markets or economies of the
foreign developed and emerging markets. Although the objective of the Fund is
long-term capital appreciation, the Fund will dispose of a security, regardless
of the time it has been held, to avoid anticipated reduction in value, or to
reduce or eliminate a position in a security which is no longer believed to
offer the potential for suitable gains. Portfolio turnover is not expected to
exceed an annual rate of 100% under normal circumstances. Higher rates of
portfolio turnover may result in additional brokerage commissions or expenses to
the Fund, as well as a reduction in investors' after-tax returns.
Investment Strategy. In managing the Fund, Rochdale focuses on those countries
within each category, foreign developed or emerging markets, that appear
attractively valued relative to other countries within that group. Rochdale
employs a proprietary quantitative methodology comprising several valuation,
financial, and economic factors for each country to arrive at a composite rating
for that country which takes each of these factors into account.
The factors included in this process include:
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-Price to Book Value
-Price to Earnings, Trailing
-Price to Earnings, Forecasted
-Earnings Yield Gap
-GDP Growth Rate Forecast
-Current Account to GDP
-Revision Ratio
-Analysts Consensus
The methodology employed ranks each of the countries on a periodic basis. Based
on the rankings for each country, the Fund allocates a certain percentage of the
portfolio to those higher ranked countries. The weighting allocated to each
country is determined by, among other factors, the nature of the market, its
market capitalization, the size of the economy, the number and type of
securities in the country, the liquidity of the country's securities markets,
and the type of country (developed or emerging). Country selection process tends
to focus on those countries that are attractive from a valuation perspective,
and thus to countries that may be experiencing or have experienced declines in
stock market value or economic growth in recent periods. The Fund invests in
companies representing a minimum of five countries and can be expected to be
invested in up to 15 or more countries in its portfolio under normal conditions.
A portfolio optimization process determines the specific securities that are
selected from each country to represent each selected country's return. Factors
used to select stocks within the countries include:
-Market capitalization
-Liquidity
-Volatility
-Growth
-Earnings/Price
-Industry
The Fund can invest in any industry, will seek to hold a broadly diversified
portfolio across several industries, and will not concentrate 25% or more of
total assets in any single industry as an ongoing policy.
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RISK FACTORS
All investments involve risk, and there can be no guarantee against loss
resulting from an investment in the Funds, nor can there by any assurance that
the Funds' investment objective will be attained. As with any investment in
securities, the value of and return from an investment in the Funds can decrease
as well as increase depending on a variety of factors which may affect the value
and return generated by the Funds' portfolio securities, including general
economic conditions and market factors. To the extent the Funds invest in
undervalued companies, there may be a substantial time period before the
securities of such companies return to price levels believed by Rochdale to
represent their true value. To the extent the Funds invest in fixed-income
securities, their value generally rises during periods of falling interest rates
but falls during periods of rising interest rates, and are subject to credit
risk relative to the ability of the issuer to repay principal and interest. An
investment in the Funds is therefore more appropriate for long-term investors
who can bear the risk of short-term fluctuations in principal and net asset
value.
Foreign Securities and Emerging Markets
Both Funds may invest, and the International Opportunity Fund will concentrate
its investments, in securities of foreign issuers, including those of companies
in emerging foreign markets. There are various risks associated with such
investments.
Since foreign securities are normally denominated and traded in foreign
currencies, the value of fund assets may be affected favorably or unfavorably by
changes in currency exchange rates relative to the U.S. dollar. There may be
less information publicly available about a foreign issuer, and foreign issuers
may not be subject to accounting standards comparable to those in the United
States.
The securities of some foreign companies are less liquid, and at times more
volatile, than securities of comparable U.S. companies. Foreign brokerage
commissions and other fees are also generally higher than in the United States.
Foreign settlement procedures and trade regulations may involve certain risks
(such
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as delay in payment or delivery of securities or in the recovery of fund assets
held abroad) and expenses not present in the settlement of domestic investments.
In addition, there may be a possibility of nationalization or expropriation of
assets, imposition of currency exchange controls, confiscatory taxation,
political or financial instability and diplomatic developments that could affect
the value of investments in certain foreign countries.
Legal remedies available to investors in certain foreign countries may be
limited. The laws of some foreign countries may limit investments in securities
of certain issuers located in those foreign countries. Special tax
considerations apply to foreign securities.
Prior Government approval for foreign investments may be required under certain
circumstances in some foreign countries, and the extent of foreign investment in
foreign companies may be subject to limitation. Foreign ownership limitations
also may be imposed by the charters of individual companies to prevent, among
other concerns, violation of foreign investment limitations. Repatriation of
investment income, capital and the proceeds of sales by foreign investors may
require governmental registration and approval in some foreign countries. A Fund
could be adversely affected by delays in, or a refusal to grant, any required
governmental approval for such repatriation.
The risks described above are typically greater in less developed nations,
sometimes referred to as "emerging markets." For instance, political and
economic structures in these countries may be in their infancy and developing
rapidly, causing instability. High rates of inflation may adversely affect the
economies and securities markets of such countries. In addition, the small size,
limited trading volume and relative inexperience of the people managing and
working in the securities markets in these countries may make investments in
such countries less liquid and more volatile than investments in more developed
countries. Investments in emerging markets are regarded as speculative, and in
non-geographically diverse emerging markets as especially speculative.
OTHER INVESTMENT PRACTICES USED BY THE FUNDS
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Short-term Investments
At times, the Funds may invest in short-term cash-equivalent securities. These
consist of high quality debt obligations maturing in one year or less from the
date of purchase, such as securities issued by the U.S. Government, its agencies
and instrumentalities, certificates of deposit, banker's acceptances and
commercial paper. High quality means that the obligations have been rated at
least A-1 by S&P or Prime-1 by Moody's Investor's Service, Inc. (Moody's), that
the issuer has an outstanding issue of debt securities rated at least AA by S&P
or Aa by Moody's, or are of comparable quality in Rochdale's opinion.
Fixed-Income Securities
Although equity securities are the primary focus for the Funds, they may also
hold fixed-income securities when Rochdale believes that opportunities for
long-term capital growth exist. The Funds' investments in corporate fixed-income
securities of domestic and foreign issuers are limited to corporate debt
securities (bonds, debentures, notes and other similar corporate debt
instruments) which meet the minimum ratings criteria set forth for the Fund, or,
if unrated, are in Rochdale's view, comparable in quality to corporate debt
securities in which the Fund may invest.
The Funds may invest up to 25% of their assets in securities rated B or better
by Moody's or Standard & Poor's. Securities rated BBB or better by S & P or Baa
and higher by Moody's are considered investment grade, but those rated BBB or
Baa may have speculative characteristics and changes in economic conditions may
lead to a weakened capacity to make principal and interest payments than is the
case with higher-rated securities.
The Funds may invest in securities rated below investment grade by Moody's and S
& P, but not rated below B. These securities have speculative characteristics,
including the possibility of default or bankruptcy of their issuers, market
price volatility based on interest rate sensitivity, and limited liquidity of
their trading markets. Because of these characteristics, the market for such
securities could be disrupted by an economic downturn and their value and the
ability of their issuers to
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repay principal and interest, and the Funds' net asset values could be adversely
affected.
Investment Companies
Consistent with the provisions of the Investment Company Act of 1940 (the "1940
Act"), the Funds may invest in the securities of other investment companies. As
a shareholder in any investment company, a Fund will bear its ratable share of
such company's expenses, including its advisory and administration fees.
Securities Lending
Each Fund is authorized to make loans of its portfolio securities to
broker-dealers or other institutional investors in an amount not exceeding 33
1/3% of its net assets. The borrower must maintain collateral equal to at least
100% of the value of the borrowed securities, plus any accrued interest. The
Fund will receive any interest or dividends paid on the loaned securities and a
fee or portion of the interest earned on the collateral. The risks in lending
portfolio securities include possible delay in receiving additional collateral
or in recovery of the securities, or possible limitation or loss of rights in
the collateral should the borrower fail financially. The Fund will make loans of
securities only to firms deemed by Rochdale to be of good standing and fully
creditworthy.
Year 2000
Like other mutual funds and financial and business organizations around the
world, the Funds could be adversely affected if the computer systems used by
them, Rochdale and other service providers and entities with computer systems
that are linked to Fund records do not properly process and calculate
date-related information and data from and after January 1, 2000. This is
commonly known as the "Year 2000 issue." The Funds and Advisor are taking steps
that are reasonably designed to address the Year 2000 issue with respect to the
computer systems they use and to obtain satisfactory assurances that comparable
steps are being taken by each of the Funds' other, major service providers.
However, there can be no assurance that these steps will be sufficient to avoid
any adverse impact on the Funds.
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The Funds have adopted certain investment restrictions, which are described
fully in the Statement of Additional Information. Like the Funds' investment
objectives, certain of these restrictions are fundamental and may be changed
only by a majority vote of a Fund's outstanding shares.
MANAGEMENT AND ADMINISTRATION
The Board of Trustees of the Trust establishes the Funds' policies and
supervises and reviews the management of the Funds.
Investment Advisor
Rochdale Investment Management, Inc. 570 Lexington Avenue, New York, NY
10022-6837, acts as investment advisor to the Funds pursuant to the Investment
Advisory Agreement. Rochdale provides investment advisory services to individual
and institutional investors and manages assets totaling over $500 million.
Rochdale was founded in 1986 and is controlled by Mr. Carl Acebes. Rochdale is
affiliated with Rochdale Securities Corporation, a New York Stock Exchange
member firm serving major corporate pension funds.
Mr. Carl Acebes and Mr. Garrett R. D'Alessandro, CFA, are the Funds' portfolio
managers. Mr. Acebes has been Chairman and Chief Investment Officer of Rochdale
since its founding. Mr. D'Alessandro, who also has been associated with Rochdale
since 1986, is the firm's President, Chief Executive Officer and Director of
Research. Mr. Acebes and Mr. D'Alessandro determine those companies that satisfy
the firm's investment criteria for inclusion in the Funds' portfolios and direct
the efforts of the firm's research analysts, as well as develop Rochdale's
proprietary analysis frameworks and multi-factor models.
Rochdale provides the Funds with advice on buying and selling securities,
manages the investments of the Funds, furnishes the Funds with office space, and
provides certain of the personnel needed by the Funds. As compensation, each
Fund pays Rochdale a monthly management fee (accrued daily) based upon the
average daily net assets of the Fund at the rate of 1.00% annually.
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<PAGE>
Investment Company Administration Corporation (the "Administrator") acts as the
Funds' Administrator under an Administration Agreement. Under that agreement,
the Administrator prepares various federal and state regulatory filings, reports
and returns for the Funds; prepares reports and materials to be supplied to the
trustees; monitors the activities of the Funds' custodian, transfer agent and
accountants; coordinates the preparation and payment of Fund expenses; and
reviews the Funds' expense accruals. For its services, the Administrator
receives a monthly fee from each Fund at the rate of 0.10% annually of average
net assets, with a minimum annual fee per Fund of $40,000.
Each Fund is responsible for its own operating expenses. Rochdale has agreed to
limit the Foundation Fund's operating expenses to assure that its annual ratio
of operating expenses to average net assets ("expense ratio") will not exceed
2.50% and the International Opportunity Fund's expense ratio so that it will not
exceed 2.75%. Rochdale also may waive fees or reimburse additional amounts to
the Funds at any time in order to reduce the Funds' expenses. Reductions made by
Rochdale in its fees or payments or reimbursement of expenses which are the
Funds' obligation are subject to reimbursement within the following three years
by the Funds provided that the Funds are able to do so and remain in compliance
with applicable expense limitations then in effect.
Rochdale considers a number of factors in determining which brokers or dealers
to use for the Funds' portfolio transactions. While these are more fully
discussed in the Statement of Additional Information, the factors include, but
are not limited to, the reasonableness of commissions, quality of services and
execution, and the availability of research which Rochdale may lawfully and
appropriately use in its investment management and advisory capacities. Provided
the Fund receives prompt execution at competitive prices, Rochdale may consider
the sale of Fund shares as a factor in selecting broker-dealers for the Funds'
portfolio transactions. Subject to overall requirements of obtaining the best
combination of price, execution, and research services on a particular
transaction, the Funds intend to place eligible portfolio transactions through
their affiliated broker-dealer, Rochdale Securities Corporation, under
procedures adopted
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by the Board of Trustees pursuant to the Investment Company Act of 1940 (the
"1940 Act") and related rules.
DISTRIBUTION PLAN
The Funds have adopted a distribution plan pursuant to Rule 12b- 1. The Plan
provides that the Funds may pay for distribution and related expenses of up to
an annual rate of 0.25% of each Fund's average net assets to Rochdale as
distribution coordinator. Expenses permitted to be paid by the Funds under the
Plan include: preparation, printing and mailing of prospectuses; shareholder
reports such as semi-annual and annual reports, performance reports and
newsletters; sales literature and other promotional material to prospective
investors; direct mail solicitation; advertising; public relations; compensation
of sales personnel, advisors or other third parties for their assistance with
respect to the distribution of the Funds' shares; payments to financial
intermediaries for shareholder support; administrative and accounting services
with respect to Fund shareholders; and such other expenses related to the
distribution of the Funds' shares.
Plan payments will be reviewed by the Trustees. However, it is possible that at
times the amount of Rochdale's compensation could exceed Rochdale's distribution
expenses, resulting in a profit to Rochdale. If the Plan is terminated, the
Funds will not be required to make payments for expenses incurred after the
termination.
HOW TO INVEST IN THE FUNDS
The minimum initial investment in each Fund is $10,000. Subsequent investments
must be at least $2,500. First Fund Distributors, Inc. (the "Distributor"), acts
as Distributor of the Fund's shares. The Distributor may, at its discretion,
waive the minimum investment requirements for purchases in conjunction with
certain group or periodic plans. In addition to cash purchases, shares may be
purchased by tendering payment in kind in the form of shares of stock, bonds or
other securities, provided that any such tendered security is readily
marketable, its acquisition is consistent with the particular Fund's
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<PAGE>
objective and it is otherwise acceptable to Rochdale.
Shares of the Funds are offered continuously for purchase at their net asset
value per share next determined after a purchase order is received. Orders
received after the time of the determination of a Fund's net asset value will be
entered at the next calculated net asset value. Investors may be charged a fee
by a broker or agent if they use such intermediaries to effect a transaction.
Investors may purchase shares of the Funds by check or wire:
By Check: For initial investments, an investor should complete the Funds'
Account Application (included with this Prospectus). The completed application,
together with a check payable to "Rochdale Foundation Fund" or the "Rochdale
International Opportunities Fund" should be mailed to the Funds at P.O. Box
____, _________, __ _____-____. For purchases by overnight mail, please contact
the Transfer Agent at (800) ___-____ for instructions.
A stub is attached to the account statement sent to shareholders after each
transaction. For subsequent investments the stub should be detached from the
statement and, together with a check payable to "Rochdale Foundation Fund," or
"Rochdale International Opportunities Fund" and mailed to the Funds in the
envelope provided at the address indicated above. The investor's account number
should be written on the check.
By Wire: For initial investments, before wiring the Funds an investor should
call (800) ___-____ between the hours of _:__ a.m. and _:__ p.m. Eastern time,
on a day when the New York Stock Exchange ("NYSE") is open for trading in order
to receive an account number. It is necessary to notify the Funds prior to each
wire purchase. Wires sent without notifying the Funds could result in a delay of
the effective date of purchase. The Funds' Transfer Agent will request the
investor's name, address, taxpayer identification number, amount being wired and
wiring bank. The investor should then instruct the wiring bank to transfer funds
by wire to : ____________________, ABA #____-____- _, for credit to Rochdale
Foundation Fund, DDA #____-______ or Rochdale International Opportunities Fund,
DDA. #___-___-____, for further credit to [investor's name and account number].
The
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<PAGE>
investor should also ensure that the wiring bank includes the name of the Fund
and the account number with the wire. If the Funds are received by the Transfer
Agent prior to the time that a Fund's net asset value is calculated, the Funds
will be invested on that day; otherwise they will be invested on the next
business day. Finally, the investor should write the account number provided by
the Transfer Agent on the Application Form and mail the Form promptly to the
Transfer Agent.
It is essential that complete information regarding the investor's account be
included in all wire instructions in order to facilitate prompt and accurate
handling of investments. Investors may obtain further information from the
Transfer Agent about remitting Funds in this manner and from their own banks
about any fees that may be imposed.
Other Purchase Information. Payments of redemption proceeds will not be made
with respect to any shares of the Funds purchased with an initial investment
made by wire until one business day after the completed Account Application is
received by the Funds. All investments must be made in U.S. dollars and, to
avoid fees and delays, checks should be drawn only on U.S. banks and should not
be made by third party check. A charge may be imposed if any check used for
investment does not clear. The Funds and the Distributor reserve the right to
reject any purchase order in whole or in part.
If a fully completed application or wire order, together with payment made
directly to the order of the Fund in U.S. dollars , is received by the Transfer
Agent by the close of trading on the NYSE (currently 4:00 p.m., New York City
time), Fund shares will be purchased at the offering price determined as of the
close of trading on that day. Otherwise, Fund shares will be purchased at the
offering price determined as of the close of trading on the NYSE on the next
business day.
Federal tax law requires that investors provide a certified Taxpayer
Identification Number and certain other required certifications upon opening or
reopening an account in order to avoid backup withholding of taxes at the rate
of 31% on taxable distributions and proceeds of redemptions. See the Funds'
Account Application for further information concerning this requirement.
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<PAGE>
The Funds are not required to issue share certificates. All shares are normally
held in non-certificated form registered on the books of the Funds and the
Funds' Transfer Agent for the account of the shareholder.
HOW TO REDEEM AN INVESTMENT IN THE FUNDS
Shareholders have the right to have the Funds redeem all or any portion of the
outstanding shares in their account at their current net asset value on each day
the NYSE is open for trading, subject to a 2% redemption fee imposed on
redemptions of shares within eighteen months of purchase. This fee is paid to
the Funds and is designed to reduce transaction costs and disruptive effects of
short-term investment in the Funds. The redemption price is the net asset value
per share next determined after the shares are validly tendered for redemption.
Direct Redemption. A written request for redemption must be received by the
Funds' Transfer Agent in order to constitute a valid tender for redemption.
Requests for redemption of fund shares should be mailed to the Funds at P.O. Box
____, __________, __ _____-____. To protect the Funds and their shareholders, a
signature guarantee is required for certain transactions, including redemptions
of amounts of $5,000 or more. Signature(s) on the redemption request must be
guaranteed by an "eligible guarantor institution" as defined in the federal
securities laws. These institutions include banks, broker-dealers, credit unions
and savings institutions. A broker-dealer guaranteeing signatures must be a
member of a clearing corporation or maintain net capital of at least $100,000.
Credit unions must be authorized to issue signature guarantees. Signature
guarantees will be accepted from any eligible guarantor institution which
participates in a signature guarantee program. A notary public is not an
acceptable guarantor.
Telephone Redemption. Shareholders who complete the Redemption by Telephone
portion of the Funds' Account Application may redeem shares on any business day
the NYSE is open by calling the Funds' Transfer Agent at (800) ___-____ between
the hours of _:__ a.m. and _:__ p.m. Eastern time. Redemption proceeds will be
mailed to the address of record or wired at the shareholder's direction the next
business day to the predesignated account. The minimum amount that may be wired
is $1,000 (wire charges, if any, will be
21
<PAGE>
deducted from redemption proceeds).
By establishing telephone redemption privileges, a shareholder authorizes the
Funds and the Transfer Agent to act upon the instruction of any person by
telephone to redeem from the account for which such service has been authorized
and send the proceeds to the address of record on the account or transfer the
proceeds to the bank account designated in the Authorization. The Funds and the
Transfer Agent will use procedures to confirm that redemption instructions
received by telephone are genuine, including recording of telephone instructions
and requiring a form of personal identification before acting on such
instructions. If these procedures are followed, neither the Funds nor their
agents will be liable for any loss, liability or cost which results from acting
upon instructions of a person believed to be a shareholder with respect to the
telephone redemption privilege. The Funds may change, modify, or terminate these
privileges at any time upon at least 60 days' notice to shareholders.
Shareholders may request telephone redemption after an account is opened;
however, the authorization form will require a separate signature guarantee.
Shareholders may experience delays in exercising telephone redemption privileges
during periods of abnormal market activity.
Other Redemption Information. Payment of redemption proceeds will be made
promptly, but not later than seven days after the receipt of all documents in
proper form, including a written redemption order with appropriate signature
guarantee in cases where telephone redemption privileges are not being utilized.
The Funds may suspend the right of redemption under certain extraordinary
circumstances in accordance with the Rules of the SEC. In the case of shares
purchased by check and redeemed shortly after purchase, the Funds will not mail
redemption proceeds until they have been notified that the check used for the
purchase has been collected, which may take up to 15 days from the purchase
date. To minimize or avoid such delay, investors may purchase shares by
certified check or federal Funds wire. A redemption may result in recognition of
a gain or loss for federal income tax purposes.
Due to the relatively high cost of maintaining smaller accounts,
22
<PAGE>
the Funds reserve the right to redeem shares in any account, other than
retirement plan or Uniform Gift to Minors Act accounts, if at any time, due to
redemptions by the shareholder, the total value of a shareholder's account does
not equal at least $5,000. If the Funds determine to make such an involuntary
redemption, the shareholder will first be notified that the value of the account
is less than $5,000 and will be allowed 30 days to make an additional investment
to bring the value of his account to at least $5,000 before the Funds take any
action.
SERVICES AVAILABLE TO THE FUNDS' SHAREHOLDERS
Retirement Plans. The Funds offer prototype Individual Retirement Account
("IRA") and Roth IRA plans, and information is available from the Distributor or
from your securities dealer with respect to other retirement plans offered.
Investors should consult a tax adviser before establishing any retirement plan.
Automatic Investment Plan. For the convenience of shareholders, the Funds offer
an automatic investment plan whereby a preauthorized amount is automatically
drawn on the shareholder's personal checking account each month (but not less
than $100). Upon receipt of the withdrawn funds, a Fund automatically invests
the money in additional shares of the Fund at the current offering price.
Applications for this service are available from the Transfer Agent. There is no
charge by the Funds for this service. The Funds may terminate or modify this
privilege at any time, and shareholders may terminate their participation by
notifying the Transfer Agent in writing, sufficiently in advance of the next
scheduled withdrawal.
Automatic Withdrawals. As another convenience, the Funds offer a Systematic
Withdrawal Program whereby shareholders may request that a check drawn in a
predetermined amount be sent to them each month or calendar quarter. A
shareholder's account in a Fund must have shares with a value of at least
$10,000 in order to start a Systematic Withdrawal Program, and the minimum
amount that may be withdrawn each month or quarter under the Systematic
Withdrawal Program is $100. This Program may be terminated or modified by a
shareholder or the Funds at any time without charge or penalty.
A withdrawal under the Systematic Withdrawal Program is treated
23
<PAGE>
as a redemption of shares, and may result in a gain or loss for federal income
tax purposes. In addition, if the amounts withdrawn exceed the dividends
credited to the shareholder's account, the account ultimately may be depleted.
HOW THE FUNDS' PER SHARE VALUE IS DETERMINED
The net asset value of a Fund share is determined once daily as of the close of
public trading on the New York Stock Exchange (currently 4:00 p.m. Eastern time)
on each day that Exchange is open for trading. Net asset value per share is
calculated by dividing the value of each Fund's total assets, less its
liabilities, by the number of Fund shares outstanding.
Portfolio securities are valued using current market values, if available.
Securities for which market quotations are not readily available are valued at
fair values as determined in good faith by or under the supervision of the
Trust's officers in accordance with methods which are specifically authorized by
the Board of Trustees. Short-term obligations with remaining maturities of 60
days or less are valued at amortized cost as reflecting fair value.
The value of securities denominated in foreign currencies and traded on foreign
exchanges or in foreign markets will be translated into U.S. dollars at the last
price of their respective currency denomination against U.S. dollars quoted by a
major bank or, if no such quotation is available, at the rate of exchange
determined in accordance with policies established in good faith by the
Trustees. Because the value of securities denominated in foreign currencies must
be translated into U.S. dollars, fluctuation in the value of such currencies in
relation to the U.S. dollar may affect the value of the Funds' shares even
without any change in the foreign currency denominated values of such
securities.
DISTRIBUTIONS AND TAXES
Dividends and Distributions. Any dividends from net investment income (which
includes realized short-term capital gains) are declared and paid at least
annually. Any undistributed long-term
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<PAGE>
net capital gains realized during the 12-month period ended each October 31, as
well as any additional undistributed capital gains realized during the Funds'
fiscal year, will also be distributed to shareholders on or about December 31 of
each year.
Dividends and capital gain distributions (net of any required tax withholding)
are automatically reinvested in additional shares of a Fund at the net asset
value per share on the reinvestment date unless the shareholder has previously
requested in writing to the Transfer Agent that distributions be made in cash.
Any dividend or distribution paid by a Fund has the effect of reducing the net
asset value per share on the reinvestment date by the amount of the dividend or
distribution. Investors should note that a dividend or distribution paid on
shares purchased shortly before such dividend or distribution was declared will
be subject to income taxes as discussed below even though the dividend or
distribution represents, in substance, a partial return of capital to the
shareholder.
Taxes. The Funds intend to qualify and elect to be treated as a regulated
investment company under Subchapter M of the Internal Revenue Code of 1986, as
amended (the "Code"). As long as the Funds continue to so qualify, and as long
as they distribute all of their income each year to the shareholders, the Funds
will not be subject to any federal income tax or excise taxes based on net
income. Distributions made by the Funds will be taxable to shareholders whether
received in shares (through dividend reinvestment) or in cash. Distributions
derived from net investment income, including net short-term capital gains, are
taxable to shareholders as ordinary income. Any long-term or mid-term capital
gain distributions are taxable to shareholders as long-term or mid-term capital
gains, respectively, regardless of the length of time shares have been held.
Although distributions are generally taxable when received, certain
distributions made in January are taxable as if received the prior December.
Shareholders will be informed annually of the amount and nature of the Funds'
distributions. Additional information about taxes is set forth in the Statement
of Additional Information. Shareholders should consult their own advisers
concerning federal, state and local tax consequences of investing in the Funds.
GENERAL INFORMATION
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<PAGE>
The Trust. The Funds are series of Rochdale Investment Trust (the "Trust"). The
Trust was organized as a Delaware business trust on February __, 1998. The
Agreement and Declaration of Trust permits the Board of Trustees to issue an
unlimited number of full and fractional shares of beneficial interest, without
par value, which may be issued in any number of series. The Board of Trustees
may from time to time classify shares and issue other series, the assets and
liabilities of which will be separate and distinct from any other series.
Shareholder Rights. Shares issued by the Funds have no preemptive, conversion,
or subscription rights. Shareholders have equal and exclusive rights as to
dividends and distributions as declared by each Fund and to the net assets of
each Fund upon liquidation or dissolution. Voting rights are not cumulative, so
that the holders of more than 50% of the shares voting in any election of
Trustees can, if they so choose, elect all of the Trustees. While the Trust is
not required and does not intend to hold annual meetings of shareholders, such
meetings may be called by the Trustees in their discretion, or upon demand by
the holders of 10% or more of the outstanding shares of the Trust for the
purpose of electing or removing Trustees.
Performance Information. From time to time, the Funds may publish total return
in advertisements and communications to investors. Total return information will
include a Fund's average annual compounded rate of return over the most recent
year and over the period from the Fund's inception of operations. The Funds may
also advertise aggregate and average total return information over different
periods of time. A Fund's total return will be based upon the value of the
shares acquired through a hypothetical $1,000 investment at the beginning of the
specified period and the net asset value of such shares at the end of the
period, assuming reinvestment of all distributions. Total return figures will
reflect all recurring charges against Fund income, and any applicable sales
charges. Investors should note that the investment results of the Fund will
fluctuate over time, and any presentation of a Fund's total return for any prior
period should not be considered as a representation of what an investor's total
return may be in any future period.
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<PAGE>
Custodian and Transfer Agent; Shareholder Inquiries. _______________,
_____________, _________, __ ______, serves as custodian of the Funds' assets.
________________________, P. O. Box ____, _________, __ _____-____ is the Funds'
Transfer and Dividend Disbursing Agent. Shareholder inquiries should be directed
to the Transfer Agent at (800) ___-____.
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<PAGE>
Advisor
Rochdale Investment Management Inc.
570 Lexington Ave.
New York, NY 10022-6837
Distributor
First Fund Distributors, Inc.
4455 E. Camelback Rd., Ste. 261E
Phoenix, AZ 85018
Custodian
===============
- ---------------
Transfer and Dividend Disbursing Agent
==============
- --------------
Auditors
===============
- ---------------
Legal Counsel
Paul, Hastings, Janofsky & Walker LLP
345 California St.
San Francisco, CA 94104
28
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STATEMENT OF ADDITIONAL INFORMATION
June __, 1998
ROCHDALE FOUNDATION FUND
ROCHDALE INTERNATIONAL OPPORTUNITY FUND
570 Lexington Avenue
New York, NY 10022-6837
(212) 702-3500
(800) ___-____
This Statement of Additional Information is not a prospectus and it should be
read in conjunction with the prospectus of the Rochdale Foundation Fund and the
Rochdale International Opportunity Fund (the "Funds"). A copy of the prospectus
of the Funds dated June , 1998 is available by calling the number
listed above or (212) 633-9700.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Reference to page
Page In Prospectus
<S> <C>
The Trust B-2
Investment Objective and Policies B-2
Investment Restrictions B-4
Distributions and Tax Information B-6
Management B-8
The Fund's Investment Advisor B-9
The Fund's Administrator B-9
The Fund's Distributor B-10
Execution of Portfolio Transactions B-10
Additional Purchase and Redemption Information B-12
Determination of Share Price B-13
Performance Information B-13
General Information B-14
</TABLE>
THE TRUST
Rochdale Investment Trust (the "Trust") is an open-end management
investment company organized as a Delaware business trust. The Trust may consist
of various series which represent separate investment portfolios. This Statement
of Additional Information relates only to the initial series of the Trust, the
Rochdale Foundation Fund and Rochdale International Opportunity Fund. Rochdale
Investment Management Inc. ("Rochdale") is the
1
<PAGE>
Fund's investment advisor.
INVESTMENT OBJECTIVE AND POLICIES
The Funds are mutual funds with an investment objective of
long-term capital appreciation. The following discussion supplements the
discussion of the Funds' investment objectives and policies as set forth in the
Prospectus. There can be no assurance that the objective of the Funds will be
attained.
Depositary Receipts
The Funds may invest in securities of foreign issuers in the form of
American Depositary Receipts ("ADRs"), European Depositary Receipts ("EDRs"),
Global Depositary Receipts ("GDRs") or other securities convertible into
securities of foreign issuers. These securities may not necessarily be
denominated in the same currency as the securities for which they may be
exchanged. The Funds may also hold American Depository Shares ("ADSs"), which
are similar to ADRs. ADRs and ADSs are typically issued by an American bank or
trust company and evidence ownership of underlying securities issued by a
foreign corporation. EDRs, which are sometimes referred to as Continental
Depository Receipts ("CDRs"), are receipts issued in Europe, typically by
foreign banks and trust companies that evidence ownership of either foreign or
domestic securities. Generally, ADRs in registered form are designed for use in
U.S. securities markets. For purposes of the Funds' investment policies, the
Funds' investments in ADRs, ADSs, EDRs, GDRs and CDRs will be deemed to be
investments in the equity securities representing securities of foreign issuers
into which they may be converted.
Repurchase Agreements
The Funds may enter into repurchase agreements in order to earn income on
available cash, or as a defensive investment in which the purchaser (i.e., the
Fund) acquires ownership of a U.S. Government security (which may be of any
maturity) and the seller agrees to repurchase the obligation at a future time at
a set price, thereby determining the yield during the purchaser's holding period
(usually not more than seven days from the date of purchase). Any repurchase
transaction in which a Fund engages
2
<PAGE>
will require full collateralization of the seller's obligation during the entire
term of the repurchase agreement. In the event of a bankruptcy or other default
of the seller, a Fund could experience both delays in liquidating the underlying
security and losses in value. However, the Funds intend to enter into repurchase
agreements only with banks with assets of $500 million or more that are insured
by the Federal Deposit Insurance Corporation and with the most credit worthy
registered securities dealers with all such transactions governed by procedures
adopted and regularly reviewed by the Trust's Board of Trustees. Rochdale
monitors the creditworthiness of the banks and securities dealers with whom the
Funds engage in repurchase transactions.
If the market value of the U.S. Government security subject to the
repurchase agreement becomes less than the repurchase price (including
interest), the Funds will direct the seller of the U.S. Government security to
deliver additional securities so that the market value of all securities subject
to the repurchase agreement will equal or exceed the repurchase price. It is
possible that the Funds might be unsuccessful in seeking to impose on the seller
a contractual obligation to deliver additional securities.
When-Issued Securities
Each Fund may from time to time purchase securities on a "when-issued"
basis. The price of such securities, which may be expressed in yield terms, is
fixed at the time the commitment to purchase is made, but delivery and payment
for the when-issued securities take place at a later date. Normally, the
settlement date occurs within one month of the purchase; during the period
between purchase and settlement, no payment is made by the Fund to the issuer
and no interest accrues to the Fund. To the extent that assets of the Fund are
held in cash pending the settlement of a purchase of securities, the Fund would
earn no income. While when-issued securities may be sold prior to the settlement
date, the Funds intend to purchase such securities with the purpose of actually
acquiring them unless a sale appears desirable for investment reasons. At the
time a Fund makes the commitment to purchase a security on a when-issued basis,
it will record the transaction and reflect the value of the security in
determining its net asset value. The market value of the when-issued securities
may be more or less than the purchase price. Rochdale does not believe that a
Fund's net asset value or income will be adversely affected by the purchase of
securities on a when-issued basis. The Funds will segregate liquid assets equal
in value to commitments for when-issued securities, which reduces but does not
eliminate leverage.
Options and Futures
The Funds may purchase and write call and put options on securities, securities
indexes, and foreign currencies, and enter into futures contracts and use
options on futures contracts. The Funds may use these techniques to hedge
against changes in securities prices, foreign currency exchange rates or as part
of its overall investment strategy. The Funds segregate liquid assets to cover
obligations under options and futures contracts to reduce leveraging.
The Funds may buy or sell interest rate futures contracts and options on
interest rate futures contracts for the purpose of hedging against changes in
the value of securities owned. The Funds will not enter into futures contracts
or options thereon for non-hedging purposes if, immediately thereafter, the
aggregate initial margin deposits on a Fund's futures positions and premiums
paid for options thereon would exceed 5% of the liquidation value of the Fund's
total assets.
There are risks involved in the use of options and futures, including the risk
that the prices of the hedging vehicles may not correlate perfectly with the
securities held by the Funds. This may cause the futures or options to react
differently from the Funds' portfolio securities to market changes. In addition,
Rochdale could be incorrect in its expectations for the direction or extent of
market movements. In these events, the Funds could lose money on the options of
futures contracts. It is also not certain that a secondary market for positions
in options or futures contracts will exist at all times, although Rochdale will
consider liquidity before entering into these transactions.
Illiquid Securities
Each Fund may invest up to 15% of its net assets in illiquid
3
<PAGE>
securities, including (i) securities for which there is no readily available
market; (ii) securities the disposition of which would be subject to legal
restrictions (so called "restricted securities"); and (iii) repurchase
agreements having more than seven days to maturity. A considerable period of
time may elapse between a Fund's decision to dispose of such securities and the
time when the Fund is able to dispose of them, during which time the value of
the securities could decline.
Restricted securities issued pursuant to Rule 144A under the Securities Act of
1933 that have a readily available market are not deemed illiquid for purposes
of this limitation. Investing in Rule 144A securities could result in increasing
the level of a Fund's illiquidity if qualified institutional buyers become, for
a time, uninterested in purchasing these securities. Rochdale will monitor the
liquidity of such securities subject to review by the Board of Trustees.
With respect to liquidity determinations generally, the Board of
Trustees has the ultimate responsibility for determining whether specific
securities are liquid or illiquid. The Board has delegated the function of
making day-to-day determinations of liquidity to Rochdale. Factors encompassed
in the evaluation of liquidity, include, but are not limited to: (i) the
frequency of trading in the security; (ii) the number of dealers that make
quotes for the security; (iii) the number of dealers that have undertaken to
make a market in the security; (iv) the number of other potential purchasers;
and (v) the nature of the security and how trading is effected (e.g., the time
needed to sell the security, how offers are solicited and the mechanics of
transfer). Rochdale will monitor the liquidity of securities in the Funds'
portfolios and report periodically on such decisions to the Board of Trustees,
consistent with the guidelines established for making liquidity determinations.
INVESTMENT RESTRICTIONS
The following policies and investment restrictions have been
adopted by each Fund and (unless otherwise noted) are fundamental and cannot be
changed without the affirmative vote of a majority of the Fund's outstanding
voting securities as defined in the 1940 Act. Neither Fund may:
4
<PAGE>
1. Make loans to others, except (a) through the purchase of debt
securities in accordance with its investment objectives and policies, (b)
through the lending of portfolio securities, or (c) to the extent the entry into
a repurchase agreement is deemed to be a loan.
(a) Borrow money, except temporarily for extraordinary or emergency
purposes from a bank and then not in excess of 10% of total assets (at the lower
of cost or fair market value; any such borrowing will be made only if
immediately thereafter there is an asset coverage of at least 300% of all
borrowings and no investments may be made while any borrowings are in excess of
5% of total assets).
(b) Mortgage, pledge or hypothecate any of its assets except in
connection with any such borrowings.
3. Purchase securities on margin, participate on a joint or joint
and several basis in any securities trading account, or underwrite securities,
except that this restriction does not preclude a Fund from obtaining such
short-term credit as may be necessary for the clearance of purchases and sales
of its portfolio securities.
4. Purchase or sell real estate, or commodities or commodity
contracts, except that a Fund may purchase or sell currencies (including forward
currency exchange contracts), futures contracts, and related options.
5. Invest 25% or more of the market value of its assets in the
securities of companies engaged in any one industry, except that this
restriction does not apply to investment in the securities of the U.S.
Government, its agencies or instrumentalities.
6. Issue senior securities, as defined in the 1940 Act except that
this restriction shall not be deemed to prohibit a Fund from (a) making any
permitted borrowings, mortgages or pledges, (b) entering into repurchase
transactions, or (c) engaging in options or futures transactions.
7. Invest in any issuer for purposes of exercising control
5
<PAGE>
or management.
Each Fund observes the following policies, which are not deemed
fundamental and which may be changed without shareholder vote. Neither Fund may:
8.Invest in securities of other investment companies except as
provided for in the Investment Company Act of 1940.
9. Invest, in the aggregate, more than 15% of its net assets in
securities with legal or contractual restrictions on resale, securities which
are not readily marketable, and repurchase agreements with more than seven days
to maturity.
If a percentage restriction is adhered to at the time of
investment, a subsequent increase or decrease in a percentage resulting from a
change in the values of assets will not constitute a violation of that
restriction, except with respect to borrowing and illiquid securities, or as
otherwise noted.
DISTRIBUTIONS AND TAX INFORMATION
Distributions
Dividends from net investment income and distributions from net
profits from the sale of securities are generally made annually. Also, each Fund
expects to distribute any undistributed net investment income on or about
December 31 of each year. Any net capital gains realized through the one-year
period ended October 31 of each year will also be distributed by December 31 of
each year.
Each distribution by a Fund is accompanied by a brief explanation
of the form and character of the distribution. In January of each year the Fund
will issue to each shareholder a statement of the federal income tax status of
all distributions made during the preceding calendar year.
Tax Information
Each Fund is treated as a separate entity for federal income tax
purposes. Each Fund expects to qualify to be treated
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<PAGE>
as a regulated investment company under Subchapter M of the Internal Revenue
Code of 1986, as amended, (the "Code"), provided that it complies with all
applicable requirements regarding the source of its income, diversification of
its assets and timing of distributions. Each Fund's policy is to distribute to
its shareholders all of its investment company taxable income and any net
realized long-term and mid-term capital gains for each fiscal year in a manner
that complies with the distribution requirements of the Code, so that the Fund
will not be subject to any federal income tax or excise taxes based on net
income. To avoid the excise tax, each Fund must also distribute (or be deemed to
have distributed) by December 31 of each calendar year (i) at least 98% of its
ordinary income for such year, (ii) at least 98% of the excess of its realized
capital gains over its realized capital losses for the one-year period ending on
October 31 during such year and (iii) any amounts from the prior calendar year
that were not distributed and on which the Fund paid no federal excise tax.
Net investment income consists of interest and dividend income,
less expenses. Net realized capital gains for a fiscal period are computed by
taking into account any capital loss carry forward of a Fund.
The Funds may write, purchase, or sell certain option and futures contracts.
Such transactions are subject to special tax rules that may affect the amount,
timing, and character of distributions to shareholders. Unless a Fund is
eligible to make and makes a special election, such contracts that are "Section
1256 contracts" will be "marked-to-market" for Federal income tax purposes at
the end of each taxable year (i.e., each contract will be treated as sold for
its fair market value on the last day of the taxable year). In general, unless
the special election referred to in the previous sentence is made, gain or loss
from transactions in such contracts will be 60% long term and 40% short-term
capital gain or loss. Section 1092 of the Code, which applies to certain
"straddles", may affect the taxation of the Fund's transactions in option,
futures, and foreign currency contracts. Under Section 1092 of the Code, the
Funds may be required to postpone recognition for tax purposes of losses
incurred in certain closing transactions.
Distributions of net investment income and net short-term capital
7
<PAGE>
gains are taxable to shareholders as ordinary income. In the case of corporate
shareholders, a portion of the distributions may qualify for the intercorporate
dividends-received deduction to the extent a Fund designates the amount
distributed as a qualifying dividend. The aggregate amount so designated cannot,
however, exceed the aggregate amount of qualifying dividends received by the
Fund for its taxable year. The deduction, if any, may be reduced or eliminated
if Fund shares held by a corporate investor are treated as debt-financed or are
held for fewer than 46 days.
Any long-term or mid-term capital gain distributions are taxable to
shareholders as long-term or mid-term capital gains, respectively, regardless of
the length of time they have held their shares. Capital gains distributions are
not eligible for the dividends-received deduction referred to in the previous
paragraph. Distributions of any net investment income and net realized capital
gains will be taxable as described above, whether received in shares or in cash.
Shareholders electing to receive distributions in the form of additional shares
will have a cost basis for federal income tax purposes in each share so received
equal to the net asset value of a share on the reinvestment date. Distributions
are generally taxable when received. However, distributions declared in October,
November or December to shareholders of record on a date in such a month and
paid the following January are taxable as if received on December 31.
Distributions are includable in alternative minimum taxable income in computing
a shareholder's liability for the alternative minimum tax.
Under the Code, the Funds will be required to report to the
Internal Revenue Service all distributions of taxable income and capital gains
as well as gross proceeds from the redemption or exchange of Fund shares, except
in the case of exempt shareholders, which includes most corporations. Pursuant
to the backup withholding provisions of the Code, distributions of any taxable
income and capital gains and proceeds from the redemption of a Fund's shares may
be subject to withholding of federal income tax at the rate of 31 percent in the
case of non-exempt shareholders who fail to furnish the Funds with their
taxpayer identification numbers and with required certifications regarding their
status under the federal income tax law. If the backup withholding provisions
are applicable, any such distributions and
8
<PAGE>
proceeds, whether taken in cash or reinvested in additional shares, will be
reduced by the amounts required to be withheld. Corporate and other exempt
shareholders should provide the Funds with their taxpayer identification numbers
or certify their exempt status in order to avoid possible erroneous application
of backup withholding. The Funds reserve the right to refuse to open an account
for any person failing to certify the person's taxpayer identification number.
Neither Fund will be subject to tax in the State of Delaware as
long as it qualifies as a regulated investment company for federal income tax
purposes. Distributions and the transactions referred to in the preceding
paragraphs may be subject to state and local income taxes, and the tax treatment
thereof may differ from the federal income tax treatment.
Generally, a credit for foreign taxes may not exceed the
shareholder's U.S. federal income tax (determined without reward to the
availability of the credit) attributable to his or her total foreign source
taxable income. For this purpose, the portion of distributions paid by a Fund
from foreign source income will be treated as foreign source income. A Fund's
gains from the sale of securities will generally be treated as derived from U.S.
sources, and certain currency fluctuation gains and losses, including
fluctuation gains from foreign currency denominated debt securities, receivables
and payables will be treated as derived from U.S. sources. The limitation on the
foreign tax credit is applied separately to foreign source "passive income",
such as the portion of dividends received from a Fund which qualifies as foreign
source income. In addition, the foreign tax credit is allowed to offset only 90%
of the alternative minimum tax imposed on corporations and individuals. Because
of these limitations, shareholders may be unable to claim a credit for the full
amount of their proportionate shares of foreign income taxes paid by the Funds.
The foregoing discussion of U.S. federal income tax law relates solely
to the application of that law to U.S. citizens or residents and U.S. domestic
corporations, partnerships, trusts, and estates. Each shareholder who is not a
U.S. person should consider the U.S. and foreign tax consequences of ownership
of shares of the Funds, including the possibility that such a shareholder may be
subject to a U.S. withholding tax at a rate of
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<PAGE>
30 percent (or at a lower rate under an applicable income tax treaty) on amounts
constituting ordinary income.
MANAGEMENT
TRUSTEES
The Trustees of the Trust, who were elected for an indefinite term by
the initial shareholders of the Trust, are responsible for the overall
management of the Trust, including general supervision and review of the
investment activities of the Funds. The Trustees, in turn, elect the officers of
the Trust, who are responsible for administering the day-to-day operations of
the Trust and its separate series. The current Trustees and officers and their
affiliations and principal occupations for the past five years are set forth
below.
[Information on Trustees to be supplied]
Set forth below is the total compensation estimated to be received by
the Trustees during the Funds' initial fiscal period. Disinterested Trustees
receive an annual retainer of $_,___ and a fee of $____ for each regularly
scheduled meeting. These trustees also receive a fee of $____ for any special
meeting attended. Disinterested trustees are also reimbursed for expenses in
connection with each Board meeting attended. No other compensation or retirement
benefits are received by any Trustee or officer from the Funds or any other
portfolios of the Trust.
Name of Trustee Total Compensation
- --------------- ------------------
THE FUNDS' INVESTMENT ADVISOR
As stated in the Prospectus, investment advisory services are
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<PAGE>
provided to the Funds by Rochdale, pursuant to an Investment Advisory
Agreement.
The Investment Advisory Agreement continues in effect after its initial
two year term from year to year so long as such continuation is approved at
least annually by (1) the Board of Trustees of the Trust or the vote of a
majority of the outstanding shares of the Funds, and (2) a majority of the
Trustees who are not interested persons of any party to the Agreement, in each
case cast in person at a meeting called for the purpose of voting on such
approval. The Agreement may be terminated at any time, without penalty, by
either a Fund or Rochdale upon sixty days' written notice and is automatically
terminated in the event of its assignment as defined in the 1940 Act.
Rochdale has agreed to reduce fees payable to it or reimburse the
Funds; operating expenses to the extent necessary to limit the Fund's ratio of
operating expenses to average net assets to no more than 2.50% annually for the
Foundation Fund and 2.75% annually for the International Opportunity Fund. Any
such reduction of fees or payment of expenses may be subject to reimbursement by
the Funds within the following three years provided that a Fund is able to do so
and remain in compliance with applicable expense limitations then in effect.
THE FUNDS' ADMINISTRATOR
The Funds have entered into an Administration Agreement with Investment
Company Administration Corporation (the "Administrator"). The Administration
Agreement provides that the Administrator will prepare and coordinate reports
and other materials supplied to the Trustees; prepare and/or supervise the
preparation and filing of all securities filings, periodic financial reports,
prospectuses, statements of additional information, tax returns, shareholder
reports and other regulatory reports or filings required of the Funds; prepare
all required notice filings necessary to maintain the Funds' ability to sell
shares in all states where the Funds currently do or intend to do business;
coordinate the preparation, printing and mailing of all materials (e.g., Annual
Reports) required to be sent to shareholders; coordinate the preparation and
payment of Fund-related expenses; monitor and oversee the activities of the
11
<PAGE>
Funds' servicing agents (e.g., transfer agent, custodian, fund accountants,
etc.); review and adjust as necessary the Funds' daily expense accruals; and
perform such additional services as may be agreed upon by the Funds and the
Administrator. For its services, the Administrator receives a monthly fee from
each Fund at the annual rate of 0.10% of average daily net assets with a minimum
annual fee of $40,000.
THE FUNDS' DISTRIBUTOR
First Fund Distributors, Inc. (the "Distributor"), an affiliate of the
Administrator, acts as the Funds' principal underwriter in a continuous public
offering of the Funds shares. The Distribution Agreement between the Funds and
the Distributor continues in effect from year to year if approved at least
annually by (i) the Board of Trustees or the vote of a majority of the
outstanding shares of the Fund (as defined in the 1940 Act) and (ii) a majority
of the Trustees who are not interested persons of any such party, in each case
cast in person at a meeting called for the purpose of voting on such approval.
The Distribution Agreement may be terminated without penalty by the parties
thereto upon sixty days, written notice, and is automatically terminated in the
event of its assignment as defined in the 1940 Act.
EXECUTION OF PORTFOLIO TRANSACTIONS
Pursuant to the Investment Advisory Agreement, Rochdale determines
which securities are to be purchased and sold by the Funds and which
broker-dealers are eligible to execute the Funds' portfolio transactions.
Purchases and sales of securities in the over-the-counter market will generally
be executed directly with a "market-maker" unless, in the opinion of Rochdale, a
better price and execution can otherwise be obtained by using a broker for the
transaction.
Purchases of portfolio securities for the Funds also may be made
directly from issuers or from underwriters. Where possible, purchase and sale
transactions will be effected through dealers (including banks) which specialize
in the types of securities which the Funds will be holding, unless better
executions are available elsewhere. Dealers and underwriters usually act as
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<PAGE>
principal for their own account. Purchases from underwriters will include a
concession paid by the issuer to the underwriter and purchases from dealers will
include the spread between the bid and the asked price. If the execution and
price offered by more than one dealer or underwriter are comparable, the order
may be allocated to a dealer or underwriter that has provided research or other
services as discussed below.
In placing portfolio transactions, Rochdale will use its best efforts
to choose a broker-dealer capable of providing the services necessary to obtain
the most favorable price and execution available. The full range and quality of
services available will be considered in making these determinations, such as
the size of the order, the difficulty of execution, the operational facilities
of the firm involved, the firm's risk in positioning a block of securities, and
other factors. In those instances where it is reasonably determined that more
than one broker-dealer can offer the services needed to obtain the most
favorable price and execution available, consideration may be given to those
broker-dealers which furnish or supply research and statistical information to
Rochdale that it may lawfully and appropriately use in its investment advisory
capacities, as well as provide other services in addition to execution services.
Rochdale considers such information, which is in addition to and not in lieu of
the services required to be performed by it under its Agreement with the Funds,
to be useful in varying degrees, but of indeterminable value. Portfolio
transactions may be placed with broker-dealers who sell shares of the Funds
subject to rules adopted by the National Association of Securities Dealers, Inc.
While it is the Funds' general policy to seek first to obtain the most
favorable price and execution available, in selecting a broker-dealer to execute
portfolio transactions for the Funds, weight may also be given to the ability of
a broker-dealer to furnish brokerage and research services to the Funds or to
Rochdale, even if the specific services were not imputed just to the Funds and
may be useful to Rochdale in advising other clients. In negotiating commissions
with a broker or evaluating the spread to be paid to a dealer, the Funds may
therefore pay a higher commission or spread than would be the case if no weight
were given to the furnishing of these supplemental services, provided that the
amount of such commission or spread has been
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<PAGE>
determined in good faith by Rochdale to be reasonable in relation to the value
of the brokerage and/or research services provided by such broker-dealer. The
standard of reasonableness is to be measured in light of Rochdale's overall
responsibilities to the Funds.
Investment decisions for the Funds are made independently from those of
other client accounts or mutual funds managed or advised by Rochdale.
Nevertheless, it is possible that at times identical securities will be
acceptable for both the Funds and one or more of such client accounts or other
funds. In such event, the position of the Funds and such client account(s) or
other funds in the same issuer may vary and the length of time that each may
choose to hold its investment in the same issuer may likewise vary. However, to
the extent any of these client accounts or other funds seeks to acquire the same
security as a Fund at the same time, the Fund may not be able to acquire as
large a portion of such security as is desired, or may have to pay a higher
price or obtain a lower yield for such security. Similarly, a Fund may not be
able to obtain as high a price for, or as large an execution of, an order to
sell any particular security at the same time. If one or more of such client
accounts or other funds simultaneously purchases or sells the same security that
a Fund is purchasing or selling, each day's transactions in such security will
be allocated between the Fund and all such client accounts or other funds in a
manner deemed equitable by Rochdale, taking into account the respective sizes of
the accounts and the amount being purchased or sold. It is recognized that in
some cases this system could have a detrimental effect on the price or value of
the security insofar as a Fund is concerned. In other cases, however, it is
believed that the ability of the Fund to participate in volume transactions may
produce better executions for the Fund.
The Funds do not effect securities transactions through brokers in accordance
with any formula, nor do they effect securities transactions through such
brokers solely for selling shares of the Funds, although the Funds may consider
the sale of shares as a factor in allocating brokerage. However, as stated
above, broker-dealers who execute brokerage transactions may effect purchase of
shares of the Funds for their customers.
Subject to overall requirements of obtaining the best combination
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<PAGE>
of price, execution and research services on a particular transaction, the Funds
may place eligible portfolio transactions through its affiliated broker-dealer,
Rochdale Securities Corporation, under procedures adopted by the Board of
Trustees pursuant to the Investment Company Act of 1940 (the "1940 Act") and
related rules.
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION
The Trust reserves the right in its sole discretion (i) to suspend the
continued offering of the Funds' shares, (ii) to reject purchase orders in whole
or in part when in the judgment of Rochdale or the Distributor such rejection is
in the best interest of the Funds, and (iii) to reduce or waive the minimum for
initial and subsequent investments for certain fiduciary accounts or under
circumstances where certain economies can be achieved in sales of the Funds'
shares.
Payments to shareholders for shares of a Fund redeemed directly from
the Fund will be made as promptly as possible but no later than seven days after
receipt by the Funds' Transfer Agent of the written request in proper form, with
the appropriate documentation as stated in the Prospectus, except that the Funds
may suspend the right of redemption or postpone the date of payment during any
period when (a) trading on the New York Stock Exchange is restricted as
determined by the SEC or such Exchange is closed for other than weekends and
holidays; (b) an emergency exists as determined by the SEC making disposal of
portfolio securities or valuation of net assets of the Funds not reasonably
practicable; or (c) for such other periods as the SEC may permit for the
protection of the Funds' shareholders. At various times, the Funds may be
requested to redeem shares for which they have not yet received confirmation of
good payment; in this circumstance, the Funds may delay payment of the
redemption proceeds until payment for the purchase of such shares has been
collected and confirmed to the Funds.
The Funds intend to pay cash (U.S. dollars) for all shares redeemed,
but, under abnormal conditions which make payment in cash unwise, the Funds may
make payment partly in securities with a current market value equal to the
redemption price. Although the Funds do not anticipate that it will make any
part of a redemption payment in securities, if such payment were made, an
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<PAGE>
investor may incur brokerage costs in converting such securities to cash. The
Trust and Funds have elected to be governed by the provisions of Rule 18f-1
under the 1940 Act, which contains a formula for determining the minimum
redemption amounts that must be paid in cash.
The value of shares on redemption or repurchase may be more or less
than the investor's cost, depending upon the market value of a Fund's portfolio
securities at the time of redemption or repurchase.
As discussed in the Prospectus, the Funds provide an Automatic
Investment Plan for the convenience of investors who wish to purchase shares of
the Funds on a regular basis. All record keeping and custodial costs of the Plan
are paid by the Funds. The market value of the Funds' shares is subject to
fluctuation, so before undertaking any plan for systematic investment, the
investor should keep in mind that this plan does not assure a profit nor protect
against depreciation in declining markets.
DETERMINATION OF SHARE PRICE
As noted in the Prospectus, the net asset value and offering price of
shares of the Funds will be determined once daily at the close of public trading
on the New York Stock Exchange, ("NYSE"), currently 4:00 p.m., New York City
time, on each day the NYSE is open for trading. It is expected that the Exchange
will be closed on Saturdays and Sundays and on New Year's Day, Martin Luther
King Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas. The Funds do not expect to determine
the net asset value of their shares on any day when the Exchange is not open for
trading even if there is sufficient trading in its portfolio securities on such
days to materially affect the net asset value per share.
In valuing the Funds' assets for calculating net asset value, readily
marketable portfolio securities listed on a national securities exchange or
NASDAQ are valued at the last sale price on the business day as of which such
value is being determined. If there has been no sale on such exchange or on
NASDAQ on such day, the security is valued at the closing bid price on such day.
Readily marketable securities traded only in
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<PAGE>
an over-the-counter market and not on NASDAQ are valued at the current or last
bid price. If no bid is quoted on such day, the security is valued by such
method as the Board of Trustees of the Trust shall determine in good faith to
reflect the security's fair value. All other assets of the Funds are valued in
such manner as the Board of Trustees in good faith deems appropriate to reflect
their fair value.
The net asset value per share of each Fund is calculated as follows:
all liabilities incurred or accrued are deducted from the valuation of total
assets, which includes accrued but undistributed income; the resulting net
assets are divided by the number of shares of the Fund outstanding at the time
of the valuation; and the result (adjusted to the nearest cent) is the net asset
value per share.
PERFORMANCE INFORMATION
From time to time, the Funds may state their total return in
advertisements and investor communications. Total return may be stated for any
relevant period as specified in the advertisement or communication. Any
statements of total return will be accompanied by information on the Funds'
average annual compounded rates of return over the most recent year and the
period from the Funds' inception of operations. The Funds may also advertise
aggregate and average total return information over different periods of time. A
Fund's average annual compounded rate of return is determined by reference to a
hypothetical $1,000 investment that includes capital appreciation and
depreciation for the stated periods, according to the following formula:
n
P(1+T) = ERV
Where: P = a hypothetical initial purchase order of $1,000
from which the maximum sales load is deducted
T = average annual total return n = number of years
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ERV = ending redeemable value of the hypothetical $1,000 purchase
at the end of the period
Aggregate total return is calculated in a similar manner, except
that the results are not annualized. Each calculation assumes that all dividends
and distributions are reinvested at net asset value on the reinvestment dates
during the period.
The Funds' total returns may be compared to relevant domestic and
foreign indices, including those published by Lipper Analytical Services, Inc.
From time to time, evaluations of the Funds' performance by independent sources
may also be used in advertisements and in information furnished to present or
prospective investors in the Funds.
Investors should note that the investment results of the Funds will
fluctuate over time, and any presentation of the Funds' total returns for any
period should not be considered as a representation of what an investment may
earn or what an investor's total return may be in any future period.
GENERAL INFORMATION
Investors in the Funds will be informed of the Funds' progress
through periodic reports. Financial statements certified by independent public
accountants will be submitted to shareholders at least annually.
______________________, ___________ acts as Custodian of
the securities and other assets of the Funds.
__________________________, ___________ acts as the Funds'
transfer and shareholder service agent.
The Trust is registered with the SEC as a management investment
company. Such a registration does not involve supervision of the management or
policies of the Funds. The Prospectus of the Funds and this Statement of
Additional Information omit certain of the information contained in the
Registration Statement filed with the SEC. Copies of such information may be
obtained from the SEC upon payment of the prescribed fee.
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<PAGE>
ROCHDALE INVESTMENT TRUST
FORM N-1A
PART C
Item 24. Financial Statements and Exhibits.
(a) Statement of Assets and Liabilities
Notes to Financial Statements
(To be filed by Amendment)
(b) Exhibits:
(1) Agreement and Declaration of Trust--1
(2) By-Laws--1
(3) Voting Trust Agreement -- Not applicable
(4) Specimen Share Certificate--2
(5) Form of Investment Advisory Agreement--1
(6) Form of Distribution Agreement--1
(7) Benefit Plan -- Not applicable
(8) Form of Custodian and Transfer Agent Agreements--2
(9) Form of Administration Agreement--1
(10) Consent and Opinion of Counsel as to legality of shares-2
(11) Consent of Accountants-2
(12) All Financial Statements omitted from Item 23 --Not
applicable
(13) Letter of Understanding relating to initial capital-2
(14) Model Retirement Plan Documents - Not applicable
(15) Form of Plan pursuant to Rule 12b-1-not applicable
(16) Schedule for Computation of Performance Quotations-2
1-Filed with Registration Statement on Form N-1A on March 6, 1998.
2 To be filed by Amendment
Item 25. Persons Controlled by or under Common Control with
Registrant.
As of the date of this Amendment to the Registration Statement, there
are no persons controlled or under common control with the Registrant.
Item 26. Number of Holders of Securities.
Number of Record
Holders as of
Title of Class May 27, 1998
Shares of Beneficial Interest, no par value: None
Item 27. Indemnification
Article VII, Section 2 of the Trust's Declaration of Trust provides as follows:
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 ("Securities Act") may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is therefore unenforceable. In the event
that a claim for indemnification against such liabilities (other than payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in connection with the successful defense
of any action, suit or proceeding) is asserted against the Registrant by such
director, officer or controlling person in connection with the shares being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
Item 28. Business and Other Connections of Investment Adviser.
With respect to the Investment Adviser, the response to this item is
incorporated by reference to the Adviser's Form ADV as amended, File No.
801-27265.
Item 29. Principal Underwriters.
(a) The Registrant's principal underwriter also acts as principal
underwriter for the following investment companies:
Advisors Series Trust
Brandes Investment Trust
Fleming Mutual Fund Group
Fremont Mutual Funds
Guinness Flight Investment Funds
Jurika & Voyles Fund Group
Kayne Anderson Mutual Funds
Masters' Select Investment Trust
O'Shaughnessy Funds, Inc.
PIC Investment Trust
Professionally Managed Portfolios
Purisima Funds
Rainier Investment Management Mutual Funds
RNC Mutual Fund Group
UBS Private Investor Funds
(b) The following information is furnished with respect to the officers
and directors of First Fund Distributors, Inc.:
Position and Offices Position and
Name and Principal with Principal Offices with
Business Address Underwriter Registrant
Robert H. Wadsworth President None
4455 E. Camelback Road and Treasurer
Suite 261E
Phoenix, AZ 85018
Eric M. Banhazl Vice President None
2025 E. Financial Way
Glendora, CA 91741
Steven J. Paggioli Vice President & None
479 West 22nd Street Secretary
New York, New York 10011
(c) Not applicable.
Item 30. Location of Accounts and Records.
The accounts, books, and other documents required to be maintained by
Registrant pursuant to Section 31(a) of the Investment Company Act of 1940 and
the rules promulgated thereunder are in the possession the Registrant's
custodian and transfer agent, except those records relating to portfolio
transactions and the basic organizational and Trust documents of the Registrant
(see Subsections (2) (iii). (4), (5), (6), (7), (9), (10) and (11) of Rule
31a-1(b)), which, with respect to portfolio transactions are kept by the Fund's
Advisor at its address set forth in the prospectus and statement of additional
information and with respect to trust documents by its administrator at 2020 E.
Financial Way, Ste. 100, Glendora, CA 91741.
Item 31. Management Services.
There are no management-related service contracts not discussed in
Parts A and B.
Item 32. Undertakings
The registrant undertakes to furnish to each person to whom a prospectus is
delivered a copy of the Fund's latest annual report to shareholders, upon
request and without charge.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940 the Registrant has duly caused this amendment to
this Registration Statement to be signed on its behalf by the undersigned,
thereto duly authorized, in the City of New York in the State of New York on May
27, 1998.
ROCHDALE INVESTMENT TRUST
By: Garrett R. D'Alessandro
Garrett R. D'Alessandro
President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
Julie L. Allecta Trustee May 27, 1998
Julie L. Allecta
Garrett R. D'Alessandro Principal May 27, 1998
Garrett R. D'Alessandro Financial
Officer
