Securities Act Registration No. 333-67717
Investment Company Act Registration No. 811-9109
UNITED STATES
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
INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 1
___________________________________________________________
Firstmark Partners (Exact Name of Registrant as Specified in Charter)
808 South 74th Plaza, Suite #113
Omaha, Nebraska 68114-4666
(Address of Principal Executive Offices)
(402) 391-3375
(Registrant's Telephone Number)
The Corporation Trust Company
1209 Orange Street
Wilmington, DE 19801
(Name and Address of Agent for Service)
___________________________________________________________
Approximate Date of Proposed Public Offering:
As soon as practicable after the Registration Statement becomes effective.
Calculation of Registration Fee Under the Securities Act of 1933
_____________________________________________________________________________
Proposed Proposed
Maximum Maximum Amount of
Title of Securities Amount Being Offering Price Aggregate Registration
Being Registered Registered Per Unit Offering Fee
Price
_____________________________________________________________________________
Contrarian Value *Indefinite $10.00 *Indefinite *$500
Fund
*Registrant hereby elects to register pursuant to Rule 24f-2 under the
Investment Company Act of 1940 an indefinite number of shares of the Contrarian
Value Fund, a series of Firstmark Partners. Pursuant to Rule 24f-2,
the registration fee payable with respect to such election is $500.
The Registrant hereby amends this Registration Statement on such date or dates
that may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission acting to section 8(a) may determine.
<PAGE>
Cross Reference Sheet
INFORMATION REQUIRED CAPTIONS IN FILING
Part A: IN PROSPECTUS
Item 1. Cover Page Cover Page
Item 2. Synopsis Fund Expenses
Item 3. Condensed Financial Information Fund Expenses
Item 4. General Description of Registrant The Fund
Item 5. Management of the Fund Management of the Fund
Item 6. Capital Stock and other Securities Capitalization
Item 7. Purchase of Securities being Offered Share Purchase - Reinvestments
Item 8. Redemption or Repurchase Redemption of Shares
Item 9. Legal Proceedings Litigation
Part B: STATEMENT OF ADDITIONAL INFORMATION
Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History The Fund
Item 13. Investment Objectives and Policies Objective and Policies
Item 14. Management of the Registrant Officers & Directors of the Fund
Item 15. Control Persons & Principal Holders of Securities Not Applicable
Item 16. Investment Advisory and Other Services Investment Adviser Services
Item 17. Brokerage Allocation Brokerage
Item 18. Capital Stock & Other Securities Capitalization
Item 19. Purchase, Redemption & Pricing
of Securities being Offered Purchase of Shares and Reinvestment
Item 19. Purchase, Redemption & Pricing
of Securities being Offered Redemption of Shares
Item 19. Purchase, Redemption & Pricing
of Securities being Offered Pricing of Shares
Item 20. Tax Status Tax Status
Item 21. Underwriters Not Applicable
Item 22. Calculation of Yield Quotations of Money Market Funds Not Applicable
Item 23. Financial Statements Financial Statements
Part C: OTHER INFORMATION
Item 24. Financial Statements & Exhibits Financial Statements & Exhibits
Item 25. Persons Controlled by/or under Common Control Control Persons
Item 26. Number of Holders of Securities Number of Shareholders
Item 27. Indemnifications Indemnification
Item 28. Business & Other Connections Activities of Investment Advisor
of Advisor
Item 29 Principal Underwriters Principal Underwriter
Item 30. Location of Accounts & Records Location of Accounts & Records
Item 31. Management Services Not Applicable
Item 32. Undertakings Not Applicable
<PAGE>
PROSPECTUS
FIRSTMARK PARTNERS
CONTRARIAN VALUE FUND
808 South 74th Plaza Suite #113
Omaha, Nebraska 68114-4666
(402) 391-3375
February 10, 1999
THE FUND AND INVESTMENT OBJECTIVE
Contrarian Value Fund (the "Fund") is a non-diversified series of Firstmark
Partners (the "Trust"), an open-end management investment company. The Trust
was organized in Delaware as a business trust and may offer shares of beneficial
interest in a number of separate series, each series representing a distinct
fund with its own investment objectives and policies. At present, there is only
one series authorized by the Trust, which series has been designated as the
Contrarian Value Fund. The Fund's primary investment objective is to seek
capital appreciation by primarily investing in a core portfolio of 20-30 common
stocks which the Fund's adviser believes to be undervalued in the marketplace.
Receipt of income is a secondary objective, as some investments may yield
dividends, interest or other income.
FUND SHARE PURCHASE
Capital shares of the Fund may be purchased directly at net asset value as next
determined after receipt of order. The Board of Trustees has established $5,000
as the minimum initial purchase. Subsequent investments in the Fund must be at
least $500. Lower minimums may be available to investors purchasing shares of
the Fund through certain brokerage firms.
ADDITIONAL INFORMATION
This Prospectus, which should be held for future reference, is designed to set
forth concisely the information that you should know before you invest. A
"Statement of Additional Information" containing more information about the Fund
has been filed with the Securities and Exchange Commission. Such Statement is
dated February 10, 1999 and has been incorporated by reference into the
Prospectus. A copy of the Statement may be obtained without charge, by writing
to the Fund or by calling the telephone number shown above.
These securities have not been approved or disapproved by the Securities and
Exchange Commission or any State Securities Commission, not has the
Securities and Exchange Commission or any State Securities Commission passed
upon the accuracy or adequacy of this prospectus. Any representation to the
contray is a criminal offense.
<PAGE>
TABLE OF CONTENTS
ABOUT THE FUND
Fund Expenses 3
The Fund 4
Investment Objective 4
Risk Factors 4
Types of Securities 5
Security Selection Criteria 5
Investment Strategy and Practices 5
Technical Analysis 6
Portfolio Turnover Policy 6
Non-Diversification Policy 6
Temporary Defensive Position 7
Repurchase Agreements 7
Tax Status 7
Investment Restrictions 8
MANAGEMENT OF THE FUND
Investment Adviser 9
Advisory Fee 10
Fund Administration 10
Advisory and Administration Agreements 10
Management of the Fund 11
Remuneration of Officers and Trustees 12
Organization and Capital Structure 12
INVESTING IN THE FUND
Pricing of Shares 13
Purchase of Shares and Reinvestment 13
Redemption of Shares 14
Retirement Plans 15
Brokerage 15
Shareholders Meetings 16
Reports to Shareholders 16
OTHER FUND INFORMATION
Custodian and Transfer Agent 16
Auditors 16
Legal Opinion 16
Litigation 17
Additional Information 17
<PAGE>
FUND EXPENSES
Set forth below is a table containing information regarding the annual expenses
which may be incurred by the Fund. The purpose of this table is to assist an
investor in understanding the various costs and expenses that a shareholder in
the Fund will bear directly or indirectly.
Shareholder Transaction Expenses:
Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Deferred Sales Loads None
Redemption Fees None
Exchange Fees None
IRA Trustee Fees None
Annualized Fund Operating Expenses:
Management Fees 1.25%
12b-1 Fees None
Other Expenses* 0.50%
Total Operating Expenses 1.75%
The Fund and the Investment Adviser may enter into arrangements with brokerage
firms and financial institutions under which shares of the Fund may be purchased
or sold. Investors may be charged a transaction fee if they effect transactions
in Fund shares through a broker or agent.
*Fees payable under the Administration Agreement between the Fund and the
Investment Adviser are fixed at 0.50% of the Fund's average daily net assets.
The following is an example that illustrates the expenses paid on a $1,000
investment over various time periods assuming (a) 5% annual rate of return and
(b) redemption at the end of each time period. This example should not be
considered a representation of past or future expenses or performance. Actual
expenses may be greater or less than those shown.
1 Year 3 Years
$18 $55
<PAGE>
THE FUND
Contrarian Value Fund (the "Fund") is an open-end, non-diversified portfolio
of Firstmark Partners (the "Trust"). The Trust was organized on November 12,
1998 as a Delaware business trust and is authorized to issue an indefinite
number of shares of beneficial interest. The Trust's registered office is 1209
Orange Street, Wilmington, Delaware 19801. Mail may be addressed to Trust's
principal executive office at 808 South 74th Plaza Suite #113, Omaha, Nebraska
68114-4666.
INVESTMENT OBJECTIVE
Contrarian Value Fund's primary objective is to seek capital appreciation
through investment in common stocks. The Fund seeks to accomplish this bjective
by primarily investing in a core portfolio of 20-30 common stocks which the
Fund's adviser believes to be undervalued in the marketplace. Under normal
circumstances, the Fund pursues its objective by investing in common stocks
selected primarily for their capital appreciation potential. However, the
Fund may reduce its commitment to common stocks when, in the opinion of the
Adviser, investment considerations warrant such action. Receipt of income is a
secondary objective, as some investments may yield dividends, interest or other
income. Potential investors should be aware that risks exist in all types of
investments and there can be no assurance that the Fund will be successful in
achieving its investment objectives.
RISK FACTORS
Generally: Risks associated with the Fund's performance will be those due to
broad market declines along with business and financial risks from difficulties
which occur to particular companies while in the Fund's portfolio. It therefore
must be realized, as is true of almost all general common stock funds, the two
most fundamental risks associated with the Fund, are poor stock selection by the
Adviser, and the risk that the value of the common stocks it holds might
decrease in value.
Non-Diversification: The Fund will be operated as a non-diversified investment
company which means it may invest a relatively high percentage of its assets in
a limited number of common stocks. As a result, the gains or losses on a single
stock will have a greater impact on the Fund's Net Asset Value (NAV).
Therefore, the Fund's shares may be more susceptible to adverse change in value
than would be the shares of a diversified investment company. The policy of the
fund, as stated above, is therefore one of selective investments rather than
broad diversification. The fund is not intended to be a complete investment
program on its own.
Lack of Operating History and Experience: Firstmark Partners (and its first
series, the Contrarian Value Fund) is a newly organized investment company
with no history of operations. None of the principals, officers, or directors
of the investment adviser, Firstock Financial Services, Inc., have ever
registered, operated, or supervised the operations of investment companiesin the
past, and there is no assurance that there past business experiences will enable
them to successfully manage the assets of the Fund in the future.
Reliance on Technical Analysis: Although the Adviser's investment strategy
utilizes both fundamental as well as technical analysis, the Adviser places
greater emphasis on the use of technical analysis than it does fundamental
analysis. In the opinion of the Adviser, one of the advantages of technical
analysis is that it may be possible to draw logical conclusions about the
future value of a security with only limited access to fundamental facts. Yet,
the Adviser also acknowledges, one of the disadvantages of technical analysis is
that it may never offer more than a set of possibilities, or probabilities at
best, about the future value of a security, neither of which may be correct.
There can be no assurance that the Adviser will be successful in its application
of its technical analysis techniques or strategies while using them in trying to
achieve the funds objective.
Definitions of Fundamental and Thecnical Analysis: According to Barron's
Dictionary of Finance and Investment Terms, fundamental analysis is "analysis of
the balance sheet and income statements of companies in order to forecast their
future stock price movements. Fundamental analysts consider past records of
assets, earnings, sales, products, management and markets in predicting future
trends in these indicators of a company's success of failure." technical
analysis is defined as "research into the demand and supply for securities
and commodities based on trading volume and price studies. Technical analysts
use charts or computer programs to identify and project price trends in a
market, security or commodity future. Most analysis is done for short- or
intermediate-term, but some technicians also predict long-term cycles based on
charts and other data. Unlike FUNDAMENTAL ANALYSIS, technical analysis is not
concerned with the financial position of a company."
<PAGE>
SECURITY SELECTION CRITERIA
The Fund, under normal circumstances, will primarily invest in, but is not
limited to, those common stocks contained in the Standard & Poors 500 Composite
Index (S&P500). The index generally tracks 400 industrial company stocks, 20
transportation stocks, 40 financial company stocks, and 40 public utilities.
This index is dynamic and changes over time. The inclusion of stocks in the
index and the publication of the index itself are services of the Standard &
Poors Corporation.
In selecting investments for the Fund, the Adviser will use both fundamental and
technical analysis in its analysis of possible securities to be considered for
purchase. Although the Adviser uses both fundamental and technical analysis
in determining what stocks to buy, the decision of when to buy a stock
is based soley on technical analysis. Therefore, under normal circumstances,
a stock will not be considered for purchase if, in the opinion of the Adviser,
the stock does not show favorable technical characteristics.
INVESTMENT STRATEGY AND PRACTICES
The Adviser pursues a flexible investment strategy in the selection of
securities, not limited to any particular investment sector, industry or company
size. The Adviser uses a disciplined approach to stock selection to help it
attempt to identify companies whose stocks are, in the opinion of the Adviser,
either undervalued or currently mispriced in the marketplace. The Adviser's
assessment of a company's stock that may be out of favor may differ from the
investment approach followed by other mutual funds. To some extent, during
periods of above average market volatility, the Fund may buy or sell stock or
other securities seeking short term capital appreciation.
Stock selections are made in part based on the Adviser's opinion regarding the
future appreciation and sustainability of a company's stock price. Under normal
circumstances, the portfolio will consist of between 20 and 30 stocks.
Generally, it is the intent of the Fund, to have each stock position represent
between four and five percent of the Fund's total net assets at the time of
purchase.
The Adviser continually reviews investment alternatives and may implement
portfolio changes as more attractive investment opportunities become available.
If a company's stock price appreciates to a level that, in the opinion of the
Adviser, appears not sustainable, the position is generally sold to realize the
existing profits and avoid a potential price correction. If the Adviser
identifies a new stock that it considers to be a better investment than a
current holding, the Adviser will generally consider selling the current holding
to add the new stock. The Adviser anticipates the Fund's portfolio generally
will be fully invested in common stocks. However, the fund may reduce its
commitment to common stocks when in the opinion of the Adviser, investment
considerations warrant such action.
<PAGE>
Under normal circumstances, technical analysis is the primary methodology used
by the Adviser in determining when a stock should be sold. However, once a
position has, in the opinion of the Adviser, appreciated substantially, the
Adviser may, under normal circumatances, place a "sell stop" order, at the
discretion of the Adviser, somewhere below the current market price of the stock
as a way of protecting the gain already in the position. Should the value of
the stock continue to appreciate, the "sell stop" may by raised accordingly at
the discretion of the Adviser. Any position that has declined 10% from its
original purchase price is re-examined and may be considered as a potential sale
candidate.
PORTFOLIO TURNOVER POLICY
The annual rate of portfolio turnover for the Fund is unknown since the fund has
no operating history and therefore no actual portfolio turnover rate presently
exists. The Fund's investment adviser expects to actively trade the portfolio
in pursuit of the Fund's investment objective and investments may be sold
without regard to length of time the Fund has held a position when, in the
opinion of the investment adviser, investment considerations warrant such
action. Although the Fund cannot accurately predict its portfolio turnover
rate, it is not expected to exceed 150%, wherein turnover is computed by
dividing the lesser of the Fund's total purchases or sales of securities within
the period by the average monthly portfolio value of the Fund during such
period. There are no limits on the rate of portfolio turnover. Higher
portfolio turnover rates, rates in excess of 100%, and short-term trading may
result in higher brokerage costs to the Fund and may result in the acceleration
of net taxable capital gains to shareholders.
NON-DIVERSIFICATION POLICY
The Fund is classified as being non-diversified which means that it may not
invest more than 25% of its assets in the securities of any one issuer and, with
respect to 50% of its total assets, the Fund may not invest more than 5% of its
total assets in the securities of any one issuer. Thus, the Fund may invest up
to 25% of its total assets in the securities of each of any two issuers.
However, under normal circumstances, the Fund anticipates maintaining a
portfolio, of between 20 and 30 approximately equally weighted positions. The
Fund, therefore, may be more susceptible to risk of loss than a more widely
diversified fund as a result of a single business, economic, political, or
regulatory occurrence. The policy of the Fund, in the hope of achieving its
objective as stated above, is therefore one of selective investments rather than
broad diversification. The Fund seeks only enough diversification to maintain
its federal non-taxable status under Sub-Chapter M of the Internal Revenue Code.
<PAGE>
TEMPORARY DEFENSIVE POSITION
When, in the judgement of the Adviser, market conditions a temporary defensive
posture, the Fund may invest up to 100% of its assets in short-term debt
securities and money market instruments, including securities issued by the U.S.
Government, its agencies or instrumentalities and repurchase agreements secured
thereby, commercial paper, certificates of deposit bank or savings and loan
association interest-bearing demand accounts. The adoption of such defensive
position does not constitute a change in the Fund's investment objective.
REPURCHASE AGREEMENTS
The Fund may invest in repurchase agreements. Repurchase agreements are
transactions in which the Fund purchases securities and commits to sell the
securities to the original seller (a member bank of the Federal Reserve System
or securities dealers who are members of a national securities exchange or are
market makers in U.S. Government securities) at an agreed upon date and price
reflecting a market rate of interest unrelated to the coupon rate or maturity of
the purchased securities. Repurchase agreements offer a means of generation
income from excess cash the Fund might otherwise hold un invested. Repurchase
agreements carry certain risks not associated with direct investments in
securities. Delays in payment or losses could result if the other party to the
agreement defaults or becomes bankrupt.
TAX STATUS
Under the provisions of Sub-Chapter M of the Internal Revenue Code of 1986 as
amended, the Fund intends to pay out substantially all of its investment income
and realized capital gains. As a result, the Fund intends to be relieved of
federal income tax on the amounts distributed to shareholders. In order to
qualify as a "regulated investment company" under Sub-Chapter M, at least 90% of
the Fund's income must be derived from dividends, interest, and gains from
securities transactions. No more than 50% of the Fund assets may be held in
security holdings that exceed 5% of the total assets of the Fund at time of
purchase. Distribution of any net long-term capital gains realized by the Fund
will be taxable to the shareholder as long-term capital gains regardless of the
length of time Fund shares have been held by the investor. All income realized
by the Fund, including short-term capital gains, will be taxable to the
shareholder as ordinary income. Dividends from net income will be made annually
or more frequently at the discretion of the Fund's Board of Trustees and will
automatically be reinvested in additional Fund shares at net asset value, unless
shareholder has elected to receive payment in the form of cash. Dividends
received shortly after purchase of shares by an investor will have the effect of
reducing the per share net asset value of the shares by the amount of such
dividends or distributions and, although in effect a return of capital, are
subject to federal income taxes.
The Fund is required by federal law to withhold 31% of reportable payments
(which may include dividends, capital gains, distributions and redemptions) paid
to shareholders who have not complied with IRS regulations. In order to avoid
this withholding requirement you must certify on the Shareholder Purchase
Application supplied by the Fund, that your Social Security or Taxpayer
Identification Number is correct and that you are not currently subject to back-
up withholding or otherwise certify that you are exempt from back-up
withholding.
<PAGE>
INVESTMENT RESTRICTIONS
The Fund has adopted the following fundamental investment restrictions. These
restrictions cannot be changed without approval by the holders of a majority of
the outstanding voting securities of the Fund. As defined in the Investment
Company Act of 1940 (the "Act"), the "vote of a majority of the outstanding
voting securities" means the lesser of the vote of (i) 67% of the shares of the
Fund at a meeting where more than 50% of the outstanding shares are present in
person or by proxy or (ii) more than 50% of the outstanding shares of the Fund.
The Fund may not:
(a) Act as underwriter for securities of other issuers except insofar as the
Fund may be deemed an underwriter in selling its own portfolio
securities.
(b) Borrow money or purchase securities on margin except for temporary or
emergency (not leveraging) purposes, including the meeting of redemption
requests that might otherwise require the untimely disposition of
securities, in an aggregate amount not exceeding 25% of the value of the
Fund's total assets at the time any borrowing is made. While the Fund's
borrowings are in excess of 5% of its total assets, the Fund will not
purchase any additional portfolio securities.
(c) Sell securities short.
(d) Invest in securities of other investment companies except as part of a
merger, consolidation, or purchase of assets approved by the Fund's
shareholders or by purchases with no more than 10% of the Fund's assets
in the open market involving only customary broker's commissions.
(e) Make investments in commodities, commodity contracts or real estate
although the Fund may purchase and sell securities of companies which
deal in real estate or interests therein.
(f) Make loans. The purchase of a portion of a readily marketable issue of
publicly distributed bonds, debentures or other debt securities will not
be considered the making of a loan.
(g) Acquire more than 10% of the securities of any class of another issuer,
treating all preferred securities of an issuer as a single class and all
debt securities as a single class, or acquire more than 10% of the
voting securities of another issuer.
(h) Invest in companies for the purpose of acquiring control.
(i) Purchase or retain securities of any issuer if those officers, directors
or trustees of the Fund or its Investment Adviser individually owns more
than 1/2 of 1% of any class of security or collectively own more than 5%
of such class of securities of such issuer.
(j) Pledge, mortgage or hypothecate any of its assets.
(k) Invest in securities which may be subject to registration under the
Securities Act of 1933 prior to sale to the public or which are not at
the time of purchase readily saleable.
(l) Invest more than 10% of the total Fund assets, taken at market value at
the time of purchase, in securities of companies with less than three
years' continuous operation, including the operations of any
predecessor.
(m) Issue senior securities.
(n) Acquire any securities of companies within one industry if, as a result
of such acquisition, more than 25% of the value of the Fund's total
assets would be invested in securities of companies within such
industry.
<PAGE>
In connection with its investment objective and policies the Fund may, however,
invest in the following types of securities which can involve certain risks:
U.S. Government Securities: The Fund may purchase securities issued or
guaranteed by the U.S. Government or its agencies or instrumentalities. Such
securities will typically include, without limitation, U.S. Treasury
securities such as Treasury Bills, Treasury Notes or Treasury Bonds that differ
in their interest rates, maturities and times of issuance. Bank Obligations:
The Fund may invest in bank obligations, including certificates of deposit, time
deposits, banker's acceptances and other short-term obligations of banks,
savings and loan associations and other banking institutions.
INVESTMENT ADVISER
The Trust retains Firstock Financial Services, Inc., located at 808 South 74th
Plaza Suite #113, Omaha, Nebraska 68114-4666, as its Investment Adviser.
Firstock Financial Services, Inc. (the "Investment Adviser") is a Nebraska
corporation founded in August 1986. The company is registered as an Investment
Adviser with the Securities and Exchange Commission under the Investment
Advisers Act of 1940. The corporation is controlled and wholly owned by Mark H.
Baumann and Jane A. Baumann. The Investment Adviser has been actively in the
business of rendering investment advisory services to businesses and individuals
since 1995 and is currently providing investment advisory services to over 100
businesses and individuals.
Mark H. Baumann has the direct responsibility for the overall strategic
management of the Fund's portfolio and its administration. Mr. Baumann founded
Firstock Financial Service, Inc. in 1986, has served as Chairman of the Board
and Chief Executive Officer since the company's inception. Mr. Baumann is a
Chartered Financial Analyst (CFA), and Certified Financial Planner (CFP)
licensee. He graduated from the University of Nebraska--Lincoln in 1983 where
he earned a B.S. degree in Education. From January 1989 through July 1998 Mr.
Baumann was also a registered representative with Robert Thomas Securities, Inc.
Jane A. Baumann, a registered nurse with Nebraska Health Systems, is not
actively involved in the business of the Adviser. Both Mark and Jane Baumann
serve as Trustees to the Fund.
ADVISORY FEE
The Fund will be managed by Firstock Financial Services, Inc. The Investment
Adviser will be paid a fee of 1.25% per year on the net assets of the Fund. All
fees are computed on the average daily closing net asset value of the Fund and
are payable monthly. Such fee is higher than the fee paid by most other funds.
Notwithstanding, the Investment Adviser may at its discretion, forgo
sufficient fees which would have the effect of lowering the Fund's expense ratio
and increasing the yield to shareholders.
FUND ADMINISTRATION
In addition to its fee for serving as the Fund's Investment Adviser, Firstock
Financial Services, Inc. will receive a fee for serving as the Fund's
administrator. The fee will be paid monthly at an annual rate of 0.50% of the
Fund's average daily net assets.
The Investment Adviser has retained Mutual Shareholder Services, to serve as the
Fund's transfer agent, dividend paying agent and shareholder service agent, to
provide accounting and pricing services to the Fund, and to assist the
Investment Adviser in providing executive, administrative and regulatory
services to the Fund. The Investment Adviser will pay the Transfer Agent's fees
for these services.
<PAGE>
ADVISORY AND ADMINISTRATION AGREEMENTS
On November 20, 1998 the shareholders of the Fund and the Board of Trustees
unanimously approved an investment advisory contract (the "Advisory Agreement")
and a separate administration contract (the "Administration Agreement") with
Firstock Financial Services, Inc. The Advisory Agreement and the Administration
Agreement are effective through the end of the Fund's first fiscal year.
Thereafter, both agreements may be continued for successive periods not to
exceed one year, provided that such continuance is specifically approved
annually by (a) the Fund's Board of Trustees or (b) vote of the holders of a
majority (as defined in the 1940 Act) of the outstanding voting securities of
the Fund. In either event, the continuance must be approved by a majority of
the Board of Trustees who are not "interested persons" of the Trust (as defined
by the 1940 Act) or the Investment Adviser, by vote cast in person at a meeting
called for the purpose of voting on such approval.
Under the Advisory Agreement, Firstock Financial Services, Inc. will determine
what securities will be purchased, retained or sold by the Fund on the basis of
a continuous review of its portfolio. Mr. Baumann, will have the direct
responsibility of managing the composition of the Fund's portfolio in accordance
with the Fund's investment objective. Pursuant to its contract with the Fund,
the Investment Adviser is (i) required to render research, statistical and
advisory services to the Fund, (ii) make specific recommendations based on the
Fund's investment requirements, and (iii) pay salaries of the Fund's employees
who may be officers, directors or employees of the Investment Adviser. Excepting
these items, the Fund pays all other fees and expenses incurred in conducting
its business affairs. The Investment Adviser has paid the initial
organizational costs of the Fund and will reimburse the Fund for any and all
losses incurred because of purchase reneges.
Under the Administration Agreement, the Investment Adviser will render all
administrative and supervisory services to the Fund. The Adviser will oversee
the maintenance of all books and records with respect to the Fund's securities
transactions and the Fund's book of accounts in accordance with all applicable
federal and state laws and regulations. The Adviser will also arrange for the
preservation of journals, ledgers, corporate documents, brokerage account
records and other records which are required pursuant to Rule 31a-1 promulgated
under the 1940 Act. In accordance with the Administration Agreement, the
Adviser is also responsible for the equipment, staff, office space and
facilities necessary to perform its obligations. The Fund will assume all other
expenses except to the extent of those paid by the Adviser.
The Investment Adviser assumes and shall pay all ordinary expenses of the Fund.
Examples of such expenses include: (a) organizational costs, (b) compensation of
the Investment Adviser's personnel, (c) compensation of any of the Fund's
trustees, officers or employees who are not interested persons of the Investment
Adviser or its affiliates, (d) fees and expenses of registering the Fund's
shares under the federal securities laws and of qualifying its shares under
applicable state Blue Sky laws, including expenses attendant upon renewing such
registrations and qualifications, (e) insurance premiums, (f) fidelity bonds,
(g) accounting and bookkeeping costs and expenses necessary to maintain the
Fund's books and records, (h) outside auditing and ordinary legal expenses, (i)
all costs associated with shareholders meetings and the preparation and
dissemination of proxy solicitation materials, (j) costs of printing and
distribution of the Fund's Prospectus and other shareholder information to
existing shareholders, (k) charges, if any, of custodian and dividend disbursing
agent's fees, (l) industry association fees, and (m) costs of independent
pricing services and calculation of daily net asset value. The Adviser may, at
its discretion, assume any additional expenses ordinarily assumed by the Fund
when it determines that such action is in the best interest of the shareholders.
Any extraordinary and non-recurring expenses shall be paid by the Fund.
<PAGE>
The Investment Adviser may act as an investment adviser and administrator to
other persons, firms, or corporations (including investment companies), and may
have numerous advisory clients besides the Fund.
The Advisory Agreement and the Administration Agreement are terminable on 60
days' written notice, without penalty, by a vote of a majority of the Fund's
outstanding shares or by vote of a majority of the Fund's entire Board of
Trustees, or by the Investment Adviser on 60 days' written notice, and
automatically terminates in the event of its assignment.
MANAGEMENT OF THE FUND
The business of the Fund is managed under the direction of its Board of Trustees
in accordance with Section 3.2 of the Declaration of Trust of Firstmark
Partners, which Declaration of Trust has been filed with the Securities and
Exchange Commission and is available upon request. Pursuant to Section 2.6 of
the Declaration of Trust, the trustees shall elect officers including a
president, secretary and treasurer. The Board of Trustees retains the power to
conduct, operate and carry on the business of the Fund and has the power to
incur and pay any expenses which, in the opinion of the Board of Trustees, are
necessary or incidental to carry out any of the Fund's purposes. The trustees,
officers, employees and agents of the Fund, when acting in such capacities,
shall not be subject to any personal liability except for his or her own bad
faith, willful misfeasance, gross negligence or reckless disregard of his or her
duties. The trustees and officers together with their principal occupations
during the past five years are as follows:
Name and Address Position Principal Occupation Past 5 Years
*Mark H. Baumann Trustee Chairman & CEO
President & Treasurer Firstock Financial Services, Inc.
of the Trust Registered Representative
Robert Thomas Securities, Inc.
*Jane A. Baumann Trustee Registered Nurse
Secretary of the Trust Nebraska Health Systems
Gary L. Teel Trustee Independent Sales Agent
Imation Corporation
John R. Wingender, Jr., Ph.D. Trustee Professor of Finance
Creighton University
Robin R. Richardson Trustee Accountant, CPA
Richardson & Associates P.C.
<PAGE>
*Trustees of the Fund who are considered "interested persons" as defined in
Section 2(a)(19) of the Investment Company Act of 1940 by virtue of their
affiliation with the Investment Adviser.
REMUNERATION OF OFFICERS AND TRUSTEES
The Fund does not compensate trustees affiliated with the Investment Adviser
except as they may benefit through payment of the Advisory and Administrative
fees. The Fund will reimburse those officers and trustees not affiliated with
the Investment Adviser to compensate for travel expenses associated with
performance of their duties.
ORGANIZATION AND CAPITAL STRUCTURE
The Trust was organized on November 12, 1998 as a Delaware business trust and is
authorized to issue an unlimited number of shares of beneficial interest. At
present there is only one series authorized by the Trust, which series has been
designated as the Contrarian Value Fund. The Board of Trustees may authorize
the creation of an additional series without shareholder approval. All shares,
when issued, will be fully paid and non-assessable and will be redeemable and
freely transferable. All shares have equal voting rights and can be issued as
full or fractional shares. A fractional share has pro rata the same kind of
rights and privileges as a full share. The shares possess no preemptive or
conversion rights.
Each shareholder has one vote for each share held irrespective of the relative
net asset value of the shares. Each share has equal dividend, distribution and
liquidation rights. The voting rights of the shareholders are non-cumulative, so
that holders of more than 50% of the shares can elect all trustees being
elected. On some issues, such as election of trustees, all shares of the Fund
vote together as one series. In the event that the Trust authorizes additional
series of shares as separate funds, on issues affecting only a particular fund,
the shares of the affected fund will vote as a separate series. An example of
such an issue would be a fundamental investment restriction pertaining to only
one fund.
The Board of Trustees of the Trust is responsible for managing the business and
affairs of the Fund. The Board of Trustees consists of five members: Mark H.
Baumann, Jane A. Baumann, Gary L. Teel, John R. Wingender Jr., and Robin R.
Richardson.
As of the date of this offering, all of the outstanding voting shares of the
Fund were owned by the following Trustees and other holders of beneficial
interest:
Holders of Interest Shares Percent of Class
Mark H. Baumann* 10,000 100%
*Mark H. Baumann is considered a control person as defined in Section 2(a)(9) of
the Investment Company Act of 1940.
PRICING OF SHARES
The net asset value of the Fund's shares is determined as of the close of
business of the New York Stock Exchange on each business day of which that
Exchange is open (presently 4:00 p.m.); Monday through Friday exclusive of
Washington's Birthday, Good Friday, Memorial Day, July 4th, Labor Day,
Thanksgiving, Christmas and New Year's Day. The price is determined by dividing
the value of its securities, plus any cash and other assets less all
liabilities, excluding capital surplus, by the number of shares outstanding.
The market value of securities listed on a national exchange is determined to be
the last recent sales price on such exchange. Listed securities that have not
recently traded and over-the-counter securities are valued at the last bid price
in such market. Short-term paper (debt obligations that mature in less than 60
days) are valued at amortized cost which approximates market value. Other
assets are valued at fair market value as determined in good faith by the Board
of Trustees.
<PAGE>
PURCHASE OF SHARES AND REINVESTMENT
The offering price of the shares offered by the Fund is at the Net Asset Value
("NAV") per share next determined after receipt of the purchase order by the
Fund and is computed in the manner described under the caption "Pricing of
Shares" in this Prospectus. The Fund reserves the right to terminate the
offering of the shares made by this Prospectus at any time and to refuse
purchase applications when, in the judgment of management, such termination or
refusal is in the best interests of the Fund. The Fund does not intend to issue
share certificates to its shareholders whereby shares of the Fund shall be
considered "uncertificated securities" as defined under Rule 17f-1 of the
Securities Exchange Act of 1934. The Fund and the Investment Adviser may enter
into arrangements with brokerage firms and financial institutions under which
shares of the Fund may be purchased or sold. Investors may be charged a
transaction fee if they effect transactions in Fund shares through a broker or
agent.
Initial Investments: Initial purchase of shares of the Fund may be made by
application submitted to the Contrarian Value Fund, 1301 East Ninth Street,
Suite 3600, Cleveland, Ohio 44114. Checks should be made payable to "Contrarian
Value Fund." For the convenience of investors, a Share Purchase Application
is provided with this Prospectus. The minimum initial purchase of shares is
$5,000 which is due and payable three (3) business days after the purchase date.
Lower minimums may be available to investors purchasing shares of the Fund
through certain brokerage firms. Investors may be charged a transaction fee if
the effect purchase orders through certain brokerage firms. The Fund
anticipates initially registering in California, Colorado, Florida, Iowa,
Nebraska, and New York and therefore will be restricted to residents of those
states at the time of purchase. There will be no solicitation out of those
states of potential shareholders until registration under the Blue Sky laws
of the state of residence have been met. Should an order to purchase shares
be canceled because your check does not clear, you will be responsible for any
resulting losses or fees incurred by the Fund or the Transfer Agent in the
transaction. Furthermore, the Fund reserves the right to limit the amount of
investments and to refuse to sell to any person.
Subsequent Purchases: Subsequent purchases may be made by mail and are due and
payable three (3) business days after the purchase date. The minimum is $500.
Reinvestments: The Fund will automatically retain and reinvest dividends and
capital gains distributions and use same for the purchase of additional shares
for the shareholder at net asset value as of the close of business on the
distribution date. A shareholder may at any time by letter or forms supplied by
the Fund direct the Fund to pay dividends and/or capital gains distributions,
if any, to such shareholder in cash.
Fractional Shares: Full and/or fractional shares will be issued by the Fund.
Fractional shares will be issued to three decimal places as purchased from the
Fund. The Fund will maintain an account for each shareholder of shares for
which no certificates have been issued.
<PAGE>
REDEMPTION OF SHARES
You may redeem shares of the Fund on each day that the Fund is open for business
by sending a written request to the Transfer Agent. The request must state the
number of shares or the dollar amount to be redeemed and your account number.
The request must be signed exactly as your name appears on the Fund's account
records. If the shares to be redeemed have a value of $25,000 or more, your
signature must be guaranteed by a national bank or a member of the New York
Stock Exchange. A notary public is not an acceptable guarantor. In some
instances shareholders may also redeem shares by placing a wire redemption
through a securities broker-dealer. Some broker-dealers may impose a fee on the
shareholder for this service. It is the responsibility of broker-dealers to
properly transmit wire redemption orders.
The redemption price a shareholder will receive is the net asset value per share
next determined after receipt by the Transfer Agent of your redemption request.
Because the net asset value of the Fund's shares will fluctuate, the proceeds
received by the shareholder may be more or less than his cost of such shares,
depending upon the net asset value per share at the time of redemption and the
difference should be treated by the shareholder as a capital gain or loss for
federal income tax purposes.
Payment by the Fund will ordinarily be made within three business days after
tender. The Fund may suspend the right of redemption or postpone the date of
payment if: The New York Stock Exchange is closed for other than customary
weekend or holiday closings, or when trading on the New York Stock Exchange is
restricted as determined by the Securities and Exchange Commission or when the
Securities and Exchange Commission has determined that an emergency exists,
making disposal of fund securities or valuation of net assets not reasonably
practicable. The Fund intends to make payments in cash, however, if the Board
of Trustees believes that economic conditions exist which would make such
practice detrimental to the best interests of the Fund, redemption may be
accomplished through distribution of portfolio securities of the Fund known as
"payments in kind".
The Fund and the Investment Adviser may enter into arrangements with brokerage
firms and financial institutions under which shares of the Fund may be purchased
or sold. Investors may be charged a transaction fee if they effect transactions
in Fund shares through a broker or agent.
RETIREMENT PLANS
Generally, shares of the Fund may be purchased directly by existing retirement
plans, including IRAs, 401(k)s, Keogh Plans, or Qualified Pension and Profit
Sharing Plans which allow for such investment. At this time the Fund has have
made no provisions for interested and eligible individuals to establish any such
plans or accounts directly with the Fund.
BROKERAGE TRANSACTIONS
The Investment Adviser may select selected broker-dealers to execute portfolio
transactions for the Fund, provided that the commissions, fees, or other
remuneration received by such party in exchange for executing such transactions
are reasonable and fair compared to those paid to other broker-dealers in
connection with comparable transactions. The Fund requires all broker-dealers
to effect transactions in portfolio securities in such a manner as to get prompt
and reliable execution of the orders at the most favorable price. The Adviser
will use its best judgment in determining which broker-dealers can provide the
best net price and execution. The Adviser may select broker-dealers who, in
addition to meeting the primary requirements of execution and price, may also
make available shares of the Fund, execute transactions for other accounts
advised by the Adviser, or offer electronic interface services, provided they
have the execution capability and that their commission rates are comparable to
those of other broker-dealers. Other than as set forth above, the Fund has no
fixed policy, formula, method, or criteria which it uses in allocating its
brokerage business. The Board of Trustees will evaluate and review semiannually
the reasonableness of brokerage commissions paid by the Fund.
<PAGE>
SHAREHOLDERS MEETINGS
Annual meetings of shareholders will not be held unless called by the
shareholders pursuant to Delaware Business Trust Act or unless required by the
1940 Act and the rules and regulations promulgated thereunder. Special meetings
of the shareholders may be held from time to time when called upon by (i) the
Chairman of the Board of Trustees, if one exists, the President and two or more
trustees, (ii) by one or more shareholders holding ten percent or more of the
shares entitled to vote on matters presented to the meeting, or (iii) if the
annual meeting is not held within any thirteen month period, upon application of
any shareholder, a court of competent jurisdiction may summarily order that such
meeting be held. In addition, the 1940 Act requires a shareholder vote on all
investment advisory contracts and amendments thereto. Shareholder inquiries
should be directed to the Fund's transfer agent at 1301 East Ninth Street, Suite
3600, Cleveland, Ohio 44114.
REPORTS TO SHAREHOLDERS
The Fund sends all shareholders annual reports containing audited financial
statements and other periodic reports, at least semiannually, containing
unaudited financial statements.
CUSTODIAN AND TRANSFER AGENT
The Investment Adviser has retained Mutual Shareholder Services (MSS), 1301 East
Ninth Street, Suite 3600, Cleveland, Ohio 44114, to provide administrative,
accounting and pricing, dividend disbursing, shareholder servicing and transfer
agent services. MSS maintains shareholder records, answers shareholder
inquiries concerning their accounts, process purchases and redemptions of the
Fund's shares. All shareholder inquiries should be directed to MSS at the above
address, or you may telephone toll free (800) 446-2987.
The Custodian acts as the depository for the Fund, is responsible for
safekeeping its portfolio securities, collects all income and other payments
with respect to portfolio securities, disburses monies at the Fund's request and
maintains records in connection with its duties. The Investment Adviser has
retained Fifth Third Bank, Fifth Third Center, Cincinnati, Ohio 45263 as
Custodian of the Fund's assets.
AUDITORS
McCurdy & Associates CPA's, Inc., independent certified public accountants,
27955 Clemens Road, Westlake, Ohio 44145, have been selected as the auditor of
the Fund. McCurdy & Associates CPA's, Inc. has no direct or indirect financial
interest in the Fund or the Adviser.
<PAGE>
LEGAL OPINION
The legality of the shares offered hereby have been passed upon by Anderson,
Berkshire, Lauritsen & Brower, 8805 Indian Hills Drive, Suite 200, Omaha,
Nebraska 68114.
LITIGATION
As of the date of this prospectus, there was no pending or threatened litigation
involving the Fund in any capacity whatsoever.
ADDITIONAL INFORMATION
This Prospectus omits certain information contained in the registration
statement on file with the Securities & Exchange Commission. The registration
statement may be inspected without charge at the principal office of the
Commission in Washington, D.C. and copies of all or part thereof may be obtained
upon payment of the fee prescribed by the Commission. Shareholders may also
direct inquiries to the Fund by phone or at the address given on cover of this
Prospectus.
<PAGE>
CONTRARIAN VALUE FUND
SHARE PURCHASE APPLICATION
Mail to Minimum Investments
Contrarian Value Fund Initial $5,000
1301 East Ninth Street, Suite 3600 Subsequent $500
Cleveland, Ohio 44114
1) Please complete for one of the following four types of accounts:
A) Individual Account
First Name MI Last Name Social Security Number
B) Joint Accounts
First Name MI Last Name Social Security Number
First Name MI Last Name Social Security Number
C) Custodial Accounts
Custodian's First Name MI Custodian's Last Name
Minor's First Name MI Minor's Last Name Minor's Soc Sec #
D) All Other Accounts
Name of Account Tax Identification #
____________________________________________
(Use this second line if you need it)
2) Biographical and other information about your new account:
Address_______________________________________________________________
City________________________________ State________ Zip____________
Home Phone________________________ Bus Phone______________________
<PAGE>
3) Investment Information:
Amount of Investment $____________
Please make payable to Contrarian Value Fund
4) Distribution Options:
Dividends and capital gains may be reinvested or paid by check. If no
options are selected below, both dividends and capital gains will be reinvested.
Dividends: Reinvest [ __ ] Pay in Cash [ __ ]
Capital Gains: Reinvest [ __ ] Pay in Cash [ __ ]
5) Taxpayer Identification Number and Certification: (signature required)
Part 1. Employer ID Number or Social Security # ________________________
Part 2. Backup Withholding: Check if you are NOT subject to backup
withholding under the provisions of Section 3406(a) (1) (C) of the Internal
Revenue Code [ __ ]
I am a U.S. Citizen Yes [__] No [__]
Certification - Under the penality of perjury, I certify that the
information provided on this form is true, correct and complete.
Signature ________________________________ Date _______________
6) Signature and Agreement: (signature required)
I/we, the undersigned, have received, a printed or downloaded a copy of the
current Prospectus of the Contrarian Value Fund and are purchasing Fund
shares in accordance with its provisions. I/we further certify that the
undersigned is of legal age and has full legal capacity to make this
purchase. The purchase price shall be the net asset value next determined
following receipt of the applacation by the Fund, if the application is
accepted. This application cannot be processed unless accompanied by
payment.
Signature of Owner, Trustee or Custodian: _______________________________
Signature of Joint Owner (if joint account): _______________________________
<PAGE>
BOARD OF TRUSTEES
Mark H. Baumann
Jane A. Baumann
John R. Wingender Jr.
Robin R. Richardson
Gary L. Teel
INVESTMENT ADVISER
Firstock Financial Services, Inc.
808 South 74th Plaza
Suite #113
Omaha, Nebraska, 68114-4666
INDEPENDENT AUDITORS
McCurdy & Associates CPA's, Inc.
27955 Clemens Road
Westlake, Ohio 44145
CUSTODIAN
Fifth Third Bank
Fifth Third Center
Cincinnati, Ohio 45263
LEGAL COUNSEL
Anderson, Berkshire, Lauritsen & Brower
8805 Indian Hills Drive
Suite 200
Omaha, Nebraska 68114
TRANSFER AGENT AND DIVIDEND PAYING AGENT
Mutual Shareholder Services
1301 East Ninth Street
Suite 3600
Cleveland, Ohio 44114
No person has been authorized to give any information or to make any
representation with respect to the Fund other than those contained in this
Prospectus, and information or representations not herein contained, if given or
made, must not be relied upon as having been authorized by the Fund. This
prospectus does not constitute an offer to sell or a solicitation of an offer to
buy in any jurisdiction to any person to whom it is unlawful to make such an
offer or solicitation in such jurisdiction.
<PAGE>
FIRSTMARK PARTNERS
CONTRARIAN VALUE FUND
808 South 74th Plaza Suite #113
Omaha, Nebraska 68114-4666
(402) 391-3375 (216) 687-1000
PART B
STATEMENT OF ADDITIONAL INFORMATION
February 10, 1999
This Statement is not a prospectus, but should be read in conjunction with the
Fund's current prospectus dated February 10, 1999. To obtain the Prospectus,
please write the Fund or call either of the telephone numbers that are shown
above.
<PAGE>
TABLE OF CONTENTS
ABOUT THE FUND
The Fund 3
Investment Objective 3
Risk Factors 3
Types of Securities 4
Security Selection Criteria 4
Investment Strategy and Practices 4
Technical Analysis 5
Portfolio Turnover Policy 5
Non-Diversification Policy 5
Temporary Defensive Position 6
Repurchase Agreements 6
Tax Status 6
Investment Restrictions 7
MANAGEMENT OF THE FUND
Investment Adviser 8
Advisory Fee 8
Fund Administration 9
Mutual Shareholder Services 9
Advisory and Administration Agreements 9
Management of the Fund 11
Remuneration of Officers and Trustees 12
Organization and Capital Structure 12
INVESTING IN THE FUND
Pricing of Shares 12
Purchase of Shares and Reinvestment 13
Redemption of Shares 14
Payments in Kind 14
Performance Information 14
Retirement Plans 16
Brokerage 16
Shareholders Meetings 17
Reports to Shareholders 17
OTHER FUND INFORMATION
Custodian and Transfer Agent 17
Auditors 18
Legal Opinion 18
Litigation 18
Miscellaneous Information 18
Financial Statements 18
APPENDIX
Independent Auditor's Report 19
Statements of Assets and Liabilities 20
Notes to Financial Statements 21
<PAGE>
THE FUND
Contrarian Value Fund (the "Fund")is an open-end, non-diversified portfolio of
Firstmark Partners (the "Trust"). The Trust was organized on November 12,
1998 as a Delaware business trust and is authorized to issue an indefinite
number of shares of beneficial interest. The Trust's registered office is
1209 Orange Street, Wilmington, Delaware 19801. Mail may be addressed to Trust's
principal executive office at 808 South 74th Plaza Suite #113, Omaha, Nebraska
68114-4666.
INVESTMENT OBJECTIVE
Contrarian Value Fund's primary objective is to seek capital appreciation
through investment in common stocks. The Fund seeks to accomplish this
objective by primarily investing in a core portfolio of 20-30 common stocks
which the Fund's adviser believes to be undervalued in the marketplace. Under
normal circumstances, the Fund pursues its objective by investing in common
stocks selected primarily for their capital appreciation potential. However,
the Fund may reduce its commitment to common stocks when, in the opinion of the
Adviser, investment considerations warrant such action. Receipt of income is a
secondary objective, as some investments may yield dividends, interest or other
income. Potential investors should be aware that risks exist in all types of
investments and there can be no assurance that the Fund will be successful in
achieving its investment objectives.
RISK FACTORS
Generally: Risks associated with the Fund's performance will be those due to
broad market declines along with business and financial risks from difficulties
which occur to particular companies while in the Fund's portfolio. It therefore
must be realized, as is true of almost all general common stock funds, the two
most fundamental risks associated with the Fund, are poor stock selection by the
Adviser, and the risk that the value of the common stocks it holds might
decrease in value.
Non-Diversification: The Fund will be operated as a non-diversified investment
company which means it may invest a relatively high percentage of its assets in
a limited number of common stocks. As a result, the gains or losses on a single
stock will have a greater impact on the Fund's Net Asset Value (NAV).
Therefore, the Fund's shares may be more susceptible to adverse change in value
than would be the shares of a diversified investment company. The policy of the
fund, as stated above, is therefore one of selective investments rather than
broad diversification. The fund is not intended to be a complete investment
program on its own.
Lack of Operating History and Experience: Firstmark Partners (and its first
series, the Contrarian Value Fund) is a newly organized investment company with
no history of operations. None of the principals, officers, or directors of the
investment adviser, Firstock Financial Services, Inc., have ever registered,
operated, or supervised the operations of investment companies in the past, and
there is no assurance that there past business experiences will enable them to
successfully manage the assets of the Fund in the future.
Reliance on Technical Analysis: Although the Adviser's investment strategy
utilizes both fundamental as well as technical analysis, the Adviser places
greater emphasis on the use of technical analysis than it does fundamental
analysis. In the opinion of the Adviser, one of the advantages of technical
analysis is that it may be possible to draw logical conclusions about the
future value of a security with only limited access to fundamental facts. Yet,
the Adviser also acknowledges, one of the disadvantages of technical analysis is
that it may never offer more than a set of possibilities, or probabilities at
best, about the future value of a security, neither of which may be correct.
There can be no assurance that the Adviser will be successful in its application
of its technical analysis techniques or strategies while using them in trying to
achieve the funds objective.
Definitions of Fundamental and Thecnical Analysis: According to Barron's
Dictionary of Finance and Investment Terms, fundamental analysis is "analysis of
the balance sheet and income statements of companies in order to forecast their
future stock price movements. Fundamental analysts consider past records of
assets, earnings, sales, products, management and markets in predicting future
trends in these indicators of a company's success of failure." technical
analysis is defined as "research into the demand and supply for securities
and commodities based on trading volume and price studies. Technical analysts
use charts or computer programs to identify and project price trends in a
market, security or commodity future. Most analysis is done for short- or
intermediate-term, but some technicians also predict long-term cycles based on
charts and other data. Unlike FUNDAMENTAL ANALYSIS, technical analysis is not
concerned with the financial position of a company."
<PAGE>
SECURITY SELECTION CRITERIA
The Fund, under normal circumstances, will primarily invest in, but is not
limited to, those common stocks contained in the Standard & Poors 500 Composite
Index (S&P500). The index generally tracks 400 industrial company stocks, 20
transportation stocks, 40 financial company stocks, and 40 public utilities.
This index is dynamic and changes over time. The inclusion of stocks in the
index and the publication of the index itself are services of the Standard &
Poors Corporation.
In selecting investments for the Fund, the Adviser will use both fundamental and
technical analysis in its analysis of possible securities to be considered for
purchase. Although the Adviser uses both fundamental and technical analysis
in determining what stocks to buy, the decision of when to buy a stock
is based soley on technical analysis. Therefore, under normal circumstances,
a stock will not be considered for purchase if, in the opinion of the Adviser,
the stock does not show favorable technical characteristics.
INVESTMENT STRATEGY AND PRACTICES
The Adviser pursues a flexible investment strategy in the selection of
securities, not limited to any particular investment sector, industry or company
size. The Adviser uses a disciplined approach to stock selection to help it
attempt to identify companies whose stocks are, in the opinion of the Adviser,
either undervalued or currently mispriced in the marketplace. The Adviser's
assessment of a company's stock that may be out of favor may differ from the
investment approach followed by other mutual funds. To some extent, during
periods of above average market volatility, the Fund may buy or sell stock or
other securities seeking short term capital appreciation.
Stock selections are made in part based on the Adviser's opinion regarding the
future appreciation and sustainability of a company's stock price. Under normal
circumstances, the portfolio will consist of between 20 and 30 stocks.
Generally, it is the intent of the Fund, to have each stock position represent
between four and five percent of the Fund's total net assets at the time of
purchase.
The Adviser continually reviews investment alternatives and may implement
portfolio changes as more attractive investment opportunities become available.
If a company's stock price appreciates to a level that, in the opinion of the
Adviser, appears not sustainable, the position is generally sold to realize the
existing profits and avoid a potential price correction. If the Adviser
identifies a new stock that it considers to be a better investment than a
current holding, the Adviser will generally consider selling the current holding
to add the new stock. The Adviser anticipates the Fund's portfolio generally
will be fully invested in common stocks. However, the fund may reduce its
commitment to common stocks when in the opinion of the Adviser, investment
considerations warrant such action.
<PAGE>
Under normal circumstances, technical analysis is the primary methodology used
by the Adviser in determining when a stock should be sold. However, once a
position has, in the opinion of the Adviser, appreciated substantially, the
Adviser may, under normal circumatances, place a "sell stop" order, at the
discretion of the Adviser, somewhere below the current market price of the stock
as a way of protecting the gain already in the position. Should the value of
the stock continue to appreciate, the "sell stop" may by raised accordingly at
the discretion of the Adviser. Any position that has declined 10% from its
original purchase price is re-examined and may be considered as a potential sale
candidate.
PORTFOLIO TURNOVER POLICY
The annual rate of portfolio turnover for the Fund is unknown since the fund has
no operating history and therefore no actual portfolio turnover rate presently
exists. The Fund's investment adviser expects to actively trade the portfolio
in pursuit of the Fund's investment objective and investments may be sold
without regard to length of time the Fund has held a position when, in the
opinion of the investment adviser, investment considerations warrant such
action. Although the Fund cannot accurately predict its portfolio turnover
rate, it is not expected to exceed 150%, wherein turnover is computed by
dividing the lesser of the Fund's total purchases or sales of securities within
the period by the average monthly portfolio value of the Fund during such
period. There are no limits on the rate of portfolio turnover. Higher
portfolio turnover rates, rates in excess of 100%, and short-term trading may
result in higher brokerage costs to the Fund and may result in the acceleration
of net taxable capital gains to shareholders.
NON-DIVERSIFICATION POLICY
The Fund is classified as being non-diversified which means that it may not
invest more than 25% of its assets in the securities of any one issuer and, with
respect to 50% of its total assets, the Fund may not invest more than 5% of its
total assets in the securities of any one issuer. Thus, the Fund may invest up
to 25% of its total assets in the securities of each of any two issuers.
However, under normal circumstances, the Fund anticipates maintaining a
portfolio, of between 20 and 30 approximately equally weighted positions. The
Fund, therefore, may be more susceptible to risk of loss than a more widely
diversified fund as a result of a single business, economic, political, or
regulatory occurrence. The policy of the Fund, in the hope of achieving its
objective as stated above, is therefore one of selective investments rather than
broad diversification. The Fund seeks only enough diversification to maintain
its federal non-taxable status under Sub-Chapter M of the Internal Revenue Code.
<PAGE>
TEMPORARY DEFENSIVE POSITION
When, in the judgement of the Adviser, market conditions a temporary defensive
posture, the Fund may invest up to 100% of its assets in short-term debt
securities and money market instruments, including securities issued by the U.S.
Government, its agencies or instrumentalities and repurchase agreements secured
thereby, commercial paper, certificates of deposit bank or savings and loan
association interest-bearing demand accounts. The adoption of such defensive
position does not constitute a change in the Fund's investment objective.
REPURCHASE AGREEMENTS
The Fund may invest in repurchase agreements. Repurchase agreements are
transactions in which the Fund purchases securities and commits to sell the
securities to the original seller (a member bank of the Federal Reserve System
or securities dealers who are members of a national securities exchange or are
market makers in U.S. Government securities) at an agreed upon date and price
reflecting a market rate of interest unrelated to the coupon rate or maturity of
the purchased securities. Repurchase agreements offer a means of generation
income from excess cash the Fund might otherwise hold un invested. Repurchase
agreements carry certain risks not associated with direct investments in
securities. Delays in payment or losses could result if the other party to the
agreement defaults or becomes bankrupt.
TAX STATUS
Under the provisions of Sub-Chapter M of the Internal Revenue Code of 1986 as
amended, the Fund intends to pay out substantially all of its investment income
and realized capital gains. As a result, the Fund intends to be relieved of
federal income tax on the amounts distributed to shareholders. In order to
qualify as a "regulated investment company" under Sub-Chapter M, at least 90% of
the Fund's income must be derived from dividends, interest, and gains from
securities transactions. No more than 50% of the Fund assets may be held in
security holdings that exceed 5% of the total assets of the Fund at time of
purchase. Distribution of any net long-term capital gains realized by the Fund
will be taxable to the shareholder as long-term capital gains regardless of the
length of time Fund shares have been held by the investor. All income realized
by the Fund, including short-term capital gains, will be taxable to the
shareholder as ordinary income. Dividends from net income will be made annually
or more frequently at the discretion of the Fund's Board of Trustees and will
automatically be reinvested in additional Fund shares at net asset value, unless
shareholder has elected to receive payment in the form of cash. Dividends
received shortly after purchase of shares by an investor will have the effect of
reducing the per share net asset value of the shares by the amount of such
dividends or distributions and, although in effect a return of capital, are
subject to federal income taxes.
The Fund is required by federal law to withhold 31% of reportable payments
(which may include dividends, capital gains, distributions and redemptions) paid
to shareholders who have not complied with IRS regulations. In order to avoid
this withholding requirement you must certify on the Shareholder Purchase
Application supplied by the Fund, that your Social Security or Taxpayer
Identification Number is correct and that you are not currently subject to back-
up withholding or otherwise certify that you are exempt from back-up
withholding.
<PAGE>
INVESTMENT RESTRICTIONS
The Fund has adopted the following fundamental investment restrictions. These
restrictions cannot be changed without approval by the holders of a majority of
the outstanding voting securities of the Fund. As defined in the Investment
Company Act of 1940 (the "Act"), the "vote of a majority of the outstanding
voting securities" means the lesser of the vote of (i) 67% of the shares of the
Fund at a meeting where more than 50% of the outstanding shares are present in
person or by proxy or (ii) more than 50% of the outstanding shares of the Fund.
The Fund may not:
(a) Act as underwriter for securities of other issuers except insofar as the
Fund may be deemed an underwriter in selling its own portfolio
securities.
(b) Borrow money or purchase securities on margin except for temporary or
emergency (not leveraging) purposes, including the meeting of redemption
requests that might otherwise require the untimely disposition of
securities, in an aggregate amount not exceeding 25% of the value of the
Fund's total assets at the time any borrowing is made. While the Fund's
borrowings are in excess of 5% of its total assets, the Fund will not
purchase any additional portfolio securities.
(c) Sell securities short.
(d) Invest in securities of other investment companies except as part of a
merger, consolidation, or purchase of assets approved by the Fund's
shareholders or by purchases with no more than 10% of the Fund's assets
in the open market involving only customary broker's commissions.
(e) Make investments in commodities, commodity contracts or real estate
although the Fund may purchase and sell securities of companies which
deal in real estate or interests therein.
(f) Make loans. The purchase of a portion of a readily marketable issue of
publicly distributed bonds, debentures or other debt securities will not
be considered the making of a loan.
(g) Acquire more than 10% of the securities of any class of another issuer,
treating all preferred securities of an issuer as a single class and all
debt securities as a single class, or acquire more than 10% of the
voting securities of another issuer.
(h) Invest in companies for the purpose of acquiring control.
(i) Purchase or retain securities of any issuer if those officers, directors
or trustees of the Fund or its Investment Adviser individually owns more
than 1/2 of 1% of any class of security or collectively own more than 5%
of such class of securities of such issuer.
(j) Pledge, mortgage or hypothecate any of its assets.
(k) Invest in securities which may be subject to registration under the
Securities Act of 1933 prior to sale to the public or which are not at
the time of purchase readily saleable.
(l) Invest more than 10% of the total Fund assets, taken at market value at
the time of purchase, in securities of companies with less than three
years' continuous operation, including the operations of any
predecessor.
(m) Issue senior securities.
(n) Acquire any securities of companies within one industry if, as a result
of such acquisition, more than 25% of the value of the Fund's total
assets would be invested in securities of companies within such
industry.
In connection with its investment objective and policies the Fund may, however,
invest in the following types of securities which can involve certain risks:
U.S. Government Securities: The Fund may purchase securities issued or
guaranteed by the U.S. Government or its agencies or instrumentalities. Such
securities will typically include, without limitation, U.S. Treasury
securities such as Treasury Bills, Treasury Notes or Treasury Bonds that differ
in their interest rates, maturities and times of issuance. Bank Obligations:
The Fund may invest in bank obligations, including certificates of deposit, time
deposits, banker's acceptances and other short-term obligations of banks,
savings and loan associations and other banking institutions.
<PAGE>
INVESTMENT ADVISER
The Trust retains Firstock Financial Services, Inc., located at 808 South 74th
Plaza Suite #113, Omaha, Nebraska 68114-4666, as its Investment Adviser.
Firstock Financial Services, Inc. (the "Investment Adviser") is a Nebraska
corporation founded in August 1986. The company is registered as an Investment
Adviser with the Securities and Exchange Commission under the Investment
Advisers Act of 1940. The corporation is controlled and wholly owned by Mark H.
Baumann and Jane A. Baumann. The Investment Adviser has been actively in the
business of rendering investment advisory services to businesses and individuals
since 1995 and is currently providing investment advisory services to over 100
businesses and individuals.
Mark H. Baumann has the direct responsibility for the overall strategic
management of the Fund's portfolio and its administration. Mr. Baumann founded
Firstock Financial Service, Inc. in 1986, has served as Chairman of the Board
and Chief Executive Officer since the company's inception. Mr. Baumann is a
Chartered Financial Analyst (CFA), and Certified Financial Planner (CFP)
licensee. He graduated from the University of Nebraska--Lincoln in 1983 where
he earned a B.S. degree in Education. From January 1989 through July 1998 Mr.
Baumann was also a registered representative with Robert Thomas Securities, Inc.
Jane A. Baumann, a registered nurse with Nebraska Health Systems, is not
actively involved in the business of the Adviser. Both Mark and Jane Baumann
serve as Trustees to the Fund.
ADVISORY FEE
The Fund will be managed by Firstock Financial Services, Inc. The Investment
Adviser will be paid a fee of 1.25% per year on the net assets of the Fund. All
fees are computed on the average daily closing net asset value of the Fund and
are payable monthly. Such fee is higher than the fee paid by most other funds.
Notwithstanding, the Investment Adviser may at its discretion, forgo
sufficient fees which would have the effect of lowering the Fund's expense ratio
and increasing the yield to shareholders.
FUND ADMINISTRATION
In addition to its fee for serving as the Fund's Investment Adviser, Firstock
Financial Services, Inc. will receive a fee for serving as the Fund's
administrator. The fee will be paid monthly at an annual rate of 0.50% of the
Fund's average daily net assets.
The Investment Adviser has retained Mutual Shareholder Services, to serve as the
Fund's transfer agent, dividend paying agent and shareholder service agent, to
provide accounting and pricing services to the Fund, and to assist the
Investment Adviser in providing executive, administrative and regulatory
services to the Fund. The Investment Adviser will pay the Transfer Agent's fees
for these services.
<PAGE>
MUTUAL SHAREHOLDER SERVICES
Mutual Shareholder Services, (MSS), 1301 East Ninth Street, Suite 3600,
Cleveland, Ohio 44114, a division of Maxus Information Systems Inc., an Ohio
corporation, is retained by the Investment Adviser to maintain the records of
each shareholder's account, process purchases and redemptions of the Fund's
shares and act as dividend and distribution disbursing agent. MSS also provides
administrative services to the Fund, calculates daily net asset value per share
and maintains such books and records as are necessary to enable MSS to perform
its duties. For the performance of these services, the Investment Adviser will
pay MSS a fee which will vary with the number of States in which the Fund elects
to do business; a fee for transfer agency and shareholder services at the annual
rate per shareholder account of the Fund (subject to a minimum fee); and a
monthly fee for accounting and pricing services which will vary according to the
Fund's average net assets during such month (subject to a minimum fee). Maxus
is a wholly owned subsidiary of Resource Management, Inc., an Ohio corporation
with interests primarily in the financial services industry.
ADVISORY AND ADMINISTRATION AGREEMENTS
On November 20, 1998 the shareholders of the Fund and the Board of Trustees
unanimously approved an investment advisory contract (the "Advisory Agreement")
and a separate administration contract (the "Administration Agreement") with
Firstock Financial Services, Inc. The Advisory Agreement and the Administration
Agreement are effective through the end of the Fund's first fiscal year.
Thereafter, both agreements may be continued for successive periods not to
exceed one year, provided that such continuance is specifically approved
annually by (a) the Fund's Board of Trustees or (b) vote of the holders of a
majority (as defined in the 1940 Act) of the outstanding voting securities of
the Fund. In either event, the continuance must be approved by a majority of
the Board of Trustees who are not "interested persons" of the Trust (as defined
by the 1940 Act) or the Investment Adviser, by vote cast in person at a meeting
called for the purpose of voting on such approval.
Under the Advisory Agreement, Firstock Financial Services, Inc. will determine
what securities will be purchased, retained or sold by the Fund on the basis of
a continuous review of its portfolio. Mr. Baumann, will have the direct
responsibility of managing the composition of the Fund's portfolio in accordance
with the Fund's investment objective. Pursuant to its contract with the Fund,
the Investment Adviser is (i) required to render research, statistical and
advisory services to the Fund, (ii) make specific recommendations based on the
Fund's investment requirements, and (iii) pay salaries of the Fund's employees
who may be officers, directors or employees of the Investment Adviser. Excepting
these items, the Fund pays all other fees and expenses incurred in conducting
its business affairs. The Investment Adviser has paid the initial
organizational costs of the Fund and will reimburse the Fund for any and all
losses incurred because of purchase reneges.
Under the Administration Agreement, the Investment Adviser will render all
administrative and supervisory services to the Fund. The Adviser will oversee
the maintenance of all books and records with respect to the Fund's securities
transactions and the Fund's book of accounts in accordance with all applicable
federal and state laws and regulations. The Adviser will also arrange for the
preservation of journals, ledgers, corporate documents, brokerage account
records and other records which are required pursuant to Rule 31a-1 promulgated
under the 1940 Act. In accordance with the Administration Agreement, the
Adviser is also responsible for the equipment, staff, office space and
facilities necessary to perform its obligations. The Fund will assume all other
expenses except to the extent of those paid by the Adviser.
<PAGE>
The Investment Adviser assumes and shall pay all ordinary expenses of the Fund.
Examples of such expenses include: (a) organizational costs, (b) compensation of
the Investment Adviser's personnel, (c) compensation of any of the Fund's
trustees, officers or employees who are not interested persons of the Investment
Adviser or its affiliates, (d) fees and expenses of registering the Fund's
shares under the federal securities laws and of qualifying its shares under
applicable state Blue Sky laws, including expenses attendant upon renewing such
registrations and qualifications, (e) insurance premiums, (f) fidelity bonds,
(g) accounting and bookkeeping costs and expenses necessary to maintain the
Fund's books and records, (h) outside auditing and ordinary legal expenses, (i)
all costs associated with shareholders meetings and the preparation and
dissemination of proxy solicitation materials, (j) costs of printing and
distribution of the Fund's Prospectus and other shareholder information to
existing shareholders, (k) charges, if any, of custodian and dividend disbursing
agent's fees, (l) industry association fees, and (m) costs of independent
pricing services and calculation of daily net asset value. The Adviser may, at
its discretion, assume any additional expenses ordinarily assumed by the Fund
when it determines that such action is in the best interest of the shareholders.
Any extraordinary and non-recurring expenses shall be paid by the Fund.
The Investment Adviser may act as an investment adviser and administrator to
other persons, firms, or corporations (including investment companies), and may
have numerous advisory clients besides the Fund.
The Advisory Agreement and the Administration Agreement are terminable on 60
days' written notice, without penalty, by a vote of a majority of the Fund's
outstanding shares or by vote of a majority of the Fund's entire Board of
Trustees, or by the Investment Adviser on 60 days' written notice, and
automatically terminates in the event of its assignment.
MANAGEMENT OF THE FUND
The business of the Fund is managed under the direction of its Board of Trustees
in accordance with Section 3.2 of the Declaration of Trust of Firstmark
Partners, which Declaration of Trust has been filed with the Securities and
Exchange Commission and is available upon request. Pursuant to Section 2.6 of
the Declaration of Trust, the trustees shall elect officers including a
president, secretary and treasurer. The Board of Trustees retains the power to
conduct, operate and carry on the business of the Fund and has the power to
incur and pay any expenses which, in the opinion of the Board of Trustees, are
necessary or incidental to carry out any of the Fund's purposes. The trustees,
officers, employees and agents of the Fund, when acting in such capacities,
shall not be subject to any personal liability except for his or her own bad
faith, willful misfeasance, gross negligence or reckless disregard of his or her
duties. The trustees and officers together with their principal occupations
during the past five years are as follows:
Name and Address Position Principal Occupation Past 5
Years
*Mark H. Baumann Trustee Chairman & CEO
2525 S. 48th Street President & Treasurer Firstock Financial Services
Omaha, NE 68106 of the Trust Registered Representative
Age: 42 Robert Thomas Securities, Inc.
*Jane A. Baumann Trustee Registered Nurse
2525 S. 48th Street Secretary of the Trust Nebraska Health Systems
Omaha, NE 68106
Age: 40
<PAGE>
Gary L. Teel Trustee Independent Sales Agent
8305 Parker Court Imation Corporation
Omaha, NE 68114
Age: 61
John R. Wingender, Jr., Ph.D. Trustee Professor of Finance
2121 La Platte Road Creighton University
Bellevue, NE 68123
Age: 48
Robin R. Richardson Trustee Accountant, CPA
12512 Burt Street Richardson & Associates P.C.
Omaha, Nebraska 68154
Age: 50
*Trustees of the Fund who are considered "interested persons" as defined in
Section 2(a)(19) of the Investment Company Act of 1940 by virtue of their
affiliation with the Investment Adviser. Mark H. Baumann and Jane A. Baumann
are husband and wife.
REMUNERATION OF OFFICERS AND TRUSTEES
The Fund does not compensate trustees affiliated with the Investment Adviser
except as they may benefit through payment of the Advisory and Administrative
fees. The Fund will reimburse those officers and trustees not affiliated with
the Investment Adviser to compensate for travel expenses associated with
performance of their duties.
ORGANIZATION AND CAPITAL STRUCTURE
The Trust was organized on November 12, 1998 as a Delaware business trust and is
authorized to issue an unlimited number of shares of beneficial interest. At
present there is only one series authorized by the Trust, which series has been
designated as the Contrarian Value Fund. The Board of Trustees may authorize
the creation of an additional series without shareholder approval.
All shares, when issued, will be fully paid and non-assessable and will be
redeemable and freely transferable. All shares have equal voting rights and can
be issued as full or fractional shares. A fractional share has pro rata the same
kind of rights and privileges as a full share. The shares possess no preemptive
or conversion rights.
Each shareholder has one vote for each share held irrespective of the relative
net asset value of the shares. Each share has equal dividend, distribution and
liquidation rights. The voting rights of the shareholders are non-cumulative, so
that holders of more than 50% of the shares can elect all trustees being
elected. On some issues, such as election of trustees, all shares of the Fund
vote together as one series. In the event that the Trust authorizes additional
series of shares as separate funds, on issues affecting only a particular fund,
the shares of the affected fund will vote as a separate series. An example of
such an issue would be a fundamental investment restriction pertaining to only
one fund.
<PAGE>
The Board of Trustees of the Trust is responsible for managing the business and
affairs of the Fund. The Board of Trustees consists of five members: Mark H.
Baumann, Jane A. Baumann, Gary L. Teel, John R. Wingender Jr., and Robin R.
Richardson.
As of the date of this offering, all of the outstanding voting shares of the
Fund were owned by the following Trustees and other holders of beneficial
interest:
Holders of Interest Shares Percent of Class
Mark H. Baumann* 10,000 100%
*Mark H. Baumann is considered a control person as defined in Section 2(a)(9) of
the Investment Company Act of 1940.
PRICING OF SHARES
The net asset value of the Fund's shares is determined as of the close of
business of the New York Stock Exchange on each business day of which that
Exchange is open (presently 4:00 p.m.); Monday through Friday exclusive of
Washington's Birthday, Good Friday, Memorial Day, July 4th, Labor Day,
Thanksgiving, Christmas and New Year's Day. The price is determined by dividing
the value of its securities, plus any cash and other assets less all
liabilities, excluding capital surplus, by the number of shares outstanding.
The market value of securities listed on a national exchange is determined to be
the last recent sales price on such exchange. Listed securities that have not
recently traded and over-the-counter securities are valued at the last bid price
in such market. Short-term paper (debt obligations that mature in less than 60
days) are valued at amortized cost which approximates market value. Other
assets are valued at fair market value as determined in good faith by the Board
of Trustees.
PURCHASE OF SHARES AND REINVESTMENT
The offering price of the shares offered by the Fund is at the Net Asset Value
("NAV") per share next determined after receipt of the purchase order by the
Fund and is computed in the manner described under the caption "Pricing of
Shares" in this Prospectus. The Fund reserves the right to terminate the
offering of the shares made by this Prospectus at any time and to refuse
purchase applications when, in the judgment of management, such termination or
refusal is in the best interests of the Fund. The Fund does not intend to issue
share certificates to its shareholders whereby shares of the Fund shall be
considered "uncertificated securities" as defined under Rule 17f-1 of the
Securities Exchange Act of 1934. The Fund and the Investment Adviser may enter
into arrangements with brokerage firms and financial institutions under which
shares of the Fund may be purchased or sold. Investors may be charged a
transaction fee if they effect transactions in Fund shares through a broker or
agent.
Initial Investments: Initial purchase of shares of the Fund may be made by
application submitted to the Contrarian Value Fund, 1301 East Ninth Street,
Suite 3600, Cleveland, Ohio 44114. Checks should be made payable to
"Contrarian Value Fund." For the convenience of investors, a Share Purchase
Application is provided with this Prospectus. The minimum initial purchase of
shares is $5,000 which is due and payable three (3) business days after the
purchase date. Lower minimums may be available to investors purchasing
shares of the Fund through certain brokerage firms. Investors may be charged a
transaction fee if the effect purchase orders through certain brokerage
firms. The Fund anticipates initially registering in California, Colorado,
Florida, Iowa, Nebraska, and New York and therefore will be restricted to
residents of those states at the time of purchase. There will be no solicitation
out of those states of potential shareholders until registration under
the Blue Sky laws of the state of residence have been met. Should an order to
purchase shares be canceled because your check does not clear, you will be
responsible for any resulting losses or fees incurred by the Fund or the
Transfer Agent in the transaction. Furthermore, the Fund reserves the right to
limit the amount of investments and to refuse to sell to any person.
<PAGE>
Subsequent Purchases: Subsequent purchases may be made by mail and are due and
payable three (3) business days after the purchase date. The minimum is $500.
Reinvestments: The Fund will automatically retain and reinvest dividends and
capital gains distributions and use same for the purchase of additional shares
for the shareholder at net asset value as of the close of business on the
distribution date. A shareholder may at any time by letter or forms supplied by
the Fund direct the Fund to pay dividends and/or capital gains distributions, if
any, to such shareholder in cash.
Fractional Shares: Full and/or fractional shares will be issued by the Fund.
Fractional shares will be issued to three decimal places as purchased from the
Fund. The Fund will maintain an account for each shareholder of shares for
which no certificates have been issued.
REDEMPTION OF SHARES
You may redeem shares of the Fund on each day that the Fund is open for business
by sending a written request to the Transfer Agent. The request must state the
number of shares or the dollar amount to be redeemed and your account number.
The request must be signed exactly as your name appears on the Fund's account
records. If the shares to be redeemed have a value of $25,000 or more, your
signature must be guaranteed by a national bank or a member of the New York
Stock Exchange. A notary public is not an acceptable guarantor. In some
instances shareholders may also redeem shares by placing a wire redemption
through a securities broker-dealer. Some broker-dealers may impose a fee on the
shareholder for this service. It is the responsibility of broker-dealers to
properly transmit wire redemption orders.
The redemption price a shareholder will receive is the net asset value per share
next determined after receipt by the Transfer Agent of your redemption request.
Because the net asset value of the Fund's shares will fluctuate, the proceeds
received by the shareholder may be more or less than his cost of such shares,
depending upon the net asset value per share at the time of redemption and the
difference should be treated by the shareholder as a capital gain or loss for
federal income tax purposes.
Payment by the Fund will ordinarily be made within three business days after
tender. The Fund may suspend the right of redemption or postpone the date of
payment if: The New York Stock Exchange is closed for other than customary
weekend or holiday closings, or when trading on the New York Stock Exchange is
restricted as determined by the Securities and Exchange Commission or when the
Securities and Exchange Commission has determined that an emergency exists,
making disposal of fund securities or valuation of net assets not reasonably
practicable. The Fund intends to make payments in cash, however, if the Board
of Trustees believes that economic conditions exist which would make such
practice detrimental to the best interests of the Fund, redemption may be
accomplished through distribution of portfolio securities of the Fund known as
"payments in kind".
<PAGE>
The Fund and the Investment Adviser may enter into arrangements with brokerage
firms and financial institutions under which shares of the Fund may be purchased
or sold. Investors may be charged a transaction fee if they effect transactions
in Fund shares through a broker or agent.
PAYMENTS IN KIND
Payment of the net redemption proceeds may be made either in cash or in
portfolio securities (selected in the discretion of the Investment Adviser under
supervision of the Board of Trustees and taken at their value used in
determining the net asset value), or partly in cash and partly in portfolio
securities. However, payments will be made wholly in cash unless the Board of
Trustees believes that economic conditions exist which would make such a
practice detrimental to the best interests of the Fund. If payment for shares
redeemed is made wholly or partly in portfolio securities, brokerage costs may
be incurred by the investor in converting the securities to cash.
PERFORMANCE INFORMATION
The Fund's total returns are based on the overall dollar or percentage change in
value of a hypothetical investment in the Fund, assuming all dividends and
distributions are reinvested. Average annual total return reflects the
hypothetical annually compounded return that would have produced the same
cumulative total return if the Fund's performance had been constant over the
entire period presented. Because average annual total returns tend to smooth
out variations in the Fund's returns, investors should recognize that they are
not the same as actual year-by-year returns.
For the purposes of quoting and comparing the performance of the Fund to that of
other mutual funds and to other relevant market indices in advertisements,
performance will be stated in terms of average annual total return. Under
regulations adopted by the Securities and Exchange Commission, funds that intend
to advertise performance must include average annual total return quotations
calculated according to the following formula:
P (1+T) n = ERV
Where:
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years (1, 5, or 10)
ERV = ending redeemable value of a hypothetical $1,000 payment made
at the beginning of the 1-, 5-, or 10- year period, at the end of such period
(or fractional portion thereof).
Under the foregoing formula, the time periods used in advertising will be based
on rolling calendar quarters, updated to the last day of the most recent quarter
prior to submission of the advertising for publication, and will cover 1, 5, and
10 year periods of the Fund's existence or shorter periods dating from the
commencement of Fund registration. In calculating the ending redeemable value,
all dividends and distributions by the Fund are assumed to have been reinvested
at net asset value as described in the Prospectus on the reinvestment dates
during the period. Additionally, redemption of shares is assumed to occur at
the end of each applicable time period.
<PAGE>
The foregoing information should be considered in light of the Fund's investment
objectives and policies, as well as the risks incurred in the Fund's investment
practices. Future results will be affected by the future composition of the
Fund's portfolio, as well as by changes in the general level of interest rates,
and general economic and other market conditions.
The Fund may also advertise total return (a "nonstandardized quotation") which
is calculated differently from average annual total return. A nonstandardized
quotation of total return may be a cumulative return which measures the
percentage change in the value of an account between the beginning and end of a
period, assuming no activity in the account other than reinvestment of dividends
and capital gains distributions.
A nonstandardized quotation may also indicate average annual compounded rates of
return over periods other than those specified for average annual total return.
A nonstandardized quotation of total return will always be accompanied by the
Fund's average annual total return as described above.
The performance quotations described above are based on historical earnings and
are not intended to indicate future performance.
To help investors better evaluate how an investment in the Fund might satisfy
their investment objective, advertisements regarding the Fund may discuss
various measures of Fund performance, including current performance ratings
and/or rankings appearing in financial magazines, newspapers and publications
which track mutual fund performance. Advertisements may also compare
performance (using the calculation methods set forth herein) to performance as
reported by other investments, indices and averages. When advertising current
ratings or rankings, the Fund may use the following publications or indices to
discuss or compare Fund performance:
Lipper Mutual Fund Performance Analysis measures total return and average
current yield for the mutual fund industry and ranks individual mutual fund
performance over specified time periods assuming reinvestment of all
distributions, exclusive of sales loads. The Fund may provide comparative
performance information appearing in the Small Company Growth Funds category.
In addition, the Fund may use comparative performance information of relevant
indices, including the S&P 500 Index, the Dow Jones Industrial Average, the
Russell 2000 Index, the NASDAQ Composite Index and the Value Line Composite
Index. The S&P 500 Index is an unmanaged index of 500 stocks, the purpose of
which is to portray the pattern of common stock price movement. The Dow Jones
Industrial Average is a measurement of general market price movement for 30
widely held stocks listed on the New York Stock Exchange. The Russell 2000
Index, representing approximately 11% of the U.S. equity market, is an unmanaged
index comprised of the 2,000 smallest U.S. domiciled publicly-traded common
stocks in the Russell 3000 Index (an unmanaged index of the 3,000 largest U.S.
domiciled publicly-traded common stocks by market capitalization representing
approximately 98% of the U.S. publicly-traded equity market). The NASDAQ
Composite Index is an unmanaged index which averages the trading prices of more
than 3,000 domestic over-the-counter companies. The Value Line Composite Index
is an unmanaged index comprised of approximately 1,700 stocks, the purpose of
which is to portray the pattern of common stock price movement.
In assessing such comparisons of performance an investor should keep in mind
that the composition of the investments in the reported indices and averages is
not identical to the Fund's portfolio, that the averages are generally unmanaged
and that the items included in the calculations of such averages may not be
identical to the formula used by the Fund to calculate its performance. In
addition, there can be no assurance that the Fund will continue this performance
as compared to such other averages.
<PAGE>
RETIREMENT PLANS
Generally, shares of the Fund may be purchased directly by existing retirement
plans, including IRAs, 401(k)s, Keogh Plans, or Qualified Pension and Profit
Sharing Plans which allow for such investment. At this time the Fund has have
made no provisions for interested and eligible individuals to establish any such
plans or accounts directly with the Fund.
BROKERAGE TRANSACTIONS
The Investment Adviser may select selected broker-dealers to execute portfolio
transactions for the Fund, provided that the commissions, fees, or other
remuneration received by such party in exchange for executing such transactions
are reasonable and fair compared to those paid to other broker-dealers in
connection with comparable transactions. The Fund requires all broker-dealers
to effect transactions in portfolio securities in such a manner as to get prompt
and reliable execution of the orders at the most favorable price. The Adviser
will use its best judgment in determining which broker-dealers can provide the
best net price and execution. The Adviser may select broker-dealers who, in
addition to meeting the primary requirements of execution and price, may also
make available shares of the Fund, execute transactions for other accounts
advised by the Adviser, or offer electronic interface services, provided they
have the execution capability and that their commission rates are comparable to
those of other broker-dealers. Other than as set forth above, the Fund has no
fixed policy, formula, method, or criteria which it uses in allocating its
brokerage business. The Board of Trustees will evaluate and review semiannually
the reasonableness of brokerage commissions paid by the Fund.
SHAREHOLDERS MEETINGS
Annual meetings of shareholders will not be held unless called by the
shareholders pursuant to Delaware Business Trust Act or unless required by the
1940 Act and the rules and regulations promulgated thereunder. Special meetings
of the shareholders may be held from time to time when called upon by (i) the
Chairman of the Board of Trustees, if one exists, the President and two or more
trustees, (ii) by one or more shareholders holding ten percent or more of the
shares entitled to vote on matters presented to the meeting, or (iii) if the
annual meeting is not held within any thirteen month period, upon application of
any shareholder, a court of competent jurisdiction may summarily order that such
meeting be held. In addition, the 1940 Act requires a shareholder vote on all
investment advisory contracts and amendments thereto. Shareholder inquiries
should be directed to the Fund's transfer agent at 1301 East Ninth Street, Suite
3600, Cleveland, Ohio 44114.
REPORTS TO SHAREHOLDERS
The Fund sends all shareholders annual reports containing audited financial
statements and other periodic reports, at least semiannually, containing
unaudited financial statements.
CUSTODIAN AND TRANSFER AGENT
The Investment Adviser has retained Mutual Shareholder Services (MSS), 1301 East
Ninth Street, Suite 3600, Cleveland, Ohio 44114, to provide administrative,
accounting and pricing, dividend disbursing, shareholder servicing and transfer
agent services. MSS maintains shareholder records, answers shareholder
inquiries concerning their accounts, process purchases and redemptions of the
Fund's shares. All shareholder inquiries should be directed to MSS at the above
address, or you may telephone toll free (800) 446-2987.
The Custodian acts as the depository for the Fund, is responsible for
safekeeping its portfolio securities, collects all income and other payments
with respect to portfolio securities, disburses monies at the Fund's request and
maintains records in connection with its duties. The Investment Adviser has
retained Fifth Third Bank, Fifth Third Center, Cincinnati, Ohio 45263 as
Custodian of the Fund's assets.
<PAGE>
AUDITORS
McCurdy & Associates CPA's, Inc., independent certified public accountants,
27955 Clemens Road, Westlake, Ohio 44145, have been selected as the auditor of
the Fund. McCurdy & Associates CPA's, Inc. has no direct or indirect financial
interest in the Fund or the Adviser.
LEGAL OPINION
The legality of the shares offered hereby have been passed upon by Anderson,
Berkshire, Lauritsen & Brower, 8805 Indian Hills Drive, Suite 200, Omaha,
Nebraska 68114.
LITIGATION
As of the date of this prospectus, there was no pending or threatened litigation
involving the Fund in any capacity whatsoever.
MISCELLANEOUS INFORMATION
This Statement of Additional Information and the Prospectus do not contain all
the information included in the Trust's registration statement filed with the
Securities and Exchange Commission under the Securities Act with respect to the
securities offered hereby, certain portions of which have been omitted pursuant
to the rules and regulations of the Securities and Exchange Commission. The
registration statement, including the exhibits filed therewith, may be examined
at the offices of the Securities and Exchange Commission in Washington, D.C.
Statements contained herein and in the Prospectus as to the contents of any
contract or other documents referred to are not necessarily complete, and, in
each instance, reference is made to the copy of such contract or other documents
filed as an exhibit to the registration statement, each such statement being
qualified in all respects by such reference.
FINANCIAL STATEMENTS
The audited Statement of Assets and Liabilities of the Fund as of February 8,
1999 is attached as an Appendix to this Statement of Additional Information.
<PAGE>
APPENDIX
To The Shareholders and Trustees
Firstmark Partners Trust:
We have audited the accompanying statement of assets and liabilities of the
Firstmark Partners Trust (comprised of the Contrarian Value Fund) as of February
8, 1999. This financial statement is the responsibility of the Company's
management. Our responsibility is to express an opinion on this financial
statement based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the statement of assets and liabilities is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the statement of assets and
liabilities. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
statement of assets and liabilities presentation. Our procedures included
confirmation of cash held by the custodian as of February 8, 1999, by
correspondence with the custodian. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the statement of assets and liabilities referred to above
presents fairly, in all material respects, the financial position of the
Contrarian Value Fund as of February 8, 1999, in conformity with generally
accepted accounting principles.
/s/ McCurdy & Associates
McCurdy & Associates CPA's, Inc.
Westlake, Ohio
February 8, 1999
<PAGE>
FIRSTMARK PARTNERS TRUST
STATEMENT OF ASSETS AND LIABILITIES
FEBRUARY 8, 1999
Contrarian
Value Fund
ASSETS:
Cash in Bank $100,000
Total Assets $100,000
LIABILITIES: $ 0
Total Liabilities $ 0
NET ASSETS $100,000
NET ASSETS CONSIST OF:
Capital Paid In $100,000
OUTSTANDING SHARES
Unlimited Number of Shares
Authorized Without Par Value 10,000
NET ASSET VALUE PER SHARE $10.00
OFFERING PRICE PER SHARE $10.00
See Accountants' Audit Report
<PAGE>
FIRSTMARK PARTNERS TRUST
NOTES TO FINANCIAL STATEMENTS
February 8, 1999
1. ORGANIZATION
Firstmark Partners Trust (the "Trust") is an open-end management investment
company organized as a business trust under the laws of the State of
Delaware by a Declaration of Trust dated November 12, 1998. The Declaration
of Trust provides for an unlimited number of authorized shares of beneficial
interest without par value, which may, without shareholder approval, be
divided into an unlimited number of series of such shares, and which
presently consist of one series of shares for the Contrarian Value Fund (the
"Fund").
The Fund uses an independent custodian and transfer agent. No transactions
other than those relating to organizational matters and the sale of 10,000
Shares of the Contrarian Value Fund have taken place to date.
2. RELATED PARTY TRANSACTIONS
As of February 8, 1999, all of the outstanding shares of the Fund were owned
by Mark H. Baumann. A shareholder who beneficially owns, directly or
indirectly, more than 25% of the Fund's voting securities may be deemed a
"control person" (as defined in the 1940 Act) of the Fund. Mark H. Baumann
is the President of the Fund.
Firstock Financial Services, Inc., the Fund's investment adviser and
administrator, is registered as an investment adviser under the Investment
Advisers Act of 1940. Firstock Financial Services, Inc. is owned by Mark H.
Baumann.
As adviser, Firstock Financial Services, Inc. receives from the Fund as
compensation for its services to the Fund an annual fee of 1.25% of the
Fund's net assets. This fee is higher than that paid by most other
investment companies. The fee is paid monthly and calculated on the average
daily closing net asset value of the Fund.
As administrator, Firstock Financial Services, Inc. receives from the Fund
as compensation for its services to the Fund, an annual fee of 0.50% of the
Fund's net assets. This fee is paid monthly and calculated on the average
daily closing net asset value of the Fund
The Fund pays all expenses not assumed by the Adviser, including brokerage
fees and commissions and will pay the expenses of Trustees not affiliated
with the Adviser. The Adviser will pay expenses of registration of the Fund
and of the shares of the Fund with the Securities and Exchange Commission
and the various states, charges of the custodian, dividend and transfer
agent, outside auditing and legal expenses, liability insurance premiums
on property or personnel (including officers and trustees), maintenance of
trust existence such as the filing of reports required by state law, any
<PAGE>
FIRSTMARK PARTNERS TRUST
NOTES TO FINANCIAL STATEMENTS (CONT'D)
February 8, 1999
2. RELATED PARTY TRANSACTIONS (Cont'd)
taxes payable by the Fund, interest payments relating to Fund borrowings,
costs of preparing, printing and mailing registration statements,
prospectuses, periodic reports and other documents furnished to shareholders
and regulatory authorities, fees and expenses of legal counsel, and costs
of printing share certificates, portfolio pricing services and shareholder
meetings.
From time to time, the Adviser may waive receipt of its fees and/or
voluntarily assume certain fund expenses, which would have the effect of
lowering the Fund's expense ratio and increasing yield to investors during
the time such amounts are waived or assumed. The Fund will not be required
to pay the Manager for any amounts voluntarily waived or assumed, nor will
the Fund be required to reimburse the Manager for any amounts waived or
assumed during a prior fiscal year.
3. CAPITAL STOCK AND DISTRIBUTION
At February 8, 1999, an unlimited number of shares were authorized and
paid in capital amounted to $100,000 for the Contrarian Value Fund.
Transactions in capital stock were as follows:
Shares Sold:
Contrarian Value Fund 10,000
Shares Redeemed:
Contrarian Value Fund 0
Net Increase:
Contrarian Value Fund 10,000
Shares Outstanding:
Contrarian Value Fund 10,000
<PAGE>
FORM N-1A
PART C - OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements
Financial statements are presented in Part B. These include:
Independent Auditor's Report dated February 8, 1999
Statement of Assets and Liabilities as of February 8, 1999
Notes to Statement of Assets and Liabilities as of February 8, 1999
(b) Exhibits - All exhibits believed to be applicable to this filing include:
Exhibit No. Description
10.10 Certificate of Trust of Firstmark Partners
10.20 Declaration of Trust of Firstmark Partners, Table of Contents
10.21 Declaration of Trust of Firstmark Partners
20.10 Certificate of Consent of the Trustees of Firstmark Partners
30.10 Investment Advisory Agreement
30.20 Administration Agreement
40.10 Reimbursement Agreement
50.10 Transfer Agent Agreement
50.20 Accounting Services Agreement
60.10 Custody Agreement
70.10 Legal Opinion and Consent of Counsel
80.10 Consent of Independent Auditors
Item 25. Control Persons
Not Applicable.
Item 26. Number of Shareholders
Title of Class Number of Record Holders
Contrarian Value Fund One as of February 9, 1999
Item 27. Indemnification
Under section 3817(a) of the Delaware Business Trust Act, a Delaware business
trust has the power to indemnify and hold harmless any trustee, beneficial owner
or other person from and against any and all claims and demands whatsoever.
Reference is made to sections 5.1 and 5.2 of the Declaration of Trust of
Firstmark Partners (the "Trust") (Exhibit 10.21) pursuant to which no trustee,
officer, employee or agent of the Trust shall be subject to any personal
liability, when acting in his or her individual capacity, except for his own bad
faith, willful misfeasance, gross negligence or reckless disregard of his or her
duties. The Trust shall indemnify each of its trustees, officers, employees and
agents against all liabilities and expenses reasonably incurred by him or her in
connection with the defense or disposition of any actions, suits or other
proceedings by reason of his or her being or having been a trustee, officer,
employee or agent, except with respect to any matter as to which he or she shall
have been adjudicated to have acted in or with bad faith, willful misfeasance,
gross negligence or reckless disregard of his or her duties. The Trust will
comply with Section 17(h) of the Investment Company Act of 1940, as amended (the
"1940 Act") and 1940 Act Releases number 7221 (June 9, 1972) and number 11330
(September 2, 1980).
<PAGE>
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to trustees, officers and controlling persons of the Trust
pursuant to the foregoing, the Trust has been advised that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy and therefore may be unenforceable. In the event that a claim for
indemnification (except insofar as it provides for the payment by the Trust of
expenses incurred or paid by a trustee, officer or controlling person in the
successful defense of any action, suit or proceeding) is asserted against the
Trust by such trustee, officer or controlling person and the Securities and
Exchange Commission is still in the same opinion, the Trust 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 of whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
Indemnification provisions exist in the Investment Advisory and Administration
Agreement under the headings "Limitation of Liability" which are identical to
those in the Declaration of Trust noted above.
Item 28. Activities of Investment Adviser
Firstock Financial Services, Inc. activity at the present time is performance on
its Investment Advisory Contract and Administration Agreement currently
effective with Firstmark Partners. Mark H. Baumann has the principal occupation
of, owner, officer and director of Firstock Financial Services, Inc.
Item 29. Principal Underwriter
The Fund acts as its own underwriter.
Item 30. Location of Accounts and Records
All fund records are held at the Trust's principal executive offices at 808
South 74th Plaza Suite #113, Omaha, Nebraska 68114-4666 except (1) records held
and maintained by Fifth Third Bank relating to its function as custodian; (2)
records held and maintained by Mutual Shareholder Service, relating to its
function as fund accountant, administrator and transfer agent.
Item 31. Management Services
Not Applicable
<PAGE>
Item 32. Undertakings
The Registrant undertakes to furnish each person to whom a prospectus is
delivered with a copy of the Registrant's latest annual report to shareholders,
upon request and without charge.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant certifies that it meets all of the
requirements for effectiveness of this Registration Statement and has duly
caused this amendment to the Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Omaha and State of
Nebraska, on the 9th day of February, 1999.
Firstmark Partners
By: /s/ Mark H. Baumann
Mark H. Baumann, President
Pursuant to the requirements of the Securities Act of 1933, this registration
Statement has been signed below by the following persons in the capacities and
on the dates(s) indicated.
/s/ Mark H. Baumann 2/09/98
Mark H. Baumann Trustee; President of the Trust Date
/s/ Jane A. Baumann 2/09/98
Jane A. Baumann Trustee; Secretary of the Trust Date
/s/ Gary L. Teel 2/09/98
Gary L. Teel Trustee Date
/s/ John R. Wingender, Jr. 2/09/98
John R. Wingender Jr. Trustee Date
/s/ Robin R. Richardson 2/09/98
Robin R. Richardson Trustee Date
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page
10.10 Certificate of Trust of Firstmark Partners
10.20 Declaration of Trust of Firstmark Partners, Table of Contents
10.21 Declaration of Trust of Firstmark Partners
20.10 Certificate of Consent of the Trustees of Firstmark Partners
30.10 Investment Advisory Agreement
30.20 Administration Agreement
40.10 Reimbursement Agreement
50.10 Transfer Agent Agreement
50.20 Accounting Services Agreement
60.10 Custody Agreement
70.10 Legal Opinion and Consent of Counsel
80.10 Consent of Independent Auditors
EXHIBIT 10.10
CERTIFICATE OF TRUST
This Certificate of Trust is filed in accordance with the provisions of the
Delaware Business Trust Act (12 Del. C. Section 3801 et. seq.) and sets forth
the following:
1. The name of the business trust is FIRSTMARK PARTNERS.
2. FIRSTMARK PARTNERS will become, within one hundred eighty (180) days
following the issuance of beneficial interests, a registered
investment company under the Investment Company Act of 1940, as amended (15
U.S.C. 80a-1 et. seq.) and shall have and maintain the following registered
office and registered agent for service of process:
The Corporation Trust Co. 1209 Orange Street
Wilmington, Delaware 19801,
located in New Castle County,
Delaware
3. The following persons shall serve as all of the Trustees of FIRSTMARK
PARTNERS:
Mark Baumann 808 South 74th Plaza - Suite 113
Omaha, Nebraska 68114
Jane A. Baumann 808 South 74th Plaza - Suite 113
Omaha, Nebraska 68114
Gary L. Teel 8305 Parker Court
Omaha, Nebraska 68114
John R. Wingender, Jr., Ph.D. 2121 La Platte Road
Bellevue, Nebraska 68123
Robin R. Richardson, CPA, CFP Richardson & Associates, P.C.
1716 North 120th Street
Omaha, Nebraska 68154
We, the undersigned, in order to form a business trust under the laws of
the State of Delaware, hereby make and file this Certificate of Trust.
Dated this 4th day of November, 1998.
/s/ Mark Baumann /s/ Jane A. Baumann
MARK BAUMANN, Trustee JANE A. BAUMANN, Trustee
/s/ Gary L. Teel /s/ John R. Wingender, Jr.
GARY L. TEEL, Trustee JOHN R. WINGENDER, JR., Ph.D., Trustee
/s/ Robin R. Richardson
ROBIN R. RICHARDSON, CPA, CFP, Trustee
<PAGE>
EXHIBIT 10.20
DECLARATION OF TRUST OF FIRSTMARK PARTNERS
TABLE OF CONTENTS
PAGE
Article I: The trust 1
1.1 Name 1
1.2 Trust Purpose 1
1.3 Definitions 1
Article II: Trustees 3
2.1 Number and Qualification 3
2.2 Term and Election 3
2.3 Resignation and Removal 4
2.4 Vacancies 4
2.5 Meetings 4
2.6 Officers; Chairman of the Board 5
2.7 By-Laws 6
Article III: Powers of Trustees 6
3.1 General 6
3.2 Investments 6
3.3 Legal Title 7
3.4 Sale of Interests 7
3.5 Borrow Money 7
3.6 Delegation; Committee 7
3.7 Collection and Payment 7
3.8 Expenses 7
3.9 Miscellaneous Powers 8
3.10 Further Powers 8
Article IV: Investment Advisory and Administrative Services
and Placement Agent Arrangements 8
4.1 Investment Advisory and Other Arrangements 8
4.2 Parties to Contract 9
Article V: Limitations of Liability 9
5.1 No Personal Liability of Trustees,
Officers, Employees, Agents 9
5.2 Indemnification of Trustees, Officers, Employees, Agents 9
5.3 Liability of Holders; Indemnification 10
5.4 No bond Required of Trustees 10
5.5 No Duty of Investigation;
Notice in Trust Instruments, Etc. 10
5.6 Reliance on Experts, Etc. 11
5.7 Assent to Declaration 11
<PAGE>
Article VI: Interests in the Trust 11
6.1 Interests 11
6.2 Rights of Holders 11
6.3 Register of Interests 11
6.4 Notices 11
6.5 No Pre-emptive Rights; Derivative Suits 12
6.6 No Appraisal Rights 12
Article VII: Purchases and Redemption 12
7.1 Purchases 12
7.2 Redemption by Holder 12
7.3 Redemption by Trust 12
7.4 Net Asset Value 13
Article VIII: Holders 13
8.1 Meetings of Holders 13
8.2 Notice of Meetings 13
8.3 Record Date for Meetings 14
8.4 Proxies, Etc. 14
8.5 Reports 14
8.6 Inspection of Records 15
8.7 Voting Powers 15
8.8 Series of Interests 15
8.9 Holder Action by Written Consent 17
8.10 Holder Communications 17
Article IX: Duration; Termination of Trust;
Amendment; Mergers, Etc. 18
9.1 Duration 18
9.2 Termination of Trust 18
9.3 Amendment Procedure 19
9.4 Merger, Consolidation and Sale of Assets 19
9.5 Incorporation 20
Article X: Miscellaneous 20
10.1 Certificate of Designation; Agent for Service of Process 20
10.2 Governing law 20
10.3 Counterparts 21
10.4 Reliance by Third parties 21
10.5 Provisions in Conflict with Law of Regulations 21
10.6 Trust Only 21
10.7 Withholding 22
10.8 Headings and Construction 22
<PAGE>
EXHIBIT 10.21
DECLARATION OF TRUST OF FIRSTMARK PARTNERS
This DECLARATION OF TRUST of FIRSTMARK PARTNERS is made on the 4th day of
November, 1998, by the parties signatory hereto, as Trustees.
WHEREAS, the Trustees desire to form a business Trust under the laws of
Delaware for the investment and reinvestment of its assets; and
WHEREAS, it is proposed that the Trust assets be composed of cash,
securities and other Assets contributed to the Trust by the holders of interests
in the Trust entitled to ownership rights in the Trust;
NOW, THEREFORE, the Trustees hereby declare that the Trustees will hold in
Trust all cash, securities and other assets which they may from time to time
acquire in any manner as Trustees hereunder, and manage and dispose of the same
for the benefit of the holders of interests in the Trust and subject to the
following terms and conditions:
ARTICLE I: THE TRUST
Section 1.1 Name. The name of the Trust created hereby (the "Trust")
shall be "FIRSTMARK PARTNERS", and so far as may be practicable the Trustees
shall conduct the Trust's activities, execute all documents and sue or be sued
under that name, which name (and the word "Trust" wherever hereinafter used)
shall not refer to the Trustees in their individual capacities or the officers,
agents, employees or holders of interest in the Trust. However, should the
Trustees determine that the use of the name of the Trust is not advisable, they
may select such other name for the Trust as they deem proper and the Trust may
hold its property and conduct it activities under such other name. Any name
change shall become effective upon the execution by a majority of the then
Trustees of an instrument setting forth the new name and the filing of a
Certificate of Amendment pursuant to Section 3810(b) of the DBTA. Any such
instrument shall not require the approval of the holders of interests in the
Trust, but shall have the status of an amendment to this Declaration.
Section 1.2 Trust Purpose. The purpose of the Trust is to conduct, operate
and carry on the business of an open-end management investment company
registered under the 1940 Act. In furtherance of the foregoing, it shall be the
purpose of the Trust to do everything necessary, suitable, convenient or proper
for the conduct, promotion and attainment of any businesses and purposes which
at any time may be incidental or may appear conducive or expedient for the
accomplishment of the business of any open-end management investment company
registered under the 1940 Act and which may be engaged in or carried on by a
Trust organized under the DBTA, and in connection therewith, the Trust shall
have and may exercise all of the powers conferred by the laws of the State of
Delaware upon a Delaware business Trust.
<PAGE>
Section 1.3 Definitions. As used in this Declaration, the following terms
shall have the following meanings:
(a) "1940 Act" shall mean the Investment Company Act of 1940, as amended
from time to time, and the rules and regulations thereunder, as adopted or
amended from time to time.
(b) "Affiliated Person", "Assignment" and "Interested Person" shall have
the meanings given them in the 1940 Act.
(c) "Administrator" shall mean any party furnishing services to the Trust
pursuant to any administrative services contract described in Section 4.1
hereof.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the rules and regulations thereunder, as adopted or amended
from time to time.
(e) "Commission" shall mean the Securities and Exchange Commission.
(f) "Declaration" shall mean this Declaration of Trust as amended from
time to time. References in this Declaration to "Declaration", "hereof",
"herein", and "hereunder" shall be deemed to refer to the Declaration rather
than the article or section in which such words appear. This Declaration shall
constitute the governing instrument of the Trust under the DBTA.
(g) "DBTA" shall mean the Delaware Business Trust Act, Delaware Code
Annotated Title 12, Sections 3801 et. seq., as amended from time to time.
(h) "Fiscal Year" shall mean an annual period as determined by the
Trustees unless otherwise provided by the Code or applicable regulations.
(i) "Holders" shall mean as of any particular time any or all holders of
record of interests in the Trust or in Trust Property, as the case may be, at
such time.
(j) "Interest" shall mean a Holder's units of interest into which the
beneficial interest in the Trust and each series of the Trust shall be divided
from time to time.
(k) "Investment Advisor" shall mean any party furnishing services to the
Trust pursuant to any investment advisory contract described in Section 4.1
hereof.
(l) "Majority Interests Vote" shall mean the vote, at a meeting of the
Holders of Interests, or of the lesser of, (A) sixty-seven percent (67%) or more
of the Interests present or represented at such meeting, provided the Holders of
more than fifty percent (50%) of the Interests are present or represented by
proxy, or (B) more than fifty percent (50%) of the Interest.
(m) "Person" shall mean and include an individual, corporation,
partnership, Trust, association, joint venture and other entity, whether or not
a legal entity, and a government and agencies and political subdivisions
thereof.
(n) "Registration Statement" as of any particular time shall mean the
Registration Statement of the Trust which is effective at such time under the
1940 Act.
<PAGE>
(o) "Trust Property" shall mean as of any particular time any and all
property, real or personal, tangible or intangible, which at such time is owned
or held by or for the account of the Trust or the Trustees. The Trustees may
authorize the division of Trust Property into two or more series, in accordance
with the provisions of Section 8.8 hereof, in which case all references in this
Declaration to the Trust, Trust Property, Interests herein or Holders thereof
shall be deemed to refer to each such series, as the case may be, except as the
context otherwise requires. Any series of Trust Property shall be established
and designated, and the variations in the relative rights and preferences as
between the different series shall be fixed and determined by the Trustees.
(p) "Trustees" shall mean such persons who are indemnified as Trustees of
the Trust on the signature page of this Declaration, so long as they shall
continue in office in accordance with the terms of this Declaration of Trust,
and all other persons who at the time in question have been duly elected or
appointed as Trustees in accordance with the provisions of this Declaration of
Trust and are then in office, in their capacity as Trustees hereunder.
ARTICLE II: TRUSTEES
Section 2.1 Number and Qualification. The number of Trustees shall
initially be five (5) and shall thereafter be fixed from time to time by
written instrument signed by a majority of the Trustees so fixed then in office,
provided, however, that the number of Trustees shall in no event be less than
one (1). A Trustee shall be an individual at least twenty-one (21) years of age
who is not under legal disability.
(a) Any vacancy created by an increase in Trustees shall be filled by the
appointment or election of an individual having the qualifications described in
this Article as provided in Section 2.4. Any such appointment shall not become
effective, however, until the individual appointed or selected shall have
accepted in writing such appointment or election and agreed in writing to be
bound by the terms of the Declaration. No reduction in the number of Trustees
shall have the effect of removing any Trustee from office.
(b) Whenever a vacancy in the number of Trustees shall occur, until such
vacancy is filled as provided in Section 2.4 hereof, the Trustees in office,
regardless of their number, shall have all the powers granted to the Trustees
and shall discharge all the duties imposed upon the Trustees by this
Declaration.
Section 2.2 Term and Election. Each Trustee named herein, or elected or
appointed prior to the first meeting of the Holders, shall (except in the event
of resignations or removals or vacancies pursuant to Sections 2.3 or 2.4 hereof)
hold office until his or her successor has been elected at such meeting and has
qualified to serve as Trustee. Beginning with the Trustees elected at the first
meeting of Holders, each Trustee shall hold office during the lifetime of this
Trust and until its termination as hereinafter provided unless such Trustee
resigns or is removed as provided in Section 2.3 below.
<PAGE>
Section 2.3 Resignation and Removal. Any Trustee may resign (without need
for prior or subsequent accounting) by an instrument in writing signed by him or
her and delivered or mailed to the Chairman, if any, the President or the
Secretary and such resignation shall be effective upon such delivery, or at a
later date according to the terms of the instrument.
(a) Any of the Trustees may be removed with or without cause by the
affirmative vote of the Holders of two-thirds (2/3rds) of the Interests or
(provided the aggregate number of Trustees, after such removal and after giving
effect to any appointment made to fill the vacancy created by such removal,
shall not be less than the number required by Section 2.1 hereof) with cause, by
the action of two-thirds (2/3rds) of the remaining Trustees. Removal with
cause shall include, but not be limited to, the removal of a Trustee due to
physical or mental incapacity.
(b) Upon the resignation or removal of a Trustee, or his or her otherwise
ceasing to be a Trustee, he or she shall execute and deliver such documents as
the remaining Trustees shall require for the purpose of conveying to the Trust
or the remaining Trustees any Trust Property held by the name of the resigning
or removed Trustee. Upon the death of any Trustee or upon removal or
resignation due to any Trustee's incapacity to serve as Trustee, his or her
legal representative shall execute and deliver on his or her behalf such
documents as the remaining Trustees shall require as provided in the preceding
sentence.
Section 2.4 Vacancies. The term of office of a Trustee shall terminate and
a vacancy shall occur in the event of the death, resignation, adjudicated
incompetence or other incapacity to perform the duties of the office, or
removal, of a Trustee. A vacancy shall also occur in the event of an increase
in the number of Trustees as provided in Section 2.1. No such vacancy shall
operate to annul this Declaration or to revoke any existing Trust created
pursuant to the terms of this Declaration. In the case of a vacancy, the
Holders of at least a majority of the Interests entitled to vote, acting at any
meeting of the Holders held in accordance with Section 8.1 hereof, or, to the
extent permitted by the 1940 Act, a majority vote of the Trustees continuing in
office acting by written instrument or instruments, may fill such vacancy, and
any Trustee so elected by the Trustees or the Holders shall hold office as
provided in this Declaration. There shall be no cumulative voting by the Holder
in the election of the Trustees.
Section 2.5 Meetings. Meetings of the Trustees shall be held from time to
time within or without the State of Delaware upon the call of the Chairman, if
any, the President, the Chief Operating Officer, the Secretary, an Assistant
Secretary or any two (2) Trustees.
(a) Regular meetings of the Trustees may be held without call or notice at
a time and place fixed by resolution of the Trustees. Notice of any other
meeting shall be given not later than seventy-two (72) hours preceding the
meeting by United States mail or by electronic transmission to each Trustee at
his business address as set forth in the records of the Trust or otherwise given
personally not less than twenty-four (24) hours before the meeting but may be
waived in writing by any Trustee either before or after such meeting. The
attendance of a Trustee at a meeting shall constitute a waiver of notice of such
meeting except where a Trustee attends a meeting for the express purpose of
objecting to the transmission of any business on the ground that the meeting has
not been lawfully called or convened.
<PAGE>
(b) A quorum for all meetings of the Trustees shall be two-thirds (2/3rds)
of the total number of Trustee, but (except at such time as there is only one
(1) Trustee) no less than two (2) Trustees. Unless provided otherwise in this
Declaration, any action of the Trustees may be taken at a meeting by vote of a
majority of the Trustees present (a quorum being present) or without a meeting
by written consent of a majority of the Trustees, which written consent shall be
filed with the minutes of proceedings of the Trustees or any such committee. If
there be less than a quorum present at any meeting of the Trustees, a majority
of those present may adjourn the meeting until a quorum shall have been
obtained.
(c) Any committee of the Trustees, including an executive committee, if
any, may act with or without a meeting. A quorum for all meetings of any such
committee shall be two (2) or more of the members thereof, unless the Board
shall provide otherwise. Unless provided otherwise in this Declaration, any
action of any such committee may be taken at a meeting by vote of a majority of
the members present (a quorum being present) or without a meeting by written
consent of a majority of the members, which written consent shall be filed with
the minutes of the proceedings of the Trustees or any such committee.
(d) With respect to actions of the Trustees and any committee of the
Trustees, Trustees who are Interested Persons of the Trust or are otherwise
interested in any action to be taken may be counted for quorum purposes under
this Section 2.5 and shall be entitled to vote to the extent permitted by the
1940 Act.
(e) All or any one or more Trustees may participate in a meeting of the
Trustees of any committee thereof by means of a conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and participation in a meeting pursuant to such
communications system shall constitute presence in person at such meeting,
unless the 1940 Act specifically requires the Trustees to act "in person", in
which case such term shall be construed consistent with Commission or staff
releases or interpretations.
Section 2.6 Officers; Chairman of the Board. The Trustees shall, from time
to time, elect officers of the Trust, including a President, a Secretary and a
Treasurer. The Trustees shall elect or appoint, from time to time, a Trustee to
act as Chairman of the Board who shall preside at all meetings of the Trustees
and carry out such other duties as the Trustees shall designate. The Trustees
may elect or appoint or authorize the President to appoint such other officers
or agents with such powers as the Trustees may deem to be advisable. The
President, Secretary and Treasurer may, but need not, be a Trustee. The
Chairman of the Board and such officers of the Trust shall serve in such
capacity for such time and with such authority as the Trustees may, in their
discretion, so designate.
Section 2.7 By-Laws. The Trustees may adopt and, from time to time, amend
or repeal the By-Laws for the conduct of the business of the Trust not
inconsistent with this Declaration, and such By-Laws are hereby incorporated in
this Declaration by reference thereto.
<PAGE>
ARTICLE III: POWERS OF TRUSTEES
Section 3.1 General. The Trustees shall have exclusive and absolute
control over management of the business and affairs of the Trust, but with such
powers of delegation as may be permitted by this Declaration and the DBTA. The
Trustees may perform such acts as in their sole discretion are proper for
conducting the business and affairs of the Trust. The enumeration of any
specific power herein shall not be construed as limiting the aforesaid power.
Such powers of the Trustees may be exercised without order of or recourse to any
court.
Section 3.2 Investments. The Trustees shall have power to:
(a) conduct, operate and carry on the business of any investment company;
(b) subscribe for, invest in, reinvest in, purchase or otherwise acquire,
hold, pledge, sell, assign, transfer, exchange, distribute or otherwise deal in
or dispose of United States and foreign currencies and related instruments
including forward contracts, and securities, including common and preferred
stock, warrants, bonds, debentures, time notes and all other evidences of
indebtedness, negotiable or non-negotiable instruments, obligations,
certificates of deposit or indebtedness, commercial paper, repurchase
agreements, reverse repurchase agreements, convertible securities, forward
contracts, options, futures contracts, and other securities, including, without
limitation, those issued, guaranteed or sponsored by any state, territory or
possession of the United States and the District of Columbia and their political
subdivisions, agencies and instrumentalities, or by the United States
government, any foreign government, or any agency, instrumentality or political
subdivision of the United States government or any foreign government, or
international instrumentalities, or by any bank, savings institution,
corporation or other business entity organized under the laws of the United
States or under foreign laws; and to execute any and all rights, powers and
privileges of ownership or interest in respect of any and all such investments
of every kind and description, including, without limitation, the right to
consent and otherwise act with respect thereto, with power to designate one or
more persons, firms, associations, or corporations to exercise any of said
rights, powers and privileges in respect of any of said instruments; and the
Trustees shall be deemed to have the foregoing powers with respect to any
additional securities in which the Trustees may determine to invest.
The Trustees shall not be limited to investing in obligations maturing
before the possible termination of the Trust, nor shall the Trustees be limited
by any law limiting the investments which may be made by fiduciaries.
Section 3.3 Legal Title. Legal title to all the Trust Property shall be
vested in the Trust as a separate legal entity under the DBTA, except that the
Trustees shall have the power to cause legal title to any Trust Property to be
held by or in the name of one or more of the Trustees or in the name of any
other Person on behalf of the Trust on such terms as the Trustees may determine.
<PAGE>
In the event that title to any part of the Trust Property is vested in one
or more Trustees, the right, title and interest of the Trustees in the Trust
Property shall vest automatically in each person who may hereafter become a
Trustee upon his or her due election and qualifications. Upon the resignation,
removal or death of a Trustee he or she shall automatically cease to have any
right, title or interest in any of the Trust Property, and the right, title and
interest of such Trustee in the Trust Property shall vest automatically in the
remaining Trustees. To the extent permitted by law, such vesting and cessation
of title shall be effective whether or not conveyancing documents have been
executed and delivered.
Section 3.4 sale of Interests. Subject to the more detailed provisions set
forth in Article VII, the Trustees shall have the power to permit persons to
purchase Interests and to add or reduce, in whole or in part, their Interest in
the Trust.
Subject 3.5 Borrow Money. The Trustees shall have the power to borrow
money or otherwise obtain credit and to secure the same by mortgaging, pledging
or otherwise subjecting as security the assets or the Trust, including the
lending of portfolio securities, and to endorse, guarantee or undertake the
performance of any obligation, contract or engagement of any other person, firm,
association or corporation
Section 3.6 Delegation; Committees. The Trustees shall have powers,
consistent with their continuing exclusive authority over the management of the
Trust and the Trust Property, to delegate from time to time to such of their
number or to officers, employees or agents of the Trust the doing of such things
and the execution of such instruments, either in the name of the Trust or the
names of the Trustees or otherwise, as the Trustees may deem expedient.
Section 3.7 Collection and Payment. The Trustees shall have the power to
collect all property due to the Trust; to pay all claims, including taxes,
against the Trust Property; to prosecute, defend, compromise or abandon any
claims relating to the Trust Property; to foreclose any security interest
securing any obligations, by virtue of which any property is owned, to the
Trust; and to enter into releases, agreements and other instruments.
Section 3.8 Expenses. The Trustees shall have the power to incur and pay
any expenses which in the opinion of the Trustees are necessary or incidental to
carry out any of the purposes of this Declaration, and to pay reasonable
compensation from the funds of the Trust to themselves as Trustees. The
Trustees may pay themselves such compensation for special services, including
legal and brokerage services, as they in good faith may deem reasonable (subject
to any limitations in the 1940 Act), and reimbursement for expenses reasonably
incurred by themselves on behalf of the Trust.
<PAGE>
Section 3.9 Miscellaneous Powers. The Trustees shall have the power to (a)
employ or contract with such Persons as the Trustees may deem desirable for the
transaction of the business of the Trust and terminate such employees or
contractual relationships as they consider appropriate; (b) enter into joint
ventures, partnerships and any other combinations or associations; (c) purchase,
and pay for out of Trust Property, insurance policies including but not limited
to fidelity, bonding and errors and omission policies; insuring the Investment
Adviser, Administrator, distributor, Holders, Trustees, officers, employees,
agents, or independent contractors of the Trust against all claims arising by
reason of holding any such position or by reason of any action taken or omitted
by any such person in such capacity, whether or not the Trust would have the
power to indemnify such person against liability; (d) establish pension, profit-
sharing and other retirement, incentive and profit realized directly or
indirectly therefrom, provided that the contract or agreement when entered into
was reasonable and fair and not inconsistent with the provisions of this Article
IV. Any Trustee or officer of the Trust or Holder may be the other party to
contracts or agreements entered into pursuant to Section 4.1 hereof, and any
Trustee or officer of the Trust or any Holder may be financially interested or
otherwise affiliated with Persons who are parties to any or all of the contracts
or agreements mentioned in this Section 4.2.
Section 3.10 Further Powers. The Trustees shall have power to conduct the
business of the Trust and carry on its operations in any and all of its branches
and maintain offices, whether within or without the State of Delaware, in any
and all States of the United States of America, in the District of Columbia, in
any foreign countries, and in any and all commonwealths, territories,
dependencies, colonies, possessions, agencies of instrumentalities of the United
States of America and of foreign countries, and to do all such other things and
execute all such instruments as they deem necessary, proper or desirable in
order to promote the interests of the Trust although such things are not herein
specifically mentioned. Any determination as to what is in the interests of the
Trust made by the Trustees in good faith shall be conclusive and shall be
binding upon the Trust and the Holders, past, present and future. In construing
the provisions of this Declaration, the presumption shall be in favor of a grant
of power to the Trustees. The Trustees shall not be required to obtain any
court order to deal with Trust Property.
ARTICLE IV: INVESTMENT ADVISORY AND ADMINISTRATIVE
SERVICES AND PLACEMENT AGENT ARRANGEMENTS
Section 4.1 Investment Advisory and Other Arrangements. The Trustees may
in their discretion, from time to time, enter into contracts or agreements for
investment advisory services, administrative services (including transfer and
dividend disbursing agency services), distribution services, fiduciary
(including custodian) services, placement agent services, Holder servicing and
distribution services, or other services, whereby the other party to such
contract or agreement shall undertake to furnish the Trustees such services as
the Trustees shall, from time to time, consider desirable and all upon which
terms and conditions as the Trustees may in their discretion determine.
Notwithstanding any other provisions of this Declaration to the contrary, the
Trustees may authorize any Investment Advisor (subject to such general or
specific instruments as the Trustees may, from time to time, adopt) to effect
purchases, sales, loans or exchanges of Trust Property on behalf of the Trustees
or may authorize any officer, employee, or Trust to effect such purchases,
sales, loans or exchanges pursuant to recommendations of any such Investment
Adviser (all without further action by the Trustees). An such purchases, sales,
loans and exchanges shall be binding upon the Trust.
<PAGE>
Section 4.2 Parties to Contract. Any contract or agreement of the
character described in Section 4.1 of this Article IV may be entered into with
any Person, although one or more of the Trustees or officers of the Trust or any
Holder may be an officer, director, trustee, shareholder, or member of such
other party to the contract or agreement, and no such contract or agreement
shall be invalidated or rendered voidable by reason of the existence of any such
relationship, nor shall any person holding such relationship be liable merely by
reason of such relationship for any loss or expense to the Trust under or by
reason of such contract or agreement or accountable for any profit realized
directly or indirectly therefrom, provided that the contract or agreement when
entered into was reasonable and fair and not inconsistent with the provisions of
this Article IV. Any Trustee or officer of the Trust or any Holder may be the
other party to contracts or agreements entered into pursuant to Section 4.1
hereof, and any Trustee or officer of the Trust or any Holder may be financially
interested or otherwise affiliated with Persons who are parties to any or all of
the contracts or agreements mentioned in this Section 4.2.
ARTICLE V: LIMITATIONS OF LIABILITY
Section 5.1 No Personal Liability of Trustees, Officers, Employees, Agents.
No Trustee, officer, employee or agent of the Trust when acting in such capacity
shall be subject to any personal liability whatsoever, in his or her individual
capacity, to any Person, other than the Trust or its Holders, in connection with
Trust Property or the affairs of the Trust; and all such Persons shall look
solely to the Trust Property for satisfaction of claims of any nature against a
Trustee, officer, employee or agent of the Trust arising in connection with the
affairs of the Trust. No Trustee, officer, employee or agent of the Trust shall
be liable to the Trust, Holders of Interests therein, or to any Trustee,
officer, employee, or agent thereof for any action or failure to act (including,
without limitation the failure to compel in any way any former or acting Trustee
to redress any breach of Trust) except for his or her own bad faith, willful
misfeasance, gross negligence or reckless disregard of his or her duties.
Section 5.2 Indemnification of Trustees, Officers, Employees, Agents. The
Trust shall indemnify each of its Trustees, officers, employees, and agents
(including Persons who serve at its request as directors, officers or Trustees
of another organization in which it has an interest, as a shareholder, creditor
or otherwise) against all liabilities and expenses (including amounts paid in
satisfaction of judgments, in compromise, as fines and penalties, and as counsel
fees) reasonably incurred by him or her in connection with the defense or
disposition of any action, suit or other proceeding, whether civil or criminal,
in which he or she may be involved or with which he or she may be threatened,
while in office or thereafter, by reason of his or her being or having been such
a Trustee, officer, employee or agent, except with respect to any matter as to
which he or she shall have been adjudicated to have acted in bad faith, willful
misfeasance, gross negligence or reckless disregard of his or her duties;
provided, however, that as to any matter disposed of by a compromise payment by
such Person, pursuant to a consent decree or otherwise, no indemnification
either for said payment or for an other expenses shall be provided unless there
has been a determination that such Person did not engage in willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of his or her office by the court or other body approving the settlement
or other disposition or by a reasonable determination, based upon review of
readily available facts (as opposed to a full trial-type inquiry), that he or
she did not engage in such conduct by written opinion from independent legal
counsel approved by the Trustees. The rights accruing to any Person under these
provisions shall not exclude any other right to which he or she may be lawfully
entitled; provided that no Person may satisfy any right of indemnity or
reimbursement granted herein or in Section 5.1 or to which he or she may be
otherwise entitled except out of the Trust Property. The Trustees may make
advance payments in connection with indemnification under this Section 5.2,
provided that the indemnified Person shall have given a written undertaking to
reimburse the Trust in the event it is subsequently determined that he or she is
not entitled to such indemnification.
<PAGE>
Section 5.3 Liability of Holders; Indemnification. The Trust shall
indemnify and hold each Holder harmless from and against any claim or liability
to which such Holder may become subject solely by reason of his or her being or
having been a Holder and not because of such Holder's acts or omissions or for
some other reason, and shall reimburse such Holder for all legal and other
expenses reasonably incurred by him or her in connection with any such claim or
liability (upon proper and timely request by the Holder); provided, however,
that no Holder shall be entitled to indemnification by any series established in
accordance with Section 8.8 unless such Holder is a Holder of Interest of such
series. The rights accruing to a Holder under this Section 5.3 shall not
exclude any other right to which such Holder may be lawfully entitled, nor shall
anything herein contained restrict the right of the Trust to indemnify or
reimburse a Holder in any appropriate situation even though not specifically
provided herein.
Section 5.4 No Bond Required of Trustees. No Trustee shall, as such, be
obligated to give any bond or surety or other security for the performance of
any of his or her duties hereunder.
Section 5.5 No duty of Investigation; Notice in Trust Instruments, Etc. No
purchaser, lender, or other Person dealing with the Trustees or any officer,
employee or agent of the Trust shall be bound to make any inquiry concerning the
validity of any transaction purporting to be made by the Trustees or by said
officer, employee or agent or be liable for the application of money or property
paid, loaned, or delivered to or on the order of the Trustees or of said
officer, employee or agent. Every obligation, contract, instrument, certificate
or other interest or undertaking of the Trust, and every other act or thing
whatsoever executed in connection with the Trust, shall be conclusively taken to
have been executed or done by the executors thereof only in their capacity as
Trustees, officers, employees or agents of the Trust. Every written obligation,
contract, instrument, certificate or other interest or undertaking of the Trust
made by the Trustees or by any officer, employee or agent of the Trust, in his
or her capacity as such, shall contain an appropriate recital to the effect that
the Trustee, officer, employee and agent of the Trust shall not personally be
bound by or liable thereunder, nor shall resort be had to their private property
or the private property of the Holders for the satisfaction of any obligation or
claim thereunder, and appropriate references shall be made therein to the
Declaration, and may contain any further recital which they may deem
appropriate, but the omission of such recital shall not operate to impose
personal liability on any of the Trustees, officers, employees or agents of the
Trust. The Trustees may maintain insurance for the protection of the Trust
Property, Holders, Trustees, officers, employees and agents in such amount as
the Trustees shall deem advisable.
<PAGE>
Section 5.6 Reliance on Experts, Etc. Each Trustee and officer or employee
of the Trust shall, in the performance of his or her duties, be fully and
completely justified and protected with regard to any act or any failure to act
result from reliance in good faith upon the books of account or other records of
the Trust, upon any opinion of counsel, or upon reports made to the Trust by any
of its offices or employees or by any Investment Adviser, Administrator,
accountant, appraiser or other experts or consultants selected with reasonable
care by the Trustees, officers or employees of the Trust, regardless of whether
such counsel or expert may also be a Trustee.
Section 5.7 Assent to Declaration. Every Holder, by virtue of having
become a Holder in accordance with the terms of this Declaration, shall be held
to have expressly assented and agreed to the terms hereof and to have become a
party hereto.
ARTICLE VI: INTERESTS IN THE TRUST
Section 6.1. Interests. The beneficial interests in the property of the
Trust shall consist of an unlimited number of Interests. No certificate
certifying the ownership of Interests need be issued except as the Trustees may
otherwise determine from time to time.
Section 6.2. Rights of Holders. The ownership of the Trust Property of
every description and the right to conduct any business hereinbefore described
are vested exclusively in the Trust or the Trustees, and the Holders shall have
no right or title therein other than the beneficial interest conferred by their
Interests and they shall have no right to call for any partition or division of
any property, profits or rights of the Trust. The Interests shall be personal
property giving only the rights specifically set forth in this Declaration.
Section 6.3. Register of Interests. A register shall be kept by the Trust
under the direction of the Trustees which shall contain the names and addresses
of the Holders and Interests held by each Holder. Each such register shall be
conclusive as to the identity of the Holders of the Trust and the Persons who
shall be entitled to payments of distributions or otherwise to exercise or
enjoy the rights of Holders. No Holder shall be entitled to receive payment of
any distribution, nor to have notice given to it as herein provided, until it
has given its address to such officer or agent of the Trustees as shall keep the
said register for entry thereon.
Section 6.4. Notices. Any and all notices to which any Holder hereunder
may be entitled and any and all communications shall be deemed duly served or
given if mailed, postage prepaid, addressed to any Holder of record at its last
known address as recorded on the register.
Section 6.5. No pre-emptive Rights: Derivative Suits. Holders shall have
no pre-emptive or other right to subscribe to any additional Interests or other
securities issued by the Trust or any series thereof. No action may be brought
by a Holder on behalf of the Trust unless Holders owing no less than ten percent
(10%) of the then outstanding Interests join in the bringing of such action.
Section 6.6. No Appraisal Rights. Holders shall have no right to demand
payment for their Interests or to any other rights of dissenting Holders in the
event the Trust participates in any transaction which would give rise to
appraisal or dissenters' rights by a holder of a corporation organized under the
General Corporation Law of Delaware, or otherwise.
<PAGE>
ARTICLE VII: PURCHASES AND REDEMPTION
Section 7.1. Purchases. The Trustees, in their discretion, may, from time
to time, without a vote of the Holders, permit the purchase of Interests by such
party or parties (or increase in the Interests of a Holder) and for such type of
consideration, including, without limitation, cash or property, at such time or
times (including, without limitation, each business day) and on such terms as
the Trustees may deem best, and may in such manner acquire other assets
(including, without limitation, the acquisition of assets subject to, and in
connection with the assumption of, liabilities) and businesses.
Section 7.2. Redemption by Holder. Each Holder of Interests of the Trust
or any series thereof shall have the right at such times as may be permitted by
the Trust to require the Trust to redeem all or any part of his or her Interests
of the Trust or series thereof at a redemption price equal to the net asset
value per Interest of the Trust or series thereof next determined in accordance
with Section 7.4 hereof after the Interests are properly tendered for
redemption. Payment of the redemption price shall be in cash; provided,
however, that if the Trustees determine, which determination shall be
conclusive, that conditions exist which make payment wholly in cash unwise or
undesirable, the Trust may, subject to the requirements of the 1940 Act, make
payment wholly or partly in securities or other assets belonging to the Trust or
series thereof which the Interests being redeemed are part of the value of such
securities or assets used in such determination of the net asset value.
Notwithstanding the foregoing, the Trust may postpone payment of the
redemption price and may suspend the right of the Holders of Interests of the
Trust or series thereof to require the Trust to redeem Shares of the Trust or
series during any period or at any time when and to the extent permissible under
the 1940 Act.
Section 7.3. Redemption by Trust. Each Interest of the Trust or series
thereof that has been established and designated is subject to redemption by the
Trust at the redemption price which would be applicable if such Interest was
then being redeemed by the Holder pursuant to Section 7.2 hereof: (i) at any
time, if the Trustees determine in their sole discretion and by majority vote
that failure to so redeem may have materially adverse consequences to the Trust
or any series or to the Holders of the Interests of the Trust or any series
thereof, or (ii) upon such other conditions as may from time to time be
determined by the Trustees and set forth in the then current Prospectus of the
Trust with respect to maintenance of Holder accounts of a minimum amount. Upon
such redemption the Holders of the Interests so redeemed shall have no further
right with respect thereto other than to receive payment of such redemption
price.
Section 7.4. Net Asset Value. The net asset value per Interest of any
series shall be (i) in the case of a series whose Interests are not divided into
classes, the quotient obtained by dividing the value of the net assets of that
series (being the value of the assets belonging to that series less the
liabilities belonging to that series) by the total number of Interests of that
series outstanding, and (ii) in the case of a class of Interests of a series
whose Interests are divided into classes, the quotient obtained by dividing the
value of the net assets of that series allocable to such class (being the value
of the assets belonging to that series allocable to such class less the
liabilities belonging to such class) by the total number of Interests of such
class outstanding: all determined in accordance with the methods and
procedures, including without limitation those with respect to rounding,
established by the Trustee from time to time.
<PAGE>
The Trustees may determine to maintain the net asset value per Interests of
any series at a designated constant dollar amount and in connection therewith
may adopt procedures consistent with the 1940 Act for continuing declarations of
income attributable to that series as dividends payable in additional Interests
of that series at the designated constant dollar amount and for the handling of
any losses attributable to that series.
ARTICLE VIII: HOLDERS
Section 8.1 Meetings of Holders. Meetings of the Holders may be called at
any time by a majority of the Trustees and shall be called by any Trustee upon
written request of the Holders holding, in the aggregate, not less than ten
percent (10%) of the Interests, such requests specifying the purpose or purposes
for which such meeting is to be called. Any such meeting shall be held within
or without the State of Delaware on such day and at such time as the Trustees
shall designate. Holders of one-third (1/3rd) of the Interests in the Trust,
present in person or by proxy, shall constitute a quorum for the transaction of
any business, except as may otherwise be required by the 1940 Act or other
applicable law or by this Declaration. If a quorum is present at a meeting, an
affirmative vote by the Holders present, in person or by proxy, holding more
than fifty percent (50%) of the total Interests of the Holders present, either
in person or by proxy, at such meeting constitutes the action of the Holders,
unless the 1940 Act, other applicable law or this declaration requires a greater
number of affirmative votes.
Section 8.2 Notice of Meetings. Written or printed notice of all meetings
of the Holders, stating the time, place and purposes of the meeting, shall be
given by the Trustees either by presenting it personally to a Holder, leaving it
at his or her residence or usual place of business, or by sending it via United
States mail or by electronic transmission to a Holder, at his or her registered
address, at least ten (10) business days and not more than ninety (90) business
days before the meeting. If mailed, such notice shall be deemed to be given
when deposited in the United States mail addressed to the Holder at his or her
address as it is registered with the Trust, with postage thereon prepaid. At
any such meeting, any business properly before the meeting may be considered
whether or not stated in the notice of the meeting. Any adjourned meeting may
be held as adjourned without further notice.
Section 8.3 Record Date for Meetings. For the purpose of determining the
Holders who are entitled to notice of any meeting and to vote at any meeting, or
to participate in any distribution, or for the purpose of any other action, the
Trustee may from time to time fix a date, not more than ninety (90) calendar
days prior to the date of any meeting of the Holders or payment of distributions
or other action, as the case may be, as a record date for the determination of
the persons to be treated as Holders of record for such purposes. If the
Trustee shall divide the Trust Property into two (2) or more series in
accordance with Section 8.8 herein, nothing in this Section 8.3 shall be
construed as precluding the Trustees from setting different record dates for
different series.
<PAGE>
Section 8.4 Proxies, Etc. At any meeting of Holders, any Holder entitled
to vote thereat may vote by proxy, provided that no proxy shall be voted at any
meeting unless it shall have been placed on file with the Secretary, or with
such other officer or agent of the Trust as the Secretary may direct, for
verification prior to the time at which such vote shall be taken.
(a) Pursuant to a resolution of a majority of the Trustees, proxies may be
solicited in the name of one or more Trustees or one or more of the officers of
the Trust. Only Holders of record shall be entitled to vote. Each Holder shall
be entitled to a vote proportionate to its Interest in the Trust.
(b) When Interests are held jointly by several persons, any one of them
may vote at any meeting in person or by proxy in respect of such Interest, but
if more than one of them shall be present at such meeting in person or by proxy,
and such joint owners or their proxies so present disagree as to any vote to be
cast, such vote shall not be received in respect of such Interest.
(c) A proxy purporting to be executed by or on behalf of a Holder shall be
deemed valid unless challenged at or prior to its exercise, and the burden of
proving invalidity shall rest on the challenger. If the Holder is a minor or a
person of unsound mind, and subject to guardianship or to the legal control of
any other person regarding the charge or management of its Interest, he or she
may vote by his or her guardian or such other person appointed or having such
control, and such vote may be given in person or by proxy.
Section 8.5 Reports. The Trustee shall cause to be prepared, at least
annually, a report of operations containing a balance sheet and statement of
income and undistributed income of the Trust prepared in conformity with
generally accepted accounting principles and an opinion of an independent public
accountant on such financial statements. The Trustees shall, in addition,
furnish to the Holders at least semi-annually interim reports containing an
unaudited balance sheet as of the end of such period and an unaudited statement
of income and surplus for the period from the beginning of the current Fiscal
Year to the end of such period.
Section 8.6 Inspection of Records. The records of the Trust shall be open
to inspection by Holders during normal business hours and for any purpose not
harmful to the Trust.
Section 8.7 Voting Powers. The Holders shall have power to vote only (a)
for the election of Trustees as contemplated by Section 2.2 hereof, (b) with
respect to any investment advisory contract as contemplated by Section 4.1
hereof, (c) with respect to termination of the Trust as provided in Section 9.2
hereof, (d) with respect to any merger, consolidation or sale of assets as
provided in Section 9.4 hereof, (e) with respect to incorporation of the Trust
to the extent and as provided in Section 9.5 hereof, (f) with respect to such
additional matters relating to the Trust as may be required by the 1940 Act,
DTBA, or to any other applicable law, the Declaration, or any registration of
the Trust with the Commission (or any successor agency) or any state, or as and
when the Trustees may consider necessary or desirable.
<PAGE>
Each Holder shall be entitled to vote based on the ratio its Interest bears
to the Interests of all Holders entitled to vote. Until Interests are issued,
the Trustees may exercise all rights of Holders and may take any action required
by law of the Declaration to be taken by Holders.
Section 8.8 Series of Interests. The Trustees shall have the power to
divide the Trust Property into two or more series. The following provisions
shall be applicable to such series and any further series that may from time to
time be established and designated by the Trustees:
(a) All consideration received by the Trust for the issue or sale of
Interests of a particular series together with all Trust Property in which such
consideration is invested or reinvested, all income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall
irrevocably belong to that series for all purposes, subject only to the rights
of creditors of such series and except as may otherwise be required by
applicable tax laws, and shall be so recorded upon the books of account of the
Trust. In the event that there is any Trust Property, or any income, earnings,
profits, and proceeds thereof, funds, or payments which are not readily
identifiable as belonging to any particular series, the Trustees shall allocate
them among any one or more of the series established and designated from time to
time in such manner and on such basis as they, in their sole discretion, deem
fair and equitable. Each such allocation by the Trustees shall be conclusive
and binding upon the Holders of all Interests for all purposes.
(b) The Trust Property belonging to each particular series shall be
charged with the liabilities of the Trust in respect of that series and all
expenses, courts, charges and reserves attributable to that series, and any
general liabilities, expenses, costs, charges or reserves of the Trust which are
not readily identifiable as belonging to any particular series shall be
allocated and charged by the Trustees to and among any one or more of the series
established and designated from time to time in such manner and on such basis as
the Trustees in their sole discretion deem fair and equitable. Each allocation
of liabilities, expenses, costs, charges and reserves by the Trustees shall be
conclusive and including upon the Holders of all interests for all purposes.
The Trustees shall have full discretion, to the extent not inconsistent with the
1940 Act, to determine which items shall be treated as income and which items as
capital, and each such determination and allocation shall be conclusive and
binding upon the Holders. Without limitation of the foregoing provisions of
this Section, but subject to the right of the Trustees in their discretion to
allocate general liabilities, expenses, costs, charges or reserves as herein
provided, the debts, liabilities, obligations and expenses incurred, contracted
for or otherwise existing with respect to a particular series shall be
enforceable against the assets of such series only, and not against the assets
of any other series. Notice of this limitation on inter-series liabilities may,
in the Trustee's sole discretion, be set forth in the Certificate of Trust of
the Trust (whether originally or by amendment) as filed or to be filed in the
Office of the Secretary of State of the Sate of Delaware pursuant to the DBTA,
and upon the giving of such notice in the Certificate of Trust, the statutory
provisions of Section 3804 of the DBTA relating to limitations on inter-series
liabilities (and the statutory effect under Section 3804 of setting forth such
notice in the Certificate of Trust) shall become applicable to the Trust and
each series. Every note, bond, contract or other undertaking issued by or on
behalf of a particular series shall include a recitation limiting the obligation
represented thereby to that series and its assets.
<PAGE>
(c) Dividends and distributions on Interests of a particular series may be
paid and with frequency as the Trustees may determine, which may be daily or
otherwise, pursuant to a standing resolution or resolution adopted only once or
with such frequency as the Trustees may determine, to the Holders of Interests
in that series, from such of the income and capital gains, accrued or realized,
from the Trust Property belonging to that series as the Trustees may determine,
after providing for actual and accrued liabilities belonging to that series.
All dividends and distributions on Interests in a particular series shall be
distributed pro rata to the Holders of Interests in that series in proportion to
the total outstanding Interests in that series held by such Holders at the date
and time of record establishment for the payment of such dividends or
distribution.
(d) The Interests in a series of the Trust shall represent beneficial
interests in the Trust Property belonging to such series. Each Holder of
Interests in a series shall be entitled to receive its pro rata share of
distributions of income and capital gains made with respect to such series.
Upon reduction or withdrawal of its Interests or indemnification for liabilities
incurred by reason of being or having been a Holder of Interests in a series,
such Holder shall be paid solely out of the funds and property of such series of
the Trust. Upon liquidation or termination of a series of the Trust, Holders of
Interests in such series shall be entitled to receive a pro rata share of the
Trust Property belonging to such series. A Holder of Interests in a particular
series of the Trust shall not be entitled to participate in a derivative or
class action lawsuit on behalf of any other series or the Holders of Interests
in any other series of the Trust.
(e) Notwithstanding any other provision hereof, if the Trust Property has
been divided into two or more series, then on any matter submitted to a vote of
Holders of Interests in the Trust, all Interests then entitled to vote shall be
voted by individual series, except that (1) when required by the 1940 Act,
Interests shall be voted in the aggregate and not by individual series, and (2)
when the Trustees have determined that the matter affects only the interests of
Holders of Interests in a limited number of series, then only the Holders of
Interests in such series shall be entitled to vote thereon. Except as otherwise
provided in this Article VIII, the Trustees shall have the power to determine
the designations, preferences, privileges, limitations and rights, including
voting and dividend rights, of each series of Interests.
(f) The establishment and designation of any series of Interests other
than those set forth above shall be effective upon the execution by a majority
of the then Trustees of an instrument setting forth such establishment and
designation and the relative rights and preferences of such series, or as
otherwise provided in such instrument. At any time that there are no Interests
outstanding of any particular series previously established and designated, the
Trustee may by an instrument executed by a majority of their number abolish that
series and the establishment and designation thereof. Each instrument referred
to in this paragraph shall have the status of an amendment to this Declaration.
<PAGE>
(g) If the Trust Property has been divided into two or more series, then
Section 9.2 of this Agreement shall apply also with respect to each such series
as if such series were a separate Trust.
(h) The Trustees shall be authorized to issue an unlimited number of
Interests of each series.
(i) Subject to compliance with the requirements of the 1940 Act, the
Trustees shall have the authority to provide that Holders of Interests of any
series shall have the right to convert said Interests into one or more other
series in accordance with such requirements and procedures as may be established
by the Trustees.
Section 8.9. Holder Action by Written Consent. Any action which may be
taken by Holders may be taken without notice and without a meeting if Holders
holding more than 50% of the total Interests entitled to vote (or such larger
proportion thereof as shall be required by any express provision of this
Declaration) shall consent to the action in writing and the written consents
shall be filed with the records of the meetings of Holders. Such consents shall
be treated for all purposes as votes taken at a meeting of Holders.
Section 8.10 Holder Communications. Whenever ten (10) or more Holders who
have been such for at least six (6) months preceding the date of application,
and who hold in the aggregate at least one percent (1%) of the total Interests,
shall apply to the Trustees in writing, stating that they wish to communicate
with other Holders with a view to obtaining signatures to a request for a
meeting of Holders and accompanied by a form of communication and request which
they wish to transmit, the Trustees shall within five (5) business days after
receipt of such application either (1) afford to such applicants access to a
list of the names and addresses of all Holders as recorded on the books of the
Trust; or (2) inform such applicants as to the approximate number of Holders,
and the approximate cost of transmitting to them the proposed communication and
form of request.
If the Trustees elect to follow the course specified in clause (2) above,
the Trustees, upon the written request of such applicants, accompanied by a
tender of the material to be transmitted and of the reasonable expenses of
transmission, shall, with reasonable promptness, transmit, by United States mail
or by electronic transmission, such material to all Holders at their addresses
as recorded on the books, unless within five (5) business days after such tender
the Trustees shall transmit, by United States mail or by electronic
transmission, to such applicants and file with the Commission, together with a
copy of the material to be transmitted, a written statement signed by at least a
majority of the Trustees to the effect that in their opinion either such
material contains untrue statements of fact or omits to state facts necessary to
make the statements contained therein not misleading, or would be in violation
of applicable law, and specifying the basis of such opinion. The Trustees shall
thereafter comply with any order entered by the Commission and the requirements
of the 1940 Act and the Securities Exchange Act of 1934.
ARTICLE IX: DURATION, TERMINATION OF TRUST; AMENDMENT; MERGERS; ETC.
Section 9.1 Duration. Subject to possible termination in accordance with
the provisions of Section 9.2, the Trust created hereby shall continue
perpetually pursuant to Section 3808 of DBTA.
<PAGE>
Section 9.2 Termination of Trust.
(a) The Trust may be terminated (i) by the affirmative vote of the Holders
of not less than two-thirds of the Interests in the Trust at any meeting of the
Holders, or (ii) by an instrument in writing, without a meeting, signed by a
majority of the Trustees and consented to by the Holders of not less than two-
thirds (2/3rds) of such Interests, or (iii) by the Trustees by written notice to
the Holders. Upon any such termination:
(i) The Trust shall carry on no business except for the purpose of winding
up its affairs.
(ii) The Trustees shall proceed to wind up the affairs of the Trust and all
of the powers of the Trustees under this Declaration shall continue until the
affairs of the Trust shall have been wound up, including the power to fulfill or
discharge the contracts of the Trust, collect its assets, sell, convey, assign,
exchange, or otherwise dispose of all or any part of the remaining Trust
Property to one or more Persons at public or private sale for consideration
which may consist in whole or in part of cash, securities or other property of
any kind, discharge or pay its liabilities, and do all other acts appropriate to
liquidate its business; provided that any sale, conveyance, assignment,
exchange, or other disposition of all or substantially all of the Trust Property
shall require approval of the principal terms of the transaction and the nature
and amount of the consideration by the Holders by a Majority Interests Vote.
(iii) After paying or adequately providing for the payment of all
liabilities, and upon receipt of such releases, indemnities and refunding
agreements, as they deem necessary for their protection, the Trustees may
distribute the remaining Trust Property, in cash or in kind or partly each,
among the Holders according to their respective rights.
(b) Upon termination of the Trust and distribution to the Holders as
herein provided, a majority of the Trustees shall execute and lodge among the
records of the Trust an instrument in writing setting forth the fact of such
termination and file a certificate of cancellation in accordance with Section
3810 of the DBTA. Upon termination of the Trust, the Trustees shall thereon be
discharged from all further liabilities and duties hereunder, and the rights and
interests of all Holders shall thereupon cease.
Section 9.3 Amendment Procedure.
(a) All rights granted to the Holders under this Declaration of Trust are
granted subject to the reservation of the right of the Trustees to amend this
Declaration of Trust as herein provided, except as set forth herein to the
contrary. Subject to the foregoing, the provisions of this Declaration of Trust
(whether or not related to the rights of Holders) may be amended at any time, so
long as such amendment is not in contravention of applicable law, including the
1940 Act, by an instrument in writing signed by a majority of the then Trustees
(or by an officer of the Trust pursuant to the vote of a majority of such
Trustees). Any such amendment shall be effective as provided in the instrument
containing the terms of such amendment or, if there is no provision therein with
respect to effectiveness, upon the execution of such instrument and of a
certificate (which may be a part of such instrument) executed by a Trustee or
officer of the Trust to the effect that such amendment has been duly adopted.
<PAGE>
(b) No amendment may be made, under Section 9.3(a) above, which would
change any rights with respect to any Interest in the Trust by reducing the
amount payable thereon upon liquidation of the Trust, by repealing the
limitations on personal liability of any Holder or Trustee, or by diminishing or
eliminating any voting rights pertaining thereto, except with a Majority
Interests Vote.
(c) A certification signed by a majority of the Trustees setting forth an
amendment and reciting that it was duly adopted by the Holders or by the
Trustees as aforesaid or a copy of the Declaration, as amended, and executed by
a majority of the Trustees, shall be conclusive evidence of such amendment when
lodged among the records of the Trust.
(d) Notwithstanding any other provisions hereof, until such time as
Interests are first sold, this Declaration may be terminated or amended in any
respect by the affirmative vote of a majority of the Trustees or by an
instrument signed by a majority of the Trustees.
Section 9.4 Merger, Consolidation and Sale of Assets. The Trust, or any
series thereof, may merge or consolidate with any other corporation,
association, Trust or other organization or may sell, lease or exchange all or
substantially all of its property, including its good will, upon such terms and
conditions and for such consideration when and as authorized by no less than a
majority of the Trustees and by a Majority Interests Vote of the Trust or such
series, as the case may be, or by an instrument or instruments in writing
without a meeting, consented to by the Holders of not less than fifty percent
(50%) of the total Interests of the Trust or such series, as the case may be,
and any such merger, consolidation, sale, lease or exchange shall be deemed for
all purposes to have been accomplished under and pursuant to the statutes of the
State of Delaware. In accordance with Section 3815(f) of DBTA, an agreement of
merger or consolidation may effect any amendment to the Declaration or effect
the adoption of a new declaration of Trust if the Trust is the surviving or
resulting business Trust. A certificate of merger or consolidation of the Trust
shall be signed by a majority of the Trustees.
Section 9.5 Incorporation. Upon a Majority Interests Vote, the Trustees
may cause to be organized or assist in organizing a corporation or corporations
under the laws of any jurisdiction or any other Trust, partnership, association
or other organization to take over all of the Trust Property or to carry on any
business in which the Trust shall directly or indirectly have any interest, and
to sell, convey and transfer the Trust Property to any such corporation, Trust,
association or organization in exchange for the equity interests thereof or
otherwise, and to lend money to, subscribe for the equity interests of, and
enter into any contracts with any such corporation, Trust, partnership,
association or organization, or any corporation, partnership, Trust, association
or organization in which the Trust holds or is about to acquire equity
interests. The Trustees may also cause a merger or consolidation between the
Trust or any successor thereto and any such corporation, Trust partnership,
association or other organization if and to the extent permitted by law, as
provided under the law then in effect. Nothing contained herein shall be
construed as requiring approval of the Holders for the Trustees to organize or
assist in organizing one or more corporations, Trusts, partnerships,
associations or other organizations and selling, conveying or transferring a
portion of the Trust Property to such organizations or entities.
<PAGE>
ARTICLE X: MISCELLANEOUS
Section 10.1 Certificate of Designation; Agent for Service of Process. The
Trust shall file, in accordance with Section 3812 of DBTA, in the office of the
Secretary of State of Delaware, a Certificate of Trust, in the form and with
such information required by Section 3810 by DBTA and executed in the manner
specified in Section 3811 of DBTA. In the event the Trust does not have at
least one (1) Trustee qualified under Section 3807(a) of DBTA, then the Trust
shall comply with Section 3807(b) of DBTA by having and maintaining a registered
office in Delaware and by designating a registered agent for service of process
on the Trust, which agent shall have the same business office as the Trust's
registered office. The failure to file any such certificate, to maintain a
registered office, to designate a registered agent for service of process, or to
include such other information shall not affect the validity of the
establishment of the Trust, the Declaration or any action taken by the Trustees,
the Trust officers or any other Person with respect to the Trust except insofar
as a provision of the DBTA would have governed, in which case the Delaware
common law governs.
Section 10.2 Governing Law. This Declaration is executed by all of the
Trustees and delivered with reference to DBTA and the laws of the State of
Delaware, and the rights of all parties and the validity and construction of
every provision hereof shall be subject to and construed according to DBTA and
the laws of the State of Delaware (unless and to the extent otherwise provided
for and/or preempted by the 1940 Act or other applicable federal securities
law); provided, however, that there shall not be applicable to the Trust, the
Trustees or this Declaration (a) the provisions of Section 3540 of Title 12 of
the Delaware Code or (b) any provisions of the laws (statutory or common) of the
State of Delaware (other than the DBTA) pertaining to Trusts which are
inconsistent with the rights, duties, powers, limitations or liabilities of the
Trustees set forth or referenced in this Declaration.
Section 10.3 Counterparts. This Declaration may be simultaneously executed
in several counterparts, each of which shall be deemed to be an original, and
such counterparts, together, shall constitute one and the same instrument, which
shall be sufficiently evidenced by any such original counterpart.
Section 10.4 Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Trust or of any recording office
in which this Declaration may be recorded, appears to be a Trustee hereunder,
certifying to (a) the number or identity of Trustees or Holders, (b) the due
authorization of the execution of any instrument or writing, (c) the form of any
vote passed at a meeting of Trustees or Holders, (d) the fact that the number of
Trustees or Holders present at any meeting or executing any written instrument
satisfies the requirements of this Declaration, (e) the identity of any officers
elected by the Trustees, or (f) the existence of any fact or facts which in any
manner relate to the affairs of the Trust, shall be conclusive evidence as to
the matters so certified in favor of any person dealing with the Trustees and
their successors.
<PAGE>
Section 10.5 Provisions in Conflict with Law or Regulations.
(a) The provisions of this Declaration are severable, and if the Trustees
shall determine, with the advice of counsel, that any of such provisions is in
conflict with the 1940 Act, the DBTA, or with other applicable laws and
regulations, the conflicting provisions shall be deemed never to have
constituted a part of this Declaration; provided, however, that such
determination shall not affect any of the remaining provisions of this
Declaration or render invalid or improper any action taken or omitted prior to
such determination.
(b) If any provision of this Declaration shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall
attach only to such provision in such jurisdiction and shall not in any manner
affect such provision in any other jurisdiction or any other provision of this
Declaration in any jurisdiction.
Section 10.6 Trust Only. It is the intention of the Trustees to create
only a business Trust under DBTA with the relationship of Trustee and
beneficiary between the Trustees and each Holder from time to time. It is not
the intention of the Trustees to create a general partnership, limited
partnership, joint stock association, corporation, bailment, or any form of
legal relationship other than a Delaware business Trust except to the extent
such Trust is deemed to constitute a corporation under the Code and applicable
state tax laws. Nothing in this Declaration of Trust shall be construed to make
the Holders, either by themselves or with the Trustees, partners or members of a
joint stock association.
Section 10.7 Withholding. Should any Holder be subject to withholding
pursuant to the Code or any other provision of law, the Trust shall withhold all
amounts otherwise distributable to such Holder as shall be required by law and
any amounts so withheld shall be deemed to have been distributed to such Holder
under this Declaration of Trust. If any sums are withheld, pursuant to this
provision, the Trust shall remit the sums so withheld to and file the required
forms with the Internal Revenue Service, or other applicable government agency.
Section 10.8 Headings and Construction. Headings are placed herein for
convenience of reference only and shall not be taken as a part hereof or control
or affect the meaning, construction or effect of this instrument. Whenever the
singular number is used herein, the same shall include the plural; and the
neuter, masculine and feminine genders shall include each other, as applicable.
IN WITNESS WHEREOF the undersigned has caused this Declaration of Trust to
be executed as of the day and year first above written.
<PAGE>
/s/ Mark Baumann 11/4/98
MARK BAUMANN, Trustee Date
/s/ Jane A. Baumann 11/4/98
JANE A. BAUMANN, Trustee Date
/s/ Gary L. Teel 11/4/98
GARY L. TEEL, Trustee Date
/s/ John R. Wingender, Jr. 11/4/98
JOHN R. WINGENDER, Jr., Ph.D., Trustee Date
/s/ Robin R. Richardson 11/4/98
ROBIN R. RICHRDSON, CPA, CFP, Trustee Date
EXHIBIT 20.10
CERTIFICATE OF CONSENT OF THE TRUSTEES OF
FIRSTMARK PARTNERS
The undersigned, being Trustees of Firstmark Partners (the "Trust"), do hereby
adopt the following resolutions and shall become effective on the effective date
of the first public offering of the Fund's shares.
WHEREAS, the Trustees deem it to be in the best interest of the Trust to
establish an initial series of the Trust;
NOW, THEREFORE, BE IT RESOLVED, the Trustees hereby adopt the initial series of
the Trust, which shall be named Contrarian Value Fund, subject to the
following restrictions:
These fundamental investment restrictions cannot be changed without approval by
the holders of a majority of the outstanding voting securities of the Series.
As defined in the Investment Company Act of 1940 (the "Act"), the "vote of a
majority of the outstanding voting securities" means the lesser of the vote of
(i) 67% of the shares of the Fund at a meeting where more than 50% of the
outstanding shares are present in person or by proxy or (ii) more than 50% of
the outstanding shares of the Fund.
The Fund may not:
(a) Act as underwriter for securities of other issuers except insofar as the
Fund may be deemed an underwriter in selling its own portfolio
securities.
(b) Borrow money or purchase securities on margin except for temporary or
emergency (not leveraging) purposes, including the meeting of redemption
requests that might otherwise require the untimely disposition of
securities, in an aggregate amount not exceeding 25% of the value of the
Fund's total assets at the time any borrowing is made. While the Fund's
borrowings are in excess of 5% of its total assets, the Fund will not
purchase any additional portfolio securities.
(c) Sell securities short.
(d) Invest in securities of other investment companies except as part of a
merger, consolidation, or purchase of assets approved by the Fund's
shareholders or by purchases with no more than 10% of the Fund's assets
in the open market involving only customary broker's commissions.
(e) Make investments in commodities, commodity contracts or real estate
although the Fund may purchase and sell securities of companies which
deal in real estate or interests therein.
(f) Make loans. The purchase of a portion of a readily marketable issue of
publicly distributed bonds, debentures or other debt securities will not
be considered the making of a loan.
(g) Acquire more than 10% of the securities of any class of another issuer,
treating all preferred securities of an issuer as a single class and all
debt securities as a single class, or acquire more than 10% of the
voting securities of another issuer.
(h) Invest in companies for the purpose of acquiring control.
(i) Purchase or retain securities of any issuer if those officers, directors
or trustees of the Fund or its Investment Adviser individually owns more
than 1/2 of 1% of any class of security or collectively own more than 5%
of such class of securities of such issuer.
(j) Pledge, mortgage or hypothecate any of its assets.
(k) Invest in securities which may be subject to registration under the
Securities Act of 1933 prior to sale to the public or which are not at
the time of purchase readily saleable.
<PAGE>
(l) Invest more than 10% of the total Fund assets, taken at market value at
the time of purchase, in securities of companies with less than three
years' continuous operation, including the operations of any
predecessor.
(m) Issue senior securities.
(n) Acquire any securities of companies within one industry if, as a result
of such acquisition, more than 25% of the value of the Fund's total
assets would be invested in securities of companies within such
industry.
In connection with its investment objective and policies the Fund may, however,
invest in the following types of securities which can involve certain risks:
U.S. Government Securities: The Fund may purchase securities issued or
guaranteed by the U.S. Government or its agencies or instrumentalities. Such
securities will typically include, without limitation, U.S. Treasury securities
such as Treasury Bills, Treasury Notes or Treasury Bonds that differ in their
interest rates, maturities and times of issuance.
Bank Obligations: The Fund may invest in bank obligations, including
certificates of deposit, time deposits, banker's acceptances and other short-
term obligations of banks, savings and loan associations and other banking
institutions.
IN WITNESS WHEREOF the undersigned, being the Trustees of the Trust, have
hereunto set their hands and seals, to be effective as of the date first above
written.
/s/ Mark H. Baumann 11/20/98
Mark H. Baumann, Trustee Date
/s/ Jane A. Baumann 11/20/98
Jane A. Baumann, Trustee Date
/s/ Gary L. Teel 11/20/98
Gary L. Teel, Trustee Date
/s/ John R. Wingender, Jr. 11/20/98
John R. Wingender Jr., Trustee Date
/s/ Robin R. Richardson 11/20/98
Robin R. Richardson, Trustee Date
EXHIBIT 30.10
INVESTMENT ADVISORY AGREEMENT
THIS INVESTMENT ADVISORY AGREEMENT ("Agreement"), is made and entered into by
and between Firstmark Partners, a Delaware business trust (the "Fund"), and
Firstock Financial Services, Inc., a Nebraska corporation (the "Investment
Adviser"). WITNESSETH:
WHEREAS, the Fund, and open-end, non-diversified investment company registered
under the Investment Company Act of 1940 (the "1940 Act"), wishes to retain the
Investment Adviser to provide investment advisory services to the Fund; and
WHEREAS, the Investment Adviser is willing to furnish such services on the terms
and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the promises and mutual covenants herein
contained, it is agreed as follows:
1.Employment of the Investment Adviser. The Fund hereby appoints the
Investment Adviser to manage the investment and reinvestment of assets of the
Contrarian Value Fund and any other portfolio of the Fund which may be
hereafter designated as a separate series for the period and on the terms set
forth in this Agreement. The Investment Adviser accepts such appointment and
agrees to render the services herein set forth, for the compensation herein
provided.
2.Obligations of the Fund. The Fund shall at all times inform the Investment
Adviser as to the securities owned by it, the funds available or to become
available for investment by it, and generally as to the condition of its
affairs. It shall furnish the Investment Adviser with such other documents
and information with regard to its affairs as the Investment Adviser may from
time to time reasonably request.
3. Obligations of the Investment Adviser. Subject to the direction and control
of the Fund's Board of Trustees, the Investment Adviser shall regularly
provide the Fund with investment research, advice, management and supervision
and shall furnish a continuous investment program for the Fund's portfolio of
securities consistent with the Fund's investment objective, policies, and
limitations as stated in the Fund's current Prospectus and Statement of
Additional Information. The Investment Adviser shall determine from time to
time what securities will be purchased, retained or sold by the Fund, and
shall implement those decisions, all subject to the provisions of the Fund's
Declaration of Trust, the 1940 Act, the applicable rules and regulations of
the Securities and Exchange Commission, and other applicable federal and
state laws, as well as the investment objectives, policies, and limitations
of the Fund. In placing orders for the Fund with brokers and dealers with
respect to the execution of the Fund's securities transactions, the
<PAGE>
Investment Adviser shall attempt to obtain the best net results. In doing
so, the Investment Adviser may consider such factors which it deems relevant
to the Fund's best interest, such as price, the size of the transaction, the
nature of the market for the security, the amount of the commission, the
timing of the transaction, the reputation, experience and financial stability
of the broker-dealer involved and the quality of service rendered by the
broker-dealer in othertransactions. The Investment Adviser shall have the
discretionary authority to utilize certain broker-dealers even though it may
result in the payment by the Fund of an amount of commission for effecting a
securities transaction in excess of the amount of commission another broker-
dealer would have charged for effecting that transaction, providing, however,
that the Investment Adviser had determined that such amount of commission was
reasonable in relation to the value of the brokerage and research services
provided by the broker-dealer effecting the transaction. In no instance will
portfolio securities be purchased from or sold to the Investment Adviser or
any affiliated person thereof except in accordance with the rules and
regulations promulgated by the Securities and Exchange Commission pursuant to
the 1940 Act. The Investment Adviser shall also provide advice and
recommendations with respect to other aspects of the business and affairs of
the Fund and shall perform such other functions of management and supervision
as may be directed by the Board of Trustees of the Fund, provided that in no
event shall the Investment Adviser be responsible for any expense
occasioned by the performance of such functions.
4.Expenses of the Fund. The Investment Adviser is responsible for (i) the
compensation of any of the Fund's trustees, officers and employees who are
interested persons of the Investment Adviser, (ii) compensation of the
Investment Adviser's personnel and other expenses in connection with the
provisions of portfolio management services under this Agreement, and (iii)
expenses of printing and distributing the Fund's prospectus and sales and
advertising materials to prospective clients. Other than as herein
specifically indicated, the Investment Adviser shall not be responsible for
the Funds expenses. Specifically, the Investment Adviser will not be
responsible, except to the extent of the reasonable compensation of employees
of the Fund whose services may be used by the Investment Adviser hereunder,
for any of the following expenses of the Fund, which expenses shall be borne
by Fund: legal and audit expenses, organizational expenses; interest; taxes;
governmental fees; industry association fees; the cost (including brokerage
commissions or charges, if any) of securities purchased or sold by the Fund
and any losses incurred in connection herewith; fees, if any, of custodians,
transfer agents, registrars or other agents; distribution fees; expenses of
preparing share certificates; expenses relating to the redemption or
repurchase of the Fund's shares; fees and expenses of registering the Fund's
shares under the federal securities laws and of qualifying its shares under
applicable state Blue Sky laws, including expenses attendant upon renewing
such registrations and qualifications; expenses of preparing, setting in
print, printing and distributing prospectuses, proxy statements, reports,
notices, and dividends to fund shareholders; cost of stationary; costs of
shareholders and other meetings of the Fund; compensation and expenses of the
independent trustees of the Fund; fidelity bond and other insurance covering
the Fund and its officers and trustees.
5.Limitations on Salaries. No trustee, officer or employee of the Fund shall
receive from the Fund any salary or other compensation as such trustee,
officer or employee while he is at the same time director, officer or
employee of the Investment Adviser or any affiliated company of the
Investment Adviser. This paragraph shall not apply to trustees, executive
committee members, consultants and other persons who are not regular members
of the Investment Adviser's or any affiliated company's staff.
<PAGE>
6.Compensation. As compensation for the services performed by the Investment
Adviser, the Fund shall pay the Investment Adviser, as promptly as possible
after the last day of each month, a fee, accrued each calendar day (including
weekends and holidays) at a rate of 1.25% per annum of the daily net assets
of the Fund. The first payment of fee hereunder shall be prorated on a daily
basis from the date this Agreement takes effect but may be waived by the
Investment Adviser under special circumstances. The Investment Adviser shall
reduce such fee or, if necessary, make payments to the Fund to the extent
required to satisfy any limitations with respect thereto imposed by the
securities laws or regulations thereunder of any state in which the Fund's
shares are qualified for sale. The daily net assets of the Funds shall be
computed as of the time of the regular close of business of the New York
Stock Exchange, or such other time as may be determined by the Board of
Trustees of the Fund. Any of such payments as to which the Investment
Adviser may so request shall be accompanied by a report of the Fund prepared
either by the Fund or by a reputable firm of independent accountants which
shall show the amount properly payable to the Investment Adviser under this
Agreement and detailed computation thereof.
7.Limitation of Liability. The Investment Adviser assumes no responsibility
under this Agreement other than to render the services called for hereunder
in good faith, and shall not be responsible for any action of the Board of
Trustees of the Fund in the following or declining to follow any advice or
recommendation of the Investment Adviser; provided that nothing in this
Agreement shall protect the Investment Adviser against any liability to the
Fund or its stockholders to which it would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and duties
hereunder.
8.Independent Contractor. The Investment Adviser shall be an independent
contractor and shall have no authority to act for or represent the Fund in
its investment commitments unless otherwise provided. No agreement, bid,
offer, commitment, contract or other engagement entered into by the
Investment Adviser whether on behalf of the Investment Adviser or whether
purporting to have been entered unto on behalf of the Fund shall be binding
upon the Fund, and all acts authorized to be done by the Investment Adviser
under this Agreement shall be done by it as an independent contractor and not
as an agent.
9.Activities of the Investment Adviser. Nothing in this Agreement shall limit
or restrict the right of any director, officer, or employee of the Investment
Adviser who may also be a trustee, officer, or employee of the Fund, to
engage in any other business or to devote his time and attention in part to
the management or other aspects of any other business, whether of a similar
nature or dissimilar nature, nor to limit or restrict the right of the
Investment Adviser to engage in any other business or to render services of
any kind, including investment advisory services, to any other corporation,
firm, individual or association.
10. Definitions. As used in this Agreement, the terms "assignment,"
"interested person," and "majority of the outstanding voting securities"
shall have meanings given to them by Section 2(a) of the 1940 Act, subject to
such exemptions as may be granted by the Securities and Exchange Commission
by any rule, regulation or order.
<PAGE>
11. Termination. This Agreement shall terminate automatically in the event
of its assignment by the Investment Adviser and shall not be assignable by
the Fund without consent of the Investment Adviser. This Agreement may also
be terminated at any time, without payment of penalty (i) by the Fund either
by vote of the Board of Trustees of the Fund or by vote of a majority of the
outstanding voting securities of the Fund, on 60 days written notice to the
Investment Adviser, or (ii) by the Investment Adviser on 60 days written
notice to the Fund. Upon the termination of this agreement, the obligations
of all the parties hereunder shall cease and terminate as of the date of such
termination, except for any obligation to respond for a breach of this
Agreement committed prior to such termination and except or the obligation of
the Fund to pay to the Investment Adviser the fee provided in Paragraph 6
hereof, prorated to the date of termination.
12. Term. This Agreement shall become effective on the effective date of the
first public offering of the Fund's shares and shall continue in effect for
one year and from year to year thereafter only so long as specifically
approved annually by (i) the Fund's Board of Trustees and by a vote of the
holders of a majority of the outstanding voting securities of the Fund, or
(ii) a majority of the Trustees who are not parties to the Agreement or
"interested persons" (as defined in the Act) of any such party cast in person
at a meeting called for the purpose of voting on such approval.
13. Amendments. No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed
by the party against which enforcement of the change, waiver, discharge or
termination is sought, and no material amendment of this agreement shall be
effective until approved by vote of the holders of a majority of the Fund's
outstanding voting securities.
14. Severability. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby. This agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors.
15. Governing Law. This agreemennt shall be construed in accordance with and
governed by the Laws of the State of Nebraska.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and sealed by their duly authorized officers this 20th day of November 1998.
FIRSTMARK PARTNERS FIRSTOCK FINANCIAL SERVICES, INC.
By: /s/ Mark H. Baumann By: /s/ Mark H. Baumann
Mark H. Baumann, President Mark H. Baumann, Chairman & CEO
ATTEST ATTEST
By: /s/ Jane A. Baumann By: /s/ Jane A. Baumann
Jane A. Baumann, Secretary Jane A. Baumann, Secretary
EXHIBIT 30.20
ADMINISTRATION AGREEMENT
THIS ADMINISTRATION AGREEMENT ("Agreement"), is made by and between Firstmark
Partners, a Delaware business trust (the "Fund"), and Firstock Financial
Services, Inc., a Nebraska corporation (the "Administrator"). WITNESSETH:
WHEREAS, the Fund is engaged in business as a non-diversified open-end
management investment company and is to be registered as such under the
Investment Company Act of 1940, as amended (the "Act"); and
WHEREAS, the Administrator is engaged in the business of rendering
administrative and supervisory services to investment companies; and
WHEREAS, the Fund desires to retain the Administrator to render supervisory and
corporate administrative services to the Fund in the manner and on the terms
hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual promises and covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1.Employment of the Administrator. The Fund hereby employs the Administrator
to administer the affairs of the Fund subject to the direction of the Board
of Trustees and the officers of the Fund, for the period and on the terms
hereinafter set forth. The Administrator hereby accepts such employment and
agrees during such period to render the services and to assume the
obligations herein set forth for the compensation herein provided. The
Administrator shall devote such time as is necessary to carry out and shall
at all times faithfully, with diligence and to the best of its ability,
perform all of the duties required of it by the Fund hereunder.
2.Obligations of the Administrator. The Administrator shall, at its expense,
establish and maintain separate books of account and other records reasonably
appropriate for the operation of the business of the Fund, including such
entries and supporting documents as may be necessary or appropriate for the
purpose of showing all the transactions made or committed on behalf of the
Fund, and shall supervise all accounting procedures and audits. All books
and records shall be maintained in such form and detail as may be required by
applicable law. The Administrator shall oversee the maintenance of all books
and records with respect to the Fund's securities transactions and the Fund's
book of account in accordance with all applicable federal and state laws and
regulations. The Administrator, at its expense, shall supply the Board of
Trustees and officers of the Fund with all statistical information and
reports reasonably required by it and reasonably available to the
Administrator and furnish the Fund with office facilities, including space,
furniture and equipment and all personnel reasonably necessary for the
operation of the Fund. In compliance with the requirements of Rule 31a-3
under the Act, the Administrator hereby agrees that any records which it
maintains for the Fund are the property of the Fund and further agrees to
surrender promptly to the Fund any of such records upon the Fund's request.
The Administrator further agrees to arrange for the preservation of the
records required to be maintained by Rule 31a-1 under the Act for the periods
prescribed by Rule 31a-2 under the Act.
<PAGE>
The Administrator covenants and agrees that it will maintain, or will
otherwise have available to it, facilities and staff, including managerial,
administrative and technical, as shall be necessary and adequate, in all
material respects, to perform properly its obligations hereunder.
3.Expenses of the Fund. The Administrator assumes and shall pay for
maintaining its staff and personnel, and shall at its own expense provide the
equipment, office space and facilities necessary to perform its obligations
under this Agreement. In addition, the Administrator assumes and shall pay
all ordinary expenses of the Fund, including, without limitation: (a)
organizational costs, (b) compensation of the Investment Adviser's personnel
and payment of other expenses in connection with provision of portfolio
management services, (c) compensation of any of the Fund's trustees, officers
or employees who are not interested persons of the Investment Adviser or its
affiliates, (d) fees and expenses of registering the Fund's shares under the
federal securities laws and of qualifying its shares under applicable state
Blue Sky laws, including expenses attendant upon renewing such registrations
and qualifications, (e) insurance premiums, (f) fidelity bonds, (g)
accounting and bookkeeping costs and expenses necessary to maintain the
Fund's books and records, (h) outside auditing and ordinary legal expenses,
(i) all costs associated with shareholders meetings and the preparation and
dissemination of proxy solicitation materials, (j) costs of printing and
distribution of the Fund's Prospectus and other shareholder information to
existing shareholders, (k) charges, if any, of custodian and dividend
disbursing agent's fees, (l) industry association fees, and (m) costs of
independent pricing services and calculation of daily net asset value. The
Administrator may, at its discretion, assume any additional expenses
ordinarily assumed by the Fund when it determines that such action is in the
best interest of the shareholders. Any extraordinary and non-recurring
expenses shall be paid by the Fund.
4.Compensation. As compensation for the services rendered, the facilities
furnished and the expenses assumed by the Administrator, the Fund shall pay
to the Administrator, in arrears, within ten days after the end of each
calendar month, a fee, accrued each calendar day (including weekends and
holidays) at a rate of 0.50% per annum of the Fund's average daily net assets
for such month as determined and computed in accordance with the description
of the method of determination of net asset value contained in the Fund's
Prospectus and Statement of Additional Information.
5.Expense Limitation. If, in any fiscal year, the aggregate expenses of the
Fund (including advisory, administrative and transfer agency fees, but
excluding interest, local, state and federal taxes), exceed the expense
limitations of any state having jurisdiction over the Fund, then the fee paid
to the Administrator hereunder will be reduced pro rata (but not below zero)
to the extent required by such expense limitation. The Administrator will
bear its pro rata share of any such fee reduction based on the percentage
that the Administrator's fee bears to the total administrative and advisory
fees paid by the Fund to the Administrator and to the investment adviser of
the Fund, for the month and year in which this Agreement becomes effective or
terminates, there shall be an appropriate proration of said fee reduction
based on the number of days that the Agreement is in effect during such month
and year, respectively.
<PAGE>
6.Inspection of Books and Records. Manager shall, upon reasonable notice,
permit the Fund and its duly authorized representatives to inspect and to
audit, for any purposes whatsoever, all of the books of account, documents,
records, papers and files in the custody or possession of the Administrator
relating in any manner to the business of the Fund. All expenses involved in
such audit or inspection will be borne by the Fund.
7.Independent Contractor. The Administrator is for all purposes hereunder an
independent contractor, free from control, direction or supervision of the
Fund and any persons engaged by the Administrator in the performance of the
Administrator's duties hereunder are solely the employees or agents of the
Administrator. The parties hereto intend and contemplate that their
relationship shall not be construed, nor shall any provision of this
Agreement be interpreted, so as to create a partnership or joint venture
between them or their respective successors in interest and, except as
expressly provided or authorized, neither party shall have the authority to
act for, represent or bind the other or otherwise be deemed an agent of the
other.
8.Activities of the Administrator. The services of the Administrator to the
Fund hereunder are not to be deemed exclusive and the Administrator shall be
free to render similar services to others. Subject to, and in accordance
with the Declaration of Trust and By-Laws of the Fund and Section 10(a) of
the Act, it is understood that trustees, officers, agents and beneficial
holders of the Fund are or may be "interested persons" (as defined in the
Act) of the Administrator of its affiliates, and that directors, officers,
agents or shareholders of the Administrator of its affiliates are or may be
"interested persons" of the Fund as beneficial holders or otherwise.
9.Limitation of Liability. In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations or duties hereunder on
the part of the Administrator, the Administrator shall not be liable to the
Fund or to any beneficial holder of the Fund for any act or omission in the
course of, or in connection with, rendering services hereunder or for any
losses that may be sustained in the purchase, holding or sale of any
security.
10. Term. This Agreement shall become effective on the effective date of
the first public offering of the Fund's shares and shall continue in effect
for one year and from year to year thereafter only so long as specifically
approved annually by (i) the Fund's Board of Trustees and by a vote of the
holders of a majority of the outstanding voting securities of the Fund, or
(ii) a majority of the Trustees who are not parties to the Agreement or
"interested persons" (as defined in the Act) of any such party cast in person
at a meeting called for the purpose of voting on such approval.
11. Termination. This Agreement may be terminated at any time without the
payment of any penalty (i) by the Fund either by vote of the Board of
Trustees of the Fund or by vote of a majority of the outstanding voting
securities of the Fund, on 60 days written notice to the Administrator, or
(ii) by the Administrator on 60 days written notice to the Fund.
12. Amendments. This Agreement may be amended by the parties only if such
amendment is specifically approved by (i) the Board of Trustees of the Fund
and by a vote of the holders of a majority of the outstanding voting
securities of the Fund, or (ii) a majority of those trustees of the Fund who
are not parties to this Agreement or interested persons of any such party
cast in person at a meeting called for the purpose of voting on such
approval.
<PAGE>
13. Notices. Any notice required or desired to be given hereunder shall be
in writing and shall be considered effective (i) when delivered, if by
personal delivery, (ii) upon receipt, if sent by FAX, which FAX has been
telephonically confirmed, between the hours of 9:00 a.m. and 5:00 p.m. local
time of the recipient on a business day, or if not, at 9:00 a.m., local time
on the next business day, or (iii) upon the earlier of actual or first
attempted delivery, if mailed, postage prepaid, addressed as follows:
If to the Administrator: If to the Fund:
Firstock Financial Services, Inc. Firstmark Partners
808 South 74th Plaza, Suite #113 808 South 74th Plaze, Suite #113
Omaha, Nebraska 68114-4666 Omaha, Nebraska 68114-4666
FAX No.: (402) 391-3395 FAX No.: (402) 391-3395
Telephone No.: (402) 391-3375 Telephone No.: (402) 391-3375
or to such other address as the party shall have furnished in writing in
accordance with the provisions of this Section 13.
14. Entire Agreement. This Agreement constitutes the entire agreement of
the parties with respect to the subject matter hereof, and supersedes all
prior negotiations or agreements, whether written or oral.
15. Inurement. This Agreement shall inure to the benefit of and be binding
upon the Fund, the Administrator, and their respective successors,
transferees and assigns.
16. Assignment. Except as otherwise expressly provided herein, the rights
and obligations of the parties pursuant to this Agreement may not be assigned
without the express written consent of the other party.
17. Severability. If any provision of this Agreement shall be held,
declared or pronounced void, voidable, invalid, unenforceable or inoperative
for any reason by any court of competent jurisdiction, such holding,
declaration or pronouncement shall not adversely affect any other provision
of this Agreement, and this Agreement shall otherwise remain in full force
and effect and be enforced in accordance with its terms, including in a
manner that may be reasonably required in order to render any provision that
has been held, declared or pronounced void, voidable, invalid, unenforceable
or inoperative to become valid, enforceable and operative.
18. Counterparts. This Agreement shall be executed in counterparts, in
which case all such counterparts shall constitute one and the same agreement.
19. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Nebraska.
20. Attorneys' Fees. In the event any proceeding is brought by one party
against the other to enforce or for the breach of any of the provisions of
this Agreement, the prevailing party shall be entitled in such proceeding and
in any appeal therefrom to recover reasonable attorneys' fees, together with
the costs of such proceeding therein incurred.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and sealed by their duly authorized officers this 20th day of November 1998.
FIRSTMARK PARTNERS FIRSTOCK FINANCIAL SERVICES, INC.
By: /s/ Mark H. Baumann By: /s/ Mark H. Baumann
Mark H. Baumann, President Mark H. Baumann, Chairman & CEO
ATTEST ATTEST
By: /s/ Jane A. Baumann By: /s/ Jane A. Baumann
Jane A. Baumann, Secretary Jane A. Baumann, Secretary
EXHIBIT 40.10
REIMBURSEMENT AGREEMENT
The Fund will reimburse officers and trustees not affiliated with the Investment
Adviser to compensate for travel expenses associated with performance of their
duties.
The Fund has no plans to compensate officers and trustees who are affiliated
with the Investment Adviser except indirectly through payment of the management
fee.
EXHIBIT 50.10
TRANSFER AGENT AGREEMENT
THIS AGREEMENT is made and entered into this 20th day of November, 1998, by
and between Firstmark Partners a registered management investment company (the
"Trust"), and Maxus Information Systems, Inc. DBA Mutual Shareholder Services,
an Ohio corporation ("MSS").
RECITALS:
A. The Trust is a non-diversified, open-end management investment company
registered with the United States Securities and Exchange Commission under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
B. The Trust desires to appoint MSS as its transfer agent and dividend
disbursing and redemption agent, and MSS desires to accept such appointment.
AGREEMENTS:
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereby agree as follows:
1. DUTIES OF MSS.
1.01 Subject to the terms and conditions set forth in this Agreement, the
Trust hereby employs and appoints MSS to act, and MSS agrees to act, as transfer
agent for the Trust's authorized and issued shares of beneficial interest of
each class of each portfolio of the Trust (the "Shares"), and as dividend
disbursing and redemption agent for the Trust.
1.02 MSS agrees that it will perform the following services:
(a) In accordance with procedures established from time to time by
agreement between the Trust and MSS, MSS shall:
(i) Receive for acceptance, orders for the purchase of Shares,
and promptly deliver payment and appropriate documentation therefore
to the Custodian of the Trust authorized by the Board of Trustees of
the Trust (the "Custodian");
(ii) Pursuant to purchase orders, issue the appropriate number of
Shares and hold such Shares in the appropriate Shareholder account;
(iii) Receive for acceptance redemption requests and redemption
directions and deliver the appropriate documentation therefore to the
Custodian;
(iv) At the appropriate time as and when it receives monies paid
to it by the Custodian with respect to any redemption, pay over or
cause to be paid over in the appropriate manner such monies as
instructed by the redeeming Shareholders;
<PAGE>
(v) Effect transfers of Shares by the registered owners thereof
upon receipt of appropriate instructions;
(vi) Prepare and transmit payments for dividends and
distributions declared by the Trust;
(vii) Maintain records of account for and advise the Trust and its
Shareholders as to the foregoing; and
(viii) Record the issuance of shares of the Trust and maintain
pursuant to SEC Rule 17Ad-10(e) a record of the total number of shares
of the Trust which are authorized, based upon data provided to it by
the Trust, and issued and outstanding. MSS shall also provide the
Trust on a regular basis with the total number of shares which are
authorized and issued and outstanding and shall have no obligation,
when recording the issuance of shares, to monitor the issuance of such
shares or to take cognizance of any laws relating to the issue or sale
of such shares, which functions shall be the sole responsibility of
the Trust.
(b) In addition, MSS shall perform all of the customary services of a
transfer agent, dividend disbursing and redemption agent, including but not
limited to: maintaining all Shareholder accounts, preparing Shareholder
meeting lists, mailing proxies, receiving and tabulating proxies, mailing
Shareholder reports and prospectuses to current Shareholders, withholding
taxes on U.S. resident and non-resident alien accounts, preparing and
filing U.S. Treasury Department Forms 1099 and other appropriate forms
required with respect to dividends and distributions by federal authorities
for all Shareholders, preparing and mailing confirmation forms and
statements of account to Shareholders for all purchases and redemptions of
Shares and other confirmable transactions in Shareholder accounts,
preparing and mailing activity statements for Shareholders, and providing
Shareholder account information and provide a system and reports which will
enable the Trust to monitor the total number of Shares sold in each State.
Procedures applicable to certain of these services may be established from
time to time by agreement between the Trust and MSS.
2. FEES AND EXPENSES
2.01 In consideration of the services to be performed by MSS pursuant to
this Agreement, the Trust agrees to pay MSS the fees set forth in the fee
schedule attached hereto as Exhibit "A".
2.02 In addition to the fee paid under Section 2.01 above, the Trust agrees
to reimburse MSS for out-of-pocket expenses or advances incurred by MSS in
connection with the performance of its obligations under this Agreement. In
addition, any other expenses incurred by MSS at the request or with the consent
of the Trust will be reimbursed by the Trust.
<PAGE>
2.03 The Trust agrees to pay all fees and reimbursable expenses within five
days following the receipt of the respective billing notice. Postage for
mailing of dividends, proxies, Trust reports and other mailings to all
shareholder accounts shall be advanced to MSS by the Trust at least seven days
prior to the mailing date of such materials.
3. REPRESENTATIONS AND WARRANTIES OF MSS
MSS represents and warrants to the Trust that:
3.01 It is a corporation duly organized and existing and in good standing
under the laws of the State of Ohio.
3.02 It is duly qualified to carry on its business in the State of Ohio.
3.03 It is empowered under applicable laws and by its charter and by-laws
to enter into and perform this Agreement.
3.04 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
3.05 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.
3.06 MSS is duly registered as a transfer agent under the Securities Act of
1934 and shall continue to be registered throughout the remainder of this
Agreement.
4. REPRESENTATIONS AND WARRANTIES OF THE TRUST
The Trust represents and warrants to MSS that:
4.01 It is a business Trust duly organized and existing and in good
standing under the laws of the State of Delaware.
4.02 It is empowered under applicable laws and by its Declaration of Trust
to enter into and perform this Agreement.
4.03 All corporate proceedings required by said Declaration of Trust have
been taken to authorize it to enter into and perform this Agreement.
4.04 It is an open-end and diversified management investment company
registered under the 1940 Act.
4.05 A registration statement under the Securities Act of 1933 is currently
or will become effective and will remain effective, and appropriate state
securities law filings as required, have been or will be made and will continue
to be made, with respect to all Shares of the Trust being offered for sale.
<PAGE>
5. INDEMNIFICATION
5.01 MSS shall not be responsible for, and the Trust shall indemnify and
hold MSS harmless from and against, any and all losses, damages, costs, charges,
counsel fees, payments, expenses and liability arising out of or attributable
to:
(a) All actions of MSS or its agents or subcontractors required to be
taken pursuant to this Agreement, provided that such actions are taken in
good faith and without gross negligence or willful misconduct.
(b) The Trust's refusal or failure to comply with the terms of this
Agreement, or which arise out of the Trust's lack good faith, gross
negligence or willful misconduct or which arise out of the breach of any
representation or warranty of the Trust hereunder.
(c) The reliance on or use by MSS or its agents or subcontractors of
information, records and documents which (i) are received by MSS or its
agents or subcontractors and furnished to it by or on behalf of the Trust,
and (ii) have been prepared and/or maintained by the Trust or any other
person or firm on behalf of the Trust.
(d) The reliance on, or the carrying out by MSS or its agents or
subcontractors of, any instructions or requests of the Trust.
(e) The offer or sale of Shares in violation of any requirement under
the federal securities laws or regulations or the securities laws or
regulations of any state that such Shares be registered in such state or in
violation of any stop order or other determination or ruling by any federal
agency or any state with respect to the offer or sale of such Shares in
such state.
5.02 MSS shall indemnify and hold the Trust harmless from and against any
and all losses, damages, costs, charges, counsel fees, payments, expenses and
liability arising out of or attributable to any action or failure or omission to
act by MSS as a result of MSS's lack of good faith, gross or ordinary negligence
or willful misconduct.
5.03 At any time MSS may apply to any officer of the Trust for
instructions, and may consult with legal counsel with respect to any matter
arising in connection with the services to be performed by MSS under this
Agreement, and MSS and its agents or subcontractors shall not be liable and
shall be indemnified by the Trust for any action taken or omitted by it in
reliance upon such instructions or upon the opinion of such counsel. MSS, its
agents and subcontractors shall be protected and indemnified in acting upon any
paper or document furnished by or on behalf of the Trust, reasonably believed to
be genuine and to have been signed by the proper person or persons, or upon any
instruction, information, data, records or documents provided MSS or its agents
or subcontractors by machine readable input, telex, CRT data entry or other
similar means authorized by the Trust, and shall not be held to have notice of
any change of authority of any person, until receipt of written notice thereof
from the Trust. MSS, its agents and subcontractors shall also be protected and
indemnified in recognizing stock certificates which are reasonably believed to
bear the proper manual or facsimile signatures of the officers of the Trust, and
the proper countersignature of any former transfer agent or registrar, or of a
co-transfer agent or co-registrar.
<PAGE>
5.04 In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, equipment or
transmission failure or damage reasonably beyond its control, or other causes
reasonably beyond its control, such party shall not be liable for damages to the
other for any damages resulting from such failure to perform or otherwise from
such causes.
5.05 Neither party to this Agreement shall be liable to the other party for
consequential damages under any provision of this Agreement or for any act or
failure to act hereunder.
5.06 Upon the assertion of a claim for which either party may be required
to indemnify the other, the party of seeking indemnification shall promptly
notify the other party of such assertion, and shall keep the other party advised
with respect to all developments concerning such claim. The party who may be
required to indemnify shall have the option to participate with the party
seeking indemnification the defense of such claim. The party seeking
indemnification shall in no case confess any claim or make any compromise in any
case in which the other party may be required to indemnify it except with the
other party's prior written consent.
6. COVENANTS OF THE TRUST AND MSS
6.01 The Trust shall promptly furnish to MSS a certified copy of the
resolution of the Board of Trustees of the Trust authorizing the appointment of
MSS and the execution and delivery of this Agreement.
6.02 MSS hereby agrees to establish and maintain facilities and procedures
reasonably acceptable to the Trust for safekeeping of stock certificates, check
forms and facsimile signature imprinting devices, if any; and for the
preparation or use, and for keeping account of, such certificates, forms and
devices.
6.03 MSS shall keep records relating to the services to be performed
hereunder, in the form and manner as it may deem advisable. To the extent
required by Section 31 of the 1940 Act, as amended, and the Rules thereunder,
MSS agrees that all such records prepared or maintained by MSS relating to the
services to be performed by MSS hereunder are the property of the Trust and will
be preserved, maintained and made available in accordance with such Section and
Rules, and will be surrendered promptly to the Trust on and in accordance with
its request.
6.04 MSS and the Trust agree that all books, records, information and data
pertaining to the business of the other party which are exchanged or received
pursuant to the negotiation or the carrying out of this Agreement shall remain
confidential, and shall not be voluntarily disclosed to any other person, except
as may be required by law.
6.05 In case of any requests or demands for the inspection of the
Shareholder records of the Trust, MSS will endeavor to notify the Trust and to
secure instructions from an authorized officer of the Trust as to such
inspection. MSS reserves the right, however, to exhibit the Shareholder records
to any person whenever it is advised by its counsel that it may be held liable
for the failure to exhibit the Shareholder records to such person, and shall
promptly notify the Trust of any unusual request to inspect or copy the
shareholder records of the Trust or the receipt of any other unusual request to
inspect, copy or produce the records of the Trust.
<PAGE>
7. TERM OF AGREEMENT
7.01 This Agreement shall become effective as of the date hereof and shall
remain in force for a period of three years; provided, however, that each party
to this Agreement have the option to terminate the Agreement without penalty,
upon 90 days prior written notice.
7.02 Should the Trust exercise its right to terminate, all out-of-pocket
expenses associated with the movement of records and material will be borne by
the Trust. Additionally, MSS reserves the right to charge for any other
reasonable expenses associated with such termination.
8. MISCELLANEOUS
8.01 Neither this Agreement nor any rights or obligations hereunder may be
assigned by either party without the written consent of the other party. This
Agreement shall inure to the benefit of and be binding upon the parties and
their respective permitted successors and assigns.
8.02 This Agreement may be amended or modified by a written agreement
executed by both parties and authorized or approved by a resolution of the Board
of Trustees of the Trust.
8.03 The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of Ohio as at the time in effect and the
applicable provisions of the 1940 Act. To the extent that the applicable law of
the State of Ohio, or any of the provisions here in, conflict with the
applicable provisions of the 1940 Act, the latter shall control.
8.04 This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject matter
hereof whether oral or written.
8.05 All notices and other communications hereunder shall be in writing,
shall be deemed to have been given when received or when sent by telex or
facsimile, and shall be given to the following addresses (or such other
addresses as to which notice is given):
To the Trust: To MSS:
Firstmark Partners Maxus Information Systems, Inc.
808 South 74th Plaza DBA Mutual Shareholder Services
Suite 113 1301 East Ninth Street, 36th Floor
Omaha, NE 68114-4666 Cleveland, OH 44114
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
FIRSTMARK PARTNERS MAXUS INFORMATION SYSTEMS, INC.
By: /s/ Mark H. Baumann By: /s/ Gregory B. Getts
Mark H. Baumann Gregory B. Getts
Its: Chairman & President Its: Vice President
EXHIBIT 50.20
ACCOUNTING SERVICES AGREEMENT
THIS AGREEMENT is made and entered into this 20th day of November, 1998,by
and between Firstmark Partners, a registered management investment company (the
"Trust"), and Maxus Information Systems, Inc., an Ohio corporation doing
business as Mutual Shareholder Services ("MSS").
RECITALS:
A. The Trust is a non-diversified, open-end management investment company
registered with the United States Securities and Exchange Commission under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
B. MSS is a corporation experienced in providing accounting services to
mutual funds and possesses facilities sufficient to provide such services; and
C. The Trust desires to avail itself of the experience, assistance and
facilities of MSS and to have MSS perform the Trust certain services appropriate
to the operations of the Trust, and MSS is willing to furnish such services in
accordance with the terms hereinafter set forth.
AGREEMENTS:
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereby agree as follows:
1. DUTIES OF MSS.
MSS will provide the Trust with the necessary office space, communication
facilities and personnel to perform the following services for the Trust:
(a) Timely calculate and transmit to NASDAQ the daily net asset value
of each class of shares of each portfolio of the Trust, and communicate
such value to the Trust and its transfer agent;
(b) Maintain and keep current all books and records of the Trust as
required by Rule 31a-1 under the 1940 Act, as such rule or any successor
rule may be amended from time to time ("Rule 31a-1"), that are applicable
to the fulfillment of MSS's duties hereunder, as well as any other
documents necessary or advisable for compliance with applicable regulations
as may be mutually agreed to between the Trust and MSS. Without limiting
the generality of the foregoing, MSS will prepare and maintain the
following records upon receipt of information in proper form from the Trust
or its authorized agents:
<PAGE>
* Cash receipts journal
* Cash disbursements journal
* Dividend record
* Purchase and sales - portfolio securities journals
* Subscription and redemption journals
* Security ledgers
* Broker ledger
* General ledger
* Daily expense accruals
* Daily income accruals
* Securities and monies borrowed or loaned and collateral therefore
* Foreign currency journals
* Trial balances
(c) Provide the Trust and its investment adviser with daily portfolio
valuation, net asset value calculation and other standard operational
reports as requested from time to time.
(d) Provide all raw data available from its fund accounting system
for the preparation by the Trust or its investment advisor of the
following:
1.Semi-annual financial statements;
2.Semi-annual form N-SAR;
3.Annual tax returns;
4.Financial data necessary to update form N-1A;
5.Annual proxy statement.
(e) Provide facilities to accommodate annual audit and any audits or
examinations conducted by the Securities and Exchange Commission or any
other governmental or quasi-governmental entities with jurisdiction.
MSS shall for all purposes herein be deemed to be an independent contractor and
shall, unless otherwise expressly provided or authorized, have no authority to
act for or represent the Trust in any way or otherwise be deemed an agent of the
Trust.
2. FEES AND EXPENSES.
(a) In consideration of the services to be performed by MSS pursuant
to this Agreement, the Trust agrees to pay MSS the fees set forth in the
fee schedule attached hereto as Exhibit A.
(b) In addition to the fees paid under paragraph (a) above, the Trust
agrees to reimburse MSS for out-of-pocket expenses or advances incurred by
MSS in connection with the performance of its obligations under this
Agreement. In addition, any other expenses incurred by MSS at the request
or with the consent of the Trust will be reimbursed by the Trust.
(c) The Trust agrees to pay all fees and reimbursable expenses within
five days following the receipt of the respective billing notice.
<PAGE>
3. LIMITATION OF LIABILITY OF MSS.
(a) MSS shall be held to the exercise of reasonable care in carrying
out the provisions of the Agreement, but shall not be liable to the Trust
for any action taken or omitted by it in good faith without gross
negligence, bad faith, willful misconduct or reckless disregard of its
duties hereunder. It shall be entitled to rely upon and may act upon the
accounting records and reports generated by the Trust, advice of the Trust,
or of counsel for the Trust and upon statements of the Trust's independent
accountants, and shall not be liable for any action reasonably taken or
omitted pursuant to such records and reports or advice, provided that such
action is not, to the knowledge of MSS, in violation of applicable federal
or state laws or regulations, and provided further that such action is
taken without gross negligence, bad faith, willful misconduct or reckless
disregard of its duties.
(b) Nothing herein contained shall be construed to protect MSS
against any liability to the Trust to which MSS shall otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence in the
performance of its duties to the Trust, reckless disregard of its
obligations and duties under this Agreement or the willful violation of any
applicable law.
(c) Except as may otherwise be provided by applicable law, neither
MSS nor its stockholders, officers, trustees, employees or agents shall be
subject to, and the Trust shall indemnify and hold such persons harmless
from and against, any liability for and any damages, expenses or losses
incurred by reason of the inaccuracy of information furnished to MSS by the
Trust or its authorized agents.
4. REPORTS.
(a) The Trust shall provide to MSS on a quarterly basis a report of a
duly authorized officer of the Trust representing that all information
furnished to MSS during the preceding quarter was true, complete and
correct in all material respects. MSS shall not be responsible for the
accuracy of any information furnished to it by the Trust or its authorized
agents, and the Trust shall hold MSS harmless in regard to any liability
incurred by reason of the inaccuracy of such information.
(b) Whenever, in the course of performing its duties under this
Agreement, MSS determines, on the basis of information supplied to MSS by
the Trust or its authorized agents, that a violation of applicable law has
occurred or that, to its knowledge, a possible violation of applicable law
may have occurred or, with the passage of time, would occur, MSS shall
promptly notify the Trust and its counsel of such violation.
5. ACTIVITIES OF MSS.
The services of MSS under this Agreement are not to be deemed exclusive,
and MSS shall be free to render similar services to others so long as its
services hereunder are not impaired thereby.
<PAGE>
6. ACCOUNTS AND RECORDS.
The accounts and records maintained by MSS shall be the property of the
Trust, and shall be surrendered to the Trust promptly upon request by the Trust
in the form in which such accounts and records have been maintained or
preserved. MSS agrees to maintain a back-up set of accounts and records of the
Trust (which back-up set shall be updated on at least a weekly basis) at a
location other than that where the original accounts and records are stored. MSS
shall assist the Trust's independent auditors, or, upon approval of the Trust,
any regulatory body, in any requested review of the Trust's accounts and
records. MSS shall preserve the accounts and records as they are required to be
maintained and preserved by Rule 31a-1.
7. CONFIDENTIALITY.
MSS agrees that it will, on behalf of itself and its officers and
employees, treat all transactions contemplated by this Agreement, and all other
information germane thereto, as confidential and not to be disclosed to any
person except as may be authorized by the Trust.
8. TERM OF AGREEMENT.
(a) This Agreement shall become effective as of the date hereof and shall
remain in force for a period of three years; provided, however, that each party
to this Agreement have the option to terminate the Agreement, without penalty,
upon 90 days prior written notice.
(b) Should the Trust exercise its right to terminate, all out-of-pocket
expenses associated with the movements of records and material will be borne by
the Trust. Additionally, MSS reserves the right to charge for any other
reasonable expenses associated with such termination.
9. MISCELLANEOUS.
(a) Neither this Agreement nor any rights or obligations hereunder may be
assigned by either party without the written consent of the other party. This
Agreement shall inure to the benefit of and be binding upon the parties and
their respective permitted successors and assigns.
(b) The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of Ohio as at the time in effect and the
applicable provisions of the 1940 Act. To the extent that the applicable law of
the State of Ohio, or any of the provisions herein, conflict with the applicable
provisions of the 1940 Act, the latter shall control.
(c) This Agreement may be amended by the parties hereto only if such
amendment is in writing and signed by both parties.
<PAGE>
(d) This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject matter
hereof whether oral or written.
(e) All notices and other communications hereunder shall be in writing,
shall be deemed to have been given when received or when sent by telex or
facsimile, and shall be given to the following addresses (or such other
addresses as to which notice is given):
To the Trust: To MSS:
Firstmark Partners Maxus Information Systems, Inc.
808 South 74th Plaza DBA Mutual Shareholder Services
Suite 113 1301 East Ninth Street, 36th Floor
Omaha, NE 68114-4666 Cleveland, OH 44114
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
FIRSTMARK PARTNERS MAXUS INFORMATION SYSTEMS, INC.
By: /s/ Mark H. Baumann By: /s/ Gregory B. Getts
Mark H. Baumann Gregory B. Getts
Its: Chairman & President Its: Vice President
EXHIBIT 60.10
CUSTODY AGREEMENT
THIS AGREEMENT, is made as of the 20th of November, 1998, by and between
FIRSTMARK PARTNERS, a business trust organized under the laws of the State of
Delaware (the "Trust"), and THE FIFTH THIRD BANK, a banking company organized
under the laws of the State of Ohio (the "Custodian").
WITNESSETH:
WHEREAS, the Trust desires that the Securities and cash of each of the
investment portfolios identified in Exhibit A hereto (such investment portfolios
and individually referred to herein as a "Fund" and collectively as the
"Funds"), be held and administered by the Custodian pursuant to this Agreement;
and
WHEREAS, the Trust is an open-end management investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Custodian represents that it is a bank having the
qualifications prescribed in Section 26(a)(i) of the 1940 Act;
NOW, THEREFORE, in consideration of the mutual agreements herein made, the
Trust and the Custodian hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
1.1 "Authorized Person" means any Officer or other person duly authorized
by resolution of the Board of Trustees to give Oral Instructions and Written
Instructions on behalf of the Trust and named in Exhibit B hereto or in such
resolutions of the Board of Trustees, certified by an Officer, as may be
received by the Custodian from time to time.
1.2 "Board of Trustees" shall mean the Trustees from time to time serving
under the Trust's Agreement and Declaration of Trust, dated November 4th, 1998,
as from time to time amended.
1.3 "Book-Entry System" shall mean a federal book-entry system as provided
in Subpart O of Treasury Circular No. 300, 31 CFR 306, in Subpart B of 31 CFR
Part 350, or in such book-entry regulations of federal agencies as are
substantially in the form of such Subpart O.
1.4 "Business Day" shall mean any day recognized as a settlement day by
The New York Stock Exchange, Inc. and any other day for which the Fund computes
the net asset value of the Fund.
<PAGE>
1.5 "NASD" shall mean The National Association of Securities Dealers, Inc.
1.6 "Officer" shall mean the President, any Vice President, the Secretary,
any Assistant Secretary, the Treasurer, or any Assistant Treasurer of the Trust.
1.7 "Oral Instructions" shall mean instructions orally transmitted to and
accepted by the Custodian because such instructions are: (i) reasonably
believed by the Custodian to have been given by an Authorized Person, (ii)
recorded and kept among the records of the Custodian made in the ordinary course
of business and (iii) orally confirmed by the Custodian. The Trust shall cause
all Oral Instructions to be confirmed by Written Instructions. If such Written
Instructions confirming Oral Instructions are not received by the Custodian
prior to a transaction, it shall in no way affect the validity of the
transaction or the authorization thereof by the Trust. If Oral Instructions
vary from the Written Instructions which purport to confirm them, the Custodian
shall notify the Trust of such variance but such Oral Instructions will govern
unless the Custodian has not yet acted.
1.8 "Custody Account" shall mean any account in the name of the Trust,
which is provided for in Section 3.2 below.
1.9 "Proper Instructions" shall mean Oral Instructions or Written
Instructions. Proper Instructions may be continuing Written Instructions when
deemed appropriate by both parties.
1.10 "Securities Depository" shall mean The Participants Trust Company or
The Depository Trust Company and (provided that Custodian shall have received a
copy of a resolution of the Board of Trustees, certified by an Officer,
specifically approving the use of such clearing agency as a depository for the
Trust) any other clearing agency registered with the Securities and Exchange
Commission under Section 17A of the Securities and Exchange Act of 1934 (the
"1934 Act"), which acts as a system for the central handling of Securities where
all Securities of any particular class or series of an issuer deposited within
the system are treated as fungible and may be transferred or pledged by
bookkeeping entry without physical delivery of the Securities.
1.11 "Securities" shall include, without limitation, common and preferred
stocks, bonds, call options, put options, debentures, notes, bank certificates
of deposit, bankers' acceptances, mortgage-backed securities, other money market
instruments or other obligations, and any certificates, receipts, warrants or
other instruments or documents representing rights to receive, purchase or
subscribe for the same, or evidencing or representing any other rights or
interests therein, or any similar property or assets that the Custodian has the
facilities to clear and to service.
1.12 "Shares" shall mean the units of beneficial interest issued by the
Trust.
1.13 "Written Instructions" shall mean (i) written communications actually
received by the Custodian and signed by one or more persons as the Board of
Trustees shall have from time to time authorized, or (ii) communications by
telex or any other such system from a person or persons reasonably believed by
the Custodian to be Authorized, or (iii) communications transmitted
electronically through the Institutional Delivery System (IDS), or any other
similar electronic instruction system acceptable to Custodian and approved by
resolutions of the Board of Trustees, a copy of which, certified by an Officer,
shall have been delivered to the Custodian.
<PAGE>
ARTICLE II
APPOINTMENT OF CUSTODIAN
2.1 Appointment. The Trust hereby constitutes and appoints the Custodian
as custodian of all Securities and cash owned by or in the possession of the
Trust at any time during the period of this Agreement, provided that such
Securities or cash at all times shall be and remain the property of the Trust.
2.2 Acceptance. The Custodian hereby accepts appointment as such
custodian and agrees to perform the duties thereof as hereinafter set forth and
in accordance with the 1940 Act as amended. Except as specifically set forth
herein, the Custodian shall have no liability and assumes no responsibly for any
non-compliance by the Trust or a Fund of any laws, rules or regulations.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
3.1 Segregation. All Securities and non-cash property held by the
Custodian for the account of the Fund, except Securities maintained in a
Securities Depository or Book-Entry System, shall be physically segregated from
other Securities and non-cash property in the possession of the Custodian and
shall be identified as subject to this Agreement.
3.2 Custody Account. The Custodian shall open and maintain in its trust
department a custody account in the name of each Fund, subject only to draft or
order of the Custodian, in which the Custodian shall enter and carry all
Securities, cash and other assets of the Fund which are delivered to it.
3.3 Appointment of Agents. In its discretion, the Custodian may appoint,
and at any time remove, any domestic bank or trust company, which has been
approved by the Board of Trustees and is qualified to act as a custodian under
the 1940 Act, as sub-custodian to hold Securities and cash of the Funds and to
carry out such other provisions of this Agreement as it may determine, and may
also open and maintain one or more banking accounts with such a bank or trust
company (any such accounts to be in the name of the Custodian and subject only
to its draft or order), provided, however, that the appointment of any such
agent shall not relieve the Custodian of any of its obligations or liabilities
under this Agreement.
3.4 Delivery of Assets to Custodian. The Fund shall deliver, or cause to
be delivered, to the Custodian all of the Fund's Securities, cash and other
assets, including (a) all payments of income, payments of principal and capital
distributions received by the Fund with respect to such Securities, cash or
other assets owned by the Fund at any time during the period of this Agreement,
and (b) all cash received by the Fund for the issuance, at any time during such
period, of Shares. The Custodian shall not be responsible for such Securities,
cash or other assets until actually received by it.
3.5 Securities Depositories and Book-Entry Systems. The Custodian may
deposit and/or maintain Securities of the Funds in a Securities Depository or in
a Book-Entry System, subject to the following provisions:
<PAGE>
(a) Prior to a deposit of Securities of the Funds in any Securities
Depository or Book-Entry System, the Fund shall deliver to the
Custodian a resolution of the Board of Trustees, certified by an
Officer, authorizing and instructing the Custodian on an on-going
basis to deposit in such Securities Depository or Book-Entry System
all Securities eligible for deposit therein and to make use of such
Securities Depository or Book-Entry System to the extent possible and
practical in connection with its performance hereunder, including,
without limitation, in connection with settlements of purchases and
sales of Securities, loans of Securities, and deliveries and returns
of collateral consisting of Securities. So long as such Securities
Depository or Book-Entry System shall continue to be employed for the
deposit of Securities of the Funds, the Trust shall annually re-adopt
such resolution and deliver a copy thereof, certified by an Officer,
to the Custodian.
(b) Securities of the Fund kept in a Book-Entry System or Securities
Depository shall be kept in an account ("Depository Account") of the
Custodian in such Book-Entry System or Securities Depository which
includes only assets held by the Custodian as a fiduciary, custodian
or otherwise for customers.
(c) The records of the Custodian and the Custodian's account on the
books of the Book-Entry System and Securities Depository as the case
may be, with respect to Securities of a Fund maintained in a Book-
Entry System or Securities Depository shall, by book-entry, or
otherwise identify such Securities as belonging to the Fund.
(d) If Securities purchases by the Fund are to be held in a Book-
Entry System or Securities Depository, the Custodian shall pay for
such Securities upon (i) receipt of advice from the Book-Entry System
or Securities Depository that such Securities have been transferred to
the Depository Account, and (ii) the making of an entry on the records
of the Custodian to reflect such payment and transfer for the account
of the Fund. If Securities sold by the Fund are held in a Book-Entry
System or Securities Depository, the Custodian shall transfer such
Securities upon (i) receipt of advice from the Book-Entry System or
Securities depository that payment for such Securities has been
transferred to the Depository Account, and (ii) the making of an entry
on the records of the Custodian to reflect such transfer and payment
for the account of the Fund.
(e) Upon request, the Custodian shall provide the Fund with copies of
any report (obtained by the Custodian from a Book-Entry System or
Securities Depository in which Securities of the Fund is kept) on the
internal accounting controls and procedures for safeguarding
Securities deposited in such Book-Entry System or Securities
Depository.
<PAGE>
(f) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Trust for any loss or damage to the
Trust resulting (i) from the use of a Book-Entry System or Securities
Depository by reason of any negligence or willful misconduct on the
part of Custodian or any sub-custodian appointed pursuant to Section
3.3 above or any of its or their employees, or (ii) from failure of
Custodian or any such sub-custodian to enforce effectively such rights
as it may have against a Book-Entry System or Securities Depository.
At its election, the Trust shall be subrogated to the rights of the
Custodian with respect to any claim against a Book-Entry System or
Securities Depository or any other person for any loss or damage to
the Funds arising from the use of such Book-Entry System or Securities
Depository, if and to the extent that the Trust has been made whole
for any such loss or damage.
3.6 Disbursement of Moneys from Custody Accounts. Upon receipt of Proper
Instructions, the Custodian shall disburse moneys from a Fund Custody Account
but only in the following cases:
(a) For the purchase of Securities for the Fund but only upon
compliance with Section 4.1 of this Agreement and only (i) in the case
of Securities (other than options on Securities, futures contracts and
options on futures contracts), against the delivery to the Custodian
(or any sub-custodian appointed pursuant to Section 3.3 above) of such
Securities registered as provided in Section 3.9 below in proper form
for transfer, or if the purchase of such Securities is effected
through a Book-Entry System or Securities Depository, in accordance
with the conditions set forth in Section 3.5 above; (ii) in the case
of options on Securities, against delivery to the Custodian (or such
sub-custodian) of such receipts as are required by the customs
prevailing among dealers in such options; (iii) in the case of futures
contracts and options on futures contracts, against delivery to the
Custodian (or such sub-custodian) of evidence of title thereto in
favor of the Trust or any nominee referred to in Section 3.9 below;
and (iv) in the case of repurchase or reverse repurchase
agreements entered into between the Trust and a bank which is a member
of the Federal Reserve System or between the Trust and a primary
dealer in U.S. Government securities, against delivery of the
purchased Securities either in certificate form or through an entry
crediting the Custodian's account at a Book-Entry System or Securities
Depository for the account of the Fund with such Securities;
(b) In connection with the conversion, exchange or surrender, as set
forth in Section 3.7(f) below, of Securities owned by the Fund;
(c) For the payment of any dividends or capital gain distributions
declared by the Fund;
(d) In payment of the redemption price of Shares as provided in
Section 5.1 below;
(e) For the payment of any expense or liability incurred by the
Trust, including but not limited to the following payments for the
account of a Fund: interest; taxes; administration, investment
management, investment advisory, accounting, auditing, transfer agent,
custodian, trustee and legal fees; and other operating expenses of a
Fund; in all cases, whether or not such expenses are to be in whole or
in part capitalized or treated as deferred expenses;
<PAGE>
(f) For transfer in accordance with the provisions of any agreement
among the Trust, the Custodian and a broker-dealer registered under
the 1934 Act and a member of the NASD, relating to compliance with
rules of The Options Clearing Corporation and of any registered
national securities exchange (or of any similar organization or
organizations) regarding escrow or other arrangements in connection
with transactions by the Trust;
(g) For transfer in accordance with the provisions of any agreement
among the Trust, the Custodian, and a futures commission merchant
registered under the Commodity Exchange Act, relating to compliance
with the rules of the Commodity Futures Trading Commission and/or any
contract market (or any similar organization or organizations)
regarding account deposits in connection with transactions by the
Trust;
(h) For the funding of any uncertificated time deposit or other
interest-bearing account with any banking institution (including the
Custodian), which deposit or account has a term of one year or less;
and
(i) For any other proper purposes, but only upon receipt, in addition
to Proper Instructions, of a copy of a resolution of the Board of
Trustees, certified by an Officer, specifying the amount and purpose
of such payment, declaring such purpose to be a proper corporate
purpose, and naming the person or persons to whom such payment is to
be made.
3.7 Delivery of Securities from Fund Custody Accounts. Upon receipt of
Proper Instructions, the Custodian shall release and deliver Securities from a
Custody Account but only in the following cases:
(a) Upon the sale of Securities for the account of a Fund but only
against receipt of payment therefor in cash, by certified or cashiers
check or bank credit;
(b) In the case of a sale effected through a Book-Entry System or
Securities Depository, in accordance with the provisions of Section
3.5 above;
(c) To an Offeror's depository agent in connection with tender or
other similar offers for Securities of a Fund; provided that, in any
such case, the cash or other consideration is to be delivered to the
Custodian;
(d) To the issuer thereof or its agent (i) for transfer into the name
of the Trust, the Custodian or any sub-custodian appointed pursuant to
Section 3.3 above, or of any nominee or nominees of any of the
foregoing, or (ii) for exchange for a different number of certificates
or other evidence representing the same aggregate face amount or
number of units; provided that, in any such case, the new Securities
are to be delivered to the Custodian;
(e) To the broker selling Securities, for examination in accordance
with the "street delivery" custom;
<PAGE>
(f) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of the
issuer of such Securities, or pursuant to provisions for conversion
contained in such Securities, or pursuant to any deposit agreement,
including surrender or receipt of underlying Securities in connection
with the issuance or cancellation of depository receipts; provided
that, in any such case, the new Securities and cash, if any, are to be
delivered to the Custodian;
(g) Upon receipt of payment therefor pursuant to any repurchase or
reverse repurchase agreement entered into by a Fund;
(h) In the case of warrants, rights or similar Securities, upon the
exercise thereof, provided that, in any such case, the new Securities
and cash, if any, are to be delivered to the Custodian;
(i) For delivery in connection with any loans of Securities of a
Fund, but only against receipt of such collateral as the Trust shall
have specified to the Custodian in Proper Instructions;
(j) For delivery as security in connection with any borrowings by the
Trust on behalf of a Fund requiring a pledge of assets by such Fund,
but only against receipt by the Custodian of the amounts borrowed;
(k) Pursuant to any authorized plan of liquidation, reorganization,
merger, consolidation or recapitalization of the Trust or a Fund;
(l) For delivery in accordance with the provisions of any agreement
among the Trust, the Custodian and a broker-dealer registered under
the 1934 Act and a member of the NASD, relating to compliance with the
rules of The Options Clearing Corporation and of any registered
national securities exchange (or of any similar organization or
organizations) regarding escrow or other arrangements in connection
with transactions by the Trust on behalf of a Fund;
(m) For delivery in accordance with the provisions of any agreement
among the Trust on behalf of a Fund, the Custodian, and a futures
commission merchant registered under the Commodity Exchange Act,
relating to compliance with the rules of the Commodity Futures Trading
Commission and/or any contract market (or any similar organization or
organizations) regarding account deposits in connection with
transactions by the Trust on behalf of a Fund; or
(n) For any other proper corporate purposes, but only upon receipt,
in addition to Proper Instructions, of a copy of a resolution of the
Board of Trustees, certified by an Officer, specifying the Securities
to be delivered, setting forth the purpose for which such delivery is
to be made, declaring such purpose to be a proper corporate purpose,
and naming the person or persons to whom delivery of such Securities
shall be made.
<PAGE>
3.8 Actions Not Requiring Proper Instructions. Unless otherwise
instructed by the Trust, the Custodian shall with respect to all Securities held
for a Fund;
(a) Subject to Section 7.4 below, collect on a timely basis all
income and other payments to which the Trust is entitled either by law
or pursuant to custom in the securities business;
(b) Present for payment and, subject to Section 7.4 below, collect on
a timely basis the amount payable upon all Securities which may mature
or be called, redeemed, or retired, or otherwise become payable;
(c) Endorse for collection, in the name of the Trust, checks, drafts
and other negotiable instruments;
(d) Surrender interim receipts or Securities in temporary form for
Securities in definitive form;
(e) Execute, as custodian, any necessary declarations or certificates
of ownership under the federal income tax laws or the laws or
regulations of any other taxing authority now or hereafter in effect,
and prepare and submit reports to the Internal Revenue Service ("IRS")
and to the Trust at such time, in such manner and containing such
information as is prescribed by the IRS;
(f) Hold for a Fund, either directly or, with respect to Securities
held therein, through a Book-Entry System or Securities Depository,
all rights and similar securities issued with respect to Securities of
the Fund; and
(g) In general, and except as otherwise directed in Proper
Instructions, attend to all non-discretionary details in connection
with sale, exchange, substitution, purchase, transfer and other
dealings with Securities and assets of the Fund.
3.9 Registration and Transfer of Securities. All Securities held for a
Fund that are issued or issuable only in bearer form shall be held by the
Custodian in that form, provided that any such Securities shall be held in a
Book-Entry System for the account of the Trust on behalf of a Fund, if eligible
therefor. All other Securities held for a Fund may be registered in the name of
the Trust on behalf of such Fund, the Custodian, or any sub-custodian appointed
pursuant to Section 3.3 above, or in the name of any nominee of any of them, or
in the name of a Book-Entry System, Securities Depository or any nominee of
either thereof; provided, however, that such Securities are held specifically
for the account of the Trust on behalf of a Fund. The Trust shall furnish to
the Custodian appropriate instruments to enable the Custodian to hold or deliver
in proper form for transfer, or to register in the name of any of the nominees
hereinabove referred to or in the name of a Book-Entry System or Securities
Depository, any Securities registered in the name of a Fund.
<PAGE>
3.10 Records. (a) The Custodian shall maintain, by Fund, complete and
accurate records with respect to Securities, cash or other property held for the
Trust, including (i) journals or other records of original entry containing an
itemized daily record in detail of all receipts and deliveries of Securities and
all receipts and disbursements of cash; (ii) ledgers (or other records)
reflecting (A) Securities in transfer, (B) Securities in physical possession,
(C) monies and Securities borrowed and monies and Securities loaned (together
with a record of the collateral therefor and substitutions of such collateral),
(D) dividends and interest received, and (E) dividends receivable and interest
accrued; and (iii) canceled checks and bank records related thereto. The
Custodian shall keep such other books and records of the Trust as the Trust
shall reasonably request, or as may be required by the 1940 Act, including, but
not limited to Section 3.1 and Rule 31a-1 and Rule 31a-2 promulgated thereunder.
(b) All such books and records maintained by the Custodian shall (i) be
maintained in a form acceptable to the Trust and in compliance with rules and
regulations of the Securities and Exchange Commission, (ii) be the property of
the Trust and at all times during the regular business hours of the Custodian be
made available upon request for inspection by duly authorized officers,
employees or agents of the Trust and employees or agents of the Securities and
Exchange Commission, and (iii) if required to be maintained by Rule 31a-1 under
the 1940 Act, be preserved for the periods prescribed in Rule 31a-2 under the
1940 Act.
3.11 Fund Reports by Custodian. The Custodian shall furnish the Trust with
a daily activity statement by Fund and a summary of all transfers to or from the
Custody Account on the day following such transfers. At least monthly and from
time to time, the Custodian shall furnish the Trust with a detailed statement,
by Fund, of the Securities and moneys held for the Trust under this Agreement.
3.12 Other Reports by Custodian. The Custodian shall provide the Trust
with such reports, as the Trust may reasonably request from time to time, on the
internal accounting controls and procedures for safeguarding Securities, which
are employed by the Custodian or any sub-custodian appointed pursuant to Section
3.3 above.
3.13 Proxies and Other Materials. The Custodian shall cause all proxies if
any, relating to Securities which are not registered in the name of a Fund, to
be promptly executed by the registered holder of such Securities, without
indication of the manner in which such proxies are to be voted, and shall
include all other proxy materials, if any, promptly deliver to the Trust such
proxies, all proxy soliciting materials, which should include all other proxy
materials, if any, and all notices to such Securities.
3.14 Information on Corporate Actions. Custodian will promptly notify the
Trust of corporate actions, limited to those Securities registered in nominee
name and to those Securities held at a Depository or sub-Custodian acting as
agent for Custodian. Custodian will be responsible only if the notice of such
corporate actions is published by the Financial Daily Card Service, J.J. Kenny
Called Bond Service, DTC, or received by first class mail from the agent. For
market announcements not yet received and distributed by Custodian's services,
Trust will inform its custody representative with appropriate instructions.
Custodian will, upon receipt of Trust's response within the required deadline,
affect such action for receipt or payment for the Trust. For those responses
received after the deadline, Custodian will affect such action for receipt or
payment, subject to the limitations of the agent(s) affecting such actions.
Custodian will promptly notify Trust for put options only if the notice is
received by first class mail from the agent. The Trust will provide or cause to
be provided to Custodian with all relevant information contained in the
prospectus for any security which has unique put/option provisions and provide
Custodian with specific tender instructions at least ten business days prior to
the beginning date of the tender period.
<PAGE>
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
4.1 Purchase of Securities. Promptly upon each purchase of Securities for
the Trust, Written Instructions shall be delivered to the Custodian, specifying
(a) the name of the issuer or writer of such Securities, and the title or other
description thereof, (b) the number of shares, principal amount (and accrued
interest, if any) or other units purchased, (c) the date of purchase and
settlement, (d) the purchase price per unit, (e) the total amount payable upon
such purchase, and (f) the name of the person to whom such amount is payable.
The Custodian shall upon receipt of such Securities purchased by a Fund pay out
of the moneys held for the account of such Fund the total amount specified in
such Written Instructions to the person named therein. The Custodian shall not
be under any obligation to pay out moneys to cover the cost of a purchase of
Securities for a Fund, if in the relevant Custody Account there is insufficient
cash available to the Fund for which such purchase was made.
4.2 Liability for Payment in Advance of Receipt of Securities Purchased.
In any and every case where payment for the purchase of Securities for a Fund is
made by the Custodian in advance of receipt for the account of the Fund of the
Securities purchased but in the absence of specific Written or Oral Instructions
to so pay in advance, the Custodian shall be liable to the Fund for such
Securities to the same extent as if the Securities had been received by the
Custodian.
4.3 Sale of Securities. Promptly upon each sale of Securities by a Fund,
Written Instructions shall be delivered to the Custodian, specifying (a) the
name of the issuer or writer of such Securities, and the title or other
description thereof, (b) the number of shares, principal amount (and accrued
interest, if any), or other units sold, (c) the date of sale and settlement (d)
the sale price per unit, (e) the total amount payable upon such sale, and (f)
the person to whom such Securities are to be delivered. Upon receipt of the
total amount payable to the Trust as specified in such Written Instructions, the
Custodian shall deliver such Securities to the person specified in such Written
Instructions. Subject to the foregoing, the Custodian may accept payment in
such form as shall be satisfactory to it, and may deliver Securities and arrange
for payment in accordance with the customs prevailing among dealers in
Securities.
4.4 Delivery of Securities Sold. Notwithstanding Section 4.3 above or any
other provision of this Agreement, the Custodian, when instructed to deliver
Securities against payment, shall be entitled, if in accordance with generally
accepted market practice, to deliver such Securities prior to actual receipt of
final payment therefor. In any such case, the Trust shall bear the risk that
final payment for such Securities may not be made or that such Securities may be
returned or otherwise held or disposed of by or through the person to whom they
were delivered, and the Custodian shall have no liability for any of the
foregoing.
<PAGE>
4.5 Payment for Securities Sold, etc. In its sole discretion and from
time to time, the Custodian may credit the relevant Custody Account, prior to
actual receipt of final payment thereof, with (i) proceeds from the sale of
Securities which it has been instructed to deliver against payment, (ii)
proceeds from the redemption of Securities or other assets of the Trust, and
(iii) income from cash, Securities or other assets of the Trust. Any such
credit shall be conditional upon actual receipt by Custodian of final payment
and may be reversed if final payment is not actually received in full. The
Custodian may, in its sole discretion and from time to time, permit the Trust to
use funds so credited to its Custody Account in anticipation of actual receipt
of final payment. Any such funds shall be repayable immediately upon demand
made by the Custodian at any time prior to the actual receipt of all final
payments in anticipation of which funds were credited to the Custody Account.
4.6 Advances by Custodian for Settlement. The Custodian may, in its sole
discretion and from time to time, advance funds to the Trust to facilitate the
settlement of a Trust transactions on behalf of a Fund in its Custody Account.
Any such advance shall be repayable immediately upon demand made by Custodian.
ARTICLE V
REDEMPTION OF TRUST SHARES
Transfer of Funds. From such funds as may be available for the purpose in
the relevant Custody Account, and upon receipt of Proper Instructions specifying
that the funds are required to redeem Shares of a Fund, the Custodian shall wire
each amount specified in such Proper Instructions to or through such bank as the
Trust may designate with respect to such amount in such Proper Instructions.
Upon effecting payment or distribution in accordance with proper Instruction,
the Custodian shall not be under any obligation or have any responsibility
thereafter with respect to any such paying bank.
ARTICLE VI
SEGREGATED ACCOUNTS
Upon receipt of Proper Instructions, the Custodian shall establish and
maintain a segregated account or accounts for and on behalf of each Fund, into
which account or accounts may be transferred cash and/or Securities, including
Securities maintained in a Depository Account,
(a) in accordance with the provisions of any agreement among the
Trust, the Custodian and a broker-dealer registered under the 1934 Act
and a member of the NASD (or any futures commission merchant
registered under the Commodity Exchange Act), relating to compliance
with the rules of The Options Clearing Corporation and of any
registered national securities exchange (or the Commodity Futures
Trading commission or any registered contract market), or of any
similar organization or organizations, regarding escrow or other
arrangements in connection with transactions by the Trust,
(b) for purposes of segregating cash or Securities in connection with
securities options purchased or written by a Fund or in connection
with financial futures contracts (or options thereon) purchased or
sold by a Fund,
(c) which constitute collateral for loans of Securities made by a
Fund,
<PAGE>
(d) for purposes of compliance by the Trust with requirements under
the 1940 Act for the maintenance of segregated accounts by registered
investment companies in connection with reverse repurchase agreements
and when-issued, delayed delivery and firm commitment transactions,
and
(e) for other proper corporate purposes, but only upon receipt of, in
addition to Proper Instructions, a certified copy of a resolution of
the Board of Trustees, certified by an Officer, setting forth the
purpose or purposes of such segregated account and declaring such
purposes to be proper corporate purposes.
ARTICLE VII
CONCERNING THE CUSTODIAN
7.1 Standard of Care. The Custodian shall be held to the exercise of
reasonable care in carrying out its obligations under this Agreement, and shall
be without liability to the Trust for any loss, damage, cost, expense (including
attorneys' fees and disbursements), liability or claim unless such loss,
damages, cost, expense, liability or claim arises from negligence, bad faith or
willful misconduct on its part or on the part of any sub-custodian appointed
pursuant to Section 3.3 above. The Custodian's cumulative liability within a
calendar year shall be limited with respect to the Trust or any party claiming
by, through or on behalf of the Trust for the initial and all subsequent renewal
terms of this Agreement, to the lessor amount of (a) the actual damages
sustained by the Trust, (actual damages for uninvested funds shall be the
overnight Feds fund rate), or (b) to an amount not to exceed one-half of the net
fees paid to the Custodian within the prior three calendar months. The Custodian
shall be entitled to rely on and may act upon advice of counsel on all matters,
and shall be without liability for any action reasonably taken or omitted
pursuant to such advice. The Custodian shall promptly notify the Trust of any
action taken or omitted by the Custodian pursuant to advice of counsel. The
Custodian shall not be under any obligation at any time to ascertain whether the
Trust is in compliance with the 1940 Act, the regulations thereunder, the
provisions of the Trust's charter documents or by-laws, or its investment
objectives and policies as then in effect.
7.2 Actual Collection Required. The Custodian shall not be liable for, or
considered to be the custodian of, any cash belonging to the Trust or any money
represented by a check, draft or other instrument for the payment of money,
until the Custodian or its agents actually receive such cash or collect on such
instrument.
7.3 No Responsibility for title, etc. So long as and to the extent that
it is in the exercise of reasonable care, the Custodian shall not be responsible
for the title, validity or genuineness of any property or evidence of title
thereto received or delivered by it pursuant to this Agreement.
7.4 Limitation on Duty to Collect. Custodian shall not be required to
enforce collection, by legal means or otherwise, of any money or property due
and payable with respect to Securities held for the Trust if such Securities are
in default or payment is not made after due demand or presentation.
7.5 Reliance Upon Documents and Instructions. The Custodian shall be
entitled to rely upon any certificate, notice or other instrument in writing
received by it and reasonably believed by it to be genuine. The Custodian shall
be entitled to rely upon any Oral Instructions and/or any Written Instructions
actually received by it pursuant to this Agreement.
<PAGE>
7.6 Express Duties Only. The Custodian shall have no duties or
obligations whatsoever except such duties and obligations as are specifically
set forth in this Agreement, and no covenant or obligation shall be implied in
this Agreement against the Custodian.
7.7 Cooperation. The Custodian shall cooperate with and supply necessary
information, by the Trust, to the entity or entities appointed by the Trust to
keep the books of account of the Trust and/or compute the value of the assets of
the Trust. The Custodian shall take all such reasonable actions as the Trust
may from time to time request to enable the Trust to obtain, from year to year,
favorable opinions from the Trust's independent accountants with respect to the
Custodian's activities hereunder in connection with (a) the preparation of the
Trust's report on Form N-1A and Form N-SAR and any other reports required by the
Securities and Exchange Commission, and (b) the fulfillment by the Trust of any
other requirements of the Securities and Exchange Commission.
ARTICLE VIII
INDEMNIFICATION
8.1 Indemnification. The Trust shall indemnify and hold harmless the
Custodian and any sub-custodian appointed pursuant to Section 3.3 above, and any
nominee of the Custodian or of such sub-custodian from and against any loss,
damage, cost, expense (including attorneys' fees and disbursements), liability
(including, without limitation, liability arising under the Securities Act of
1933, the 1934 Act, the 1940 Act, and any state or foreign securities and/or
banking laws) or claim arising directly or indirectly (a) from the fact that
Securities are registered in the name of any such nominee, or (b) from any
action or inaction by the Custodian or such sub-custodian (i) at the request or
direction of or in reliance on the advice of the Trust, or (ii) upon Proper
Instructions, or (c) generally, from the performance of its obligations under
this Agreement or any sub-custody agreement with a sub-custodian appointed
pursuant to Section 3.3 above or, in the case of any such sub-custodian, from
the performance of its obligations under such custody agreement, provided that
neither the Custodian nor any such sub-custodian shall be indemnified and held
harmless from and against any such loss, damage, cost, expense, liability or
claim arising from the Custodian's or such sub-custodian's negligence, bad faith
or willful misconduct.
8.2 Indemnity to be Provided. If the Trust requests the Custodian to take
any action with respect to Securities, which may, in the opinion of the
custodian, result in the Custodian or its nominee becoming liable for the
payment of money or incurring liability of some other form, the Custodian shall
not be required to take such action until the Trust shall have provided
indemnity therefor to the Custodian in an amount and form satisfactory to the
Custodian.
<PAGE>
ARTICLE IX
FORCE MAJEURE
Neither the Custodian nor the Trust shall be liable for any failure or
delay in performance of its obligations under this Agreement arising out of or
caused, directly or indirectly, by circumstances beyond its reasonable control,
including, without limitation, acts of God; earthquakes; fires; floods; wars;
civil or military disturbances; sabotage; strikes; epidemics; riots; power
failures; computer failure and any such circumstances beyond its reasonable
control as may cause interruption, loss or malfunction of utility,
transportation, computer (hardware or software) or telephone communication
service; accidents; labor disputes, acts of civil or military authority;
governmental actions; or inability to obtain labor, material, equipment or
transportation; provided, however, that the Custodian in the event of a failure
or delay shall use its best efforts to ameliorate the effects of any such
failure or delay. Notwithstanding the foregoing, the Custodian shall maintain
sufficient disaster recovery procedures to minimize interruptions.
ARTICLE X
EFFECTIVE PERIOD; TERMINATION
10.1 Effective Period. This Agreement shall become effective as of the
date first set forth above and shall continue in full force and effect until
terminated as hereinafter provided.
10.2 Termination. Either party hereto may terminate this Agreement by
giving to the other party a notice in writing specifying the date of such
termination, which shall be not less than ninety (90) days after the date of the
giving of such notice. If a successor custodian shall have been appointed by
the Board of Trustees, the Custodian shall, upon receipt of a notice of
acceptance by the successor custodian, on such specified date of termination (a)
deliver directly to the successor custodian all Securities (other than
Securities held in a Book-Entry System or Securities Depository) and cash then
owned by the Trust and held by the Custodian as custodian, and (b) transfer any
Securities held in a Book-Entry System or Securities Depository to an account of
or for the benefit of the Trust at the successor custodian, provided that the
Trust shall have paid to the Custodian all fees, expenses and other amounts to
the payment or reimbursement of which it shall then be entitled. Upon such
delivery and transfer, the Custodian shall be relieved of all obligations under
this Agreement. The Trust may at any time immediately terminate this Agreement
in the event of the appointment of a conservator or receiver for the Custodian
by regulatory authorities in the State of Ohio or upon the happening of a like
event at the direction of an appropriate regulatory agency or court of competent
jurisdiction.
10.3 Failure to Appoint Successor Custodian. If a successor custodian is
not designated by the Trust on or before the date of termination specified
pursuant to Section 10.1 above, then the Custodian shall have the right to
deliver to a bank or trust company of its own selection, which is (a) a "Bank"
as defined in the 1940 Act, (b) has aggregate capital, surplus and undivided
profits as shown on its then most recent published report of not less than $25
million, and (c) is doing business in New York, New York, all Securities, cash
and other property held by Custodian under this Agreement and to transfer to an
account of or for the Trust at such bank or trust company all Securities of the
Trust held in a Book-Entry System or Securities Depository. Upon such delivery
and transfer, such bank or trust company shall be the successor custodian under
this Agreement and the Custodian shall be relieved of all obligations under this
Agreement. If, after reasonable inquiry, Custodian cannot find a successor
custodian as contemplated in this Section 10.3, then Custodian shall have the
right to deliver to the Trust all Securities and cash then owned by the Trust
and to transfer any Securities held in a Book-Entry System or Securities
Depository to an account of or for the Trust. Thereafter, the Trust shall be
deemed to be its own custodian with respect to the Trust and the Custodian shall
be relieved of all obligations under this Agreement.
<PAGE>
ARTICLE XI
COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to compensation as agreed upon from time to
time by the Trust and the Custodian. The fees and other charges in effect on
the date hereof and applicable to the Funds are set forth in Exhibit B attached
hereto.
ARTICLE XII
LIMITATION OF LIABILITY
The Trust is a business trust organized under the laws of the State of
Delaware and under a Declaration of Trust, to which reference is hereby made a
copy of which is on file at the office of the Secretary of State of Delaware as
required by law, and to any and all amendments thereto so filed or hereafter
filed. The obligations of the Trust entered into in the name of the Trust or on
behalf thereof by any of the Trustees, officers, employees or agents are made
not individually, but in such capacities, and are not binding upon any of the
Trustees, officers, employees, agents or shareholders of the Trust or the Funds
personally, but bind only the assets of the Trust, and all persons dealing with
any of the Funds of the Trust must look solely to the assets of the Trust
belonging to such Fund for the enforcement of any claims against the Trust.
ARTICLE XIII
NOTICES
Unless otherwise specified herein, all demands, notices, instructions, and
other communications to be given hereunder shall be in writing and shall be sent
or delivered to The receipt at the address set forth after its name herein
below:
To the Trust:
Firstmark Partners
808 South 74th Plaza, Suite 113
Omaha, Nebraska 68114-4666
Attn: Mark H. Baumann
Telephone: (402) 391-3375
Facsimile: (402) 391-3395
To the Custodian:
The Fifth Third Bank
38 Fountain Square Plaza
Cincinnati, Ohio 45263
Attn: Area Manager - Trust Operations
Telephone: (513) 579-5300
Facsimile: (513) 579-4312
<PAGE>
or at such other address as either party shall have provided to the other by
notice given in accordance with this Article XIII. Writing shall include
transmission by or through teletype, facsimile, central processing unit
connection, on-line terminal and magnetic tape.
ARTICLE XIV
MISCELLANEOUS
14.1 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
14.2 References to Custodian. The Trust shall not circulate any printed
matter which contains any reference to Custodian without the prior written
approval of Custodian, excepting printed matter contained in the prospectus or
statement of additional information or its registration statement for the Trust
and such other printed matter as merely identifies Custodian as custodian for
the Trust. The Trust shall submit printed matter requiring approval to
Custodian in draft form, allowing sufficient time for review by Custodian and
its counsel prior to any deadline for printing.
14.3 No Waiver. No failure by either party hereto to exercise and no delay
by such party in exercising, any right hereunder shall operate as a waiver
thereof. The exercise by either party hereto of any right hereunder shall not
preclude the exercise of any other right, and the remedies provided herein are
cumulative and not exclusive of any remedies provided at law or in equity.
14.4 Amendments. This Agreement cannot be changed orally and no amendment
to this Agreement shall be effective unless evidenced by an instrument in
writing executed by the parties hereto.
14.5 Counterparts. This Agreement may be executed in one or more
counterparts, and by the parties hereto on separate counterparts, each of which
shall be deemed an original but all of which together shall constitute but one
and the same instrument.
14.6 Severability. If any provision of this Agreement shall be invalid,
illegal or unenforceable in any respect under any applicable law, the validity,
legality and enforceability of the remaining provisions shall not be affected or
impaired thereby.
14.7 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and assigns; provided, however, that this Agreement shall not be assignable by
either party hereto without the written consent of the other party hereto.
14.8 Headings. The headings of sections in this Agreement are for
convenience of reference only and shall not affect the meaning or construction
of any provision of this Agreement.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed and delivered in its name and on its behalf by its representatives
thereunto duly authorized, all as of the day and year first above written.
FIRSTMARK PARTNERS
By: /s/ Mark H. Baumann
Mark H. Baumann
Its: Chairman & President
THE FIFTH THIRD BANK
By: /s/ Howard Kaplan
Howard Kaplan
Its: Assistant Vice-President
<PAGE>
EXHIBIT A
TO THE CUSTODY AGREEMENT BETWEEN
FIRSTMARK PARTNERS AND THE FIFTH THIRD BANK
NOVEMBER 20, 1998
Name of Fund Date
Contrarian Value Fund 11/20/98
FIRSTMARK PARTNERS
By: /s/ Mark H. Baumann
Mark H. Baumann
Its: Chairman & President
THE FIFTH THIRD BANK
By: /s/ Howard Kaplan
Howard Kaplan
Its: Assistant Vice-President
<PAGE>
EXHIBIT B
TO THE CUSTODY AGREEMENT BETWEEN
FIRSTMARK PARTNERS AND THE FIFTH THIRD BANK
NOVEMBER 20, 1998
AUTHORIZED PERSONS
Set forth below are the names and specimen signatures of the persons
authorized by the Trust to Administer each Custody Account.
Name Signature
Mark H. Baumann /s/ Mark H. Baumann
Stephen B. Swanstrom /s/ Stephen B. Swanstrom
<PAGE>
SIGNATURE RESOLUTION
RESOLVED, That all of the following officers of FIRSTMARK PARTNERS and any of
them, namely the Chairman, President, Secretary and Treasurer, are hereby
authorized as signers for the conduct of business for an on behalf of the Funds
with THE FIFTH THIRD BANK:
Mark H. Baumann CHAIRMAN /s/ Mark H. Baumann
Mark H. Baumann PRESIDENT /s/ Mark H. Baumann
Mark H. Baumann TREASURER /s/ Mark H. Baumann
Jane A. Baumann SECRETARY /s/ Jane A. Baumann
The undersigned officers of FIRSTMARK PARTNERS hereby certify that the foregoing
is within the parameters of a Resolution adopted by Trustees of the Trust in a
meeting held November 20, 1998 directing and authorizing preparation of
documents and to do everything necessary to effect the Custody Agreement between
FIRSTMARK PARTNERS and THE FIFTH THIRD BANK.
By: /s/ Mark H. Baumann
Mark H. Baumann
Its: President
By: /s/ Jane A. Baumann
Jane A. Baumann
Its: Secretary
<PAGE>
EXHIBIT C
TO THE CUSTODY AGREEMENT BETWEEN
FIRSTMARK PARTNERS AND THE FIFTH THIRD BANK
NOVEMBER 20, 1998
MUTUAL FUND CUSTODY FEE SCHEDULE
-----------
PER UNIT
FEE
-----------
I Basic Per Account Fee
Annual Asset Based Fees
Under $25 Million 1 bp
$25 - $100 Million .75 bp
$100-$200 Million .5 bp
Over $200 Million .25 bp
Minimum $2,400.00
II Security Transaction Fees
DTC/Fed Eligible $9.00
Physical 25.00
Amortized Securities 25.00
Options 25.00
Mutual Funds 15.00
Foreign - Euroclear & Cedel 50.00
Foreign - Other TBD
III Systems
Automated Securities Workstation $150.00
$200.00 Initial Setup
Mainframe-To-Mainframe 150.00
$200.00 Initial Setup
ACCESS
Single Account 50.00
Multiple Accounts 100.00
IV. Miscellaneous Fees
Principal & Interest Collection (on amortized securities) $5.00
Wire Transfers (In/Out) 7.00
Check Requests 6.00
EXHIBIT 70.10
LEGAL OPINION AND CONSENT OF COUNSEL
Anderson, Berkshire, Lauritse, & Brower
8805 Indian Hills Drive
Suite 200
Omaha, Nebraska 68114
November 20, 1998
Board of Trustees
FIRSTMARK PARTNERS
808 South 74th Plaza - Suite 113
Omaha, Nebraska 68114
Re: Registration Statement on Form N-1A Covering Offering of
Beneficial Interests of FIRSTMARK PARTNERS
Gentlemen:
We have acted as counsel to FIRSTMARK PARTNERS, a Delaware business trust
(the "Trust"), in conjunction with the registration of an unlimited number of
units (the "Units") of beneficial interest in the Trust pursuant to a
registration statement on Form N-1A as filed with the Securities and Exchange
Commission (the "Registration Statement").
We have examined the Certificate of Trust and Declaration of Trust of the
Trust and the filings before the Securities and Exchange Commission relating to
the registration under the Securities Act of 1933, as amended (the "Act"), and
the Investment Company Act of 1940, as amended ("1940 Act").
In rendering our opinion, we have assumed (i) the genuineness of all
signatures; (ii) that parties executing documents, other than the Company, had
obligations under those documents, the due authorization by all requisite
corporation action of the execution and delivery of those documents and the
validity and binding effect of those documents on those parties; and (iii) the
authenticity of all documents submitted to us as originals, the conformity to
original documents of all documents submitted to us as certified or photostatic
copies and the authenticity of the originals of such copies. As to questions of
fact material to our opinions, we have relied solely upon the documents and
instruments described above and have assumed the accuracy and correctness of all
statements of fact contained therein.
Based on the foregoing, we are of the opinion that the Units have been duly
authorized for issuance by all necessary action and, when issued in accordance
with the terms of the offering, will be validly issued, fully paid and
nonassessable.
<PAGE>
We are admitted to practice before the Bar of the State of Nebraska only.
We are not admitted to practice in Delaware, the jurisdiction of the Trust's
formation, or in any other jurisdiction in which the Company owns or may own
property or may transact business. In furnishing the opinions expressed above,
we advise that our opinions are with respect only to federal law and the laws of
the State of Nebraska in effect as of the date hereof, and in all respects are
subject to and may be limited by future legislation, regulations and judicial
decisions. To the extent that such opinions are derived from laws of other
jurisdictions, such statements are based on examinations or relevant authorities
and are believed to be correct, but we have obtained no legal opinions as to
such matters from lawyers licensed to practice in such other jurisdictions.
We hereby consent to the use of our name and to the reference to our firm
in Registration Statement and to the filing of a copy of this opinion as an
exhibit to the Registration Statement.
Very truly yours,
/s/ Christian R. Blunk
Christian R. Blunk
CRB/jcd
EXHIBIT 80.10
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use in this Pre-
effective Amendment No. 1 to the Registration Statement for the Firstmark
Partners Trust of all references to our firm included in or made a part of
this Amendment.
/s/ McCurdy & Associates
McCurdy & Associates CPA's, Inc.
February 8, 1999
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> 1-MO
<FISCAL-YEAR-END> JAN-31-2000
<PERIOD-END> FEB-08-1999
<INVESTMENTS-AT-COST> 100000
<INVESTMENTS-AT-VALUE> 100000
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 100000
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 100000
<SHARES-COMMON-STOCK> 10000
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 100000
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 0
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 10000
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 0
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 100000
<PER-SHARE-NAV-BEGIN> 10
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
